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Item 9A. Controls and Procedures

2024-03-12 compared with 2023-03-08 · 49 added, 15 removed, 119 unchanged (35% of the section changed)

15 unchanged sentences

Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

In accordance with the rules and regulations of the SEC, management’s report on the design and effectiveness of Bankwell’s system of internal control over financial reporting is not subject to attestation by Bankwell’s independent registered public accounting firm.

The SEC rules and regulations applicable to Bankwell only require a report by management.

Accordingly, this annual report filed on Form 10-K for the year ended December 31, 2022 does not include an opinion by Bankwell’s independent registered public accounting firm regarding management’s system of internal control over financial reporting.

The Company's independent registered public accounting firm, RSM US LLP, has audited the effectiveness of the Company's internal control over financial reporting as of December 31, 2023, as stated in their audit report appearing below.

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Bankwell Financial Group, Inc.

Opinion on the Internal Control Over Financial Reporting

We have audited Bankwell Financial Group, Inc.'s (the Company) internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of income, comprehensive income (loss), shareholders' equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements and our report dated March 12, 2024 expressed an unqualified opinion.

Basis for Opinion

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audit also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ RSM US LLP

Hartford, Connecticut

March 12, 2024

Other Information

Officer and Director Trading Arrangements

In the fourth quarter of 2023 , directors Eric J.

Dale , Jeffrey R.

Dunne , Carl M.

Porto , and Lawrence B.

Seidman, elected to participate in the Company’s Directors’ Deferred Compensation Plan (the “DCP”), pursuant to which all (but not less than all) retainer fees and any meeting fees (or other cash compensation) payable to such director for service on the Board of Directors is deferred.

The election is effective for calendar year 2024 and each subsequent calendar year until the director revokes the election, which revocation will be effective for the following calendar year.

Amounts deferred under the DCP are credited to a book account and deemed invested in the Company’s common stock.

The DCP is indirectly funded by the Company through a so-called “Rabbi Trust,” which is administered by an independent third party trustee.

The Company deposits deferred amounts into the Rabbi Trust, which funds are invested in our common stock through open market purchases by the trustee.

A director’s deferred compensation is paid in our common stock following retirement, except under certain specified circumstances that permit earlier payment, including a severe financial hardship resulting from illness or accident, loss of property or other similar extraordinary and unforeseeable circumstances.

Disclosure Regarding Foreign Jurisdictions That Prevent Inspection

31 unchanged sentences

Gruseke dated June 1, 2016 (3)

Exhibit 10.2† 2002 Bank Management, Director and Founder Stock Option Plan (1)

Exhibit 10.3† 2006 Bank of New Canaan Stock Option Plan (1)

Exhibit 10.4† 2007 Bank of New Canaan Stock Option and Equity Award Plan (1)

Exhibit 10.2† 2011 BNC Financial Group, Inc.

6 unchanged sentences

and Affiliates Deferred Compensation Plan for Directors, January 23, 2008 (1)

Exhibit 10.9† Employment Agreement of Penko Ivanov (4)

as amended by the Bankwell Financial Group, Inc.

and Affiliates Amended and Restated Deferred Compensation Plan for Directors and Related Investment Policy Statement (9)

Exhibit 10.6 Form of Director Indemnification Agreement (2)

10 unchanged sentences

Stock Plan (7)

Exhibit 10.18† Empl oy ment Agreement of Courtney E.

Exhibit 10.14† Employment Agreement of Courtney E.

Sacchetti (8)

Exhibit 21.1 Subsidiaries of the Registrant (1)

4 unchanged sentences

Exhibit 32 Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Exhibit 97 Clawback Policy

101 The following materials from Bankwell Financial Group, Inc.’s Annual Report on Form 10-K for the period ended December 31, 2023, formatted in Inline eXtensible Business Reporting Language (XBRL):

15 unchanged sentences

(7) Filed as an Exhibit to Registrant's June 30, 2022 Form 10-Q.

(8) Filed as part of the Registrant's December 31, 2022 Form 10-K.

(9) Filed as an Exhibit to Registrant's September 30, 2023 Form 10-Q.

Form 10-K Summary

15 unchanged sentences

Executive Vice President & Chief Financial Officer (principal financial and accounting officer)

/s/ George P.

Bauer March 8, 2023

/s/ Gail Brathwaite March 12, 2024

Gail Brathwaite

/s/ Richard Castiglioni March 8, 2023

Richard Castiglioni

Dale March 12, 2024

1 unchanged sentence

Drexler March 12, 2024

Garnett March 8, 2023

/s/ Jeffrey R.

Dunne March 12, 2024

/s/ Anahaita N.

Kotval March 12, 2024

/s/ Todd Lampert March 12, 2024

/s/ Victor S.

Liss March 8, 2023

Porto March 12, 2024

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures