Harford Bank : Definitive Proxy/Information Statements

FEDERAL DEPOSIT INSURANCE CORPORATION

Washington, D.C. 20429

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. __)

Filed by the Registrant 

Filed by a Party other than the Registrant 

Check the appropriate box:

• Preliminary Proxy Statement
• Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

• Definitive Proxy Statement

• Definitive Additional Materials
• Soliciting Material under §240.14a-12

HARFORD BANK

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

• No fee required.

• Fee paid previously with preliminary materials.
• Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

HARFORD BANK

8 W. Bel Air Avenue

Aberdeen, Maryland 21001

410-272-5000

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To the Stockholders of HARFORD BANK:

Notice is hereby given that the 2024 Annual Meeting of Stockholders (the "2024 Annual Meeting") of Harford Bank (the "Bank") will be held on May 8, 2024, at 10:00 a.m., local time, at the Water's Edge Events Center - River Watch, 4690 Millennium Drive, Belcamp Maryland, and at any postponement or adjournment thereof. The purposes of the 2024 Annual Meeting are as follows:

1. To elect the 12 Director nominees named in the enclosed Proxy Statement and proxy card to the Board of Directors for the ensuing year and until their successors are duly elected and qualify.
2. To approve, by non-binding advisory vote, the compensation paid to the Bank's named executive officers for 2023;
3. To transact such other business as may properly come before the meeting or any adjournment thereof.

Stockholders of record at the close of business on March 8, 2024 (the "Record Date") are entitled to notice of and to vote at the 2024 Annual Meeting. The 2024 Annual Meeting may be adjourned or postponed from time to time. At any adjourned or postponed meeting, action with respect to matters specified in this notice may be taken without further notice to stockholders, unless required by law or the Bank's bylaws.

All stockholders are cordially invited to attend the 2024 Annual Meeting. We urge you to vote in advance of the 2024 Annual Meeting by one of the methods described in the accompanying Proxy Statement. Whether you own a few or many shares of Common Stock, your vote is important. Returning your proxy card does not deprive you of your right to attend the 2024 Annual Meeting and vote your shares at the 2024 Annual Meeting.

A copy of the Bank's 2023 Annual Report to Stockholders is enclosed.

April 12, 2024	By Order of the Board of Directors
	Michael F. Allen
	President

Important Notice Regarding the Availability of Proxy Materials

For the Stockholder Meeting to be Held on May 8, 2024:

The Proxy Statement, accompanying proxy card, and Harford Bank's Annual Report to Stockholders (including its Annual Report on Form 10-K) are available at http://www.astproxyportal.com/ast/16488/.

HARFORD BANK

8 W. Bel Air Avenue

Aberdeen, Maryland 21001

410-272-5000

PROXY STATEMENT FOR

2024 ANNUAL MEETING OF STOCKHOLDERS

This Proxy Statement is furnished in connection with the solicitation by the Board of Directors (the "Board") of Harford Bank (the "Bank") of proxies to be voted at the 2024 Annual Meeting of Stockholders of the Bank (the "2024 Annual Meeting") to be held on Wednesday, May 8, 2024 at 10:00 a.m., local time, at the Water's Edge Events Center - River Watch, 4690 Millennium Drive, Belcamp Maryland, and at any postponement or adjournment thereof.

The Bank will pay the expense of the solicitation. In addition to solicitations by mail, the Board may solicit proxies in person or electronic communication, and may arrange for brokerage houses and other custodians, nominees, and fiduciaries to send proxy materials to their principals at the expense of the Bank. The approximate date on which this Proxy Statement and attached form of proxy are being mailed to stockholders is April 12, 2024.

PURPOSES OF THE 2024 ANNUAL MEETING

The Board is soliciting your proxy to vote at the 2024 Annual Meeting because you owned shares of the Bank's common stock, par value $10.00 per share (the "Common Stock"), as of the close of business on March 8, 2024 (the "Record Date") for the 2024 Annual Meeting, on the following proposals:

Proposal 1: To elect the 12 Director nominees named in this Proxy Statement and the accompanying proxy card to the Board of Directors for the ensuing year and until their successors are duly elected and qualify;

Proposal 2: To approve, by non-binding advisory vote, the compensation paid to the Bank's named executive officers for 2023;

Proposal 3: To transact such other business as may properly come before the 2024 Annual Meeting.

