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Item 9A. Controls and Procedures

2022-03-24 compared with 2021-03-30 · 393 added, 67 removed, 50 unchanged (90% of the section changed)

1 unchanged sentence

Disclosure Controls and Procedures

Patriot maintains disclosure controls and procedures that are designed to provide reasonable assurance that information that is required to be disclosed is accumulated and communicated to management in a timely fashion.

In designing and evaluating such controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Management’s judgment is required in evaluating controls and procedures.

As used herein, “disclosure controls and procedures” means controls and other procedures of Patriot that are designed to ensure that information required to be disclosed by Patriot in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the SEC rules and regulations.

Patriot’s disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Continual evaluation of the effectiveness of its disclosure controls and procedures is performed by management, with the participation of Patriot’s Chief Executive Officer and Chief Financial Officer.

Management has concluded that Patriot’s disclosure controls and procedures were effective as of and for the year ended December 31, 2020.

A system of internal controls is designed to provide reasonable assurance that management’s operating objectives, reliance on financial information and reports, and compliance with its mandated and stakeholder obligations are achieved.

In implementing internal controls, management must consider constraints on resources and the benefits of controls relative to their costs.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Management believes all necessary disclosure controls and procedures needed to provide reasonable assurance that information will be communicated in a timely fashion to management are in place.

Management ’ s Annual Report on Internal Control Over Financial Reporting

Patriot’s management is responsible for establishing and maintaining adequate internal controls over financial reporting, as defined in rules 13a-15(f) and 15d-15f under the Exchange Act.

Patriot’s internal control over financial reporting is a process designed under the supervision of its Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

Patriot’s internal control over financial reporting includes those policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and deployment of its assets;

Patriot maintains disclosure controls and procedures that are designed to provide reasonable assurance that information that is required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and accumulated and communicated to management in a timely fashion.

Patriot’s management, with the participation of its Chief Executive Officer and its Chief Financial Officer, conducted an evaluation, as of the end of the period covered by this report, of the effectiveness of its disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e).

Based on this evaluation, Patriot’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, Patriot’s disclosure controls and procedures, as defined in Rule 13a-15(e), were effective at the reasonable assurance level.

Management ’

s Annual Report on Internal Control Over Financial Reporting

Patriot’s management is responsible for establishing and maintaining adequate internal controls over financial reporting, as defined in rules 13a-15(f) and 15d-15f under the Exchange Act.

provide reasonable assurance that transactions are recorded in a timely manner to enable the preparation of financial statements in accordance with U.S.

1 unchanged sentence

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

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2020 based on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on management’s assessment, management concluded that, as of December 31, 2020, the Company’s internal control over financial reporting was effective based on criteria established in Internal Control-Integrated Framework (2013) issued by COSO.

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

1 unchanged sentence

In addition, projections of any evaluations 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 and/or procedures may deteriorate.

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

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021 based on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on management’s assessment, management concluded that, as of December 31, 2021, the Company’s internal control over financial reporting was effective.

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

Accordingly, this annual report on Form 10-K for the year ended December 31, 2020 does not include an opinion by Patriot’s independent registered public accounting firm regarding management’s system of internal controls over financial reporting.

Accordingly, this annual report on Form 10-K for the year ended December 31, 2021 does not include an opinion by Patriot’s independent registered public accounting firm regarding management’s system of internal controls over financial reporting.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company’s internal controls over financial reporting during the fourth fiscal quarter of 2020 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

There was no change in the Company’s internal control over financial reporting during the fourth fiscal quarter of 2021 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Other Information

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Directors, Executive Officers and Corporate Governance

The information required by Items 401, 405, 406 and 407 (c)(3);

(d)(4) and (d)(5) of Regulation S-K is incorporated into this Form 10-K by reference to the Company’s definitive proxy statement or information statement for its 2020 Annual Meeting of Shareholders to be filed within 120 days following December 31, 2020.

The Company has previously adopted a Code of Conduct for its senior financial officers, which was filed as Exhibit 14 to the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2004, filed with the SEC on March 25, 2015.

In addition, the Company adopted a Code of Ethics and Conflict of Interest Policy on October 24, 2018, amended as of March 27, 2019, which was filed as Exhibit 14.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on April 1, 2019.

In March 2021, the Code of Ethics and Conflict of Interest Policy was further amended, which was filed herewith as Exhibit 14.3.

Copies of these codes will be provided to any person so requesting by writing to Patriot National Bancorp Inc., 900 Bedford Street, Stamford, Connecticut 06901, Attn:

Perillo, Chief Financial Officer.

Board of Directors

The following sets forth information regarding our directors as of March 24, 2022.

Unless otherwise indicated, each person holds the same position(s) of both the Company and Patriot Bank.

Current Position with Patriot

Director and Chairman of the Board of Directors of the Company and the Bank

Director, President and Chief Executive Officer of the Company and the Bank

Emile Van den Bol

Carrazza has been Chairman of the Board of Directors of the Company since 2010 and served as interim Chief Executive Officer of the Company from August 2016 to July 2020.

Mr. Carrazza is also CEO of Solaia Capital Advisors, an investment management firm engaged in making private equity and credit investments.

