pnbk-proxystatement.htm
SCHEDULE
14A
(Rule
14a-101)
INFORMATION
REQUIRED IN PROXY STATEMENT
SCHEDULE
14A INFORMATION
Proxy Statement Pursuant to Section
14(a) of the
Securities
Exchange
Act of 1934 (Amendment
No. )
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the Registrant [X]
Filed by
a Party other than the Registrant [ ]
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appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the
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Commission only (as permitted
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by Rule 14a-6(e)(2))
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[X] Definitive Proxy
Statement
[ ]
Definitive Additional Materials
[ ]
Soliciting Material Under Rule 14a-12
Patriot
National Bancorp, Inc.
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(Name
of Registrant as Specified in Its Charter)
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(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
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of Filing Fee (Check the appropriate box):
[X]
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[ ]
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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Title
of each class of securities to which transaction
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(3)
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Per
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Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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(5)
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paid previously with preliminary materials.
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previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its
filing.
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(1)
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PATRIOT
NATIONAL BANCORP, INC.
900
Bedford Street
Stamford,
Connecticut 06901
(203)
324-7500
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
To
be held on June 17, 2009
To the
Shareholders of
Patriot
National Bancorp, Inc.:
The
Annual Meeting of Shareholders of Patriot National Bancorp, Inc. (“Patriot”)
will be held on Wednesday, June 17, 2009, at 9:00 a.m. local time, at The Hyatt
Regency, 1800 East Putnam Avenue, Old Greenwich, Connecticut 06870, for the
following purposes:
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1.
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To
elect ten directors to serve until the next Annual Meeting of
shareholders.
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2.
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To
consider and act upon a proposal to ratify the appointment of McGladrey
& Pullen, LLP as independent auditors for the year ending December 31,
2009.
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3.
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To
transact any other business that may properly come before the Annual
Meeting.
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Shareholders
of record at the close of business on April 24, 2009 will be entitled to vote at
the Annual Meeting or at any adjournment of the Annual Meeting.
Our Board
hopes that you will attend the meeting. Whether or not you plan to
attend, please complete, date, sign and return the enclosed proxy card in the
accompanying envelope. Your prompt response will greatly facilitate
arrangements for the meeting, and your cooperation will be
appreciated.
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By
Order of the Board of Directors
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Angelo
De Caro
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Chairman
and Chief Executive Officer
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Stamford,
Connecticut
May 4,
2009
PATRIOT
NATIONAL BANCORP, INC.
900
Bedford Street
Stamford,
Connecticut 06901
(203)
324-7500
__________
PROXY
STATEMENT
Our Board
of Directors is soliciting your proxy with the enclosed proxy card for use at
the 2009 Annual Meeting of Shareholders of Patriot National Bancorp,
Inc. The Annual Meeting will be held on Wednesday, June 17, 2009 at
The Hyatt Regency, 1800 East Putnam Avenue, Old Greenwich, Connecticut
06870. This proxy statement and accompanying proxy card are first
being sent or given to shareholders on or about May 4, 2009.
The
Annual Meeting has been called for the following purposes: (i) to elect ten
directors to serve until the next Annual Meeting of Shareholders (Proposal 1);
(ii) to ratify the appointment of McGladrey & Pullen, LLP as our independent
auditors for the year ending December 31, 2009 (Proposal 2); and (iii) to
transact any other business that properly comes before the Annual Meeting or at
any adjournments of the meeting.
GENERAL
INFORMATION ABOUT VOTING
Who can vote. You will
be entitled to vote your shares of Patriot common stock at the Annual Meeting if
you were a shareholder of record at the close of business on April 24,
2009. As of that date, 4,743,409 shares of common stock were
outstanding and entitled to vote at the Annual Meeting.
In the
election of directors, you may elect to cumulate your vote. Cumulative voting
will allow you to allocate among the director nominees, as you see fit, the
total number of votes equal to the number of director positions to be filled
multiplied by the number of shares you hold. For example, if you own 100 shares
of stock, and there are ten directors to be elected at the Annual Meeting, you
may allocate 1,000 “for” votes (ten times 100) among as few or as many of the
ten nominees to be voted on at the Annual Meeting as you choose.
If you
choose to cumulate your votes, you will need to submit a proxy card or a ballot
and make an explicit statement of your intent to cumulate your votes, either by
so indicating in writing on the proxy card or by indicating in writing on your
ballot when voting at the Annual Meeting. If you hold shares beneficially in
street name and wish to cumulate votes, you should contact your broker, trustee
or nominee.
If you
sign your proxy card with no further instructions, John A. Geoghegan, L. Morris
Glucksman, and Michael F. Intrieri, as proxy holders, may cumulate and cast your
votes in favor of the election of some or all of the applicable nominees in
their sole discretion, except that none of your votes will be cast for any
nominee as to whom you instruct that your votes be withheld.
Cumulative
voting applies only to the election of directors. For all other matters, each
share of common stock outstanding as of the close of business on the record
date, April 24, 2009, is entitled to one vote. If you sign your proxy
card with no further instructions with respect to the ratification of the
selection of the independent auditors, then proxies will be voted in favor of
the proposal.
How to vote your shares.
You can vote your shares either by attending the Annual Meeting and voting in
person or by voting by proxy. If you choose to vote by proxy, please
complete, date, sign and return the enclosed proxy card. The proxies named
in the enclosed proxy card will vote your shares as you have instructed.
You may authorize the proxies to vote your shares in favor of the proposals
contained in this proxy statement by simply signing and returning the enclosed
proxy card without indicating how your votes should be cast.
Even if
you expect to attend the Annual Meeting, please complete and mail your proxy
card in order to assure representation of your shares. If you attend the
meeting, you can always revoke your proxy by voting in person. No postage
is necessary if the proxy card is mailed in the United States. If you
have questions regarding the voting of your shares, please call the proxy
solicitor, Morrow & Co., LLC at the number listed below.
Shareholders,
please call: (800) 607-0088. Banks and brokerage firms,
please call: (800) 662-5200. All others, please call
(collect): (203) 658-9400.
Quorum. A quorum of
shareholders is required in order to transact business at the Annual
Meeting. A majority of the outstanding shares of common stock entitled to
vote must be present at the meeting, either in person or by proxy, to constitute
a quorum.
Number of votes
required. The number of votes required to approve each of the
proposals that are scheduled to be presented at the meeting is as
follows:
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Proposal
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Required
Vote
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Election of directors
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Under
cumulative voting for directors, the
ten
nominees receiving the largest number
of
votes will be elected.
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Ratification of the Audit Committee’s
selection of independent auditors
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The
affirmative vote of a majority of the
votes
cast is necessary for ratification.
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Abstentions and broker
non-votes. A broker non-vote occurs when a broker cannot vote a
customer’s shares registered in the broker’s name because the customer did not
send the broker instructions on how to vote on the matter. If the broker
does not have instructions and is
barred by
law or applicable rules from exercising its discretionary voting authority
in the particular matter, then the shares will not be voted on the matter,
resulting in a “broker non-vote.” Abstentions and broker non-votes
will be counted for purposes of determining whether a quorum is present at the
Annual Meeting.
Abstentions
and broker non-votes will not count as votes cast in the election of directors
or in the vote on ratifying the Audit Committee’s selection of independent
auditors. Therefore, abstentions and broker non-votes will have no
effect on the voting on these matters at the meeting.
Discretionary voting by proxies on
other matters. Aside from the election of directors and the
ratification of the Audit Committee’s selection of independent auditors, we do
not know of any other proposal that may be presented at the 2009 Annual
Meeting. However, if another matter is properly presented at the meeting,
the persons named in the accompanying proxy card will exercise their discretion
in voting on the matter.
How you may revoke your
proxy. You may revoke the authority granted by your executed proxy
card at any time before we exercise it by notifying our Corporate Secretary in
writing (900 Bedford Street, Stamford, Connecticut 06901), by executing a new
proxy card bearing a later date and delivering the new executed proxy card to
our Corporate Secretary, or by voting in person at the Annual
Meeting.
Expenses of
solicitation. We will bear all costs of soliciting proxies.
We will request that brokers, custodians and fiduciaries forward proxy
soliciting material to the beneficial owners of stock held in their names, for
which we will reimburse their out-of-pocket expenses. In addition to
solicitations by mail, our directors, officers and employees, without additional
remuneration, may solicit proxies by telephone and/or personal
interviews.
Patriot
has retained Morrow & Co., LLC, a professional proxy soliciting firm, to
assist in the solicitation of proxies for a fee of $7,500 plus reimbursement of
certain out-of-pocket expenses. Morrow & Co., LLC will answer any
inquiries from the Company's shareholders about this proxy statement, the
proxies, the annual meeting and how to vote your shares. If you need
additional copies of the proxy material or have any questions, you should
contact:
Morrow
& Co., LLC
470 West
Avenue
Stamford,
CT 06902
Shareholders,
please call: (800) 607-0088. Banks and brokerage firms,
please call: (800) 662-5200. All others, please call
(collect): (203) 658-9400.
Shareholders sharing the same surname
and address. In some cases, shareholders holding their shares in a
brokerage or bank account who share the same surname and address and have not
given contrary instructions are receiving only one copy of our annual report and
proxy statement. This practice is designed to reduce duplicate mailings
and save significant printing and postage costs as well as natural
resources. If you would like to have additional copies of our
annual
report and/or proxy statement sent to you, please call or write us at our
principal executive offices, Attention: Corporate Secretary, 900 Bedford Street,
Stamford, Connecticut 06901, (203) 324-7500. If you want to receive
separate copies of the proxy statement or annual report to shareholders in the
future, or if you are receiving multiple copies and would like to receive only
one copy per household, you should contact your bank, broker or other nominee
record holder.
Patriot
National Bancorp, Inc. is the bank holding company for Patriot National Bank, or
the Bank. A copy of our Annual Report on Form 10-K for the
fiscal year ended December 31, 2008 is being sent with this proxy
statement. You may also view our annual report on Form 10-K on our website under
the links entitled “For Investors”, then “SEC filings” and then “Documents” at
www.pnbdirectonline.com.