You are receiving this Proxy Statement as a stockholder of the Bank as of the Record Date for the 2024 Annual Meeting. The Record Date is the date set by the Board for purposes of determining shareholders who are entitled to receive notice of and to vote at the 2024 Annual Meeting. As described below, we request that you promptly use the enclosed proxy card to vote, by Internet or by mail, in the event you desire to express your support of or opposition to the proposals.

THE BOARD UNANIMOUSLY RECOMMENDS VOTING "FOR ALL NOMINEES" NAMED IN PROPOSAL 1 AND "FOR" PROPOSAL 2.

All properly executed proxy cards received by the Bank will be voted as directed by the stockholder in those proxy cards. If the Bank receives an executed proxy card that contains no voting instructions, then the named proxies intend to vote the shares represented by that proxy card "FOR ALL NOMINEES" named in Proposal 1, "FOR" Proposal 2, and in their discretion as to any other matters that may properly come before the meeting pursuant to Proposal 3.

OUTSTANDING SHARES AND VOTING RIGHTS

Stockholders of record at the close of business on the Record Date of issued and outstanding shares of the Common Stock are entitled to notice of and to vote at the Annual Meeting. As of the Record Date, the number of issued and outstanding shares of Common Stock entitled to vote at the Annual Meeting is 1,477,995. Each share of Common Stock is entitled to one vote on each matter presented at the Annual Meeting.

The presence, in person or by proxy, of stockholders entitled to cast a majority of all votes entitled to be cast at the Annual Meeting will constitute a quorum. Shares are counted as present at the 2024 Annual Meeting if:

1. you are a stockholder of record and you attend the 2024 Annual Meeting;
2. you are a beneficial owner of shares, you have obtained a legal proxy from your broker, bank, trustee, or other nominee, and you attend the 2024 Annual Meeting; or
3. your shares are represented by a properly authorized and submitted proxy (submitted over the Internet or by mail).

2

Directors are elected by a plurality of all votes cast in the election of Directors, so the withholding of a vote, an abstention and a broker non-vote will have no impact on the outcome of the vote on Proposal 1, as described in this Proxy Statement, but all of the foregoing will be counted for purposes of determining whether a quorum is present for the transaction of business. The approval, by non-binding advisory vote, of the compensation paid to the Bank's named executive officers for 2023, as described in Proposal 2 (the "Say-on-Pay Vote"), requires the affirmative vote of a majority of the shares of Common Stock voted on the proposal, so neither an abstention nor a broker non-vote with respect to this proposal will have any impact on the outcome of the votes but all of the foregoing will be counted for purposes of determining whether a quorum is present for the transaction of business. Except in cases of certain extraordinary matters for which the Bank's charter or bylaws or applicable law require a different proportion, the affirmative vote of a majority of all shares of Common Stock voted at the Annual Meeting is sufficient to approve any motion that comes before the meeting pursuant to Proposal 3, as described in this Proxy Statement. Abstentions and broker non-votes with respect to any motion that comes before the meeting pursuant to Proposal 3 (other than certain extraordinary matters as discussed above) are included for purposes of determining the presence of a quorum but are not included in calculating votes cast with respect to such motion.

If your shares are registered directly in your name, then you are considered the stockholder of record with respect to those shares. The Bank will send the proxy materials directly to you. The proxy card accompanying this Proxy Statement will provide information regarding Internet voting.

If your shares are held in a stock brokerage account or by a bank, trustee or other nominee, then the broker, bank, trustee or other nominee is considered to be the stockholder of record with respect to those shares. In that case, you are considered to be the beneficial owner of those shares, your shares are said to be held in "street name," and the proxy materials will be forwarded to you by that nominee. You may not vote shares held in street name by returning a proxy card directly to the Bank or by voting in person at the 2024 Annual Meeting unless you provide a "legal proxy" to the Inspector of Elections, which you must obtain from your bank, broker or nominee. The Bank is not involved in the process for obtaining legal proxies. If you own your shares in street name, then the Bank urges you to instruct your broker, bank, trustee or other nominee how to vote your shares using the voting instruction form provided by your broker, bank, trustee or other nominee so that your vote can be counted. The voting instruction form provided by your broker, bank, trustee or other nominee holding your shares might also include information about how to submit your voting instructions over the Internet. If you do not provide voting instructions to your broker or other nominee, then your shares will not be voted at the 2024 Annual Meeting on any proposal with respect to which your broker or other nominee does not have discretionary authority (a "broker non-vote").

