This Proxy Statement is being furnished to shareholders of Premier Financial Corp. (“Premier,” “PFC,” the “Company,” “we,” “us,” or “our”). Our Board of Directors (the “Board”) is soliciting proxies to be used at our 2022 Annual Meeting of Shareholders (the “Annual Meeting”) to be held on April 26, 2022, at 1:30 p.m., Eastern Time, and at any adjournment thereof, for the purposes set forth in the Notice of Annual Meeting of Shareholders. The Annual Meeting will be an entirely virtual meeting. That means you can attend the Annual Meeting online, vote your shares electronically, and submit questions during the Annual Meeting by visiting www.virtualshareholdermeeting.com/PFC2022. Be sure to have your 12-Digit Control Number to enter the Annual Meeting. The Proxy Statement and related materials were first made available to shareholders of Premier on or about March 10, 2022 and we expect to begin mailing these proxy materials to the shareholders of Premier on or about March 17, 2022.

We will be hosting the Annual Meeting live via the Internet. A summary of the information you need to attend the Annual Meeting online is provided below:

Your proxy, if properly submitted and not revoked prior to its use, will be voted in accordance with the instructions you give. Properly submitted proxies that do not contain voting instructions and that are not “broker non-votes” will be voted (1) FOR the director nominees identified in Proposal 1 herein, (2) FOR the approval of our executive compensation, (3) FOR the ratification of the appointment of Crowe LLP (“Crowe”) as our independent registered public accounting firm for 2022 and (4) in accordance with the best judgment of the persons appointed as proxies upon the transaction of such other business as may properly come before the Annual Meeting.

You may revoke your proxy at any time before it is exercised by (1) filing written notice of revocation to be received prior to voting at the Annual Meeting with our Secretary, Shannon M. Kuhl, at 601 Clinton Street, Defiance, Ohio 43512; (2) submitting a valid proxy bearing a later date that is received prior to voting at the Annual Meeting; or (3) attending the Annual Meeting online and giving notice of revocation to the Secretary prior to voting your shares at the Annual Meeting. Attending the Annual Meeting will not, by itself, revoke a previously given proxy. The proxies we are soliciting will only be exercised at the Annual Meeting and any adjournment thereof and will not be used for any other meeting.

Only our shareholders of record at the close of business on February 28, 2022 (the “Voting Record Date”) are entitled to notice of, and to vote at, the Annual Meeting. On the Voting Record Date, there were 35,816,534 common shares issued and outstanding. We have no other class of equity securities outstanding that are entitled to vote at the Annual Meeting. The presence, either in person or by proxy, of at least a majority of our outstanding shares entitled to vote is necessary to constitute a quorum at the Annual Meeting. Abstentions and broker non-votes are counted in determining the presence of a quorum.

You are entitled to cast one vote for each share owned. Below are specifics regarding the vote requirement for each proposal:

For Proposal 1, the election of directors at the Annual Meeting, director nominees will be elected by a plurality of the votes cast. Our Articles of Incorporation do not permit shareholders to cumulate votes in the election of directors. Abstentions and broker non-votes will not affect the plurality vote required to elect directors. The Board of Directors recommends that you vote for each nominee for director.

Proposal 2 to approve our executive compensation and Proposal 3 to ratify the appointment of Crowe each requires that the number of votes cast in favor of the proposal exceed the number of votes cast against it. Because abstentions will not be counted as votes cast at the Annual Meeting, they will not affect either of these proposals. Similarly, broker non-votes will not affect Proposal 2. Proposal 3 is a “discretionary” item, so it will not have broker non-votes. The Board of Directors recommends that you vote in favor of both Proposal 2 and Proposal 3.

Because the proposals to approve our executive compensation and ratify the appointment of Crowe as our independent registered public accounting firm are advisory, they will not be binding upon the Board or the Company. However, the Compensation Committee will take into account the outcome of votes when considering future executive compensation arrangements. Further, if the appointment of Crowe is not ratified by the shareholders, the Audit Committee may re-consider its selection of Crowe as our independent registered public accounting firm for the fiscal year ending December 31, 2022.

Proposals 1 and 2 are not “discretionary” items. If your shares are held in “street name,” you must provide instructions to your brokerage firm in order to cast a vote on these proposals. The ratification of the appointment of Crowe is considered a “discretionary” item, so your brokerage firm may vote in its discretion on your behalf if you do not furnish voting instructions.

The following table summarizes certain self-identified characteristics of our directors, in accordance with Nasdaq Listing Rules 5605(f) and 5606. Each term used in the table has the meaning given to it in the rule and related instructions.

We view ourselves as a high-performing, community-focused financial institution dedicated to focusing on our customers, our employees and the communities we have served since the 1890s. We are built on a foundation of focusing on the fundamentals of sound banking practices and are strengthened by our Mission & Vision and Core Values initiatives described below. We also have a tagline of “Powered by People” as an indication of our commitment to local, responsive, personalized service. We consider environmental, social and governance matters to be an integral part of our business.

While environmental, social and governance matters have been of high importance to Premier for several years, in January 2022 we specifically tasked our Governance and Nominating Committee to oversee the management of our efforts in these areas, including our efforts toward promoting diversity, equity, and inclusion.