PROPOSAL
1
ELECTION
OF DIRECTORS
Directors;
Nominees for Director
The Board
of Directors has fixed the number of directors for 2009 at ten. Under
our certificate of incorporation, each director is elected annually by the
shareholders and holds office until the next Annual Meeting of shareholders and
until his or her successor is elected and qualified, or until his or her earlier
resignation, death or removal. In the election of directors, you may
elect to cumulate your vote. Cumulative voting means that each share of common
stock is entitled to one vote multiplied by the number of directors to be
elected. All votes may be cumulated and cast for a single nominee or votes may
be distributed among two or more nominees in the manner selected by the
shareholder. If a shareholder submits a signed proxy with no further
instructions, the persons named in the proxy will distribute the votes among the
nominees in his discretion. The ten nominees who receive the largest number of
votes will be elected as directors. The ten nominees for director are currently
serving as directors of Patriot and the Bank. Each nominee has
consented to being named in this proxy statement and to serve if
elected. If for any reason a nominee should become unavailable for
election prior to the Annual Meeting, the proxies may vote for the election of a
substitute. We do not presently expect that any of the nominees will
be unavailable.
Vote
Required
Under cumulative voting for directors,
the ten nominees receiving the largest number of votes will be elected as
directors. Abstention and broker non-votes are not considered votes
cast and will not affect the outcome of the vote.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE
SHAREHOLDERS
VOTE FOR THE TEN NOMINEES SET FORTH BELOW.
Biographical
Information
The
following table contains biographical information about the nominees for
election as directors. Information about the number of shares of
common stock beneficially owned by each nominee, directly or indirectly, as of
April 15, 2009, appears below under “Security Ownership of Certain Beneficial
Owners and Management.”
There is
no arrangement or understanding between any director and any other person or
persons pursuant to which such director was or is to be selected as a director
or nominee. There is no family relationship between any director and any of our
executive officers. Each of the nominees has held the principal
occupation listed for the past five years, except as set forth
below.
Name
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Age
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Business
Experience and Other Directorships
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Director
Since
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Angelo
De Caro
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66
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Angelo
De Caro has served as our director since our organization in 1999 and
as our Chairman since his election in 2001. He has also served as our
Chief Executive Officer since 2001 and as President and Chief Executive
Officer from 1999 to 2001. He has served as a director of the Bank since
1998, as Chairman of the Board of Directors of the Bank since September
2000, and as Chief Executive Officer of the Bank from June 1999 until
October 2000. Mr. De Caro has been a private investor from 1996
to present. Mr. De Caro was a Senior Financial Officer of
Goldman, Sachs & Co. from 1979 to 1986 and a General Partner of
Goldman, Sachs & Co. from 1986 to 1996. In addition, he served on the
Executive Committees of Goldman Sachs Swiss Private Bank and Goldman Sachs
Trust Services.
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1999
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Charles
F. Howell
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60
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Charles
F. Howell has served as our Vice Chairman since 2000 and as our President
since 2001. He has also served as a director and President and Chief
Executive Officer of the Bank since 2000. From 1998 to 2000,
Mr. Howell was a director and President of Summit Bank Connecticut.
He also served as Executive Vice President, Chief Operating Officer and a
director of each of NSS Bank from 1994 to 1998, and NSS Bancorp from the
date of formation in 1997 to 1998.
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2000
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Robert
F. O’Connell
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60
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Robert
F. O’Connell has served as our director and Senior Executive Vice
President and Chief Financial Officer since 2001 and as our Executive Vice
President and Chief Financial Officer from 2000 to 2001. He has
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2001
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Name |
Age
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Business Experience
and Other Directorships |
Director
Since
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also
served as a director and Senior Executive Vice President and Chief
Financial Officer of the Bank since 2001 and as Executive Vice President
and Chief Financial Officer of the Bank from 2000 to 2001. From 1994 to
2000, Mr. O’Connell served as Senior Vice President and Chief
Financial Officer of New Canaan Bank and Trust Company and
Treasurer/Senior Financial Officer of its successor, Summit Bank, New
Canaan, Connecticut.
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Philip
W. Wolford
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61
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Philip
W. Wolford has served as our Chief Operating Officer and Secretary since
June 2000. He has also served as Chief Operating Officer and Secretary of
the Bank since September 2000. Mr. Wolford was our President and
Secretary from December 1999 until June 2000. He was President, Chief
Executive Officer and Secretary of the Bank from September 1994 until June
1999 and President and Secretary of the Bank from August 1999 until
September 2000. Mr. Wolford has served as our director since 1999 and
a director of the Bank since 1994.
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1999
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John
J. Ferguson
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69
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John
J. Ferguson has served as a director of us and the Bank since 2001. He is
a Senior Partner of the law firm of Ferguson, Aufsesser, Hallowell &
Wrynn, LLP of Greenwich, Connecticut.
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2001
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Brian
A. Fitzgerald
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60
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Brian
A. Fitzgerald has served as a director of us and the Bank since 2005. He
served as the Finance Director and Property Manager at Villa Maria
Education Center in Stamford, Connecticut from 2001 - 2008. From 1999 to
2001, Mr. Fitzgerald served as the Finance Director and Controller of
Chromacol, a developer of consumables and accessories for chromatography.
Mr. Fitzgerald was chairman of the audit committee of Summit Bank of
Connecticut from 1999 to 2001, chairman of the audit committee of NSS
Bancorp from 1997 to 1998, and chairman of the audit committee of NSS Bank
from 1995 to 1997.
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2005
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John
A. Geoghegan
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67
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John
A. Geoghegan has served as a director of us since 1999 and a director of
the Bank since 1998. He is the Resident Principal (Partner) of the law
firm of Gellert & Klein, P.C., Purchase, New York and its predecessor
firm. Previously, Mr. Geoghegan was a director of Barclays Bank, N.A.
for over eighteen years.
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1999
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Name |
Age
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Business Experience and Other
Directorships |
Director
Since
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L.
Morris Glucksman
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61
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L.
Morris Glucksman has served as a director of us since 1999 and a director
of the Bank since 1993. Mr. Glucksman is a practicing attorney in
Stamford, Connecticut.
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1999
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Michael
F. Intrieri
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65
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Michael
F. Intrieri has served as a director of us since 1999 and a director of
the Bank since 1993. He is the Director of School Activities, the Career
Center and the University of Connecticut, Storrs, “Prep” Program at
Stamford High School in Stamford,
Connecticut. Dr. Intrieri previously served as the
Assistant Principal and Director of Alternate High School in the Stamford,
Connecticut public school system. He is on the J.M. Wright Technical
School Advisory Board in Stamford,
Connecticut. Mr. Intrieri holds an Ed.D. in education and
counseling and is a licensed real estate broker and private
investor.
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1999
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Raymond
B. Smyth
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62
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Raymond
B. Smyth has served as a director of us and the Bank since November 2008.
He is a partner in the accounting firm of Masotti &
Masotti.
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2008
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CORPORATE
GOVERNANCE AND THE BOARD OF DIRECTORS
Our
business affairs are managed under the direction of the Board of Directors in
accordance with the Connecticut Business Corporation Act and our certificate of
incorporation and bylaws. Members of the Board are kept informed of
our business through discussions with the Chairman and Chief Executive Officer
and other officers, by reviewing materials provided to them, and by
participating in meetings of the Board and its committees. Our
corporate governance practices are summarized below.
During
2008, our Board of Directors met 16 times. During 2008, each of our
directors attended at least 75% of the meetings of our Board of Directors and at
least 75% of the meetings of the committees of the Board on which each director
served.
Director
Attendance at Annual Meetings
We have a
policy encouraging attendance by members of the Board of Directors at our Annual
Meetings of shareholders. All of our directors attended the 2008
Annual Meeting of Shareholders.
Independence
of Board of Directors and Members of Its Committees
The Board
of Directors has a policy that requires a majority of the directors to be
independent within the meaning of applicable laws and regulations and the
listing standards of the NASDAQ Global Market. The Board of Directors has
affirmatively determined that the following nominees for election as directors
at the Annual Meeting, constituting a majority of the nominees, are independent:
John J. Ferguson, Brian A. Fitzgerald, John A. Geoghegan, L. Morris Glucksman,
Michael F. Intrieri and Raymond B. Smyth. The Board of Directors has
also affirmatively determined that the Audit Committee is comprised entirely of
independent directors within the meaning of applicable laws and regulations, the
listing standards of the NASDAQ Global Market and our corporate guidelines set
forth in the Audit Committee Charter.
Independence
Standards
The Board
of Directors examines the independence of the directors annually. For
a director to be considered independent, the Board must determine that the
director does not have any relationship with Patriot or any of our affiliates,
either directly or as a partner, shareholder or officer of an organization that
has such a relationship which, in the opinion of the Board of Directors, would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a director.
A
director will not be considered independent if, among other things, the director
has:
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Been
employed by the Bank or its affiliates at any time in the current year or
during the past three years.
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Accepted
any payments from the Bank or its affiliates in excess of $120,000 during
any period of twelve consecutive months within the preceding three years
(except for Board services, retirement plan benefits, non-discretionary
compensation or loans made by the Bank in accordance with applicable
banking regulations).
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An
immediate family member who is, or has been in the past three years,
employed by the Bank or its affiliates as an executive
officer.
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Been
a partner, controlling shareholder or an executive officer of any “for
profit” business to which the Bank made or from which it received,
payments (other than those which arise solely from investments in the
Bank’s securities) that exceed five percent of the entity’s or the Bank’s
consolidated gross revenues for that year, or $200,000, whichever is more,
in any of the preceding three
years.
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Been
employed as an executive officer of another entity where any of the Bank’s
executive officers serve on that entity’s compensation
committee.
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Committees
of the Board of Directors
The
members of the Boards of Directors of Patriot and the Bank devote time and
talent to certain standing and ad hoc committees of Patriot
and the Bank. Among these committees are the Audit Committee, Compensation
Committee, Executive Committee and the Nominating and Governance Committee of
Patriot’s Board of Directors; and the Asset and Liability Committee, Loan
Committee and Personnel Committee of the Bank’s Board of
Directors. The principal functions and members of each committee are
described below.