A stockholder who appoints a proxy by executing the accompanying proxy card may revoke that appointment at any time before his or her shares are voted by executing another proxy card bearing a later date, or by delivering written notice of such revocation to Neil L. Christ, CPA, Corporate Secretary, at the Bank's address listed above or at the meeting (if the stockholder is authorized to attend the meeting in person). Attendance by a stockholder at the 2024 Annual Meeting alone will not have the effect of revoking that stockholder's validly executed proxy.

Stockholders do not have dissenters' rights of appraisal or similar rights with respect to any of the proposals to be presented at the 2024 Annual Meeting.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE

STOCKHOLDER MEETING TO BE HELD ON MAY 8, 2024

This Proxy Statement, the accompanying proxy card, and the Bank's Annual Report to Stockholders (including its Annual Report on Form 10-K) are available at http://www.astproxyportal.com/ast/16488/.

ELECTION OF DIRECTORS (Proposal 1)

The number of Directors who shall constitute the Board of Directors is currently set at 14. Directors are elected at each Annual Meeting of Stockholders and serve on the Board for the ensuing year and until their successors are duly elected and qualify. Directors Tony L. Bennett and John S. Karas have each reached the mandatory retirement age of 72 set forth in Section

2.3 of the Bank's Third Amended and Restated Bylaws ("Bylaws") and cannot stand for re-election at the 2024 Annual Meeting. The Board has determined to eliminate the vacancies that will be created upon the retirement of Messrs. Karas and Bennett by reducing the number of directorships to 12, effective at the conclusion of the 2024 Annual Meeting.

At the 2024 Annual Meeting, stockholders will be asked to elect the 12 nominees named below. All of the nominees other than Warline Bryant were elected by stockholders at the 2023 Annual Meeting of Stockholders. The Board elected Ms. Bryant as a director in December 2023 at the recommendation of a non-management director.

3

Proxies may not be voted for more than the 12 nominees named below, and stockholders cannot cumulate votes.

The names of the Director nominees, their ages as of the Record Date, their principal occupations and business experience for the past five years, and certain other information are set forth below. The President of the Bank is among those proposed to be elected as Directors of the Bank.

Nominees (terms expire in 2024):

Name	Age	Principal Occupation
Michael F. Allen	61	President of the Bank since July 1, 2019; Director of the Bank since 2019;
		Chief Operating Officer ("COO") of the Bank between 2017 and July 1,
		2019; and Executive Vice President and Business Development Officer of
		the Bank between April 2016 and 2017. Executive in Residence for The
		Graham Center for Entrepreneurial Leadership Studies at Penn State York
		from 2015 until 2016. Executive Vice President and COO of PeoplesBank
		in York, PA, from 2012 until 2015.
Warline Bryant	59	Chief Executive Officer and founder of BHL Group, LLC, a firm
		specializing in consulting, leader development, educational services and
		strategic planning. Served in the United States Army for 27 years in various
		leadership roles, attaining the rank of Colonel.
Daniel M. Driver	63	Director of the Bank since June 2022. Former CFO of Kinsley Properties,
		a York, PA based construction company, between 1993 and his retirement
		in 2020.
Carolyn Wilson Evans	65	Director of the Bank since June 2000.	Attorney-at-Law. Attorney, Law
		Offices of Anthony J. DiPaula, P.A., general practice with focus on needs
		of small businesses.
Richard F. Foard, Jr.	67	Director of the Bank since June 1999.	Managing Member, Foard
		Enterprises, LLC, a consulting company. Member, 121 HMS Properties,
		LLC, a land management and development, and sports arena management
		company. Member, Vortex Brewing Co., LLC, a brewery and restaurant.
Stephanie Novak Hau	61	Director of the Bank since March 2019. President and CEO of Chesapeake
		Environmental Management, Inc. since 1993, a firm providing technical
		expertise and regulatory knowledge to facilitate design, construction and
		maintenance of public infrastructure.
Henry S. Holloway	64	Director of the Bank since November 2000. Board Chair of the Bank since
		May 2023. President, The Mill of Bel Air, an agriculture company.
Timothy N. Hopkins	65	Director of the Bank since February	2007.	Broker/co-owner, Streett
		Hopkins Real Estate, LLC, a real estate brokerage company.
Charles H. Jacobs, Jr.	70	Director of the Bank since 1989. President of the Bank between October 1,
		1999 and July 1, 2019. Managing Partner, Parke Street Partnership, LLP, a
		real estate investment firm.
Bryan E. Kelly, CFP	53	Director of the Bank since April 2014. Managing Partner, The Kelly Group,
		a wealth management firm, since 1997.
Stephen K. Nolan	59	Director of the Bank since June 2000.	Principal Engineer, ENTRUST
		Solutions Group, an engineering firm.
		4

Wayne Tapscott	69	Director of the Bank since January 2000. Partner, WCT and Sons, LLC, a
		real estate development company. Retired partner of Harco Auto Park, an

automobile dealership, and Paidon Products, Inc., a commercial cleaning equipment and paper supply company. Partner, HopeWay Group, LLC, a mental health startup.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FORTHE ELECTION OF EACH NOMINEE NAMED ABOVE.

Because the outcome of the vote on this Proposal 1 relates to the re-election of the existing Directors (other than Messrs. Bennett and Karas), each such Director has an interest in the outcome of the vote.

Qualifications of Director Nominees

In addition to bringing extensive knowledge of the communities served by the Bank through their long-time residence in and involvement with their communities as business owners and managers and as volunteers, the Executive Committee and the Board believe that each Director nominee possesses a diverse balance of skills, business experience and expertise necessary to provide leadership to the Bank. The following discussion sets forth the specific experience, qualifications, other attributes and skills of each Director nominee that led the Executive Committee and the Board to determine that such person should serve on the Board of Directors.

Michael F. Allen- More than 30 years of experience in the banking industry; President of the Bank since July 2019; Director of the Bank since 2019 with service on the Investment and Loan Committees; COO of the Bank between 2017 and July 2019; Executive Vice President and Business Development Officer of the Bank between April 2016 and 2017.

Warline Bryant, Colonel US Army Retired- Company owner with leadership and strategic planning knowledge, and leadership skills developed through active duty service in the United States Army for 27 years.

Daniel M. Driver- An experienced financial professional with knowledge of the real estate and construction industries; leadership skills through work with a non-profit and private foundation; and service as a Director of the Bank since June 2022, and as a member of the Audit and Investment Committees.

Carolyn Wilson Evans- An experienced corporate and private practice lawyer possessing leadership skills through Board service and affiliations with community and civic associations; and service as a Director of the Bank for 24 years, and as a member of the Audit and Executive Committees, and as Chair of the Loan Committee.

Richard F. Foard, Jr. - Knowledge of the construction industry as well as the management of a large corporation; and service as a Director of the Bank for 25 years, as a member of the Audit, Facilities and Loan Committees, and as Chair of the Executive Committee.

Stephanie Novak Hau- More than 30 years of business management, and environmental regulation experience gained as the CEO of a scientific consulting firm serving public and private clients throughout the state of Maryland; previous selection by the Small Business Administration as Small Business Person of the Year; leadership skills gained through service on boards of local civic and philanthropic organizations; and service as a Director of the Bank for five years, and as a member of the Audit and Loan Committees.

Henry S. Holloway- Experience owning and operating a multi-store agriculture business with a large employee base; sound knowledge of the farming industry in Harford County; and service as a Director of the Bank for 24 years, as Board Chair for one year, and as a member of the Audit, Executive and Loan Committees.

Timothy N. Hopkins- Experience owning and operating a real estate company with extensive knowledge of the real estate industry and issues as they relate to Harford County; and service as a Director of the Bank for 17 years, and as a member of the Executive, Facilities and Loan Committees, and as Chair of the Audit Committee.

Charles H. Jacobs, Jr. - More than 40 years of experience in the banking industry; prior service as President of the Bank for 19 years; and service as a Director of the Bank for 35 years, and as a member of the Audit, Facilities and Loan Committees.