We believe that the protection of the environment is an important part of our responsibility as a banking institution, and we are committed to doing our part to ensure a sustainable future. In 2021, we decided to use renewable electricity and carbon-neutral natural gas to power all of our locations. Additionally, we use LED bulbs for all lighting replacement in our facilities.

Supporting individuals and businesses in our local communities is a top priority for us. We are a proud participant in the Small Business Administration’s Payment Protection Program (“PPP”), originating $$636.9 million of PPP loans (5,111 loans in total) throughout the COVID-19 pandemic. We have also accommodated many of our commercial and individual borrowers who were negatively impacted by the COVID-19 pandemic by providing loan modifications to include either interest only deferral or principal and interest deferral.

In 2021, through Premier Bank and the Premier Bank Foundation, we donated $1.3 million to over 400 non-profit organizations in the communities we serve. Our employees have also participated in numerous volunteer service efforts providing their time and talents to their local communities. All employees receive paid volunteer time specifically for the purpose of volunteering their time in their respective communities. In 2021, our employees recorded over 1,500 hours of volunteer time, and we believe the actual time dedicated to such efforts to be even greater than such recorded amount.

We are committed to employing and retaining a highly diverse workforce. We are an Equal Employment Opportunity Employer that understands the importance of employing individuals with varied backgrounds. Beginning with the “tone from the top” and cascading throughout our organization, we expect our employees to understand the importance of diversity, equity and inclusion and how these considerations impact our ability to achieve a highly efficient and dynamic work environment. We have implemented multiple programs and initiatives designed to increase diversity, equity and inclusion awareness, to build diverse teams, to encourage connections amongst all of our employees, and to support our commitment to recruiting and retaining a diverse workforce.

Our Board and management team are committed to sound and effective corporate governance practices. Certain aspects of these practices, including the leadership structure of our Board and the Board’s role in risk oversight, the Board’s committees, our Code of Ethics policy, our stock ownership guidelines for directors and executive officers, and our director and executive compensation programs are discussed in the sections below. We believe the diversity of our directors has significantly enhanced the effectiveness of our Board. This topic is discussed in greater detail under “Board Diversity” below.

Premier’s Board has determined that the following directors, constituting a majority (12 of 14 directors) of the Board, are “independent directors,” as that term is defined in Nasdaq Listing Rule 5605(a)(2): Marty E. Adams, Zahid Afzal, Louis M. Altman, Terri A. Bettinger, John L. Bookmyer, Lee Burdman, Jean A. Hubbard, Nikki R. Lanier, Charles D. Niehaus, Mark A. Robison, Richard J. Schiraldi, and Samuel S. Strausbaugh.

On August 6, 2021, the SEC approved amendments to the Listing Rules of the Nasdaq Stock Market related to board diversity. New Listing Rule 5605(f) (the “Diverse Board Representation Rule”) requires each Nasdaq-listed company, subject to certain exceptions, to (1) have at least one director who self-identifies as female, and (2) have at least one director who self-identifies as Black or African American, Hispanic or Latinx, Asian, Native American or Alaskan Native, Native Hawaiian or Pacific Islander, two or more races or ethnicities, or as LGBTQ+, or (3) explain why the company does not have at least two directors on its board who self-identify in the categories listed above. While full compliance with the Diverse Board Representation Rule does not take effect until 2025, we currently satisfy this rule with three female directors, one director who self-identifies as Asian, and one director who self-identifies as Black or African American. In addition, new Listing Rule 5606, otherwise known as the “Board Diversity Disclosure Rule,” requires each Nasdaq-listed company, subject to certain exceptions, to provide statistical information about its board of directors, in a uniform format, related to each director’s self-identified gender, race, and self-identification as LGBTQ+. This information is provided on page 3.

The Board believes its effectiveness is enhanced by being comprised of individuals with diverse backgrounds, skills and experience that are relevant to the role of the Board and the needs of our business, as well as diversity with respect to gender and ethnicity. Although the Governance and Nominating Committee does not have a formal diversity policy in place, it seeks to promote a diverse set of viewpoints and business experience in the Board’s membership.

In accordance with our Code of Regulations, the Board elects both our chairman of the Board (sometimes referred to as the “Chairman”) and our Chief Executive Officer (sometimes referred to as the “CEO”), and these positions are to be separate and held by different individuals. In the event the Chairman is not an independent director, it is the Board’s policy to designate from among the independent directors a “Lead Independent Director.”

Mr. Hileman was appointed Executive Chairman of the Board effective April 1, 2021. Mr. Bookmyer was appointed Past Chairman of the Board effective April 1, 2021. Mr. Schiraldi currently serves as Vice Chairman of the Board and Lead Independent Director. From April 2021 until the Annual Meeting, both the Lead Independent Director and Past Chairman were ex-officio members of every Board committee of which they are not assigned members. In this ex-officio capacity, Mr. Schiraldi and Mr. Bookmyer were eligible to vote on matters at the committee meetings they attended, although they were not included for purposes of determining whether a quorum of the committee members was present. After the Annual Meeting, only Mr. Schiraldi will continue in an ex-officio capacity for committees to which he is not assigned.

The Board’s function of overseeing risk is handled primarily by the Board’s Risk Committee. The Chief Risk Officer works with management as well as internal and external auditors to determine and evaluate significant risks that we may be taking and communicates those findings directly to the Risk Committee. The

Risk Committee provides oversight related to identifying, quantifying, minimizing and managing our risks. The Risk Committee believes that by involving both management and auditors in this important process, it is best able to perform its oversight function. The Company, typically in conjunction with Premier Bank, also has the following standing management-level committees: Enterprise Risk Management, Compliance, Information Security, Asset Liability, Loan, Special Assets, CRA & Fair Lending, and Change Management that meet regularly to provide governance structure and input into our risk management process. These committees provide information and support to the Risk Committee minutes, and findings of these committees are presented to the Risk Committee.

Our Board has the legal responsibility for overseeing our affairs and, thus, an obligation to keep informed about our business and strategies. This involvement enables the Board to provide guidance to management in formulating and developing plans and to exercise independently its decision-making authority on matters of importance to us. Acting as a full Board and through its standing committees, the Board is fully involved in our strategic planning process.

Each year, typically in September, senior management and the Board hold an extended meeting to focus on corporate strategy. This session involves presentations from management and input from the directors regarding the assumptions, priorities and strategies that will form the basis for management’s operating plan and strategy for the coming year. At subsequent meetings, the Board continues to review our progress against the strategic plan and to exercise oversight and decision-making authority regarding strategic areas of importance and revise the strategic plan, as necessary. The role the Board plays is inextricably linked to the development and review of our strategic plan. Through these procedures, the Board, consistent with good corporate governance practices, encourages our long-term success by exercising sound and independent business judgment on the strategic issues that are important to our business.

Our Board holds regular meetings each quarter, while Premier Bank’s Board of Directors meets twice each quarter. Special meetings of the boards are held from time to time, as needed. There were ten meetings of the Board of Directors of Premier and 12 meetings of the Board of Directors of Premier Bank held during 2021. The independent directors of Premier also met twice, in addition to the full Board meetings. All of our directors attended at least 80% of the total number of meetings of the full Board of Directors of Premier and all independent directors attended both of the independent director meetings. All directors that serve on a committee of the Board attended at least 75% of the total number of meetings of each such committee.

Neither the Board nor the Corporate Governance Committee has implemented a formal policy regarding director attendance at our annual shareholder meetings. In 2021, all of our then-incumbent directors attended the annual meeting.

Non-management directors met six times in executive session in 2021 in addition to the independent director meetings described above.

The Board has five standing committees: Audit, Compensation, Governance and Nominating, Risk and Executive. Charters for each of these committees, with the exception of the Executive Committee, are posted on our website at http://www.premierfincorp.com under the link “Governance Documents.”

The Compensation Committee is responsible for overseeing our compensation programs, including base salaries, incentive compensation, equity-based compensation, and benefit plans. The Committee also determines the CEO’s annual goals, participates in the annual evaluation of the CEO, and approves the compensation paid to the CEO. The Committee oversees the performance evaluation of the other executive officers subject to Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and approves the compensation paid to such officers. The Committee also reviews and recommends the compensation to be paid to directors for their service on the Board, Board committees, and subsidiary boards (including committee member and committee chair’s fees, equity-based awards and other similar items, as appropriate). The Committee regularly uses the services of an independent executive compensation consulting firm to fulfill its responsibilities for evaluating and establishing the compensation program for the Company’s executive officers and directors. All of the Compensation Committee members are considered “independent” for purposes of the Nasdaq listing requirements and are “non-employee directors” for purposes of Rule 16b-3 of the Exchange Act.

The Governance and Nominating Committee is responsible for ensuring that the Board is appropriately constituted and for developing and overseeing the Company’s corporate governance policies and guidelines. The Committee is responsible for ensuring that the members of the Board collectively possess the appropriate mix of knowledge, skills and experience required to ensure that our business succeeds. The Committee is responsible for establishing the procedures for director nominations and the evaluation criteria for all relevant candidates. The Committee also reviews the independence of all directors, monitors the Board’s continuing education and self-assessment process, and conducts annual assessments of the Board and periodic assessments of the Board committees. The Committee oversees the Company’s Code of Ethics and Corporate Governance Guidelines and

is responsible for the review of conflict of interest matters and related party transactions. The Governance and Nominating Committee maintains both an emergency succession plan and a long-range succession plan. All of the Governance and Nominating Committee members are considered “independent” for purposes of the Nasdaq listing requirements.

The process and criteria considered in evaluating nominees for election to the Board are described in the Committee’s Charter and in the Corporate Governance Guidelines (also available on our website at http://www.premierfincorp.com under the link “Governance Documents”). The Committee believes that candidates for director should have certain minimum qualifications, including being able to read and understand basic financial statements, having business experience, and exhibiting high moral character. The Committee will also consider whether a nominee meets applicable independence standards, possesses high personal and professional ethics and integrity, and has the ability to devote sufficient time to fulfilling the duties of a director. Additional factors considered may include the individual’s overall experience in business and education and the individual’s particular skills, attributes or other factors relevant to the Company’s business or necessary or appropriate for our corporate governance needs (e.g., the need for a “financial expert” for service on the Audit Committee). The Committee also seeks to promote a diverse set of viewpoints and business experience in the Board’s membership. In evaluating an incumbent director whose term of office is set to expire, the Committee reviews such director’s overall service during his or her term, including attendance at meetings, participation, and quality of performance. No one individual criteria or factor is given particular weight or precedence in evaluating nominees. The Committee retains the right to modify these minimum qualifications from time to time as circumstances dictate. The Committee will comply with all applicable rules, including Nasdaq Rules and the rules of the U.S. Securities and Exchange Commission (“SEC”), when considering nominations for the Board.