The
functions of the Audit Committee include (i) reviewing and recommending policies
regarding internal audit and credit review, (ii) establishing and implementing
policies to comply with applicable regulations, (iii) causing suitable audits to
be made by auditors engaged by the Audit Committee on our behalf, and (iv)
pre-approving all audit services and permitted non-audit services provided by
the auditors. The Audit Committee or its Chairman also discusses with the
independent auditors the auditors’ review of our unaudited quarterly financial
statements. The Audit Committee operates pursuant to a written charter, as
amended by the Board of Directors on April 18, 2007 and which was filed with the
Securities and Exchange Commission as an Exhibit to the Proxy Statement for the
2007 Annual Meeting of Shareholders. Shareholders may request a copy
of the Charter, without charge, by contacting Robert F. O’Connell, Senior
Executive Vice President and Chief Financial Officer, Patriot National Bancorp,
Inc., 900 Bedford Street, Stamford, Connecticut 06901 (203)
324-7500. The members of the Audit Committee are Messrs. Ferguson,
Fitzgerald, Intrieri and Smyth, each of whom is an independent director as
defined by SEC rules. The Board has determined that each of Messrs. Fitzgerald
and Smyth has the professional experience necessary to qualify as an audit
committee financial expert under SEC rules. During 2008, the Audit Committee met
seven times. The Report of the Audit Committee for the year ended December 31,
2008 is set forth on page 34.
The
Compensation Committee determines executive compensation. The members of the
Compensation Committee are Messrs. Ferguson, Fitzgerald, Geoghegan, Glucksman
and Intrieri. Each of the committee members is an independent director in
accordance with NASDAQ requirements. During 2008, the Compensation
Committee met once. A copy of the Compensation Committee Charter was
filed as an Exhibit to the Proxy Statement for the 2008 Annual Meeting of
Shareholders.
The
Executive Committee exercises, if needed and when the Board of Directors is not
in session, all powers of the Board of Directors that may lawfully be delegated.
The members of the Executive Committee are Messrs. De Caro, Ferguson, Geoghegan,
Glucksman, Howell and Intrieri. The Executive Committee did not meet in
2008.
The
principal function of the Nominating and Governance Committee is to consider and
recommend to the full Board of Directors nominees for directors of Patriot and
the Bank. The committee is also responsible for reporting and recommending from
time to time to the Board matters relative to corporate governance. The members
of the Nominating and Governance Committee are Messrs. Ferguson, Glucksman and
Intrieri. Each committee member is independent in accordance with NASDAQ
requirements. During 2008, the Nominating and
Governance
Committee met twice. A copy of the Nominating and Governance
Committee Charter was filed as an Exhibit to the Proxy Statement for the 2008
Annual Meeting of Shareholders.
The
functions of the Personnel Committee include reviewing and recommending policies
with respect to a comprehensive personnel policy, staffing requirements,
personnel compensation and benefits issues and performance review of certain
identified officer positions. The Personnel Committee also reviews management’s
implementation of established policies and personnel compliance issues. The
members of the Personnel Committee are Messrs. De Caro, Fitzgerald, Geoghegan,
Glucksman, Howell, Intrieri, O’Connell and Wolford. During 2008, the Personnel
Committee met once.
The Asset
and Liability Committee ensures adherence to the investment policies of the
Bank, recommends amendments thereto, exercises authority regarding investments
and liquidity, and exercises, when the Bank’s Board of Directors is not in
session, all other powers of the Board of Directors regarding investment
securities that may lawfully be delegated. The members of the Asset and
Liability Committee are Messrs. De Caro, Fitzgerald, Geoghegan, Glucksman,
Howell, O’Connell and Wolford. During 2008, the Asset and Liability Committee
met four times.
The Loan
Committee examines, reviews and approves loans and discounts, reviews and
approves loan policies, establishes appropriate levels of credit risk, exercises
authority regarding loans and discounts, oversees management’s efforts in
reviewing the classification of loans and workout strategies and exercises, when
the Bank’s Board of Directors is not in session, all other powers of the Board
of Directors regarding extensions of credit that may lawfully be delegated. The
members of the Loan Committee are Messrs. De Caro, Fitzgerald, Howell, Intrieri,
O’Connell, Smyth and Wolford. During 2008, the Loan Committee met 38
times.
Nomination
Process
The
process of reviewing and making recommendations for nominations and appointments
to the Board of Directors is the responsibility of the Nominating and Governance
Committee. Our directors have a critical role in guiding our strategic direction
and in overseeing management. The Nominating and Governance Committee will
consider candidates for the Board based upon several criteria, including their
broad-based business and professional skills and experiences, concern for the
long-term interests of shareholders, personal integrity and judgment. Candidates
should have reputations, both personal and professional, consistent with our
image and reputation. Directors must have time available to devote to Board
activities and to enhance their knowledge of the banking industry. Accordingly,
the Board of Directors seeks to attract and retain highly qualified directors
who have sufficient time to attend to their substantial duties and
responsibilities to Patriot, and who are expected to contribute to an effective
Board.
The
Nominating and Governance Committee utilizes the following process for
identifying and evaluating nominees to the Board. In the case of incumbent
directors, each year the Board of Directors informally reviews each director’s
overall service to Patriot during his term, including the number of meetings
attended, level of participation and quality of
performance.
In the case of new director candidates, the committee may solicit from existing
directors the names of potential candidates who meet the criteria above; the
committee may discuss candidates suggested by our shareholders and, if deemed
appropriate by the Board of Directors, or the committee may engage a
professional search firm. To date, the Nominating and Governance Committee has
not engaged a professional search firm to identify or evaluate potential
nominees, but it retains the right to do so in the future, if necessary. The
Nominating and Governance Committee meets to discuss and consider these
candidates’ qualifications and then chooses new candidates by majority vote.
Each of the nominees for director listed above was recommended by the Nominating
and Governance Committee in 2009.
Shareholder
Nominations
Under our
by-laws, nominations for directors may be made by any shareholder of any
outstanding class of our capital stock who delivers notice, along with the
additional information and materials required by our by-laws and certificate of
incorporation, to our President not fewer than 14 days and not more than 50 days
before the Annual Meeting. Shareholders may obtain a copy of our certificate of
incorporation and by-laws by writing to our Corporate Secretary, 900 Bedford
Street, Stamford, Connecticut 06901.
To be
considered, the shareholder’s nomination must contain: (i) the name and address
of each proposed nominee; (ii) the principal occupation of each proposed
nominee; (iii) the total number of shares of capital stock of Patriot that will
be voted for each proposed nominee; (iv) the name and residence address of the
notifying shareholder; and (v) the number of shares of capital stock of Patriot
owned by the notifying shareholder. In addition, the nomination
should include any other information relating to the proposed nominee required
to be included in a proxy statement filed pursuant to the proxy rules of the SEC
and the nominee’s written consent to serve as a director if
elected.
Communications
with the Board
Interested parties, including
shareholders, wishing to communicate directly with the Board or any independent
directors should send written communications to Angelo De Caro, Chairman and
Chief Executive Officer, Patriot National Bancorp, Inc., 900 Bedford Street,
Stamford, Connecticut 06901. Each communication will be reviewed by
Mr. De Caro who will make appropriate recommendations to the Board of Directors,
which may include discussing the matter raised with the Board as a whole, with
only the independent directors, and/or with other members of the senior
management team. We believe that this procedure allows the Board to
be responsive to shareholder communications in a timely and appropriate
manner.
Code
of Conduct
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
violations,
and accountability for adherence to the Code. The Code of Conduct was filed with
the Securities and Exchange Commission as an exhibit to our Annual Report on
Form 10-KSB for the fiscal year ended December 31, 2004. All of our
directors, officers and employees are also required to comply with a general
Code of Conduct that satisfies the rules set out in Section 406(c) of the
Sarbanes-Oxley Act of 2002. Shareholders may request a copy of either
Code, without charge, by contacting Robert F. O’Connell, Senior Executive Vice
President and Chief Financial Officer, Patriot National Bancorp, Inc., 900
Bedford Street, Stamford, Connecticut 06901 (203) 324-7500.
SECURITY
OWNERSHIP OF
CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The table
below provides certain information about beneficial ownership of our common
stock as of April 15, 2009 by (i) each person, or group of affiliated persons,
who is known to us to beneficially own more than five percent of our common
stock; (ii) each of our directors; (iii) each of our executive officers
named in the Summary Compensation Table; and (iv) all of our directors and
executive officers as a group.
Except as
otherwise noted, the persons or entities in this table have sole voting and
investing power with respect to all shares of common stock beneficially owned by
them, subject to community property laws, where applicable. The address of each
director and executive officer is care of us at our principal executive
office.
To our
knowledge, there exists no arrangement that might result in a change in control
of Patriot.
To
compute the percentage ownership of any shareholder in the following table, the
total number of shares deemed outstanding includes 4,743,409 shares outstanding
on April 15, 2009, plus any shares that a shareholder could acquire upon
exercise of any options that are exercisable within the 60-day period after
April 15, 2009.
|
Shares of Common Stock
Beneficially Owned
|
Beneficial
Owner
|
Shares
|
Percent
|
|
|
|
|
5%
Shareholders:
|
|
|
|
|
|
|
|
Harvey
Sandler Revocable Trust
21170
NE 22nd Court
North
Miami Beach, FL 33180
|
648,130
|
(1)
|
13.66%
|
|
|
|
|
Barry
C. Lewis
177
South Mountain Road
New
City, NY 10956
|
473,100
|
(2)
|
9.97%
|
|
|
|
|
Donald
Opatrny
30
East Elm Street
Greenwich,
CT 06830
|
376,850
|
(3)
|
7.94%
|
|
|
|
|
Wellington
Management Company, LLC
75
State Street
Boston,
MA 02109
|
322,612
|
(4)
|
6.80%
|
Directors and
Executive Officers named
in the Summary
Compensation Table:
|
|
|
|
|
|
|
|
Angelo
De Caro
|
721,665
|
(5)(6)
|
15.21%
|
John
J. Ferguson
|
7,051
|
(7)
|
*
|
Brian
A. Fitzgerald
|
4,319
|
|
*
|
John
A. Geoghegan
|
12,436
|
(8)
|
*
|
L. Morris
Glucksman
|
93,613
|
(9)
|
1.97%
|
Charles
F. Howell
|
58,050
|
|
1.22%
|
Michael
F. Intrieri
|
58,837
|
(10)
|
1.24%
|
Robert
F. O’Connell
|
27,948
|
|
*
|
Philip
W. Wolford
|
21,873
|
(11)
|
*
|
Martin
Noble
|
1,911
|
|
*
|
Raymond
B. Smyth
|
600
|
(12)
|
*
|
|
|
|
|
All
directors and executive officers of
Patriot
(14 persons)
|
1,014,324
|
(13)
|
21.23%
|
|
*
Percentage
is less than 1% of all outstanding shares of common
stock.
|
|
|
|
1.
Based
on an Amended Schedule 13G filed by the Harvey Sandler Revocable Trust
with the SEC on February 13, 2009. The Harvey Sandler Revocable
Trust has sole voting and sole dispositive control over all of these
shares. Mr. Sandler is the sole trustee of the
trust. |
|
|
|
|
2.
Based
on an Amended Schedule 13G filed by Mr. Lewis with the SEC on January 30,
2009. Reflects 327,628 shares held in Barry Lewis IRA Rollover
Accounts, of which Mr. Lewis disclaims beneficial ownership, except to the
extent of his equity interest therein, and 145,472 shares held by the
Barry Lewis Revocable Living Trust. |
|
|
|
|
3.
Based
on a Schedule 13D filed by Mr. Opatrny with the SEC on October 6,
2006. Mr. Opatrny has sole voting and sole dispositive control
over all of these shares. |
|
|
|
|
4.
Based
on an Amended Schedule 13G filed with the SEC on February 17, 2009. The
filing indicates Wellington Management Company, in its capacity as
investment advisor, may be deemed to beneficially own the shares which are
held of record by clients of Wellington Management Company. Also indicates
that one of these clients, Bay Pond Partners, L.P., owns 245,104 of these
shares, over 5% of Patriot's outstanding shares, with Wellington Hedge
Management, LLC, the sole general partner of Bay Pond Partners, LLC,
having shared voting power of such shares. |
|
|
|
|
5.
Includes
719,965 shares under pledge and 1,700 shares not pledged. |
|
|
|
|
6.
Includes
20,000 shares for which Mr. De Caro has sole voting power but in
which he has no direct or indirect pecuniary interest. |
|
|
|
|
7.
Includes
1,496 shares for which Mr. Ferguson is a Trustee for his wife’s
defined benefit plan. |
|
|
|
|
8.
Includes
10,464 shares held by Mr. Geoghegan through an Individual Retirement
Account. |
|
|
|
|
9.
Includes
1,000 shares owned solely by Roslyn Glucksman; 10,800 shares held as
Trustee for other than immediate family members; 14,200 shares held as
Trustee for family members; |
|
34,300
shares held as Trustee for other than immediate family members. Also
includes 16,000 shares of common stock issuable upon exercise of stock
options exercisable within 60 days. |
|
|
|
|
10.
Includes
2,051 shares owned by family members. Also includes 10,000
shares of common stock issuable upon exercise of stock options exercisable
within 60 days. |
|
|
|
|
11.
Includes
84 shares held in joint tenancy with, Regine Vantieghem,
Mr. Wolford’s wife; and 302 shares owned solely by Regine Vantieghem.
Also includes 9,000 shares of common stock issuable upon exercise of stock
options exercisable within 60 days. |
|
|
|
|
12.
Represents
600 shares held by Mr. Smyth through an Individual Retirement
Account. |
|
|
|
|
13.
Includes
35,000 shares of common stock issuable upon exercise of stock options
exercisable within 60 days. |
SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Our
directors, our executive officers and anyone owning beneficially more than ten
percent of our equity securities are required under Section 16(a) of the
Securities Exchange Act of 1934 to file with the SEC reports of their ownership
and changes of their ownership of our common stock. They must also
furnish copies of the reports to us. Based solely on our review of
the reports furnished to us and any written representations that no other
reports were required, we believe that during 2008, Patriot’s directors and
executive officers complied on a timely basis with all applicable Section 16(a)
filing requirements.
EXECUTIVE
OFFICERS
The following table provides
information concerning the executive officers of Patriot and the
Bank. Information about Messrs. De Caro, Howell, O’Connell and
Wolford, nominees for director, appears in the table beginning on page
5.
Name
|
Age
|
Business
Experience
|
|
|
|
Michael
A.
Capodanno
|
48
|
Michael
A. Capodanno has served as Senior Vice President since April 2008 and our
Senior Vice President and Controller from April 2004 to April
2008. He has also served as Senior Vice President of the Bank
from April 2008, Senior Vice President and Controller of the Bank from
April 2004 to April 2008 and as Vice President and Controller of the Bank
from 2001 to 2004.
|
|
|
|
John
Kantzas
|
73
|
John
Kantzas has served as Executive Vice President and Cashier of the Bank
since 1994.
|
|
|
|
Martin
G. Noble
|
59
|
Martin
G. Noble has served as Executive Vice President and Chief Lending Officer
of the Bank since February 1999.
|
|
|
|
Todd
C. Scaccia
|
47
|
Todd
C. Scaccia has served as Vice President of the Bank since February 2008
and Vice President and Controller since April 1, 2008. From
2006 to 2007, he served as Controller for Home Funding Group, a mortgage
broker. From 2005 to 2006, he served as Vice President and
Chief Financial Officer for VakifBank, New York Branch, a Turkish
bank. From 2004 to 2005, he served as Vice President of
Accounting at Abbey National Treasury Services, a British
bank. From 2000 to 2004, he served as Vice President and
Controller of LBS Bank, a Slovenian
bank.
|
COMPENSATION
DISCUSSION AND ANALYSIS
The
Compensation Committee of our Board of Directors determines executive
compensation (other than payments or benefits that are generally available to
all other employees of Patriot). The Compensation Committee considers the
recommendations of Messrs. De Caro and Howell relative to all executive
compensation other than their own.
Objectives
of Patriot’s Compensation Programs
Patriot
does not pay direct cash compensation to its executive officers. However, our
executive officers also serve as executive officers of the Bank and are
compensated by the Bank.
Our
compensation philosophy is to support our strategic goals with effective but
straight forward compensation programs. We believe that simple, cash-based
incentives will serve us and our shareholders best. Incentives are generally
paid in cash as they reflect a “pay as you go” compensation philosophy. We do
not compensate our executives with traditional perquisites such as club
memberships, automobiles or travel allowances. We do not maintain a defined
benefit
retirement
plan or an employee stock ownership plan. We have not granted stock options to
our executive officers since 1999, or stock equivalent awards since
2003.
The
compensation programs for executive officers are administered by the
Compensation Committee and are outcome-oriented; designed to attract, retain and
reward the best employees, further our growth objectives and promote shareholder
value. The Committee believes it provides attractive, market based compensation
programs with performance incentives aligned with shareholder’s interests. The
Committee believes our growth objectives will be enhanced by this
strategy.
The
compensation decisions for executive officers are derived after examining
available survey and other peer information, and evaluating individual
performance and that of Patriot. However, the Committee has determined that
available peer information is inadequate for Patriot’s purposes for two
reasons: (1) the degree to which Patriot focuses on growth is not
shared with many other institutions that would otherwise potentially be peers;
and (2) the scarcity of like-sized and -minded institutions in the greater New
York area. The Committee does not employ a compensation consultant, but does
consult publicly available compensation information and information provided by
its advisors when making compensation decisions.
Identification
of and Reward Objectives for Each Compensation Program
Compensation
paid to Patriot’s executive officers in 2008 generally consisted of the
following components: Base Salary, short-term cash bonuses paid pursuant to the
Patriot Annual Bonus Plan, legacy vesting of long-term cash incentive payments
tied to stock performance, and participation in our employee benefit
plans. Since 2008 performance goals for the Company were not
achieved, no payments were made under the Patriot Annual Bonus Plan or incentive
programs tied to stock performance. No stock options or other equity awards were
granted to executive officers in 2008. The compensation components, described
below, apply to all of the Named Executive Officers except former senior officer
Marcus Zavattaro. His bonus compensation as former head of Retail Mortgage
Brokerage was based entirely on loan origination production criteria relative to
his job responsibilities.
Base
Salaries. In
determining base salaries for our executive officers, the Committee attempts to
ensure that base salaries are competitive with New York area financial
institutions that we consider to be alternative places of employment for our
executive officers. All of the Named Executive Officers receive a base salary,
except Mr. Zavattaro who received a guaranteed draw against commissions in
2008. Mr. Howell voluntarily chose not to take his contractual
entitlement to a $20,000 salary increase for 2009.
Short Term
Bonuses. Bonus compensation for
executive officers generally consists of cash awards from Patriot’s Annual Cash
Bonus Plan (“PACBP”). The PACBP provides for cash bonuses based solely on
performance. Reward objectives are based on Patriot’s annual “profit” for the
year. No payments were made under this program for 2008
performance.
Long Term Cash
Incentives.
Patriot does not currently compensate its executives with long-term awards,
equity or non-equity. The current philosophy is to provide incentives
on a short-term, "pay as you go" basis.
Patriot’s
Reasons for Choosing to Pay Each Compensation Element
The
Compensation Committee believes that it is necessary to offer executive officers
Base Salary and short term bonuses to attract and retain talented individuals
committed to creating long-term franchise and shareholder value. The
Compensation Committee believes that the compensation program it has developed
is consistent with Patriot’s long-term strategic objective to grow its franchise
and to attract and retain talented and committed executive
officers. However, Patriot and the Committee have and continue to
make short-term adjustments to plans due to the financial challenges currently
faced by Patriot.
Patriot’s
Determinations of Amounts of Compensation Paid to Executives
The
Compensation Committee considers, determines and approves the mix of Base Salary
and short term bonuses payable to the executive officers, and the production
compensation paid to Mr. Zavattaro. The Committee evaluates the performance of
the executive officers relative to the PACBP, and makes awards based on job
responsibilities and expectations. The Committee additionally takes into account
the evaluation of the performance of executive officers from Messrs. De Caro and
Howell. The Compensation Committee reviews, but is not conclusively influenced
by, available “peer” and survey data in making these
determinations.
The
Compensation Committee meets at least annually to review and approve the
compensation of the executive officers. The decisions made by the Compensation
Committee as to executive compensation are discretionary and are based on an
assessment of performance against certain goals.