In 2012, Mr. Carrazza led the spin-out of the Bank of Ireland’s U.S.

Asset-Based Lending Group, presently known as Siena Lending Group, and served as its Chairman through 2019.

Previously, Mr.

Carrazza was co-founder of Bard Capital Group where he sponsored several transactions in the industrial sector.

He has structured and financed the leveraged buyout of International Surface Preparation Group, Inc.

Filter/Vivendi and subsequently worked alongside its Chairman, managing the company’s turnaround, financings, and subsequent sale.

Mr. Carrazza also led the financing and restructuring of Mitchell Madison Group and served on the firm’s Executive Team, where he assisted in the firm’s global expansion and managed its sale to US Web/CKS.

Mr. Carrazza began his career at Goldman, Sachs & Co.

Mr. Carrazza earned his MBA in Finance from The Stern School of Business at New York University and his B.S.

in Electrical Engineering from The Pennsylvania State University.

Carrazza is qualified to be a director as he has an extensive background in the financial services industry, has served as Patriot’s Chairman since 2011 and served as Interim CEO from 2016 to 2020.

Mr. Russell was appointed as President and Chief Executive Officer of the Company and the Bank in July 2020 and Director in September 2020. Mr. Russell has more than 30 years of community banking experience.

Prior to joining the Company and the Bank, Mr. Russell served as Executive Vice President and Chief Operating Officer of Millington Bank of Morris and Somerset Counties of New Jersey from 2015 to 2020.

Previously, he served as President and Chief Executive Officer of NJM Bank from 2013 to 2014, and before that, as its Chief Financial and Investment Officer from 2003 to 2013.

Mr. Russell has led both institutions to achieve significant growth and increases in profitability.

During the period of 1990 to 2003, Mr. Russell has also spent part of his career as an Internal Auditor and as a Controller for banking institutions of various asset sizes throughout the state of New Jersey.

Mr. Russell earned his bachelor’s degree from Montclair State University and a is a graduate of the Graduate School of Banking at Colorado.

Russell is qualified to be a director as he has over 30 years of banking experience, including Chief Executive and Chief Operating Officer roles and serves as President and CEO of Patriot Bank.

Constantino Mr. Constantino has been a director of the Company since October 2010 and the Lead Independent Director since October 2018. He has over 40 years of audit, advisory and tax experience working for two major accounting firms, Arthur Anderson LLP and KPMG LLP.

Mr. Constantino retired from KPMG in late 2009, where he was an Audit Partner in charge of the Firm’s real estate and asset management businesses.

Mr. Constantino is a member of the Board of Directors and Chairman of the Special Committee of ARC Property Trust and a member of the Board of Directors and Chairman of the Audit Committee of VineBrook Trust and NexPoint Residential Trust.

He also is the Chairman of the Real Estate and Facilities Committee and member of the Investment Committee at St.

Francis College.

Mr. Constantino also serves as a consultant for the law firm of Skadden Arps.

Mr. Constantino’s specific skills include auditing national and multinational organizations, internal control and compliance, financial reporting, regulatory reporting, risk management, asset valuation, accounting and finance and transaction structuring.

He is a licensed CPA, a Member of the American Institute of Certified Public Accountants and a Member of the New York State Society of Public Accountants.

Mr. Constantino received a Bachelor of Business Administration degree from St.

Francis University.

Constantino is qualified to be a director as he has extensive audit, advisory and tax experience as an Audit Partner with KPMG.

Emile Van den Bol Mr. Van den Bol has been a director of the Company since October 2010.

Mr. Van den Bol is currently the Chief Executive Officer of Brooklawn Capital, LLC.

Brooklawn Capital is an investment management company which advises and invests in and finances real estate, securities and operating companies.

Mr. Van den Bol retired in 2010 as Managing Director of the Commercial Real Estate Group of Deutsche Bank Securities, Inc.

Mr. Van den Bol joined Deutsche Bank in 2001 as Managing Director and held several executive positions in the Commercial Real Estate Group including Global Co-Head Structured Finance, Global Head Commercial Real Estate CDO Group and Member of the Global Commercial Real Estate Executive Committee.

Mr. Van den Bol was from 2005 to 2009 a Governor of the Board of the Commercial Mortgage Securities Association.

From 1996 to 2001 Mr. Van den Bol was employed by Lehman Brothers where he held a number of positions including Head of Esoteric Principal Finance Group and Co-Head of Lehman Brothers Franchise Conduit.

Mr. Van den Bol was a member of Morgan Stanley’s Structured Finance Group from 1991 to 1996.

Mr. Van den Bol received a Juris Doctor degree from University of Amsterdam and an MBA degree from the Wharton School of the University of Pennsylvania.

Van den Bol is qualified to be a director as he has extensive financial services and investment banking experience and is a financial expert.

Weinbaum Mr. Weinbaum has been a director of the Company since October 2010.

He has been the Vice President of Real Estate Operations for United Capital Corp.

for more than twenty years.

Mr. Weinbaum has extensive experience in real estate operations and transactions.

He is a member of the International Council of Shopping Centers and has been a member of United Capital’s Board of Directors since 2005.

Mr. Weinbaum currently serves on the Finance Board and Board of Trustees for St.

Mary’s Healthcare for Children.

Mr. Weinbaum received a Bachelor of Arts degree in Management from Franklin Pierce University.

Weinbaum is qualified to be a director as he has extensive commercial real estate investment experience.

Board Committees

The members of our Board of Directors devote time and talent to certain standing committees.

Among these committees are the Audit Committee, Compensation Committee, Executive Committee, Nominating and Corporate Governance Committee, Asset and Liability Committee, Loan Committee, and Risk Committee.

The current members of each committee are set forth below.

Audit Committee :

Constantino (Chairman), Van den Bol and Weinbaum, each of whom is an independent director as defined by the SEC and NASDAQ rules.

Compensation Committee :

Constantino (Chairman), Van den Bol and Weinbaum, each of whom is an independent director as defined by NASDAQ rules.

Executive Committee :

Carrazza (Chairman), Russell, Constantino and Van den Bol.

Nominating and Corporate Governance Committee :

Van den Bol (Chairman), Constantino and Weinbaum, each of whom is an independent director as defined by NASDAQ rules.

Asset and Liability Committee :

Russell (Chairman), Constantino, Van den Bol and Weinbaum.

Loan Committee :

Van den Bol (Chairman), Constantino and Russell.

Risk Committee:

Russell (Chairman), Van den Bol and Constantino.

Audit Committee Financial Expert

The Board has determined that Messrs.

Constantino and Van den Bol have the professional experience necessary to qualify as audit committee financial experts under SEC rules. 

Executive Officers

The following sets forth information regarding our executive officers who do not serve as directors as of March 24, 2022.

Unless otherwise indicated, each person holds the same position(s) of both the Company and Patriot Bank.

Current Position with Patriot

Perillo 

Executive Vice President and Chief Financial Officer

Secretary and Chief Human Resources Officer;

Executive Vice President and Chief Administrative Officer of Patriot Bank

Executive Vice President and Chief Compliance & Risk Officer of Patriot Bank 

Karen Rojeski

Executive Vice President and Chief Credit Officer of Patriot Bank

Steven Grunblatt

Executive Vice President and Chief Information Office of Patriot Bank

Executive Vice President and Chief Lending Officer of Patriot Bank

Perillo has served as Executive Vice President and Chief Financial Officer of the Company and Patriot Bank since May 2017.

He served as a senior executive consultant for several months beginning in January 2017, tasked with assessing the finance department’s processes and improving operations and internal controls.

Perillo is a recognized finance industry leader with over two decades of experience in the banking industry, having served as Chief Accounting Officer and Chief Financial Officer for iQor Inc., a $1.5 billion global leader in business process outsourcing.

He began in public accounting with KPMG and then spent over 20 years in banking with Citibank, NatWest and as Senior Vice President & Controller for GreenPoint Financial, then one of the 50 largest banking companies in the U.S.

Perillo earned his Bachelor of Science in accounting from St.

John’s University and is a Certified Public Accountant.

Staudmyer Mr.

Staudmyer has served as the Company’s Secretary and Chief Human Resources Officer since November 2014.

He is also the Executive Vice President and Chief Administrative Officer of Patriot Bank, N.A., overseeing human resources, retail, and business banking, corporate governance, the customer support center, property development and facilities management.

Staudmyer previously served as Assistant Dean at Cornell University’s Johnson Graduate School of Management.

Bringing more than 30 years of human resources, general management, and corporate leadership experience, he has served at leading financial institutions where he directed talent acquisition and development, including this role at Chase Manhattan Bank, now JPMorgan Chase.

He previously served as Chief Human Resources Officer for Ziff Communications and Ziff Davis Publishing.

He also co-founded and served as President and COO at a national legal services and staffing company for over seven years.

Staudmyer earned his MBA from the Johnson Graduate School of Management at Cornell and his Bachelor of Science at Cornell’s School of Industrial & Labor Relations.

He currently serves on the Board of Directors of the Human Services Council of Connecticut.

He has served on the board of directors of the MBA Career Services Council and as an Advisory Council Member of Cornell University’s Entrepreneurial and Personal Enterprise Program.

Corprew has served as Executive Vice President and Chief Compliance & Risk Officer of Patriot Bank since March 2015, ensuring compliance with local, state and federal regulations, and risk management.

She serves on the management committees for:

Regulatory Compliance, Enterprise Risk, Steering and CRA.

She holds a Certified Regulator Compliance Manager certification, a highly regarded recognition by the American Bankers Association.

With three decades of credit and risk management experience, she has held leadership positions at community-focused financial institutions and mortgage companies throughout the Tri-State area.

Early in her banking career, Ms.

Corprew was awarded honors for establishing a profitable mortgage center.

A staunch advocate for teaching financial literacy skills, Ms.

Corprew has led educational seminars and events at local schools, clubs and community organizations.

She has also held workshops on first-time home buying, credit and budgeting.

She has served as a member of the United Way Stamford Financial Stability Collaborative, and has served as a financial coach for the United Way.