In addition to the stated process and criteria for evaluating nominees for director positions, there are certain obligations resulting from the Merger that will continue until April 1, 2023. Pursuant to the Merger Agreement, Premier’s Code of Regulations was amended and restated to provide that the Board would consist of 13 directors: (1) Mr. Hileman, Mr. Bookmyer, and five other persons who served as directors of Premier or Premier Bank immediately prior to the effective time of the Merger (the “Premier related directors”) and (2) Mr. Small, Mr. Schiraldi, and four other persons who served as directors of UCFC or Home Savings Bank immediately prior to the effective time of the Merger (the “UCFC related directors”). If, prior to the second anniversary of the “succession date” (as defined in the Code of Regulations), which has been set as April 1, 2021, any of the initial Premier related directors or UCFC related directors ceases to serve as a director for any reason or does not stand for reelection, the vacancy will be filled by the Board with an individual selected by the UCFC related directors (if such director was a UCFC related director) or the Premier related directors (if such director was a Premier related director) in good faith in a manner intended to preserve the principles of representation in the Code of Regulations, provided that such individual is reasonably agreeable to the Governance and Nominating Committee in accordance with the good faith execution of its duties.

Our shareholders may also make nominations for candidates for director to the Governance and Nominating Committee, provided that notice of such nomination is given in writing to our Secretary not less than 60 days prior to the anniversary date of the immediately preceding annual meeting of shareholders. The shareholder making the nomination must promptly provide any information reasonably requested by the Governance and Nominating Committee. This Committee does not alter the manner in which it evaluates candidates, including the minimum criteria set forth above, when evaluating a candidate who was recommended by a shareholder. No director nominations were received from shareholders for the election of directors at the Annual Meeting.

The Risk Committee establishes the risk appetite of the Company and monitors the Company’s activities and performance to ensure alignment with such risk appetite. The Committee also oversees the establishment and implementation of the Company’s enterprise risk governance framework that manages the following risk categories: credit, interest rate, liquidity, market, operational, regulatory, compliance, legal, reputation, strategic, and other risks considered to be emerging risks or relating to economic trends or external influences. A majority of the members of the Risk Committee are considered “independent” for purposes of the Nasdaq listing requirements.

The Executive Committee generally has the power and authority to act on behalf of the Board between scheduled meetings unless specific Board action is required or unless otherwise restricted by our Articles of Incorporation or Code of Regulations or by action of the Board. There is no specific charter document for the Executive Committee.

The Board has adopted Corporate Governance Guidelines as a framework to assist the Board in exercising its responsibilities. These Guidelines address expectations of the Board in performing its duties and reflect its ongoing efforts to enhance its effectiveness and corporate governance. These Guidelines will be periodically reviewed and modified as deemed appropriate by the Board. The Guidelines can be found on the Company’s website at http://www.premierfincorp.com under the link “Governance Documents.”

Directors and executive officers are prohibited from engaging in transactions that could reduce the extent to which their investment in Company common stock or equity compensation is aligned with the interests of shareholders. Directors and executive officers are prohibited from entering into speculative transactions involving shares of Corporation common stock and shall not engage in any hedging transactions, short sales, puts, calls, swaps, forward contracts, or other derivative securities involving shares of the Company’s common stock.

The Board and the Governance and Nominating Committee review and approve all transactions and payments involving the directors and executive officers, or involving their related persons or immediate family members, that occur in a given fiscal year. No related person transactions were identified in 2021 that require disclosure in this Proxy Statement. Transactions with related persons of certain independent directors were identified and reviewed by the Governance and Nominating Committee, but none of these transactions were determined to affect the ability of such directors to exercise their independent judgment while serving on the Board or any Board committees due to the minimal values involved.

Premier Bank has, and expects to have in the future, banking relationships in the ordinary course of business with directors, executive officers, and their affiliates on the same terms, including interest rates and collateral on loans, as those prevailing at the same time for comparable transactions with others. Similarly, First Insurance Group has, and expects to have in the future, insurance agent relationships in the ordinary course of business with directors, executive officers, and their affiliates on terms comparable to transactions with third parties. Normal, arms-length banking or insurance relationships entered into in the ordinary course of business and consistent with applicable federal banking or other regulations are not considered to interfere with a director’s independence. Service specialization, rate concessions, fee concessions, or other services or product modifications may similarly be offered to directors and executive officers and their affiliates if the same would be offered to other similarly situated clients on a non-discriminatory basis in the ordinary course of business. All loans or extensions of credit to a director or officer, or their related interests (as defined by Regulation O of the Federal Reserve), (1) were made in compliance with Regulation O of the Federal Reserve, (2) were made in the ordinary course of business, (3) were made on substantially the same terms, including interest rates and nature of collateral, as those prevailing at the time for comparable transactions with other persons not related to the Company, and (4) did not involve more than the normal risk of collectability or present other unfavorable features.