Descriptions
of Each Element of Compensation
Base
Salary
In 2008,
each executive officer received an annual base salary estimated by the Committee
to be competitive with base salaries for comparable positions at financial
institutions similar in size, locale and profile. The actual annual base salary
for each officer was not determined using a formula or based on a certain
percentage of peer medians, but was determined based on each individual’s
particular experience, talents, and responsibilities, with consideration of the
executive officer’s specific responsibilities relative to our business
objectives. The Committee reviews annual base salaries during the fourth quarter
of each year, and the Committee increased annual base salaries in 2008 in line
with peer institutions. Mr. Howell chose not to take a contractually
entitled $20,000 increase in base salary for 2009.
Patriot’s
Annual Cash Bonus Plan
The
philosophy of the Committee in administering the PACBP is rooted in a “profit
sharing” concept in which designated officers, including our executive officers,
participate. Each officer is assigned a number of points by the Board of
Directors or its Personnel Committee. The points assigned to each officer are
converted into a percentage of the total points assigned to all officers, which
percentage is applied to the available “profit” at year end. For these purposes,
“profit” is defined as the GAAP equivalent of pre-tax net income. The annual cash bonus
is determined strictly by application of this formula. Based on the
performance of the Company for 2008, no payments were under this Plan for 2008.
All of our Named Executive Officers
participate
in the PACBP except Mr. Zavattaro. Mr. Zavattaro’s bonus compensation
as former head of Retail Mortgage Brokerage was based entirely on certain annual
production criteria relative to his job responsibilities.
Long
Term Cash Incentives
The Named
Executive Officers other than Mr. De Caro and Mr. Zavattaro were awarded long
term cash incentives of varying kinds in prior years. Those programs have been
discontinued. Mr. Howell has received cash based stock appreciation rights and
restricted stock under a discontinued long-term incentive plan. Messrs. Noble,
O’Connell and Wolford have received cash based stock appreciation rights. Mr.
Wolford also received stock options in 1999 when the Bank reorganized into a
holding company structure. The restricted stock rights and stock appreciation
rights vest over varying terms of years. They were designed to retain and
motivate our executive officers. They were also designed to align the financial
interests of our executives with those of our shareholders. The awards are all
fully deductible by us for income tax purposes upon exercise or vesting. We also
previously provided stock-based, long-term incentive compensation to certain
executives in the form of options to purchase common stock and restricted stock
awards. Our current compensation philosophy does not include the award of stock
options or equivalents.
Other
In
addition to the compensation paid to executive officers as described above,
executive officers received, along with, and on the same terms as, other
employees, certain benefits pursuant to our 401(k) Plan.
Additional
Executive Officer Compensation Considerations
The
Compensation Committee generally does not adjust salaries for executive officers
during the year, unless it does so to recognize a change in job responsibility
or other unforeseen condition. Similarly, the Compensation Committee generally
does not adjust targets under the PACBP during the year, provided it may adjust
targets in response to tax or accounting changes or adjustments during the
year.
The
Compensation Committee considers the views and recommendations of Messrs.
De Caro and Howell with regard to compensation of the other executive
officers. The Compensation Committee itself makes all decisions on executive
officer compensation.
We have
entered into employment agreements with Mr. Howell and Mr. O’Connell, and change
of control agreements with each of Messrs. De Caro, Howell, O’Connell, Noble and
Wolford. Mr. Howell’s employment agreement was entered into effective
January 1, 2007 following the December 31, 2006 expiration of his prior, three
year agreement. Mr. O’Connell’s employment agreement was entered into
effective January 1, 2008 following the December 31, 2007 expiration of his
prior agreement. We entered into a change of control agreement with
Mr. De Caro in recognition of the importance to us of his continued strategic
leadership. We entered into, or enhanced the benefits from, change of control
agreements with the other executive officers in recognition of their continued
importance to us and their increased responsibilities as a consequence of our
significant growth. Each change of control agreement contains “single trigger”
provisions. This means that the officer is entitled to change of control
compensation if
there is
a change of control of Patriot, even if the officer is offered comparable
employment with and/or remains in the employ of a successor to
Patriot. These provisions are described elsewhere in this Proxy
Statement. The Committee believes the single trigger provisions are appropriate
given our publicly articulated strategy to grow as an independent company and
thereby increase shareholder value, for the foreseeable future. Each agreement
contains a six month non-competition provision that would be effective if any
change of control payments are made.
The
Compensation Committee considers the effects of tax and accounting treatments
when it determines executive compensation. For example, in 1993, the Internal
Revenue Code was amended to disallow publicly traded companies from receiving a
tax deduction on compensation paid to executive officers in excess of
$1 million (Section 162(m) of the Code), unless, among other things, the
compensation meets the requirements for performance-based compensation. In
structuring Patriot’s compensation programs and in determining executive
compensation, the Committee takes into consideration the deductibility limit for
compensation. The Committee reserves the right, however, in the exercise of its
business judgment, to establish appropriate compensation levels for executive
officers that may exceed the limits on tax deductibility established under
Section 162(m) of the Code. Also, payments under the change of control
agreements for the Named Executive Officers are capped based on Section 280G of
the Code. If the proposed payments under the agreements would exceed the Section
280G limit on such payments and thereby would impose an excise tax on the
officer, the payments would be reduced to an amount that would avoid such
additional tax.
COMPENSATION
COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Our
Compensation Committee determines salaries, incentives and other compensation
for our executive officers. The Compensation Committee of the Board of Directors
consists of five non-employee directors. The members of the Compensation
Committee currently are John A. Geoghegan (Chairman), John J. Ferguson, Brian A.
Fitzgerald, L. Morris Glucksman and Michael F. Intrieri. All of the Committee
members are “independent” as defined by NASDAQ listing
requirements.
The
Compensation Committee has reviewed and discussed with management the
“Compensation Discussion and Analysis” disclosure appearing above in this Proxy
Statement. Based on this review and discussion, the Compensation Committee
recommended to the Board of Directors of Patriot that the Compensation
Discussion and Analysis be included in Patriot’s Annual Report on Form 10-K,
which incorporates by reference the disclosure contained in this Proxy
Statement.
April 22,
2009
The
Compensation Committee:
John
A. Geoghegan, Chairman
John
J. Ferguson
Brian
A. Fitzgerald
L.
Morris Glucksman
Michael
F. Intrieri
COMPENSATION
OF
EXECUTIVE
OFFICERS AND DIRECTORS
Annual
Compensation
The
following Summary Compensation Table sets forth certain information with respect
to the compensation of our principal executive officer, principal financial
officer and three most highly compensated executive officers during
2008. Each individual listed in the table below may be referred to as
a Named Executive Officer or NEO. The material terms of each
officer’s employment agreement are disclosed below following the Summary
Compensation Table. No options or other equity-based awards were
made, repriced or otherwise modified during 2008 for any of the Named Executive
Officers. Salary and cash bonus payments constitute all of the total
compensation for NEO’s; they do not receive any equity compensation. Patriot’s
straight forward executive compensation program emphasizes cash salary and
incentives as the principal compensation components for executives.
Name
and
Principal
Position
|
Year
|
Salary
($)
(1)
|
Bonus
($)(2)
|
Stock
Awards
($)(3)
|
Option
Awards
($)
(4)
|
Non-
Equity
Incentive
Plan
Compen-
sation
($)
|
Change
in Pension
Value
and Nonquali-
fied
Deferred
Compen-
sation
Earnings
($)
|
All
Other Compen-
sation
($)
(5)
|
Total
($)
|
(a) |
(b)
|
(c)
|
(d)
|
(e) |
(f)
|
(g)
|
(h)
|
(i) |
(j) |
|
Angelo
De
Caro
Chairman
and
Chief
Executive
Officer
|
2008
2007
2006
|
294,231
257,211
232,692
|
-0-
155,808
128,268
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
93
-0-
-0-
|
294,324
413,019
360,960
|
|
Charles
F.
Howell
President
of
Patriot
and
CEO
of the
Bank
|
2008
2007
2006
|
290,000
277,019
262,308
|
-0-
155,808
128,268
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
6,952
24,876
72,064
|
296,952
457,703
462,640
|
|
Robert
F.
O’Connell
Senior
Executive
Vice
President,
Chief
Financial
Officer
|
2008
2007
2006
|
253,323
227,361
206,400
|
-0-
155,808
128,268
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
6,958
6,750
6,600
|
260,281
389,919
341,268
|
|
Marcus
Zavattaro (6)
Former
Executive
Vice
President
of the
Bank
|
2008
2007
2006
|
210,000
180,000
180,000
|
267,063(7)
255,454
224,335
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
6,917
6,750
6,600
|
483,980
442,204
410,935
|
|
Martin
G.
Noble
Executive
Vice
President
of the
Bank
|
2008
2007
2006
|
210,000
184,037
167,308
|
-0-
118,840
104,325
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
6,952
6,750
57,384
|
216,952
309,627
329,017
|
|
(1)
|
In
addition to the base salaries, amounts disclosed in this column include
amounts deferred under the Patriot National Bank 401(k) Plan. We
periodically review, and may increase, base salaries in accordance with
the terms of employment agreements with each of our named executive
officers. Annual base salaries as of the date of this proxy are
as
|
|
follows:
Mr. De Caro $300,000, Mr. Howell $290,000, Mr. O’Connell $250,000 and Mr.
Noble $210,000.
|
|
|
(2)
|
Amounts
represent the dollar value of cash bonuses earned under the Patriot Annual
Cash Bonus Plan, with the exception of Mr. Zavattaro whose bonus amount
represents commissions earned in excess of a guaranteed draw and
additional compensation based on the revenue generated by his direct
reports.
|
|
|
(3)
|
Patriot
made no stock awards to executives in 2008, 2007 or 2006, nor did Patriot
incur compensation expense during 2008, 2007 or 2006 for prior stock
awards under SFAS 123R.
|
|
|
(4)
|
Patriot
did not grant any stock options to executive officers in 2008, 2007 or
2006, nor did Patriot incur compensation expense during 2008, 2007 or 2006
for prior stock awards under SFAS 123R.
|
|
|
(5)
|
Includes
employer contributions allocated under the 401(k) plan for the 2008 plan
year of $6,900 each for Messrs. Howell, O’Connell, Zavattaro and Noble,
respectively. Includes imputed income from life insurance
premiums for Mr. De Caro $93, Mr. Howell $52, Mr. O’Connell $58, Mr.