She is a member of the Bank Compliance Association of Connecticut, and the Institute of Certified Bankers and Regulatory Compliance Group of Fairfield County.

She is also a board member of Housatonic Community College Foundation, serving as Vice President, a board member of Future Five and a member of The Helpers Club Scholarship Foundation of Stamford.

Corprew earned her bachelor’s degree from Rutgers University and a master’s degree in finance from Post University in Waterbury, CT.

Karen Rojeski 

Rojeski joined Patriot Bank in April 2021 as Executive Vice President and Chief Credit Officer.

Prior to joining Patriot, Ms.

Rojeski served as Executive Vice President, Chief Credit Officer at Metropolitan Commercial Bank from 2011 to 2020.

Previously, she held the position of Senior Vice President, Special Assets Department Manager at Union Savings Bank.

Rojeski brings to the Company a rich and diverse experience in community bank credit and lending.

Rojeski holds an undergraduate degree from San Francisco State University and a Master of Science from Fairfield University. 

Steven Grunblatt Mr.

Grunblatt joined Patriot Bank in 2014 as Senior Vice President, Director of Technology and became Executive Vice President and Chief Information Officer in April 2021.

He has over twenty-five years of experience in various facets of information technology, including management and oversight of all aspects of vendor management, infrastructure and technology implementation.

Grunblatt graduated from the Wharton School of Business in Pennsylvania with a bachelor’s degree in Economics.

David Lowery Mr.

Lowery joined Patriot Bank in April of 2021 as Head of Lending and became Executive Vice President and Chief Lending Officer in September 2021.

Lowery is leading Patriot Bank’s SBA division, Commercial Real Estate, C&I and Consumer Lending areas.

Prior to joining Patriot, Mr.

Lowery has served in various senior capacities with several institutions including Iberia Bank, Metropolitan and M&T Bank.

He has built highly successful lending businesses in the New York metropolitan area.

Lowery earned his MBA from Loyola University in Maryland where he also received his undergraduate degree in Economics.

Delinquent Section  

16(a) Reports

Section 16(a) of the Exchange Act and the regulations promulgated thereunder require our executive officers, directors and persons who beneficially own more than 10% of our common stock to file forms with the SEC to report their ownership of the Company’s shares and any changes in ownership.

We have reviewed all forms filed electronically with the SEC during, and with respect to, fiscal 2021.

Based on that review and written information given to us by all of our directors and executive officers, we believe that all of our directors, executive officers and holders of more than 10% of our stock filed on a timely basis all reports that they were required to file under Section 16(a) during fiscal 2021, except that each of Edward N.

Constantino, Emile Van den Bol, Raymond Smyth and Michael J.

Weinbaum were late in filing a Form 4 related to a restricted stock grant;

Michael Carrazza was late in filing a Form 4 related to an indirect disposition of shares of common stock;

 and SMC Holdings I, LP was late in filing a Form 3 reporting its initial beneficial holdings.

Code of Ethics

Each of our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer is required to comply with the Patriot National Bancorp, Inc.

Code of Conduct for Senior Executive Financial Officers adopted by our Board of Directors.

The Code of Conduct was adopted to deter wrongdoing and promote honest and ethical conduct;

full, fair, accurate and timely disclosure in public documents;

compliance with law;

prompt internal reporting of Code of Conduct violations, and accountability for adherence to the Code of Conduct.

The Code of Conduct was filed with the SEC as Exhibit 14 to our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004.

In addition, all of our directors, officers and employees are required to comply with a Code of Ethics and Conflict of Interest Policy which is filed herewith as Exhibit 14.2. 

Shareholders may request a copy of either Code, without charge, by contacting Joseph D.

Perillo, Chief Financial Officer, Patriot National Bancorp, Inc., 900 Bedford Street, Stamford, Connecticut 06901, (203) 252-5920.

Executive Compensation

The information required by Item 402 of Regulation S-K is incorporated into this Form 10-K by reference to the Definitive Proxy Statement or Information Statement to be filed within 120 days following December 31, 2020.

Summary Compensation Table

The table below sets forth, for the last two fiscal years, the compensation earned by our Chairman, Chief Executive Officer, and two other executive officers who received the highest annual compensation.

Name/Principal Position(s) (1)

Compensation (2)

President and Chief Executive Officer

Chief Financial Officer

Executive Vice President and Chief Compliance & Risk Officer of Patriot Bank, N.A.

____________________

Mr. Russell has served as President and Chief Executive Officer of the Company and Patriot Bank since July 20, 2020.

The “All Other Compensation” column for the fiscal year ended December 31, 2021 includes the following compensation items:

Named Executive Officer

Contribution to 401(k) Plan ($)

Car Allowance ($)

Outstanding Equity Awards at Fiscal Year-End

None of our named executive officers had any unvested equity awards at December 31, 2021.

Executive Compensation Incentive Plan

In 2017, the Company adopted the Executive Compensation Incentive Plan, referred to as the “2017 Plan.”

The 2017 Plan applies to the President and all Executive Vice Presidents at Patriot Bank.

The 2017 plan was developed in order to attract, retain and motivate key executives by offering compensation incentives for delivering pre-defined budgeted operating results.

