Bankwell Financial Group Inc

This non-binding management proposal asks shareholders to approve the Company’s executive compensation program as described in the proxy (a Say-on-Pay vote). Management seeks this approval to validate its pay-for-performance approach, which for 2025 emphasizes a mix of base salary, annual cash incentives tied to defined financial and individual metrics, and long-term performance-based equity that vests based on ROAA and TSR relative to an approved peer group. The Board highlights governance features intended to align pay and long-term shareholder value, including use of an independent compensation consultant, defined performance metrics and thresholds, clawback provisions, stock ownership and retention policies, anti-hedging/anti-pledging rules, and revised equity vesting structures introduced in 2025 (three-year cliff vesting for performance awards). The proposal is non-binding, but the Compensation Committee and Board will consider shareholder feedback when setting future compensation. The proxy notes that 87.7% of votes supported executive compensation at the 2025 meeting, providing context that prior shareholder approval was strong. Support would signal endorsement of the Committee’s recent shift toward more formulaic, metric-driven pay determinations and the transition in equity vesting; opposition could signal shareholder concerns about pay levels, incentive design, or governance and would likely trigger further engagement. For institutional investors assessing the proposal, key considerations include the alignment of the chosen metrics (ROAA and TSR) with strategy, the peer-group selection and benchmarking process, the balance of short- and long-term incentives, and the presence of anti-risk measures and clawbacks. The Board recommends a FOR vote, arguing these programs are market-aligned and designed to retain management while linking pay to measurable company performance.

This non-binding management proposal asks shareholders to indicate whether the advisory vote on executive compensation should occur every one, two, or three years, with the Board recommending an annual (one-year) frequency. Management argues that an annual advisory vote provides a timely and meaningful forum for shareholders to approve or express concerns about the Company’s pay practices, particularly given recent changes to compensation design including a shift to more formulaic cash incentive metrics and three-year cliff vesting for performance equity. The Board frames the annual vote as a mechanism to ensure regular, detailed shareholder feedback that the Compensation Committee will consider in setting future pay. From a governance perspective, choosing annual votes increases engagement and responsiveness but can increase administrative burden and may encourage short-term reactions to annual results, which is relevant given the Company’s increased use of multi-year performance metrics (ROAA and TSR) for equity awards. Conversely, a multi-year frequency could better align with long-term incentive cycles and reduce vote noise, but would give shareholders fewer formal opportunities to signal dissatisfaction. The recommendation for annual voting reflects the Board’s emphasis on frequent engagement and accountability; however, investors should weigh the trade-off between governance responsiveness and the potential for annual votes to focus attention on short-term performance. The vote is non-binding; the Board will consider results but is not required to follow them, making this primarily an engagement and signaling mechanism rather than a mandate.