Zavattaro $17, and Mr. Noble $52.
|
|
|
(6)
|
Mr.
Zavattaro left the Bank in March 2009. He is not entitled to
any post-termination compensation and is not included in the tables that
follow where he will not participate in the subject
compensation.
|
|
|
(7)
|
Mr.
Zavattaro's bonus was based on his contract which provided for an annual
cash bonus depending upon his loan production, all as more fully described
in his employment agreement.
|
Grants
of Plan-Based Awards
No grants
of plan-based awards were made to the NEO's in 2008.
Employment
and Change of Control Agreements
Patriot
and the Bank entered into a three-year employment agreement with Charles F.
Howell, effective January 1, 2007, pursuant to which Mr. Howell serves as
President and Chief Executive Officer of the Bank and as President of Patriot
until December 31, 2009. Mr. Howell’s base salary is $275,000 for the
first year, $290,000 for the second year and $310,000 for the third year;
however, Mr. Howell waived his contractually due increase for the third year of
the contract for 2009. Mr. Howell is entitled to receive annual discretionary
cash bonuses in amounts to be determined by the board of directors; none were
provided in 2008.
In the
event of the early termination of the agreement with Mr. Howell for any
reason other than cause, he would be entitled to receive a lump sum payment
equal to the greater of the aggregate salary payments that would be made to him
for the remaining term of the agreement or 18 months of his stipulated base
salary at the time of termination.
Patriot
and the Bank entered into an employment agreement with Robert F. O’Connell,
dated January 1, 2008, pursuant to which Mr. O’Connell serves as Chief
Financial Officer and Senior Executive Vice President of the Bank until
December 31, 2010. Mr. O’Connell’s base salary is currently $250,000,
and is subject to review and increase by the board of directors each year. If
Mr. O’Connell’s employment terminates without cause (as defined in the
agreement), he would be entitled to receive a lump sum payment equal to the
greater of the aggregate salary payments that would be made to him for the
remaining term of the agreement or 12 months of his stipulated base salary
at the time of termination.
Patriot
and/or the Bank has/have also entered into substantially similar change of
control agreements with Messrs. De Caro, Howell, O'Connell, Noble and Philip W.
Wolford, the Bank’s Chief Operating Officer. The Change of Control
Agreements provide that in the event of a Change of Control, as defined in the
Agreements, Mr. De Caro, Mr. Howell and Mr. O’Connell may receive lump sum cash
payments equal to 2.5 times the greater of their annual salary or compensation,
as applicable, and Mr. Noble and Mr. Wolford may receive payments equal to two
times the greater of their annual salary or compensation. Payments under each of
the agreements is capped so as not to exceed the limits of Section 280G of the
Internal Revenue Code. The exercise of rights under a change of control
agreement by any executive officer will not result in adverse tax consequences
to us under Section 280G of the Internal Revenue Code of 1986, as
amended.
Potential
Payments Upon Termination or Change of Control
Patriot
and/or the Bank has entered into certain agreements and maintains certain plans
that will require the payment of compensation to Named Executive Officers in the
event of a termination of employment or a change in control of
Patriot. Those agreements are described above under the caption
“Employment and Change of Control Agreements.” The amount of
compensation payable to each Named Executive Officer in each situation is listed
in the tables
below. The
disclosures assume a payment event having occurred on December 31, 2008 as if
the January 1, 2009 salary arrangements described above had been in effect on
that date.
The
following table describes the potential payments upon termination or a deemed
change of control ("COC") of Patriot for Angelo De Caro:
Executive
Benefits and Payments Upon Termination
|
Voluntary
Termination
|
Normal
Retirement
|
Involuntary
Not
for Cause Termination
|
For
Cause Termination
|
Involuntary
or Good Reason Termination (COC)
|
Death
or Disability (1)
|
|
|
|
|
|
|
|
Compensation:
|
|
|
|
|
|
|
Cash
|
$
0
|
$
0
|
$
0
|
$
0
|
$750,000
|
$
0
|
Non-Cash
|
$
0
|
$
0
|
$
0
|
$
0
|
$ 0
|
$
0
|
Benefits
and Perquisites:
|
$
0
|
$
0
|
$
0
|
$
0
|
$ 0
|
$
0
|
Total:
|
$
0
|
$
0
|
$
0
|
$
0
|
$750,000
|
$
0
|
The
following table describes the potential payments upon termination or a deemed
change of control ("COC") of Patriot for Charles F. Howell:
Executive
Benefits and Payments Upon Termination
|
Voluntary
Termination
|
Normal
Retirement
|
Involuntary
Not
for Cause Termination
|
For
Cause Termination
|
Involuntary
or Good Reason Termination (COC)
|
Death
or Disability (1)
|
|
|
|
|
|
|
|
Compensation:
|
|
|
|
|
|
|
Cash
|
$
0
|
$
0
|
$435,000
|
$
0
|
$725,000
|
$145,000
|
Non-Cash
|
$
0
|
$
0
|
$ 0
|
$
0
|
$ 0
|
$ 0
|
Benefits
and Perquisites:
|
$
0
|
$
0
|
$ 0
|
$
0
|
$ 0
|
$ 0
|
Total:
|
$
0
|
$
0
|
$435,000
|
$
0
|
$725,000
|
$145,000
|
The
following table describes the potential payments upon termination or a deemed
change of control ("COC") of Patriot for Robert F. O’Connell:
Executive
Benefits and Payments Upon Termination
|
Voluntary
Termination
|
Normal
Retirement
|
Involuntary
Not
for Cause Termination
|
For
Cause Termination
|
Involuntary
or Good Reason Termination (COC)
|
Death
or Disability (1)
|
|
|
|
|
|
|
|
Compensation:
|
|
|
|
|
|
|
Cash
|
$
0
|
$
0
|
$500,000
|
$
0
|
$633,308
|
$125,000
|
Non-Cash
|
$
0
|
$
0
|
$ 0
|
$
0
|
$ 0
|
$ 0
|
Benefits
and Perquisites:
|
$
0
|
$
0
|
$ 0
|
$
0
|
$ 0
|
$ 0
|
Total:
|
$
0
|
$
0
|
$500,000
|
$
0
|
$633,308
|
$125,000
|
The
following table describes the potential payments upon termination or a deemed
change of control ("COC") of Patriot for Martin G. Noble:
Executive
Benefits and Payments Upon Termination
|
Voluntary
Termination
|
Normal
Retirement
|
Involuntary
Not
for Cause Termination
|
For
Cause Termination
|
Involuntary
or Good Reason Termination (COC)
|
Death
or Disability (1)
|
|
|
|
|
|
|
|
Compensation:
|
|
|
|
|
|
|
Cash
|
$
0
|
$
0
|
$
0
|
$
0
|
$420,000
|
$
0
|
Non-Cash
|
$
0
|
$
0
|
$
0
|
$
0
|
$ 0
|
$
0
|
Benefits
and Perquisites:
|
$
0
|
$
0
|
$
0
|
$
0
|
$ 0
|
$
0
|
Total:
|
$
0
|
$
0
|
$
0
|
$
0
|
$420,000
|
$
0
|
(1) All
full time employees receive a $50,000 life insurance benefit.
401(k)
Plan
The Bank
maintains a tax-qualified 401(k) Plan under Section 401(a) of the Internal
Revenue Code with a cash or deferred arrangement under Section 401(k) of the
Internal Revenue Code. Employees become eligible to make salary reduction
contributions to the 401(k) Plan and to receive any matching or discretionary
contributions made to the 401(k) Plan by the Bank on the first day of the
semiannual period coinciding with or next following the date that the employee
has attained 21 years of age and completed at least 1,000 hours of service in a
period of six to 12 consecutive calendar months.
Under the
401(k) Plan, participants may elect to have the Bank contribute a portion of
their compensation each year, subject to certain limitations imposed by the
Internal Revenue Code. The 401(k) Plan permits the 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. Participants
become vested in any discretionary contributions and related earnings in 50%
increments, beginning with the completion of one year of service and ending with
the completion of two years of service. Participants also become 100% vested in
any discretionary contributions and related earnings upon the attainment of
normal retirement age (age 65). Participants are permitted to receive a
distribution from the 401(k) Plan only in the form of a lump sum
payment.
2001
Stock Appreciation Rights Plan
In 2001,
we adopted the Patriot National Bancorp, Inc. 2001 Stock Appreciation
Rights Plan. Under the terms of the plan, we may grant stock
appreciation rights, or SARs, to our officers that entitle them to receive upon
exercise, in cash or shares of common stock, the appreciation in the value of
the common stock from the date of grant. Each award vests at the rate of 20% per
year from the date of grant. Any unexercised rights will expire ten years from
the date of grant. As of December 31, 2008, there were 12,000 SARs issued and
outstanding.
Subject
to the terms of the plan, the Board of Directors may grant a SAR to any eligible
participant. A SAR entitles the participant to surrender to Patriot
any then exercisable portion of
the SAR
in exchange for that number of shares of common stock having an aggregate fair
market value on the date of surrender equal to the product of (a) the excess of
the fair market value of a share of common stock on the date of surrender over
the exercise price established by the Board, which shall not be less than the
fair market value of a share of common stock on the date the SAR was granted,
and (b) the number of shares of common stock subject to such SAR. In
lieu of payment in shares of common stock, payment may be made in cash or partly
in shares and partly in cash, as determined by the Board.
Our
current compensation philosophy does not include the awarding of
SARs.
Stock
Option Plan
In
connection with our holding company reorganization in 1999, we adopted the
Bank’s stock option plan. Under this plan, an aggregate of 110,000 shares were
available for issuance thereunder, all of which have been awarded. As of
December 31, 2008, options to purchase 55,000 shares remained unexercised. There
are no shares available for future grant under this plan.
Relative to Both Stock
Plans:
Effect of a
Change in Control. In the event of a
change in control, each outstanding stock option and SAR will become fully
vested and, in the case of vested stock options and SARs will become immediately
exercisable.