The 2017 Plan is market competitive and designed to promote safe and sound business practices, where compensation objectives and risk taking are responsible, within policy guidelines and compatible with effective controls and risk-management.

The 2017 Plan provides for awards based on a balance of bank results and individual executive performance.

Awards are paid 50% in cash and 50% in restricted stock awards vesting over three years granted under the 2020 Plan.

There were no awards issued under the Executive Compensation Incentive Plan during 2020 and 2021.

Patriot Bank maintains a tax-qualified 401(k) Plan under Section 401(a) of the Code with a cash or deferred arrangement under Section 401(k) of the Code.

Employees become eligible to make salary reduction contributions to the 401(k) Plan on the first day of the month coinciding with or next following the date that the employee has attained 21 years of age and completed 1 month of service.

Employees become eligible to receive any matching or discretionary contributions made to the 401(k) by Patriot Bank after the completion of six months and at least 500 hours of service.

Under the 401(k) Plan, participants may elect to have Patriot Bank contribute a portion of their compensation each year, subject to certain limitations imposed by the Code.

The 401(k) Plan permits Patriot Bank to make discretionary matching and additional discretionary contributions to the 401(k) Plan.

Participants in the 401(k) Plan may direct the investment of their accounts in several types of investment funds.

Participants are always 100% vested in their elective deferrals, matching and discretionary matching contributions and related earnings under the 401(k) Plan.

Patriot National Bancorp, Inc.

2020 Stock Plan  

In 2011, the Company adopted the Patriot National Bancorp, Inc.

2012 Stock Plan (the “2012 Plan”), which was approved and ratified by shareholders of the Company on December 13, 2011.

On November 1, 2020, the Board of Directors of the Company approved an amendment of the 2012 Plan and renamed it as the Patriot National Bancorp, Inc.

2020 Restricted Stock Award Plan (the “2020 Plan”), which was approved and ratified by shareholders of the Company on December 22, 2021.

The 2020 Plan is administered by the Compensation Committee of the Company's Board of Directors.

Grants under the 2020 Plan are made in the form of restricted stock.

The 2020 Plan authorizes 3,000,000 shares of the Company's Common Stock for issuance.

Only directors and employees of the Company are eligible to receive grants of restricted stock under the 2020 Plan.

The grants of restricted stock may be subject to vesting, in one or more installments, upon the happening of certain events, upon the passage of a certain period of time.

The vesting of restricted stock awards may be accelerated in accordance with terms of the plan.

The Compensation Committee shall make the terms and conditions applicable to the vesting of restricted stock awards.

Director Compensation

The following table sets forth certain information regarding the compensation earned by or awarded to each of our non-employee directors who served on our Board during the fiscal year ended December 31, 2021.

Raymond Smyth (2)

Emile Van den Bol

The “Stock Awards” column represents the aggregate grant date fair value computed in accordance with ASC Topic 718 for awards of restricted stock granted under our 2020 Plan during fiscal 2021.

We calculated the estimated fair value of the restricted stock awards using the market price of our common stock on the grant date.

As of December 31, 2021, the aggregate number of unvested stock awards held by each of our non-employee directors was as follows:

Constantino – 3,156;

Raymond Smyth –0;

Emile Van den Bol –3,156;

and Michael J.

Weinbaum – 3,156.

Smyth was a director of the Company until September 22, 2021.

The Company’s directors who are also executive officers do not receive compensation for service on the Board of Directors or any of its committees.

On an annual basis, each non-employee director receives $1,150 for each board meeting in which they participate and annual retainer fees totaling $19,100.

They also receive fees ranging from $375 to $750 for each committee meeting in which they participate.

In addition, non-employee directors who serve as the chair of a committee receive additional retainer fees ranging from $3,000 to $9,200 per year.

In addition, each non-employee director receives an annual equity grant of restricted stock units with a grant date value of approximately $14,345 which will vest in full in four equal annual installments, beginning on the first anniversary of the grant date.

The Company’s directors are also reimbursed for reasonable and necessary out-of-pocket expenses incurred in connection with their service to the Company, including travel expenses. 

Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters

The information required by Item 201(d) and Item 403 of Regulation S-K is incorporated into this Form 10-K by reference to the Definitive Proxy Statement or Information Statement, to be filed within 120 days following December 31, 2020.

The table below provides information as of December 31, 2020, with respect to the compensation plan under which equity securities of the Company are authorized for issuance to directors, officers or employees.

Plan Category

Number of common shares

to be issued upon vesting

of restricted shares

Weighted average

grant date fair value

Number of common shares

available for issuance

under the Plan

excluding unvested shares

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

Security Ownership of Certain Beneficial Owners and Management of Patriot

The table below provides certain information about beneficial ownership of Patriot common stock as of March 24, 2022 with respect to:

(i) each person, or group of affiliated persons, who is known to Patriot to own more than five percent (5%) of Patriot common stock;

(ii) each of the Patriot’s directors;

(iii) each of the Patriot’s executive officers;

and (iv) all of Patriot’s directors and executive officers as a group.

Except as otherwise noted, to the knowledge of the Company, all persons listed below have sole voting and dispositive power with respect to all shares of Patriot common stock they beneficially own, except to the extent authority is shared by spouses under applicable law.