The Board has set ownership guidelines for the Board and executive management. The guideline for each Board member is ownership equal to a value of five times the annual retainer payable in Premier shares. The Board prohibits directors from engaging in transactions that could reduce the extent to which their investment in Premier’s shares is aligned with the interests of shareholders. As a result, our Corporate Governance Guidelines prohibit directors from entering into speculative transactions involving our shares, including any hedging, short sales, puts, calls, swaps, forward contracts, or other derivative securities.

This Compensation Discussion and Analysis (“CD&A”) provides a detailed description of our executive compensation philosophy and programs, the compensation decisions the Compensation Committee (the “Committee”) has made under those programs, and the factors considered in making those decisions. This CD&A focuses on the compensation of our named executive officers (“Named Executive Officers”), as identified in the Summary Compensation Table below.

Our goal is to continue to be a high-performing community-focused financial institution, meeting or exceeding the 75^th percentile of our peers in key financial measures. Compensation is a key component of attracting talent to our organization that will enable us to reach this goal.

As of December 31, 2021, the Company had assets of $7.5 billion. Although the ongoing pandemic impacted the Company’s performance measurements for 2021, we continued to produce strong annual performance results. Highlights from fiscal 2021 include:

For the three-year period ending December 31, 2021, our cumulative growth in core earnings per share was 50%. Our performance was driven by a strong three-year average core return on assets of 1.58%, and our successful execution of our organic and acquisition growth strategies. By emphasizing growth opportunities in our metro markets, our three-year compounded growth in total assets was 33% with organic growth of 12%. Due to the impact of the market improvement in 2021 after the significant downturn in response to the COVID-19 pandemic in 2020, three-year total shareholder returns were generally strong for financial institutions. Premier shares posted a total return to shareholders of 40.4% for the three-year period ended December 31, 2021, including 39.1% for 2021, which compares favorably to a total return of 35.4% for our peer group set forth below.

The Board believes the most effective executive compensation program is one that rewards the achievement of specific annual, long-term, and strategic goals that are established in conjunction with strategic planning initiatives and the long-term objective of maximizing shareholder value. Consistent with that philosophy, our executive compensation packages include both cash and stock-based compensation that reward performance as measured against predetermined goals. The Committee evaluates our executive compensation program to ensure that it is sufficiently competitive to enable us to attract and retain qualified employees in key positions. Total compensation commensurate with a range around median compensation paid to similarly situated executives of peer companies, both overall and by component, is generally what the Committee considers competitive. The Committee considers multiple factors such as experience, leadership ability, and breath of responsibility in determining the process of adjusting compensation on an individual basis.

The Board encourages ownership of PFC shares by executive management in order to align the Company’s compensation philosophy with the interests of shareholders, which is why a significant part of each Named Executive Officer’s compensation package is paid in equity, particularly associated with the Long Term Incentive Plan. The Board prohibits executive officers from engaging in transactions that could reduce the extent to which their investment in Premier’s shares is aligned with the interests of shareholders. As a result, our Corporate Governance Guidelines prohibit executive officers from entering into speculative transactions involving our shares, including any hedging, short sales, puts, calls, swaps, forward contracts, or other derivative securities. The Committee also has established share ownership guidelines for executives as follows:

For the fiscal year ended December 31, 2021, the principal components of compensation for our Named Executive Officers were:

In February 2020, the Committee engaged an independent compensation consultant, Pearl Meyer, to perform an analysis of compensation for our directors, CEO President, CFO and other key executives. The Committee believed that this analysis was important following the Merger as it wanted to ensure it was maintaining competitive salaries in light of the Company nearly doubling in asset size. In conducting this analysis, Pearl Meyer independently developed competitive data for base salaries, short-term incentives, total cash compensation (sum of salary and cash bonus), long-term incentives, equity compensation and total direct compensation (sum of cash compensation and long-term incentives) from: (1) proxies and SEC filings of select peer banks ranging in asset size from $9.7 billion to $4.4 billion, with a median asset size of $5.4 billion, (2) Pearl Meyer 2019 National Banking Compensation Survey, (3) American Bankers Association 2019 Compensation and Benefits Survey, (4) other industry surveys, and (5) the consulting experience of Pearl Meyer. The work also included an analysis of the structure of Premier’s pay program relative to typical market practices for base pay, short-term incentive and long-term incentive compensation. The data indicated that Premier’s approach to incentive compensation measures reflects that of other financial institutions surveyed. Our short-term and long-term incentive plans cap awards at 150% of the target opportunity, which is consistent with a majority of the regional, high performing and other banks surveyed. The Committee used the Pearl Meyer analysis for making adjustments to 2020 compensation relating to the merger and as a starting point for consideration in setting the 2021 compensation levels of the CEO and other executives. The Committee worked with Pearl Meyer in this process.