Stock
Options. There are generally no federal income tax
consequences either to the optionee or to us upon the grant of an
option. On the exercise of an incentive stock option (“ISO”) during
employment or within three months thereafter, the optionee will not recognize
any income and we will not be entitled to a deduction, although the excess of
the fair market value of the shares on the date of exercise over the option
price is includible in the optionee’s alternative minimum taxable income, which
may give rise to alternative minimum tax liability for the
optionee. Generally, if the optionee disposes of shares acquired upon
exercise of an ISO within two years of the date of grant or one year of the date
of exercise, the optionee will recognize ordinary income, and we will be
entitled to a deduction, equal to the excess of the fair market value of the
shares on the date of exercise over the option price (limited generally to the
gain on the sale). The balance of any gain or loss will be treated as
a capital gain or loss to the optionee. If the shares are disposed of
after the two-year and one-year periods mentioned above, we will not be entitled
to any deduction, and the entire gain or loss for the optionee will be treated
as a capital gain or loss.
On exercise of a non-qualified stock
option (“NQSO”), the excess of the date-of-exercise fair market value of the
shares acquired over the option price will generally be taxable to the optionee
as ordinary income and deductible by us, if we properly withhold taxes in
respect of the exercise. The disposition of shares acquired upon the
exercise of a NQSO will generally result in a capital gain or loss for the
optionee, but will have no tax consequences for us.
Restricted
Stock. A participant who has been awarded restricted stock
under the plan and does not make an election under Section 83(b) of the Internal
Revenue Code will not recognize taxable income at the time of the
award. At the time any transfer or forfeiture restrictions applicable
to the restricted stock lapse, the recipient will recognize ordinary income and
we will be entitled to a corresponding deduction equal to the fair market value
of the stock at such time.
Any
dividend paid to the recipient on the restricted stock at or prior to such time
will be ordinary compensation income to the recipient and deductible as such by
us.
The Board may prohibit participants
from making an election under Section 83(b) of the Code. If a
participant is permitted to make such an election and does so, he or she will
recognize ordinary income at the time of the award and we will be entitled to a
corresponding deduction equal to the fair market value of the stock at such
time. Any dividends subsequently paid to the recipient on the
restricted stock will be dividend income to the recipient and not deductible by
us. If the recipient makes a Section 83(b) election, there are no
federal income tax consequences either to the recipient or us at the time any
applicable transfer or forfeiture restrictions lapse.
Generally, an employee will not
recognize any taxable income upon the grant of an SAR. At the time the employee
receives the common stock or cash for the SAR, the fair market value of shares
of common stock or the amount of any cash received generally is taxable to the
employee as ordinary income, taxable as compensation. Subject to the
discussion under “Certain Tax Code Limitations on Deductibility” below, we will
be entitled to a deduction for federal income tax purposes at the same time and
in the same amount that an employee recognizes ordinary income from SARs under
the Plan.
Certain Tax Code
Limitations on Deductibility. Section 162(m) of the Code
generally limits the deduction for certain compensation in excess of $1 million
per year paid by a publicly-traded corporation to its chief executive officer
and the four other most highly compensated executive officers. Certain types of
compensation, including compensation based on performance goals, are excluded
from the Section 162(m) deduction limitation if certain requirements are
satisfied.
Requirements
Regarding “Deferred Compensation.” Certain awards under the
plan may constitute “deferred compensation” within the meaning of Section 409A
of the Code, a recently enacted provision governing “non-qualified deferred
compensation plans.” Failure to comply with the requirements of the
provisions of the Code regarding participant deferral elections and the timing
of payment distributions could result in the affected participants being
required to recognize ordinary income for tax purposes earlier than the times
otherwise applicable as described in the above discussion and to pay substantial
penalties.
The following tables present
information about stock awards made to the Named Executive
Officers:
Outstanding
Equity Awards at Fiscal Year-End
|
Option
Awards (1)
|
Stock
Awards (1)
|
Name
|
Number
of Securities Underlying Unexercised Options
(#)
Exercisable
|
Number
of
Securities
Underlying Unexercised Options
(#)
Unexercisable
|
Equity
Incentive
Plan
Awards
Number
of Securities Underlying Unexercised Unearned Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number
of
Shares
or
Units
of
Stock
That
Have
Not
Vested
(#)
|
Market
Value of Shares or Units of Stock That Have Not Vested
($)
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
That Have Not Vested
(#)
|
Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or
Other Rights That Have Not Vested
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
Angelo
De
Caro
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
Charles
F.
Howell
|
2,500
5,000
7,500
|
-0-
|
-0-
|
8.28
9.84
11.90
|
12/31/2011
12/31/2012
12/31/2013
|
-0-
|
-0-
|
-0-
|
-0-
|
Robert
F.
O’Connell
|
6,000
|
-0-
|
-0-
|
8.54
|
03/31/2011
|
-0-
|
-0-
|
-0-
|
-0-
|
Martin
G.
Noble
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
(1) All
awards shown above are settled in cash. The items shown in column (b)
represent stock appreciation rights.
Option Exercises and Stock
Vested
|
Option
Awards(1)
|
Stock
Awards(1)
|
Name
|
Number
of Shares Acquired on Exercise
(#)
|
Value
Realized on Exercise
($)
|
Number
of Shares Acquired on Vesting (#)
|
Value
Realized on Vesting
($)
(2)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
Angelo
De Caro
|
-0-
|
-0-
|
-0-
|
-0-
|
Charles
F. Howell
|
-0-
|
-0-
|
-0-
|
-0-
|
Robert
F. O’Connell
|
-0-
|
-0-
|
-0-
|
-0-
|
Martin
G. Noble
|
-0-
|
-0-
|
-0-
|
-0-
|
|
(1)
|
None
of the NEO’s have been granted stock options or awards.
|
|
(2)
|
Based
on Patriot's closing price of $6.85 on December 31,
2008.
|
Pension
Benefits
Patriot
does not maintain a defined benefit pension plan, or any supplemental executive
retirement plans.
Retirement
Plan
Non-Qualified
Deferred Compensation
Patriot
does not maintain any defined contribution or other plan that provides for the
deferral of compensation on a basis that is not tax-qualified.
Transactions
with Management and Others
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). The total amount of loans to officers and
directors outstanding as of December 31, 2008 was $ 3,446,683. 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 these loans neither involved more than the normal risk
of collectibility nor presented any other unfavorable features.
Information
about transactions involving related persons is assessed by our independent
directors. Related persons include our directors and executive officers as well
as immediate family members of 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.
Director
Compensation
Our
directors who are also executive officers do not receive compensation for
service on the board of directors or any of its committees. Non-employee
directors of the Bank receive $600 for each board meeting in which they
participate and $400 for each committee meeting in which they participate. In
addition, non-employee directors who serve as the chair of a committee that
meets at least four times in a year receive an additional $2,000 per
year.
Non-employee
directors serving on the board receive an annual award of our common stock at
each year’s annual meeting valued at $10,000 based on the last reported sale
price on the trading day immediately preceding the Annual Meeting. The award is
prorated for directors serving for less than a full year. We paid fees totaling
$149,985 which includes $49,932 in stock to non-employee directors during the
fiscal year ended December 31, 2008. Directors are not paid
separately for their services on the Board of both Patriot and the
Bank.
Director
Compensation
The
following table details the compensation paid to each of our non-management
Directors in 2008.
Name
|
Fees
Earned or
Paid
in Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive Plan Compensation
($)
|
Change
in
Pension
Value
and
Nonqualified
Deferred Compensation Earnings
|
All
Other Compensation
($)(1)
|
Total
($)
|
(a) |
(b)
|
(c)
|
(d)
|
(e) |
(f) |
(g)
|
(h)
|
John
J.
Ferguson
|
11,000
|
9,987
|
-0-
|
-0-
|
-0-
|
139
|
21,126
|
Brian
A.
Fitzgerald
|
31,600
|
9,987
|
-0-
|
-0-
|
-0-
|
58
|
41,645
|
John
A.
Geoghegan
|
12,000
|
9,987
|
-0-
|
-0-
|
-0-
|
101
|
22,088
|
L.
Morris
Glucksman
|
12,800
|
9,987
|
-0-
|
-0-
|
-0-
|
65
|
22,852
|
Michael
F.
Intrieri
|
29,600
|
9,987
|
-0-
|
-0-
|
-0-
|
87
|
39,674
|
Raymond
B.
Smyth
|
2,600
|
-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
2,600
|
(1) Represents imputed income from life
insurance premiums.
Compensation
Committee Interlocks And Insider Participation
The
members of the Compensation Committee during 2008 were John A. Geoghegan, John
J. Ferguson, Brian A. Fitzgerald, L. Morris Glucksman and Michael F.
Intrieri. No Compensation Committee member was, during 2008 or at any
time prior thereto, an officer or employee of Patriot or its subsidiaries.
Additionally, there were no Compensation Committee “interlocks” during 2008,
which generally means that no executive officer of Patriot served as a director
or member of the compensation committee of another entity, one of whose
executive officers served as a director or member of the Compensation
Committee.
REPORT
OF THE AUDIT COMMITTEE
The Audit
Committee operates pursuant to a written charter, as amended by the Board of
Directors on April18, 2007 and which was filed with the Securities and Exchange
Commission as an Exhibit to the Proxy Statement for the 2007 Annual Meeting of
Shareholders.
The Board
of Directors, in its business judgment, has determined that each member of the
Audit Committee is independent, as required by the applicable listing standards
of The Nasdaq Stock Market, Inc. The Board of Directors has determined that each
of Mr. Smyth and Mr. Fitzgerald has the professional experience necessary to
qualify as an audit committee financial expert within the meaning of the rules
of the Securities and Exchange Commission.
In
performing its function, the Audit Committee has:
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·
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Reviewed
and discussed our audited financial statements as of and for the year
ended December 31, 2008 with management and with McGladrey & Pullen,
LLP, our independent auditors for
2008;
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·
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Discussed
with our independent auditors the matters required to be discussed by
Statement on Auditing Standards No. 61, as amended (AICPA, Professional
Standards, Vol. 1. AU section 380), as adopted by the Public Company
Accounting Oversight Board in Rule 3200T;
and
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·
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Received
the written disclosures and the letter from the independent auditors
required by the applicable requirements of the Public Company Accounting
Oversight Board regarding the independent auditors’ communications with
the Audit Committee concerning independence and has discussed with the
independent auditors the independent auditors’ independence. The Audit
Committee has considered whether the provision of non-audit services by
the independent auditors to us is compatible with maintaining the
auditors’ independence and has discussed with McGladrey & Pullen, LLP
their independence.