Applicable percentage ownership is based on 3,956,492 shares of Patriot common stock outstanding as of March 24, 2022.

In computing the number of shares of common stock beneficially owned by a person and applicable percentage of ownership of that person, we deemed outstanding shares of common stock subject to options held by that person that are currently exercisable or exercisable within sixty (60) days of March 24, 2022.

We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person.

Unless otherwise indicated, the address of each shareholder is in care of Patriot National Bancorp, Inc., 900 Bedford Street, Stamford, CT 06901. 

Name of Beneficial Owner

Shares of Common

Stock Beneficially

Karen Rojeski

Steven Grunblatt

Emile Van den Bol

All Directors and Executive Officers

AFP Forty Six Corp.

Harvey Sandler Revocable Trust

Siguler Guff Advisers, LLC

SMC Holdings I, LP

LMI Partners, LLC

AllianceBernstein L.P.

* Less than one percent (1%)

Includes 12,221 shares held by Solaia Capital Management Profit Sharing Plan for the benefit of Mr. Carrazza, with regard to which Mr. Carrazza has sole voting and dispositive power, and 55,033 shares directly owned by Mr.

Includes 2,500 shares held in an IRA for the benefit of Mr.

Includes 3,185 shares held in an IRA for the benefit of Mr.

Includes 1,000 shares held in a SEP IRA for the benefit of Mr.

Includes 15,899 shares owned by Michael Weinbaum and 342,172 shares owned by AFP Forty Six Corp.

(“AFP”) (See footnote (6) below).

Based solely on the information set forth in the Schedule 13D filed with the SEC on April 14, 2021, Mr.

Weinbaum is an officer of AFP and an officer and director of United Capital Corp., which owns AFP, and therefore may be deemed to have voting and dispositive power over the shares held by AFP.

Weinbaum disclaims beneficial ownership of the shares owned by AFP.

The address of AFP Forty Six Corp.

is 9 Park Place, Great Neck, NY 11021.

Based solely on the information set forth in the Schedule 13D filed with the SEC on April 14, 2021, AFP is the record and direct beneficial owner of 342,172 shares.

Also see footnote (5) above regarding the voting and dispositive power over such shares.

Based solely on the information set forth in the Schedule 13G/A filed with the SEC on April 13, 2021, Gary Rubin and Andrew Sandler are trustees of Harvey Sandler Revocable Trust, and therefore may be deemed to have voting and dispositive power over the shares held by Harvey Sandler Revocable Trust The address of Harvey Sandler Revocable Trust is 2080 NW Boca Raton Blvd Ste 2 Boca Raton, FL 33431.

Based solely on the information set forth in the Schedule 13G filed with the SEC on May 3, 2021, Siguler Guff Advisers, LLC (SGA) is 100% owned by Siguler Guff & Company, LP.

The general partner of Siguler Guff & Company, LP is Siguler Guff Holdings GP, LLC.

Siguler, Andrew J.

Guff, Donald P.

Spencer and Kenneth J.

Burns are the owners of Siguler Guff Holdings GP, LLC and the executive officers of SGA, and therefore may be deemed to have voting and dispositive power over the shares held by SGA.

The address of SGA is c/o Siguler Guff & Company, LP, 200 Park Avenue, 23rd Floor, New York, NY 10166.

Based solely on the information set forth in the Schedule 13G filed with the SEC on April 27, 2021, SMC Holdings I G.P., LLC (“SMC GP”) is the general partner of SMC Holdings I, LP.

Steffens and Gregory P.

Ho each serves as a Managing Member of SMC GP, and therefore may be deemed to have voting and dispositive power over the shares held by SMC GP.

The address of SMC GP is c/o Spring Mountain Capital, LP, 650 Madison Avenue, 20th Floor, New York, NY 10022.

Based solely on the information set forth in the Schedule 13G filed with the SEC on April 16, 2021, Earl A.

Samson III is Manager of LMI Partners, LLC, and therefore may be deemed to have voting and dispositive power over the shares held by LMI Partners, LLC.

The address of LMI Partners, LLC is 954 Lexington Avenue, Suite 124, New York, NY 10021.

Based solely on the information set forth in the Schedule 13G/A filed with the SEC on December 10, 2021, by AllianceBernstein L.P.(“AllianceBernstein”) AllianceBernstein has sole voting and dispositive power over 397,418 shares.  The address of AllianceBernstein is 1345 Avenue of the Americas, New York, NY 10105.

Equity Compensation Plan Information as of the End of Fiscal 2021

The table below provides information as of December 31, 2021, with respect to the compensation plan under which equity securities of the Company are authorized for issuance to directors, officers or employees.

Equity Compensation Plans

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Approved by the shareholders

Not approved by the shareholders

Certain Relationships and Related Transactions, and Director Independence

The information required by Items 404 and 407(a) of Regulation S-K is incorporated into this Form 10-K by reference to the Definitive Proxy Statement or Information Statement to be filed within 120 days following December 31, 2020.

