Burke & Herbert Financial Services Corp. 8-K

What Happened
Burke & Herbert Financial Services Corp. announced on January 22, 2026 that H. Charles Maddy, III will not stand for re-election to the Board and will retire as President of the Company effective June 30, 2026. Mr. Maddy’s departure is not due to any disagreement with management or the Board; he will remain a director of the Bank (the Company’s wholly owned bank) and Chair of the Burke & Herbert Bank Foundation. The Board expects Executive Vice President and CFO Roy E. Halyama to be appointed President of the Company and President of the Bank after the 2026 annual meeting. The extended notice is intended to support a smooth transition and to assist with closing and integrating the previously announced merger with LINKBANCORP, Inc.

Key Details

• On January 22, 2026 the Compensation Committee approved a 2026 incentive plan covering annual cash incentives (AIP) and long-term equity incentives for executive leadership and management. Named participants for 2026: David P. Boyle, Roy E. Halyama and H. Charles Maddy, III.
• 2026 target incentive levels (as % of base salary): David Boyle — Short Term 80% / Long Term 120%; Roy Halyama — Short Term 70% / Long Term 90%; H. Charles Maddy III — Short Term 100% / Long Term 0% (Maddy not eligible for long-term stock awards).
• AIP performance metrics and weights for 2026: Fully diluted EPS 35%, GAAP ROE 30%, Non‑performing assets 15%, Customer Service NPS / Strategic & Individual Goals 20%. AIP payouts are cash and paid by March 15 following the fiscal year (subject to employment at payment, except for death, disability or retirement).
• Long-term awards: equal mix of time‑based RSUs (vest ratably over 3 years) and performance RSUs (PRSUs cliff‑vest after 3 years). PRSU metrics (equal weight): 3‑yr average ROA, 3‑yr average ROATCE, and relative TSR vs. eastern U.S. bank holding companies ($5B–$20B assets). PRSU payout: 50% threshold, 100% target, 200% max. Example share award targets: Boyle — 9,740 RSUs and 9,740 PRSU target; Halyama — 3,650 RSUs and 3,650 PRSU target. Mr. Maddy is not eligible for long‑term stock incentives. Awards are subject to the Company’s clawback policy.

Why It Matters
This filing signals a planned leadership transition at the presidential level with the CFO (Roy Halyama) expected to step into the President role, which could affect company strategy and execution—particularly as the company completes its merger with LINKBANCORP. The new 2026 incentive plan ties executive pay to specific financial metrics (EPS, ROE, asset quality, NPS) and to multi‑year performance including relative TSR, aligning pay with near‑term results and longer‑term shareholder returns. Investors should note the timing (Maddy’s June 30, 2026 retirement) and that severance details will be determined later by the Compensation Committee.