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Based on
the foregoing review and discussions, the Audit Committee recommended to the
Board of Directors that our audited financial statements be included in our
Annual Report on Form 10-K for the year ended December 31, 2008 for filing with
the Securities and Exchange Commission.
Audit
Committee
Raymond
B. Smyth, Chairman
Brian A.
Fitzgerald, Vice Chairman
John J.
Ferguson
Michael
F. Intrieri
April 22,
2009
THE
REPORT OF THE AUDIT COMMITTEE SHALL NOT BE DEEMED INCORPORATED BY REFERENCE INTO
ANY FILING UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED, EXCEPT TO THE EXTENT THAT WE SPECIFICALLY INCORPORATE IT BY
REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED TO BE FILED UNDER SUCH
ACTS.
PROPOSAL
2
RATIFICATION
OF SELECTION OF INDEPENDENT AUDITORS
Our Audit
Committee has selected McGladrey & Pullen, LLP, independent auditors, to
audit the books, records and accounts of Patriot for the year ending December
31, 2009. In accordance with a resolution of the Board of Directors, this
selection is being presented to the shareholders for ratification at the Annual
Meeting.
A
representative of McGladrey & Pullen, LLP will be present at the Annual
Meeting and will be provided the opportunity to make a statement and to respond
to appropriate questions that may be asked by shareholders.
If the
shareholders do not ratify the selection of McGladrey & Pullen, LLP, the
selection of independent auditors will be reconsidered by the Audit
Committee.
Vote
Required
In order
to be adopted, the ratification of the selection of McGladrey & Pullen, LLP
must be approved by the affirmative vote of a majority of the votes cast by
holders of record of the common stock. Abstentions and broker
non-votes are not considered votes cast and will not affect the outcome of the
vote.
Relationship
with Independent Auditors
McGladrey
& Pullen, LLP has served as independent auditors of us and/or the Bank since
1994 and is considered to be well-qualified. We have been advised by McGladrey
& Pullen, LLP that it has no direct financial interest or any material
indirect financial interest in us other than that arising from the firm’s
employment as independent auditors.
McGladrey
& Pullen, LLP performs both audit and non-audit professional services for us
and on our behalf. During 2008, the audit services included an audit of our
consolidated financial statements, an audit of the Company's internal control
over financial reporting and a review of certain filings with the Securities and
Exchange Commission. All professional services rendered by McGladrey &
Pullen, LLP during 2008 were furnished at customary rates and
terms.
Audit
Fees
During
the period covering the fiscal year ended December 31, 2008, McGladrey &
Pullen, LLP performed the following audit and audit related professional
services and RSM McGladrey, Inc. performed the following tax related
professional services:
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2008
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2007
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Audit
Fees consist of fees for professional
services
rendered for the audit of the
consolidated
financial statements, audit of
internal
control over financial reporting and
review
of financial statements included in
quarterly
reports on Form 10-Q and services
connected
with statutory and regulatory filings
or
engagements.
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$670,913
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$475,936
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Audit-Related
Fees are fees principally for
professional
services rendered for SOX 404
consultation
fees.
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---
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24,235
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Tax
Fees consist of fees for tax return
preparation,
planning and tax advice.
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26,385
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24,885
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All
Other Fees.
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---
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---
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Total:
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$697,298
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$525,056
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Policy
on Audit Committee Pre-Approval of Audit and Non-Audit Services
The Audit
Committee’s policy is to pre-approve all audit and non-audit services provided
by the independent auditors. These services may include audit services,
audit-related services, tax services and other services. Pre-approval is
generally provided for up to one year and any pre-approval is detailed as to the
particular service or category of services and is generally subject to a
specific budget. The Audit Committee has delegated pre-approval authority to its
chair when expedition of services is necessary. The chair is required to report
any decisions to pre-approve such services to the full Audit Committee at its
next meeting. The independent auditors and management are required to
periodically report to the full Audit Committee regarding the extent of services
provided by the independent auditors in accordance with this pre-approval, and
the fees for the services performed to date. The Audit Committee approved all of
the fees set forth in the table above.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS
VOTE “FOR” PROPOSAL 2.
SHAREHOLDER
PROPOSALS
Any
shareholder who intends to present a proposal at the 2010 Annual Meeting is
advised that, in order for such proposal to be included in the Board of
Directors’ proxy material for such meeting, the proposal must be received by us
at our principal executive office no later than January 5, 2010, directed to
Angelo De Caro, Chairman and Chief Executive Officer, Patriot National Bancorp,
Inc., 900 Bedford Street, Stamford, Connecticut 06901. Nothing in
this paragraph shall require Patriot to include in the Company's Proxy Statement
and form of proxy for the meeting any proposal that does not meet the
requirements of the rules and regulations of the SEC in effect at the
time.
If any
shareholder proposes to make any proposal at the 2010 Annual Meeting which
proposal will not be included in Patriot’s proxy statement for such meeting, the
proposal must be received by March 20, 2010, to be considered timely for
purposes of Rule 14a-4(c) under the Exchange Act. The form of proxy distributed
by the Board of Directors for the meeting will confer discretionary authority to
vote on any such proposal not received by that date. If any such proposal is
received by such date, the proxy statement for the meeting will provide advice
on the nature of the matter and how we intend to exercise our discretion to vote
on each such matter.
OTHER
MATTERS
As of the
date of this proxy statement, the Board of Directors knows of no other matters
to be voted upon at the Annual Meeting. Because we did not receive advance
notice of any shareholder proposal in accordance with the time limit specified
in Rule 14a-4(c) under the Exchange Act, we will have discretionary authority to
vote on any shareholder proposal presented at the Annual Meeting. If any other
matters properly come before the Annual Meeting, it is the intention of the
persons named in the enclosed proxy to vote said proxy in accordance with their
judgment on such matters.
ANNUAL
REPORT ON FORM 10-K
A copy of
our Annual Report on Form 10-K for the fiscal year ended December 31, 2008
accompanies this proxy statement. Upon written request, we will
provide without charge to each person entitled to vote at the Annual Meeting one
copy of our Annual Report on Form 10-K for the year ended December 31,
2008, including the financial statements and schedules. Written
requests must be directed to:
Robert F.
O’Connell
Senior
Executive Vice President and Chief Financial Officer
Patriot
National Bancorp, Inc.
900
Bedford Street
Stamford,
Connecticut 06901
Copies of
the Annual Report on Form 10-K will not include the exhibits thereto, but will
include a list describing the exhibits not included, copies of which also will
be available at a cost of one dollar per page. You may also view
Patriot's Annual Report on Form 10-K on Patriot's website under the link
entitled "For Investors", the "SEC filings" and then "Documents" at
www.pnbdirectonline.com.
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Angelo
De Caro
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Chairman
and Chief Executive Officer
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Stamford,
Connecticut
May 4,
2009
REVOCABLE
PROXY
PATRIOT
NATIONAL
BANCORP,
INC.
|
|
|
S PLEASE
MARK VOTES
AS
IN THIS EXAMPLE
PROXY
SOLICITED ON BEHALF OF
BOARD
OF DIRECTORS FOR ANNUAL
MEETING
OF SHAREHOLDERS TO BE
HELD
JUNE 17, 2009
The
undersigned hereby appoints John A.
Geoghegan,
L. Morris Glucksman, Michael F.
Intrieri
and each of them, as proxies for the
undersigned
with full powers of substitution to
vote
all shares of the Common Stock, par
value
$2.00 per share (the “Common Stock”), of
Patriot
National Bancorp, Inc. which the
undersigned
may be entitled to vote at the
Annual
Meeting of Shareholders of Patriot to
be
held at The Hyatt Regency, 1800 East
Putnam
Avenue, Old Greenwich, Connecticut
06870,
at 9:00 a.m., on June 17, 2009 or any
adjournment
thereof as follows:
1.
Election of directors. Proposal to elect the
persons
listed below as directors of Patriot.
For
All
Withhold Authority
Nominees From
All Nominees
£
£
Angelo
De Caro, John J. Ferguson, Brian A.
Fitzgerald,
John A. Geoghegan, L. Morris
Glucksman,
Charles F. Howell, Michael F.
Intrieri,
Robert F. O’Connell, Raymond B.
Smyth
and Philip W. Wolford
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|
£ For
All Nominees Except:
INSTRUCTION:
To withhold authority to
vote
for any individual nominee(s), mark “For
All
Nominees Except” and write that
nominee’s
name(s) in the space provided
below:
___________________________
2. Proposal
to ratify the appointment of
McGladrey
& Pullen, LLP as independent
auditors
for the year ending December 31,
2009.
For Against Abstain
£ £ £
In
their discretion the proxies are authorized to
vote
upon such other business as may properly
come
before the Annual Meeting of
Shareholders
or any adjournment thereof.
To
help our preparations for the meeting,
please
check here if you plan to attend. £
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The
undersigned acknowledges receipt of the Notice of Annual Meeting and Proxy
Statement.
Please be
sure to sign and date this Proxy in the box below.
___________________________________
Shareholder sign above
___________________________________
Co-holder (if any) sign above
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Date:
_____________________
Date:
______________________
|
Detach
above card, sign, date and mail in postage paid envelope provided
PATRIOT
NATIONAL BANCORP, INC.
PLEASE
ACT PROMPTLY
MARK,
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
THIS
PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE
SHAREHOLDER. IF NO DIRECTION IS SPECIFIED, THIS PROXY WILL BE VOTED “FOR” THE
ELECTION OF ALL NOMINEES LISTED IN PROPOSAL 1 AND “FOR” PROPOSAL 2. THE VOTES
ENTITLED TO BE CAST BY THE SHAREHOLDER WILL BE DIVIDED AMONG THE NOMINEES FOR
WHOM THE PROXIES ARE AUTHORIZED TO VOTE IN SUCH MANNER AS MAY BE DETERMINED BY
THE PROXY HOLDERS. Please sign exactly as your name(s) appear(s) hereon. When
signing as attorney, executor, administrator, trustee, guardian or for a
corporation, please give your full title as such. If shares are owned jointly,
both owners should sign.