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Shore Bancshares Adopts Deferred Compensation Plan for Non-Employee Directors

Shore Bancshares says non-employee directors may defer a specified percentage of fees and vested equity awards under a plan adopted September 30, 2026; key election and payout terms are not stated in the filing summary.
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Shore Bancshares’ board adopted a new Deferred Compensation Plan for Non-employee Directors on September 30, 2026. The company says eligible directors may elect to defer a specified percentage of director fees and vested equity awards, with deferred amounts represented in bookkeeping accounts linked to Shore Bancshares shares. The filing does not specify election deadlines, payout terms, or what happens to existing balances in the prior plan.

What the new director plan allows

In its October 1, 2026 Form 8-K, Shore Bancshares says the plan gives participants an opportunity to make annual elections to defer a specified percentage of their director fees and vested equity awards. The summary does not state the percentage range or when elections must be made. Read the company’s Form 8-K.

The company describes the plan’s purpose as helping participants build supplemental savings and retirement income through pre-tax deferrals. Shore Bancshares also states that the plan is intended to comply with Section 409A of the Internal Revenue Code; that is the company’s stated intent, not an independent determination of tax compliance.

How deferred amounts are recorded

The filing describes share-referenced bookkeeping credits, not an immediate delivery of shares when compensation is deferred:

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  • Deferred equity awards are credited to bookkeeping accounts by reference to an equivalent number of Shore Bancshares shares.
  • Deferred cash is credited to an account deemed invested in Shore Bancshares shares.
  • Participants are fully vested in their own elective deferrals and any earnings on them. The filing states: “A participant is always 100% vested in his or her own elective deferrals and any earnings thereon.”

The summary does not explain how dividends, losses, or other share-related adjustments are handled, or when and how account amounts are paid.

What changes under the prior plan

On September 30, 2026, the board also amended Shore Bancshares’ existing Deferred Compensation Plan to eliminate non-employee director participation after the 2026 plan year. The filing summary does not say how existing balances under that plan will be treated or provide payout details.

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A 2020 proxy statement described an earlier arrangement as an unfunded, nonqualified deferred compensation plan covering directors, selected management, and highly compensated employees. That historical description does not establish the detailed terms of the new 2026 plan. See the 2020 proxy statement.

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What the filing does not establish

The Form 8-K identifies the new plan as Exhibit 10.1 and the amended existing plan as Exhibit 10.2, but its summary alone does not provide the full operating terms. In particular, it does not establish:

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  • the permitted deferral percentages or election deadlines;
  • payment triggers, payment forms, or timing;
  • how dividends, losses, or other share-related adjustments affect bookkeeping accounts; or
  • what happens to balances accumulated under the prior plan.

Those details should not be inferred from the summary or from the historical proxy. Shore Bancshares is identified in the filing as a Maryland corporation whose common stock trades as SHBI on the Nasdaq Global Select Market.

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