Michael L. Cheravitch
About Michael L. Cheravitch
Executive Vice President & Chief Banking Officer of The Middlefield Banking Company since December 11, 2023; age 63; holds an MBA and BA from Cleveland State University . Company performance context: Middlefield’s cumulative TSR index (initial $100) was 123 in 2024, 137 in 2023, and 114 in 2022; net income was $15.5mm in 2024 vs $17.4mm in 2023 . No individual director/officer TSR is disclosed, but Cheravitch’s incentives are linked to company ROAA and relative TSR .
Company fundamentals (for context):
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Revenues ($USD) | * | * |
| EBITDA ($USD) | * | * |
Values retrieved from S&P Global.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| F.N.B. Corporation (First National Bank) | Senior Vice President, Regional Banking Executive (NE Ohio & NW Pennsylvania) | Mar 2019–Dec 2023 | Led consumer banking and small-business strategy across key markets for a $45.5B asset institution (as of 9/30/2023) . |
| The Cornerstone Fund (non-profit) | Chief Lending Officer & Director of Development | Feb 2018–Mar 2019 | Structured lending programs to faith-based organizations, expanding mission-driven credit delivery . |
| Huntington National Bank | SVP Business Banking Director & Credit Delivery Leader | Aug 2016–Dec 2017 | Managed business banking following acquisition of FirstMerit; streamlined credit delivery . |
| FirstMerit Bank | SVP, Director of Business Banking | 2010–2016 | Oversaw multi-state business banking segment (OH, MI, IL, WI, W. PA), driving segment growth and coverage . |
External Roles
| Organization | Role | Years | Impact |
|---|---|---|---|
| — | No public company directorships or external board roles disclosed | — | — |
Fixed Compensation
| Component | 2024 |
|---|---|
| Base Salary | $230,000 |
| Signing/Retention Bonuses | $25,000 sign-on (paid Jan 12, 2024 per offer letter) |
| Perquisites | < $10,000 (value of perqs below disclosure threshold) |
| Retirement/401(k) Match | $8,839 (401(k) contribution) |
Performance Compensation
Annual Incentive (Cash)
| Metric | Weighting | Target | Actual Attainment | Payout | Vesting |
|---|---|---|---|---|---|
| Pre-tax, pre-provision net income | 50% | Committee-set | 104.4% of target (2024) | Included in $70,057 2024 non-equity incentive | Paid March 2025 |
| Net overhead ratio | 20% | Committee-set | Not separately disclosed for 2024 in attainment text | Included in $70,057 | Paid March 2025 |
| Classified asset ratio | 10% | Committee-set | 150% of target stated; also notes failure to achieve classified asset ratio target (proxy text inconsistent) | Included in $70,057 | Paid March 2025 |
| Strategic/Qualitative goals | 20% | Committee-set | Exceeded qualitative measure | Included in $70,057 | Paid March 2025 |
Plan terms: For EVP/CFO and other execs (ex-CEO), bonus ranges are 15% threshold, 30% target, up to 45% of base salary max; clawback allows rescission/repayment for misconduct or financial reporting error . 2024 plan measures and weights as above; plan amended/restated June 10, 2024 (8-K exhibit 10.22) .
Long-Term Equity (PSUs and RSUs)
| Award Type | Grant Date | Target/Units | Threshold | Max | Performance Metrics | Vesting |
|---|---|---|---|---|---|---|
| PSUs | Aug 6, 2024 | 3,842 target shares; grant-date FV $85,869 | 1,921 shares | 7,203 shares (187.5% cap) | 3-yr avg ROAA vs custom peer (U.S. banks $1–$5B); adjusted by relative TSR percentile; negative TSR caps payout at target; top quartile TSR ensures ≥50% payout | Cliff at end of performance period (Dec 31, 2026), employment conditions apply |
| RSUs (time-based) | Aug 6, 2024 | 2,561 shares; grant-date FV $60,337 | n/a | n/a | Time-based | Equal tranches annually over 3 years from grant date; accelerate upon death/disability/termination without cause or for good reason; retirement continues vesting |
| Conditional Stock Award | Dec 11, 2023 | 2,300 shares (30% of $230k / $30) | n/a | n/a | Continuous service to Dec 31, 2025 | Vests Dec 31, 2025 if service condition met |
Outstanding awards as of Dec 31, 2024 (market value at $28.05): PSUs 3,842 ($107,768); RSUs 2,561 ($71,836); Conditional 2,300 ($64,515) .