Bryan E. Kelly, CFP- Extensive financial and leadership experience gained as Managing Partner of Bel Air-based wealth management firm he co-founded in 1997 which has received the Small Business of the Year award from the Harford Chamber of

5

Commerce and the Bel Air Business of the Year Award; service as Chair of the Board of University of Maryland Upper Chesapeake Health; service as a Director of the Upper Chesapeake Health Foundation; service as a member of the Investment subcommittee of the Finance Committee of the University of Maryland Medical System Board of Directors; served 10 years on Board of Trustees of Harford Community College, three years as Chair and two as Vice Chair; in 2015, served on the National Advisory Council of PIMCO, a leading global investment management firm; and service as a Director of the Bank for 10 years, and as a member of the Audit, Executive and Loan Committees, and as Chair of the Investment Committee.

Stephen K. Nolan- Business and management experience gained as a Professional Engineer and a former business owner with expertise in the construction market; and service as a Director of the Bank for 24 years, as a member of the Audit, Executive and Loan Committees, and as Chair of the Facilities Committee.

Wayne Tapscott- Business and management experience gained as retired owner of an automobile dealership and a commercial cleaning equipment and paper supply company, with extensive knowledge of the local business and lending environment; and service as a Director of the Bank for 24 years, and as a member of the Audit, Executive, Investment and Loan Committees.

CORPORATE GOVERNANCE MATTERS

Board Committees

The Board of Directors has an Audit Committee, an Executive Committee, a Facilities Committee, an Investment Committee and a Loan Committee. Directors serve on the Audit, Executive and Loan Committees on a rotating basis. Committee members generally serve three-year terms as long as they continue to be re-elected to the Board during such term. To ensure continuity, the Chairs of these Committees do not rotate. The Facilities and Investment Committees have a static membership. These committees are discussed below.

The Audit Committee, which met 15 times in 2023, was established to perform the duties of an "audit committee" as defined in Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and is responsible for:

1. monitoring the Bank's audit policy and program; (ii) monitoring the Bank's compliance with its policies and with applicable laws and regulations; (iii) recommending any policy changes to the Board of Directors; and (iv) the appointment, replacement, compensation, and general oversight of the Bank's independent registered public accounting firm. The Audit Committee meets with the internal and external auditors and reports to the Board on its findings. The Audit Committee is comprised of Timothy N. Hopkins, who serves as Chair, Daniel M. Driver, Charles H. Jacobs, Jr., and Stephan K. Nolan. The Board has determined that Mr. Driver qualifies as an "audit committee financial expert" as that term is defined by Item 407 of the Regulation S-K adopted by the Securities and Exchange Commission (the "SEC") and satisfies the independence standards applicable to Audit Committee members (see "Director Independence" below). The Audit Committee has adopted a written charter, and a copy is available at the Investor Relations page of the Bank's Internet website at www.HarfordBank.com.

The Executive Committee, which met 11 times in 2023, is comprised of Richard F. Foard, Jr., who serves as Chair, Henry S. Holloway, John S. Karas and Bryan E. Kelly, CFP. The Executive Committee serves as both a compensation committee and a nominating committee. It is empowered to: (i) review and recommend to the Board of Directors appropriate compensation for the President and the Directors of the Bank; (ii) seek out, interview and screen individuals who are qualified to serve as Directors, review Director candidates recommended by stockholders, and recommend to the Board of Directors those candidates who should be nominated for election as Directors (see "Director Nomination Process" below); (iii) review and recommend to the Board of Directors for approval the Bank's annual budget; and (iv) perform such other duties as may be authorized by the Board of Directors. The Executive Committee has not adopted a written charter.

The Facilities Committee, which met two times in 2023, is comprised of Stephen K. Nolan, who serves as Chair, Michael F. Allen, Richard F. Foard, Jr., Timothy N. Hopkins, and Charles H. Jacobs, Jr. The Facilities Committee is responsible for exploring options for and overseeing the construction and implementation of new and existing branches. The Committee meets as needed, usually after the regular Board meeting, to discuss the progress of various initiatives.

The Investment Committee, which met two times in 2023, is comprised of Bryan E. Kelly, who serves as Chair, Michael F. Allen, John S. Karas, Daniel M. Driver, and Wayne Tapscott. The Investment Committee is responsible for overseeing the Bank's investment portfolio. The Committee meets as needed, to review and discuss investment strategy.