A peer group is identified by the Committee each year. The peer group consists of financial institutions that are similar in size and business to the Company. The compensation practices of the peer group are reviewed to assist in evaluating the appropriateness of the compensation of our Named Executive Officers and Section 16 officers, and to evaluate the relative performance measures for the long-term incentive compensation payable under the Company’s Long Term Incentive Compensation Plan (the “Incentive Compensation Plan”). The peer group utilized for setting 2021 compensation was:

We provide our Named Executive Officers and other employees with a base salary to compensate them for services rendered during the fiscal year. The base salary for each of the Named Executive Officers is generally determined at the beginning of the year.

Based upon Pearl Meyer’s aforementioned analysis of peer group compensation practices, the Committee considered individual performance, the 2020 performance of the Company, the successful completion of the

Merger, and the cost of living increase in deciding to increase Mr. Hileman’s salary from $550,000 to an annualized rate of $561,000, or 2%, for the period January 1, 2021 through March 31, 2021. After that date and effective with his transition to Executive Chairman, Mr. Hileman’s salary was reduced to an annualized rate of $150,000.

Based upon Pearl Meyer’s aforementioned analysis of peer group compensation practices, the Committee considered the President’s performance review, the 2020 performance of the Company, the successful completion of the Merger, and the cost of living increase in deciding to increase Mr. Small’s salary from $500,000 to an annualized rate of $510,000, or 2%, for the period January 1, 2021 through March 31, 2021. After that date and effective with his transition to CEO, Mr. Small’s salary was increased to an annualized rate of $565,000.

Base salaries for Named Executive Officers other than the CEO and President are determined based upon recommendations made by the CEO. In making a recommendation for 2021 salaries, the CEO and President compared the base salary levels of the other Named Executive Officers with data from the peer group companies and compensation surveys described above as well as internal pay grades. The CEO and President also consulted with Pearl Meyer regarding median levels of the peer group. In light of these considerations, Mr. Hileman and Mr. Small recommended salary increases for 2021 for the other Named Executive Officers ranging from 2% to 3%. After evaluating a number of factors, including performance evaluations, the individual executive’s skills, competencies and experience, and the importance of the executive’s role to the Company, the Committee approved the recommendations, all of which were effective January 1, 2021.

The Board believes that a significant amount of executive compensation should be performance-based because it aligns with shareholder interests, enables the attraction and retention of executive talent, balances risk with rewards, and supports the long-term performance goals of the Company. We have created opportunities for certain employees to earn short-term and long-term incentive compensation in the form of cash and equity in the Company based on the level of achievement of performance goals that the Committee establishes each year. In general, for each incentive award, the Committee establishes a threshold, target and maximum payout based upon the level of achievement of respective performance goals. If the threshold performance level is not achieved, the payout percentage for that component of the award is zero. If the performance level for a component is between threshold and target, or between the target and maximum, the payout percentage is prorated based upon linear interpolation.

After consultation with Pearl Meyer and consideration of market analysis, the Committee granted performance-based incentive awards for 2021 to allow selected participants to earn a specified percentage of base salary upon attainment of incentive targets established by the Committee for 2021. With respect to our Named Executive Officers, incentive awards included (1) a short-term incentive award, and (2) a long-term equity incentive award.

In 2021, short-term incentive compensation to the Named Executive Officers and other executive officers was administered under a short-term incentive plan (the “Short Term Incentive Plan”). Under the Short Term Incentive Plan, the Committee approves target awards for executive officers based on a percentage of the officer’s base salary. The target award is further delineated with a portion attributable to the satisfaction of certain corporate performance goals, and a portion attributable to the individual’s personal performance goals. The individual performance goals are established in consideration of the Board’s and management’s expectations for the year and weighted for each officer based on the officer’s role within the Company.

The performance period considered for purposes of determining short-term incentive compensation begins on January 1 and ends on December 31 of the same year. At the end of the performance period, the Committee determines the level of achievement of the corporate performance goals. The Committee also evaluates and determines the level of attainment by the CEO of the CEO’s individual performance goals, and reviews the annual assessment of the other Named Officers and other Section 16 officers completed by the CEO. The Committee approves the actual short-term incentive awards payable to the CEO, other Named Executive Officers, and other Section 16 officers based on these assessments and the level of attainment of the corporate performance goals. Short-term incentive awards are payable in cash following the end of the performance period.

The 2021, Short Term Incentive Plan corporate performance goals, the associated threshold, target and maximum payout levels, and actual performance levels are detailed in the following table:

The Company’s actual results resulted in a blended payout of 107% for the corporate components. The Committee reviewed various information when evaluating the Company’s actual results against the originally defined corporate goals under the Short Term Incentive Plan, including information regarding (1) the impact of the PPP, (2) the Company’s credit quality, and (3) the overall operating environment that was significantly impacted by the on-going COVID-19 pandemic. The Committee also discussed the Company’s quality of earnings and the impact management’s actions had on the outcome for 2021. Additional consideration was given to the overall execution by management of the operating plan against the approved 2021 budget. As a result, the Committee made a quality of earnings adjustment to reduce the payout to 103%. The related payout percentages of the bonus potential for the common corporate goals are described above.