Compensation Committee & Peer Group
- Independent consultant Meridian engaged in 2024 to review management and director compensation, define peer group, and benchmark practices .
- 2024 peer group of 15 publicly traded banks across Midwest/Northeast/Mid-Atlantic with assets 0.5–3x Middlefield’s: BankFinancial, BCB Bancorp, Capital Bancorp, CF Bankshares, Enterprise Bancorp, Farmers National Banc, Farmers & Merchants Bancorp, First Savings Financial Group, Franklin Financial, HBT Financial, LCNB, Meridian Corporation, Peoples Financial Services, Primis Financial, SB Financial Group .
Equity Ownership & Alignment
| Ownership Detail | As of Mar 14, 2025 |
|---|---|
| Beneficial ownership (direct/indirect) | 0 shares |
| % of shares outstanding | ≤1% (footnote applies generally; individual at 0 shares) |
| Options (exercisable/unexercisable) | None; company has not granted executive options since 2011 |
| Unvested equity (summary) | PSUs 3,842; RSUs 2,561; Conditional 2,300 (see table above) |
| Pledging/Margin | Prohibited; no pledging or holding in margin accounts permitted for directors/officers/employees |
| Hedging | Prohibited (no short sales, derivatives, collars, forward sales) |
| Ownership guidelines (execs) | CEO/President/COO/CFO must own ≥1x base salary; 3 years to comply for new appointees after Jan 1, 2023; Cheravitch’s role (Chief Banking Officer) is not included in covered positions |
| Director ownership guidelines | Directors must reach ≥4x bank director yearly base compensation within 4 years and maintain thereafter |
Employment Terms
| Element | Key Terms |
|---|---|
| Severance/Change-in-Control | Lump sum equals 2x salary + average cash bonus/incentives upon involuntary termination without cause or voluntary termination for good reason within 24 months after a change in control; 2 years continuation of life/health/disability insurance; legal fee reimbursement |
| Trigger type | Double trigger (termination + change in control timing condition) |
| Clawbacks | Annual Incentive Plan rescission/repayment for misconduct or financial restatement; company-wide Compensation Recovery Policy aligned with Exchange Act §10D and Nasdaq Rule 5608 |
| Non-compete/Non-solicit (post-employment) | For equity award recipients: 12-month restrictions within 25 miles of any Middlefield office on soliciting customers, influencing relationships, providing banking services for others; employee/partner poaching prohibited |
| Employment agreement | No separate written employment agreement; covered via severance/change-in-control agreements |
| Tax gross-ups | Not disclosed; none indicated |
| Section 16 compliance | No delinquent filings noted for Cheravitch; 2024 report lists specific late filings for other executives/directors |
Investment Implications
- Pay-for-performance alignment: Cash incentives tied to PTPPNI, efficiency and asset quality, plus strategic goals; PSUs linked to ROAA vs peers and adjusted by relative TSR—with caps/guards against windfall in negative TSR—support risk-adjusted performance orientation .
- Retention risk and supply overhang: Unvested equity through 2025–2026 (Dec 11, 2023 award and Aug 6, 2024 RSU tranches) increases retention but may create localized selling pressure around vesting dates; pledging/hedging prohibitions mitigate adverse alignment signals .
- Ownership alignment: As of March 2025, Cheravitch held no beneficial common shares; alignment is primarily through unvested PSUs/RSUs and cash incentives; executive share ownership guidelines do not apply to his role, which may modestly reduce near-term “skin-in-the-game” optics versus CEO/CFO roles .
- Downside protections: Double-trigger CIC at 2x salary+bonus and generous benefit continuation offer protection without single-trigger acceleration; robust clawbacks reduce tail-risk from misreporting .
- Performance backdrop: Company TSR and net income trends underscore a mixed 2024 (TSR index 123, NI $15.5mm), reinforcing importance of ROAA/TSR-linked PSU design for relative outperformance amid changing rate/credit conditions .