The Loan Committee, which met 28 times during 2023, is comprised of Carolyn Wilson Evans, who serves as Chair, Michael F. Allen, Tony L. Bennett, Stephanie Novak Hau, and Wayne Tapscott. In addition to the Director members, there are three members from management: Lorrie A. Schenning, Chief Lending Officer ("CLO"), Stewart Lee, Chief Administrative Officer ("CAO"), and Reid Edwards, Chief Credit Officer. The Loan Committee is responsible for establishing and approving

6

policies and procedures relating to the lending operations of the Bank as determined in accordance with the guidelines established by the Board of Directors and approving loans made by the Bank in accordance with these guidelines.

Director Independence

To determine whether Directors are "independent", the Board has adopted the independence standards of The New York Stock Exchange ("NYSE") Listed Company Manual. The Board has determined that Tony L. Bennett, Warline Bryant, Daniel M. Driver, Carolyn Wilson Evans, Richard F. Foard, Jr., Stephanie Novak Hau, Henry S. Holloway, Charles H. Jacobs, Jr., Timothy N. Hopkins, John S. Karas, Bryan E. Kelly, Stephen K. Nolan, and Wayne Tapscott satisfy the independence standards contained in Rule 303A.02 of the NYSE Listed Company Manual. Each member of the Executive Committee satisfies the independence standards applicable to nominating and compensation committees contained in Rules 303A.04 and 303A.05 of the NYSE Listed Company Manual. Each member of the Audit Committee satisfies the independence standards applicable to audit committees contained in Rule 303A.07 of the NYSE Listed Company Manual. In making these independence determinations, the Board considered, in addition to the transactions described in the "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS" section of this Proxy Statement, the following: (i) construction management services provided to the Bank by a company affiliated with Richard F. Foard, Jr.; (ii) legal services provided to the Bank by John S. Karas' law firm; (iii) engineering services provided to the Bank by a company affiliated with Stephen K. Nolan; and (iv) agency services provided to the Bank by the real estate company of Timothy N. Hopkins.

Board Leadership Structure and Risk Oversight

The Board has separated the positions of Chair and President in an effort to maintain independent oversight of management. The Board Chair is an "independent director" as defined in the NYSE Listed Company Manual. The Board believes this structure best suits the Bank because it helps to ensure that the Board has a strong, independent leader who can objectively review operations and the performance of management. In addition, the Board believes that it is important to allow the President to concentrate on running the day-to-day operations of the Bank and the implementation of the Board's policies and procedures without the added burden of also managing the Board of Directors.

The Board of Directors administers risk oversight by assigning various organizational risk oversight functions to its committees, which report to the full Board on a regular basis.

The Audit Committee monitors compliance risk, risks related to the Bank's reputation, the Bank's internal control over financial reporting, including the internal audit function, and the performance of and reports by the Bank's independent registered public accounting firm.

The Executive Committee monitors the Bank's market and strategic risks through its oversight of marketing and strategic initiatives, and periodically meets with the President and the Chief Financial Officer (the "CFO") so that it may be kept apprised of the Bank's general operating environment. The Executive Committee also helps ensure Director independence through its nominating authority, and it manages compensation risk through its authority to review and recommend the Bank's director and executive compensation practices and policies.

The Loan Committee monitors the Bank's credit risk in accordance with guidelines established by the Board of Directors and bank regulatory agencies, and is charged with approving loans made by the Bank within acceptable guidelines. The Loan Committee also monitors the Bank's concentrations of commercial real estate loans and the risk rating of loans.

Interest rate risk, liquidity risk, various strategic risks, valuation risks and transaction risk are monitored by the full Board of Directors through its close interaction with and reports provided by the Bank's CFO, who is Chair of the Bank's Asset Liability Committee (ALCO), and the Board's interaction with its various committees.

Director Attendance at Board Meetings

The Board of Directors held 25 regular meetings and one organizational meeting during 2023. During 2023, all Directors attended at least 75% of the aggregate of (i) the total number of meetings of the Board (held during the period for which that person served as a Director) and (ii) the total number of meetings held by all committees of the Board on which that person served (during the period served).

