Kenneth F. Brown, Jr.
About Kenneth F. Brown, Jr.
Independent director of QNB Corp. and QNB Bank since 1993 (Age 69). President of McAdoo & Allen, Inc., a manufacturer of pigment dispersions and high‑performance coatings, since September 1989; long‑standing community leadership roles as director/trustee at Upper Bucks YMCA and St. Luke’s Quakertown Hospital. Board cites his success in building and managing McAdoo & Allen and community prominence as core credentials for service. Brown is classified as independent under Nasdaq rules, with QNB’s board majority independent and an independent chairman structure .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| McAdoo & Allen, Inc. | President | Sep 1989 – present | Built and managed manufacturer of pigment dispersions and high‑performance coatings; community prominence cited by Board . |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Upper Bucks YMCA | Director/Trustee | Not disclosed | Community leadership . |
| St. Luke’s Quakertown Hospital | Director/Trustee | Not disclosed | Community leadership . |
Board Governance
- Independence: Brown is independent per Nasdaq rules; QNB board has majority independent directors and an independent, non‑employee Chair (Randy S. Bimes) .
- Committee assignments (2024):
- Compensation Committee member .
- Executive Committee member .
- Nominating Committee Chair .
- Meetings held in 2024: Board 12; Audit 5; Compensation 3; Executive 2; Nominating 0 .
- Attendance: All current directors attended at least 80% of aggregate Board and committee meetings; all directors attended the May 21, 2024 annual meeting .
- Independent director executive sessions occur at least twice annually, without management present .
| Committee | Role | Meetings in 2024 |
|---|---|---|
| Compensation | Member | 3 |
| Executive | Member | 2 |
| Nominating & Governance | Chair | 0 |
Fixed Compensation (Director)
| Year | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Total ($) |
|---|---|---|---|
| 2024 | 41,800 | 7,970 | 49,770 |
2025 director pay structure (effective for directors other than the CEO):
- Annual cash retainer: $20,000; Chair retainer: $33,000 .
- Board meeting fee: $950 per meeting; $1,200 if all 12 meetings are attended .
- Committee meeting fee: $500 per meeting .
- Chair premia: Audit Chair +$3,400; Compensation Chair +$2,500; Nominating Chair +$2,500 .
Board compensation study adjustments: Cash component moved to peer 25th percentile; equity component to peer 50th percentile in 2025 to increase director equity ownership alignment .
Performance Compensation (Director Equity)
| Item | Detail |
|---|---|
| 2024 Director Stock Awards ($) | $7,970 (grant value; share count not disclosed) . |
| Grant timing practice | Annual equity awards typically approved at January Board meeting for grant on Feb 15; exercise price set at prior business day close; awards post‑Q4 earnings release . |
| 2025 Equity Incentive Plan | Authorizes options, restricted stock, RSUs, and other equity; minimum 1‑year vesting; no repricing; clawback applies . |
| Non‑employee director share limits | Aggregate director awards capped at 50,000 shares over plan term; per‑director annual cap 10,000 shares . |
No director‑specific performance metrics (e.g., TSR targets) are disclosed for equity awards; the plan permits performance criteria but does not mandate them for all awards .
Other Directorships & Interlocks
| Category | Disclosure |
|---|---|
| Current public company boards | None disclosed . |
| Compensation Committee interlocks | None; committee comprised entirely of independent outside directors (Bayles, Brown, Mann, Stauffer) . |
| Potential interlocks with competitors/suppliers/customers | Not disclosed . |
Expertise & Qualifications
- Long‑tenured community and business leader; President of a specialty manufacturing company since 1989 .
- Board cites experience in building/managing a private industrial business and community prominence as qualifications .
- Independence affirmed; familiarity with local market via community roles .
Equity Ownership
| Holder | Shares Beneficially Owned | Ownership % of Outstanding | Notes |
|---|---|---|---|
| Kenneth F. Brown, Jr. | 150,714 | 4.05% | Includes 148,336 shares owned jointly with spouse . |
Policy framework:
- Hedging and monetization transactions in QNB securities prohibited; short positions, swaps, collars, exchange funds disallowed .
- Pledging of QNB securities prohibited, with narrow exception only if borrower can clearly repay without resort to pledged securities .
- Insider trading policy with window periods and pre‑clearance for directors; Section 16 reporting emphasized .
Governance Assessment
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Positives:
- Independence, high ownership (4.05%) signaling alignment; board structure with independent chair and majority independent directors .
- Active roles on Compensation (member) and Nominating (Chair) committees central to pay and board refreshment; attendance thresholds met and annual meeting participation .
- 2025 adjustments tilt director compensation toward equity, improving long‑term alignment .
- Robust policies on hedging/pledging and clawbacks under the 2025 plan mitigate risk .
-
Watch items / potential red flags:
- Nominating Committee did not meet in 2024, which may suggest limited board refreshment activity or under‑engagement; mitigation could include documented processes outside formal meetings .
- Very long tenure (since 1993) can raise independence perception concerns among some investors despite formal independence status .
- Related‑party lending is permissible under Reg O and does not impair independence; aggregate director/officer indebtedness was $16.63 million as of Feb 28, 2025, though individual loan details are not disclosed (no specific related‑party transactions beyond ordinary‑course banking) .
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Overall: Strong ownership alignment and independent status with key committee leadership; monitor Nominating Committee activity and board refreshment cadence, and maintain transparency on any ordinary‑course banking relationships.