Alan J. Hyatt
About Alan J. Hyatt
Alan J. Hyatt (age 70) has served on Shore Bancshares’ Board since November 1, 2021, following the Severn merger, and has been Chairman since 2021; he is not considered independent under Nasdaq rules (only Mr. Hyatt and the CEO are non‑independent) . He is a partner at Hyatt & Weber, P.A., focusing on banking, land use, real estate, and commercial law; previously Chairman & CEO of Severn Bancorp and Severn Bank; J.D., University of Baltimore (1978); B.S., Bryant College (now Bryant University); bar memberships in Maryland State and Anne Arundel County bar associations . Current civic roles include the Board of Trustees of Luminis Health, the Anne Arundel County Retirement and Pension System, and the Annapolis Community Foundation .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Severn Bancorp, Inc. (and Severn Bank) | Chairman & CEO | Through Nov 1, 2021 (prior to merger into SHBI) | Led Severn; merged into Shore Bancshares; joined SHBI board as Chairman upon closing . |
| Hyatt & Weber, P.A. | Partner (banking/real estate/commercial law) | Ongoing; partner since prior to 2021 | Serves as counsel to developers/entrepreneurs; firm is general counsel to SHBI and Shore United Bank . |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Luminis Health | Trustee | Not disclosed | Board of Trustees member . |
| Anne Arundel County Retirement and Pension System | Board Member | Not disclosed | Board member . |
| Annapolis Community Foundation | Board Member | Not disclosed | Board member . |
Board Governance
- Classification and term: Class III director; current term ends at the 2027 annual meeting .
- Independence: Not independent (Board determined that all directors except Mr. Hyatt and the CEO are independent under Nasdaq rules) .
- Leadership: Chairman of the Board; roles include facilitating independent director executive sessions, governance coordination, agenda input, and CEO performance feedback (with Comp Chair) .
- Lead Independent Director: Austin J. Slater, Jr., serves as Vice Chair and Lead Independent Director .
- Committees: Executive Committee Chair; members include Hyatt (Chair), Adams, Clemmer, Esham, Jenkins, Kelly, Peterson, Streete .
- Attendance: Company states all directors attended over 75% of 2024 Board/committee meetings (one exception for medical reasons; individual not named) .
- Executive sessions: Independent directors met in executive session five times during 2024 .
Fixed Compensation
| Component (2024) | Amount | Notes |
|---|---|---|
| Annual Board cash retainer (non‑employee director) | $35,000 | Paid quarterly; directors may elect stock in lieu of cash; stock retainers vest after one year . |
| Chairman additional annual retainer | $20,000 | Paid in cash unless elected otherwise . |
| Committee chair retainers | $10,000 (Audit Chair); $5,000 (other committee chairs) | Annual retainers . |
| Annual equity retainer (non‑employee directors) | $37,000 | Granted as restricted stock; one-year vesting . |
| Alan J. Hyatt – Director Compensation (2024) | Amount ($) |
|---|---|
| Fees earned or paid in cash | 55,006 |
| Restricted stock (grant date fair value) | 36,994 |
| Dividends on unvested restricted stock (other comp) | 793 |
| Consulting services (separate agreement; see “Related‑Party/Contracts”) | 150,000 |
| Total reported compensation | 242,793 |
Consulting agreement: 5‑year agreement with Shore United Bank (commenced at Severn merger close) paying $150,000 annually (monthly installments) for business introductions, development, community functions, and other requested services .
Performance Compensation
| Equity/Performance Element | Terms | Metrics/Conditions |
|---|---|---|
| Annual director equity grant | Restricted stock; $37,000 grant value; 1‑year vesting | No performance metrics disclosed for director equity; time‑based vesting only . |
| Options/PSUs for directors | None disclosed for directors in 2024 | Not applicable . |
Anti‑hedging/pledging context: Company policy prohibits writing options and short-selling; hedging transactions discouraged and subject to compliance officer review; awards subject to hedging/pledging policies (plan language references) .
Other Directorships & Interlocks
| Category | Detail |
|---|---|
| Current public company directorships | None disclosed . |
| Prior public company board | Severn Bancorp, Inc. (Chairman & CEO prior to merger) . |
| Interlocks/overlaps | Law firm (Hyatt & Weber) is general counsel to Company/Bank; see Related‑Party section . |
Expertise & Qualifications
- Legal and financial expertise: Decades as bank CEO/chair and practicing attorney in banking, land use, real estate, and commercial law; brings skills relevant to financial reporting and enterprise/operational risk oversight .
- Education: J.D., University of Baltimore School of Law (1978); B.S., Bryant College of Business Administration (now Bryant University) .
- Community and fiduciary roles: Trusteeships and county retirement system board service indicate experience with institutional governance and fiduciary oversight .
Equity Ownership
| Ownership Detail (Record Date: Apr 1, 2025) | Amount |
|---|---|
| Total beneficial ownership | 1,769,824 shares |
| Percent of outstanding | 5.30% |
| Unvested restricted stock (voting, no investment power) | 3,306 shares |
| Held by trusts (co‑trustee) | 688,080 shares |
| Held by company where Hyatt is GP | 7,603 shares |
| Spouse beneficially owned | 5,929 shares |
- Director ownership policy: Non‑employee directors must hold shares equal to at least 5x the annual cash retainer; all nominees/continuing directors are in compliance (new directors have 5 years to reach compliance) .
- Anti‑hedging/pledging: Insider trading policy discourages hedging and bans writing options/short‑selling; compliance officer reviews proposed hedging transactions; plan subjects awards to hedging/pledging policies .
Insider Trading and Section 16 Compliance
| Item | Status |
|---|---|
| Section 16(a) filing compliance (FY2024) | Company reports all directors/executives complied timely, except one late Form 4 for C.V. Kelly and one late Form 4 for D.M. Willey; no delinquency noted for A.J. Hyatt . |
Governance Assessment
-
Strengths
- Significant insider ownership (5.30%) aligns interests with shareholders and exceeds director stock ownership guideline thresholds .
- Independent director leadership structure with a separate Chairman and CEO and a Lead Independent Director; five executive sessions held in 2024 .
- Robust governance practices cited: 90% independent board (excluding Hyatt/CEO), annual evaluations, clawback policy, no over‑boarding .
- Strong shareholder support for executive say‑on‑pay in 2024 (94.4%) .
-
Risks and potential conflicts
- RED FLAG: Not independent; simultaneously serves as Chairman .
- RED FLAG: Related‑party legal fees paid to Hyatt & Weber ($102,610 in 2024; ~$15,000 through proxy date in 2025); firm serves as general counsel to Company/Bank .
- RED FLAG: Separate 5‑year consulting agreement paying $150,000 per year to Hyatt for business development/community engagement; this is in addition to director fees/equity .
- While anti‑hedging/pledging policies exist, the proxy does not explicitly state an outright prohibition on pledging for directors; awards are subject to hedging/pledging policies per plan .
-
Implications for investors
- The combination of non‑independence, paid consulting, and outside legal work introduces perceived conflicts that can undermine board independence and investor confidence if not tightly overseen by independent directors and the Audit Committee .
- Large equity stake and compliance with director ownership policies partially mitigate alignment concerns, but continued transparency and recusal practices around legal/consulting matters are critical .
Company‑wide attendance: All directors met >75% attendance in 2024 (one exception for medical reasons; individual not identified), which supports board engagement metrics but does not isolate Hyatt’s individual attendance rate .