C ertain Relationships and Related Transactions

In the ordinary course of business, the Bank has made loans to officers and directors (including loans to members of their immediate families and loans to companies of which a director owns 10% or more).

In the opinion of management, all of such loans were made in the ordinary course of business of the Bank on substantially the same terms, including interest rates and collateral requirements, as those then prevailing for comparable transactions with persons not related to the lender.

The Bank believes that at the time of origination such loans did not involve more than the normal risk of collectability or present any other unfavorable features.

There were $100,000 loans to officers and directors outstanding as of December 31, 2020 and no loans to officers and directors outstanding as of December 31, 2021.

As of December 31, 2021 and 2020, deposits by related parties aggregated $58,000 and $189,000, respectively.

Information about transactions involving related persons is assessed by the Company’s independent directors.

Related persons include the Company’s directors and executive officers as well as immediate family members of such directors and officers.

If the independent directors approve or ratify a material transaction involving a related person, then the transaction would be disclosed in accordance with the SEC rules.

If the related person is a director, or a family member of a director, then that director would not participate in those discussions.

Board Independence

The Board has determined that the following current directors, constituting a majority of the members of the Board, are independent as defined in the applicable listing standards of the Nasdaq Stock Market, Inc.:

Constantino, Van den Bol and Weinbaum.

Each current member of the Audit, Compensation, and Nominating and Governance Committees is an independent director pursuant to all applicable listing standards of Nasdaq.

The Board of Directors has also determined that each current member of the Audit Committee also meets the additional independence standards for audit committee members established by the SEC, and each member of the Compensation Committee also qualifies as a “non-employee director”

as defined in Rule 16b-3 of the Securities Exchange Act of 1934, as amended.

Principal Accountant Fees and Services

The information required by Item 9(e) of Schedule 14A is incorporated into this Form 10-K by reference to the Definitive Proxy Statement or Information Statement to be filed within 120 days following December 31, 2020.

Principal Accounting Fees and Services

The following table sets forth the aggregate amounts of principal accounting fees we paid to our independent registered public accountants for professional services performed in fiscal years ended December 31, 2021and 2020 for:

(i) audit fees –

consisting of fees billed for services rendered for the audit of our annual financial statements and the review of our quarterly financial statements;

(ii) audit-related fees –

consisting of fees billed for services rendered that are reasonably related to the performance of the audit or review of our financial statements and that are not reported as audit fees;

and (iii) 

all other fees –

consisting of fees billed for all other services rendered.

Year Ended December 31,

Audit fees (1)

Audit related fees (1)

All other fees (1)

The aggregate fees included in Audit Fees are fees billed for the fiscal years.

The aggregate fees included in each of the other categories are fees billed in the fiscal years.

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee has adopted a policy for pre-approval of audit and permitted non-audit services by the Company’s independent registered public accountants.

The Audit Committee will consider annually and, if appropriate, approve the provision of audit services by its external auditor and consider and, if appropriate, pre-approve the provision of certain defined audit and non-audit services.

The Audit Committee also will consider on a case-by-case basis and, if appropriate, approve specific engagements that are not otherwise pre-approved.

Any proposed engagement that does not fit within the definition of a pre-approved service may be presented to the Audit Committee for consideration at its next regular meeting or, if earlier consideration is required, to the Audit Committee or one or more of its members.

The member or members to whom such authority is delegated shall report any specific approval of services at its next regular meeting.

The Audit Committee will regularly review summary reports detailing all services being provided to the Company by its external auditor.

The Audit Committee pre-approved all of the audit and non-audit services provided by RSM during the years ended December 31, 2021 and 2020.

Exhibits and Financial Statement Schedules

(a) The consolidated financial statements and exhibits listed below are filed as part of this Annual Report on Form 10-K.

The Company’s Consolidated Financial Statements, the Notes thereto and the Report of the Independent Registered Public Accounting Firm are included in PART II, Item 8.

“Financial Statements and Supplementary Data.”

Financial statement schedules have been omitted because they are not applicable, not required, or the required information is included in the Consolidated Financial Statements or Notes thereto. 

Reference is made to Item 15(b) below.

The Exhibit Index, which immediately precedes the signature page, is incorporated by reference into this Annual Report on Form 10-K.

Financial Statement Schedules .

Reference is made to Item 15(a)(2) above.

Form 10-K Summary

EXHIBIT INDEX

Agreement and Plan of Merger, dated as of November 14, 2021, by and among Patriot National Bancorp, Inc., American Challenger Development Corp.

and Next Special, Inc.(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on November 16, 2021).

Amendment No.

1 to the Merger Agreement, dated as of January 28, 2022, by and among Patriot National Bancorp, Inc., Next Special, Inc., and American Challenger Development Corp.

(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on February 3, 2022).

Amendment No.

2 to the Merger Agreement, dated as of February 28, 2022, by and among Patriot National Bancorp, Inc., Next Special, Inc., and American Challenger Development Corp.

(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on March 1, 2022).

Certificate of Incorporation of Patriot National Bancorp, Inc.