In addition to the corporate performance goals, a portion of 2021 short-term incentive awards is attributable to the satisfaction of the individual performance goals for each of the Named Executive Officers, other than Mr. Hileman and Mr. Small. Each Named Executive Officer’s participant’s individual component award is based on their performance against specific business objectives and initiatives falling under their direct responsibility over the course of the year. The final individual component payouts for 2021 were 100% for each of Mr. Nungester, Mr. Garrity, Mr. Chandhok, Mr. Gendics and Mr. Liuzzi. For 2021, Mr. Hileman and Mr. Small had their entire short-term incentive payout based on corporate performance, with no individual performance component.

The weighting of the corporate performance goals and the individual performance goal component for each executive officer is determined at the beginning of the performance period. The relative weighting of the goals for each Named Executive Officer in 2021 was:

The 2021 target short-term incentive compensation component and actual bonus payout as approved by the Committee for the Named Executive Officers is set forth below:

In addition to the short-term incentive compensation awards, the Committee may also grant long-term incentive compensation awards under the Long Term Incentive Program to its executive officers, including the Named Executive Officers. In 2021, awards under the Long Term Incentive Program were issued in the form of performance share units (“PSUs”) under the Company’s 2018 Equity Incentive Plan. A PSU Award is designed to align an individual’s compensation with the long-term success of the Company based upon the achievement of certain performance measures at the end of the performance period. The performance period and performance measures are both identified at the time of grant. The performance period for PSU Awards is three years beginning on January 1 of the year of grant through December 31 at the close of the three-year performance period. A “target” award is identified at the time of grant determined as a percentage of the executive’s base salary translated into PSUs based upon the Company’s average stock price for the twenty (20) trading days prior to the effective date of the grant.

If the performance measures identified in the grant are satisfied, the PSU award will vest and be converted to shares of common stock of the Company based on the level of performance achieved. The actual number of common shares that the executive earns at the end of the performance period will be determined by the Committee based on the level of achievement of the performance measures and the executive’s average base salary over the performance period. All determinations of whether the performance measures have been achieved, any adjustments attributed to changes in average base salary, the actual award earned by the executive, and all other matters related to a PSU award will be made by the Committee in its sole discretion.

In addition to the issuance of common shares to the executive upon certification of performance by the Committee, the executive receives all dividends on the common shares underlying the PSU’s, if any, paid by the Company prior to the date the Committee determines the performance measure level of attainment.

In the first quarter of 2021, the Committee established long-term incentive compensation awards for certain executives, including the Named Executive Officers, with a three-year performance period ending December 31, 2023. With respect to these awards, we entered into a Performance Share Units Award Agreement (each, a “PSU Award”) with each of the Named Executive Officers. The number of PSUs granted was calculated by taking the maximum incentive payout dollar value for each executive and dividing it by the Company’s average stock price for the 20 trading days prior to the approval of PSUs by the Committee, which was $30.20, except for Mr. Chandhok which was $32.41 based on his start date, which occurred after the grants were issued to the other Named Executive Officers.

With respect to the PSU awards granted in 2021, the table below sets forth the two performance measures, their respective weighting, and the goals for threshold performance, target performance and superior performance. Achievement of the threshold performance goal will result in 50% of the target payout, achievement of the target performance goal will result in 100% of target payout for the respective measure, and achievement of the superior performance goal will result in 150% of the target payout for the measure.

The 2021-2023 long-term incentive compensation award target for each of the Named Executive Officers is set forth below:

In connection with the Merger, Premier entered into a new employment agreement with Mr. Hileman, effective as of the closing date of the Merger, January 31, 2020. In exchange for entering the new agreement and cancelling his prior agreement, Mr. Hileman received a special retention payment of $2.25 million that approximated the amount of the change-in-control severance payment under his prior agreement. In recognition of the retention payment, the new agreement eliminates Mr. Hileman’s eligibility for future severance benefits in the event his employment is terminated other than limited insurance continuation benefits and acceleration of equity vesting.

Also in connection with the Merger, the Committee adopted amendments to all outstanding equity award agreements that generally provided for accelerated vesting and settlement at the actual level of performance for the 2018 and 2019 portions of the awards, and at the target level of performance for the 2020 and 2021 portion of the awards. With respect to Mr. Hileman only, however, and in response to the say-on-pay response of our shareholders, Mr. Hileman’s outstanding equity awards were treated somewhat differently than other participants. The full vesting of his awards was specifically conditioned upon his continued service through the earlier of the date the Board appointed a successor CEO, or June 30, 2021. Effective April 1, 2021, Mr. Small transitioned to the role of CEO and Mr. Hileman transitioned to Executive Chairman, which triggered full vesting of Mr. Hileman’s awards.

The Board has adopted an incentive compensation clawback policy providing for a three-year review period of the Company’s reported results to ensure that incentive compensation for all executive officers (including the Named Executive Officers), as well as any officers holding the position of vice president or higher, is based on accurate financial and operating data and the correct calculations of the attainment of performance goals. The policy allows the Company to recover incentive awards previously paid or awarded. A copy of this policy is posted on the Company’s website at http://www.premierfincorp.com under the link “Governance Documents.”

