Jeffrey S. Gayman
About Jeffrey S. Gayman
Jeffrey S. Gayman, 52, is Executive Vice President, Chief Mortgage and Retail Officer at Orrstown Financial Services, Inc., a role he has held since October 2022; he joined the company in 1996 and previously served in senior leadership across retail, consumer lending, and market president roles . Company performance context for incentive alignment: FY2024 Adjusted Net Income was $51.975M and Adjusted ROAE 13.25% (both used for incentives and achieved at maximum), while GAAP Net Income was $22.05M; over 2022–2024 the company’s TSR ranked at the 100th percentile versus both legacy and new compensation peer groups . The merger of equals with Codorus Valley on July 1, 2024 enhanced scale and profitability, with 18% cost saves achieved and the quarterly dividend increased to $0.26 per share post-merger .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Orrstown Financial Services / Orrstown Bank | EVP, Chief Mortgage and Retail Officer | Oct 2022–present | Leadership across mortgage and retail banking |
| Orrstown Bank | EVP & Market President, South Central PA | 2018–Sep 2022 | Regional market leadership |
| Orrstown Bank | EVP – Retail Banking & Consumer Lending | 2016–2018 | Retail and consumer lending oversight |
| Orrstown Bank | SVP – Retail Banking | 2012–2016 | Retail banking leadership |
| Orrstown Bank | Chief Commercial Officer | 2009–2012 | Commercial banking leadership |
External Roles
No external directorships or external roles are disclosed for Gayman in the 2025 proxy .
Company Performance Context
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($USD) | $26.95M* | $25.65M | $37.44M |
| Net Income - (IS) ($USD) | $22.04M | $35.66M | $22.05M |
| Return On Equity % | 8.80% | 14.44% | 5.64%* |
Values with an asterisk were retrieved from S&P Global.
Additional context for incentives:
- 2024 Adjusted Net Income: $51.975M (vs target $34.0M, max achieved)
- 2024 Adjusted ROAE: 13.25% (vs target 12.19%, max achieved)
- Company TSR: 100th percentile vs peers over 2022–2024
Fixed Compensation
- Base salary and fixed pay details for Gayman are not individually disclosed in the proxy (only NEOs are detailed). Company-wide, 2024 base salaries for NEOs rose 2–4% as part of the compensation framework .
Performance Compensation
The 2024 incentive design applied to all executive officers, including Gayman: two objective metrics (Net Income and ROAE), each weighted 50%, with STIP (cash) and LTIP (equity) awards initially earned off 2024 performance; LTIP is split 50% time-vested stock and 50% performance-vested RSUs with 3-year ROAA targets and a TSR modifier .
| Metric | Weighting | Threshold | Target | Maximum | 2024 Adjusted Actual | Payout Level | Vesting/Settlement |
|---|---|---|---|---|---|---|---|
| Net Income ($000) | 50% | $32,000 | $34,000 | $36,000 | $51,975 | Max (interpolated schedule; achieved max) | STIP cash; LTIP grant sizing |
| Return on Average Equity (%) | 50% | 11.5% | 12.19% | 12.91% | 13.25% | Max (interpolated schedule; achieved max) | STIP cash; LTIP grant sizing |
| Credit Quality Modifier (STIP) | Modifier | — | — | — | NPA/Assets below thresholds | Not reduced/eliminated | STIP reduced 30% if NPA/Assets>2%; eliminated if >4% |
| LTIP Time-Vested Stock | 50% of LTIP | — | — | — | — | — | Vests 33% annually over 3 years |
| LTIP Performance-Vested RSUs | 50% of LTIP | ROAA threshold 50% payout | ROAA target 100% payout | TSR modifier ±20% | 3-year period (2025–2027) | Earned based on ROAA then TSR | Single cliff vest after 3 years with TSR ±20% modifier |
- One-time adjustments removed merger-related expenses and a purchase accounting-related credit loss provision from 2024 Net Income/ROAE for incentive calculations, resulting in max payouts on both metrics .
- No discretionary +/-20% subjective adjustment was applied for 2024 awards .
Equity Ownership & Alignment
- Individual beneficial ownership for Gayman is not separately disclosed; the directors and executive officers as a group (29 persons) held ~4.7% of shares outstanding as of March 3, 2025 .
- Anti-hedging and anti-pledging provisions apply under the Insider Trading Policy; the company does not currently maintain stock ownership guidelines for NEOs unless they also serve on the Board .
- Outstanding and unvested equity holdings and option positions are disclosed for NEOs only; no options outstanding for NEOs at year-end 2024 (company context) .
Employment Terms
- Employment agreements and change-in-control (CIC) agreements are disclosed for NEOs (Quinn, Kalani, Metz, Coradi, Holt); Gayman is not listed among the NEOs in 2024, and no individual employment or CIC agreement for him is disclosed in the proxy .
- CIC framework (for disclosed NEOs): lump-sum cash equal to 2.99x (base salary + highest annual cash incentive over past 3 years), immediate equity vesting if plan is silent, and two years of health and welfare benefits post-termination within two years of a change in control; 280G excise tax handling varies (gross-up for CEO; cutback/best-net for others) .
- Non-compete and non-solicit commitments apply post-termination for disclosed executives over specified periods .
- Clawback provisions exist for excessive risk/restatement/adjustment of performance measures; company retains flexibility under Section 162(m) and acknowledges potential 280G limitations .
Investment Implications
- Pay-for-performance alignment is strong: 2024 incentives tied to Net Income and ROAE with a credit quality modifier, and long-term equity vesting tied to 3-year ROAA and TSR vs a bank index, mitigating short-termism and risk-taking—relevant for assessing insider selling pressure and alignment signals .
- Governance red flags are limited but note the absence of executive stock ownership guidelines for non-director NEOs (and by implication similar senior execs), which may reduce formal ownership alignment; anti-hedging/pledging policies partially offset this concern .
- Retention risk appears contained given Gayman’s long tenure and leadership track across retail/mortgage/markets since 1996, but lack of disclosed individual severance/CIC protections makes personal transition economics opaque; firm-wide CIC terms for NEOs indicate competitive practices .
- Strategic execution risk moderated by successful merger integration (core conversion completed in Nov 2024) and achievement of 18% cost saves; TSR performance was top-tier, supporting confidence in incentive attainability and equity value creation trajectory .
- Shareholder feedback and say-on-pay support (80.5% in 2024) suggest alignment of program design with investor expectations, relevant for anticipating future compensation votes and program stability .