(incorporated by reference to Exhibit 3(i) to the Company’s Current Report on Form 8-K filed on December 1, 1999)

Certificate of Amendment of Certificate of Incorporation of Patriot National Bancorp, Inc.

dated July 16, 2004 (incorporated by reference to Exhibit 3(i)(A) to the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2004 filed on March 25, 2005)

Certificate of Amendment of Certificate of Incorporation of Patriot National Bancorp, Inc.

dated June 15, 2006 (incorporated by reference to Exhibit 3(i)(B) to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 filed on November 14, 2006)

Certificate of Amendment of Certificate of Incorporation of Patriot National Bancorp Inc., dated October 6, 2010 (incorporated by reference to Exhibit 3.l to the Company’s Current Report Form 8-K filed on October 21, 2010)

dated June 15, 2006 (incorporated by reference to Exhibit 3(i)(B) to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 filed on November 14, 2006)

Amended and Restated By-laws of Patriot National Bancorp Inc.

(incorporated by reference to Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed on November 1, 2010)

Form of 6.25% Fixed to Floating Rate Subordinated Note (incorporated by reference to Exhibit 4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 filed on August 14, 2018)

(incorporated by reference to Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed on November 1, 2010)

Form of 7% Senior Note due 2022 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 19, 2021).

Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.

2012 Stock Plan of Patriot National Bancorp Inc.

(incorporated by reference from Annex A to the Proxy Statement on Form 14C filed on November 1, 2011)

Patriot National Bancorp, Inc.

2020 Restricted Stock Award Plan (incorporated by reference to Exhibit 10.1 to the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2020).

Amended Financial Services Agreement, by and between Patriot National Bancorp, Inc.

and PNBK Sponsor LLC, dated August 7, 2014 (incorporated by reference to Exhibit 10(a) (20) to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 (Commission File No.

and PNBK Sponsor LLC, dated August 7, 2014 (incorporated by reference to Exhibit 10(a) (20) to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 (Commission File No.

000-29599) filed on August 8, 2014)

Form of Subordinated Note Purchase Agreement (incorporated by reference to Exhibit 10(6) to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 filed on August 14, 2018)

Form of Agreement with The Comptroller of the Currency, dated as of November 7, 2018 (incorporated by reference to Exhibit 99(1) to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2018 filed on November 14, 2018)

Code of Conduct for Senior Financial Officers (incorporated by reference to Exhibit 14 to the Company’s Annual Report on Form 10 -KSB for the year ended December 31, 2004 (Commission File No.

Code of Ethics and Conflict of Interest Policy, dated March 27, 2019 (incorporated by reference to Exhibit 14.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed on April 1, 2019)

Code of Ethics and Conflict of Interest Policy, dated March 24, 2021 (filed herewith)

Subsidiaries of Bancorp (incorporated by reference to Exhibit 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed on April 29, 2020)

Form of Subordinated Note Purchase Agreement (incorporated by reference to Exhibit 10(6) to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 filed on August 14, 2018)

Investment Agreement, dated as of November 14, 2021, between Patriot National Bancorp, Inc., Patriot Bank, N.A and Oaktree Opportunities Fund Xb Holdings (Delaware), L.P.

and Oaktree Opportunities Fund XI Holdings (Delaware), L.P.

(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on November 16, 2021).

Investment Agreement, dated as of November 14, 2021, between Patriot National Bancorp, Inc., Patriot Bank, N.A and AG Credit Solutions Master Fund II A, L.P., AG Credit Solutions Non ECI Master Fund, L.P., AG Potomac Fund, L.P., AG Capital Solutions SMA One, L.P., AG Cataloochee, L.P., and AG Centre Street Partnership, L.P.(incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on November 16, 2021).

Investment Agreement, dated as of November 14, 2021, between Patriot National Bancorp, Inc.

and Eagle Strait I LLC and Eagle Strait II LLC (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on November 16, 2021).

Code of Conduct for Senior Financial Officers (incorporated by reference to Exhibit 14 to the Company’s Annual Report on Form 10 -KSB for the year ended December 31, 2004 (Commission File No.

Code of Ethics and Conflict of Interest Policy

Subsidiaries of Bancorp (incorporated by reference to Exhibit 21 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed on April 29, 2020)

Consent of RSM US LLP

2 unchanged sentences

Section 1350 Certifications

XBRL Instance Document

XBRL Schema Document

XBRL Calculation Linkbase Document

XBRL Labels Linkbase Document

XBRL Presentation Linkbase Document

Inline XBRL Instance Document

Inline XBRL Schema Document

Inline XBRL Calculation Linkbase Document

Inline XBRL Labels Linkbase Document

Inline XBRL Presentation Linkbase Document

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

†         Management Contracts and Compensatory Plans, Contracts or Arrangements.

*         Provided herewith.

**Schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K.

PNBK agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.

***Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K.

PNBK agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.

The exhibits marked with the section symbol (#) are interactive data files.

6 unchanged sentences

/s/ Robert G.

Chief Executive Officer

Chief Executive Officer and Director

(Principal Executive Officer)

4 unchanged sentences

March 24, 2022

/s/ Edward N.

/s/ Michael Carrazza

Michael Carrazza

March 24, 2022

/s/ Raymond B.

/s/ Edward N.

March 24, 2022

5 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