All of our employees, including the Named Executive Officers, are eligible to participate in the Premier Financial Corp 401(k) Employee Savings Plan (the “Savings Plan”). The Savings Plan is a tax-qualified retirement savings plan pursuant to which all employees are able to contribute up to the limit prescribed by the Internal Revenue Service to the Savings Plan on a before-tax basis. We maintain a safe harbor plan that matches 100% of the first 3% of pay that is contributed to the Savings Plan plus 50% of the salary deferrals between 3% and 5% of compensation. All employee contributions to the Savings Plan are fully vested upon contribution, and our matching contribution is vested upon completion of a minimum service requirement.

In addition, in 2021, the Named Executive Officers were eligible to participate in the First Defiance Deferred Compensation Plan, which allowed the deferral of up to 80% of their salary and up to 100% of short-term incentive compensation. In addition to the elective deferrals, a group of senior officers including the Named Executive Officers also are eligible to receive a restoration benefit under the First Defiance Deferred Compensation Plan which provides for matching contributions in excess of the Savings Plan caps. The matching contributions under the First Defiance Deferred Compensation Plan for fiscal year 2021 are included in the All Other Compensation column of the Summary Compensation Table and reported under “Company Deferred Compensation Plan Contribution” in footnote 3 to the Summary Compensation Table. Investment options within the First Defiance Deferred Compensation Plan reflect those in the Savings Plan and do not provide any guaranteed or enhanced investment returns. The First Defiance Deferred Compensation Plan is discussed in further detail below under the heading “Executive Compensation — Nonqualified Deferred Compensation”.

We provide our Named Executive Officers with perquisites and other personal benefits that the Committee believes are reasonable and consistent with our overall compensation program to better enable us to attract and retain executive talent. The Committee periodically reviews the levels of perquisites and other personal benefits.

Each Named Executive Officer is eligible, upon relocation, to receive reimbursement for certain reasonable expenses associated with the costs of such relocation. On a case by case basis, the Company considers reimbursement requests for country club and other social organization membership for its senior officers, including the Named Executive Officers, for certain business purposes. Mr. Hileman participates in the Executive Group Life Post-Separation Plan, which provides death benefits equal to two times the executive’s base salary. The plan is closed to new participants.

The Company pays the premiums for a life insurance policy and a supplemental disability insurance policy for Mr. Small. The life insurance policy provides an extra $1,000,000 death benefit to Mr. Small’s designated beneficiary if he dies between January 20, 2022 and January 19, 2023. The Company has no interest in the life insurance policy. In addition to the disability insurance benefit provided to all employees, the Company also pays the premium for a supplemental disability insurance policy that provides an additional disability benefit of $13,525 per month to Mr. Small after the first 90 days of such disability, continuing until age 67, for a disability beginning before he attains age 64, provided that he remains disabled through that date. This supplemental disability insurance policy also provides a death benefit of $40,575. The value of these perquisites is included in column (g) of the Summary Compensation Table.

We have employment or change of control agreements with certain key employees, including the Named Executive Officers with the exception of Mr. Chandhok. These agreements include provisions for severance payments upon a change of control and are designed to promote stability and continuity of senior management.

These agreements each include important protections to the Company, including, but not limited to, provisions restricting competition or the solicitation of Company customers and employees and the requirement that the executive sign a release of claims before receiving any of the severance or change in control benefits outlined in the Executive Agreement. Information regarding applicable payments under such agreements for the Named Executive Officers is provided under the heading “Executive Compensation — Potential Payments Upon Termination or Change in Control” below.

Section 162(m) of the Internal Revenue Code generally prohibits us from claiming a deduction on our federal income tax return for compensation in excess of $1,000,000 paid in a given fiscal year to certain current and former executive officers. While the Committee carefully considers the net cost and value to Premier of maintaining the deductibility of all compensation, it also desires the flexibility to reward Named Executive Officers and other key employees in a manner that enhances Premier’s ability to attract and retain individuals, as well as to create longer-term value for shareholders. Thus, income tax deductibility is only one of several factors the Committee considers in making decisions regarding Premier’s compensation program.

The Board has not adopted a formal policy regarding tax deductibility of compensation paid to our executive officers. The Board may authorize compensation that might not be deductible and may modify compensation that was initially intended to be exempt from Section 162(m) if it determines that such compensation decisions are in the best interests of the Company and its shareholders.

We are required to disclose the median of the total compensation of the Company’s employees, excluding the Company’s CEO, for the last completed fiscal year, the annual total compensation of the Company’s CEO for the last completed fiscal year, and the ratio between the foregoing compensation amounts. We identified the median employee by examining the 2021 total federal taxable compensation through December 31, 2021 for all individuals, excluding our CEO, who were employed by us on November 20, 2021 (whether employed on a full-time, part-time, or seasonal basis). For such employees, we did not make any assumptions, adjustments, or estimates with respect to total federal taxable compensation, and we did not annualize the compensation for any full-time employees that were not employed by us for all of 2021. After identifying the median employee, we calculated annual total compensation for such employee using the same methodology we use for our Named Executive Officers as set forth in the Summary Compensation Table on page 32 of this Proxy Statement.

For fiscal year 2021, the median annual total compensation for all employees (excluding the CEO) was $50,835, and the annual total compensation of our CEO was $1,845,827, resulting in a ratio of 1:36.31