7

Director Attendance at Annual Meetings of Stockholders

The Board believes that each Annual Meeting is an opportunity for stockholders to communicate directly with Directors and, accordingly, expects that all Directors will attend each Annual Meeting. All Directors who were then serving on the Board, with the exception of Michael F. Allen, attended the 2023 Annual Meeting. If you would like an opportunity to discuss issues directly with the Bank's Directors, then please consider attending this year's Annual Meeting.

Director Nomination Process

In recommending Director nominees to the Board, the Executive Committee will consider candidates recommended by the Bank's stockholders. Whether recommended by a stockholder or recommended independently by the Executive Committee, a candidate will be nominated based on his or her talents in relation to the talents of the existing Board members and the needs of the Board. It is the Executive Committee's goal in choosing nominees to foster relationships among Directors that are complementary and that will make the Board most effective.

The Executive Committee does not have a formal diversity policy with respect to the identification of Director candidates. Rather, it looks to fill vacancies and add Directors based on the specific needs of the Bank at a given time, taking into consideration a candidate's experience, talents and business acumen. A candidate, whether recommended by a Bank stockholder or otherwise, will not be considered for nomination unless he or she (i) is of good character, (ii) is a citizen of the United States, (iii) is younger than 72 years of age, and (iv) owns, or commits to acquire promptly after election, at least $500 worth of shares of Common Stock, as determined in accordance with the Financial Institutions Article of the Annotated Code of Maryland. Additionally, the Board believes it is important that nominees (a) have the ability to attract business to the Bank, (b) live or work within the communities in which the Bank operates, and (c) possess the skills and expertise necessary to provide leadership to the Bank. Certain Board positions, such as Audit Committee membership, may require other special skills, expertise, or independence from the Bank. Further, the Bylaws provide that a majority of the Bank's Directors must reside (and must have resided for at least one year prior to election) in the State of Maryland.

The Executive Committee is responsible for assembling and maintaining a list of qualified candidates to fill vacancies on the Board. The Executive Committee will periodically review this list and research the talent, skills, expertise, and general background of these candidates.

Stockholder recommendations for Director nominations should be submitted in writing to: Harford Bank, 8 West Bel Air Avenue, P.O. Box 640, Aberdeen, Maryland 21001, Attn: President; and must specify (i) the recommending stockholder's contact information, (ii) the class and number of shares of the Common Stock beneficially owned by the recommending stockholder,

1. the name, address and credentials of the candidate for nomination, and (iv) the candidate's consent to be considered as a candidate. Whether a stockholder recommendation is considered for a particular vacancy or a particular year's Proxy Statement will depend on the date that the recommendation is received by the Bank, taking into account the time needed to investigate the candidate, and on the particular needs of the Board at that time, including the requirement under the Bank's Bylaws that a majority of the Directors must reside in Maryland.

It should be noted that there is no guarantee that the Board will nominate a candidate recommended by a stockholder. A stockholder who desires to nominate a candidate for election may do so only in accordance with Section 1.5 of Article I of the Bylaws, which provides as follows:

A nomination for the election of a Director may be made by the Board of Directors and, subject to the other provisions of this Section, by a holder of any outstanding class of stock of the Bank who is entitled to vote for the election of Directors. Notice by a stockholder of his, her or its intention to make a nomination shall be made in writing and shall be delivered or mailed to the Chairperson of the Board or the President of the Bank not less than 150 days nor more than 180 days prior to the date of the meeting of stockholders called for the election of Directors which, for purposes of this provision, shall be deemed to be on the same date as the annual meeting of stockholders for the preceding year. Such notification shall contain the following information to the extent known by the notifying stockholder: (a) the name and address of each proposed nominee; (b) the principal occupation of each proposed nominee; (c) the number of shares of capital stock of the Bank owned by each proposed nominee; (d) the name and residence address of the notifying stockholder;

1. the number of shares of capital stock of the Bank owned by the notifying stockholder; (f) the consent in writing of the proposed nominee as to the proposed nominee's name being placed in nomination for Director; and (g) all information relating to such proposed nominee that would be required to be disclosed by Regulation 14A under the Securities Exchange Act of 1934, as amended, and any rules promulgated thereunder, assuming such provisions would be applicable to the solicitation of proxies for such proposed

8

nominee. Nominations that are not made in accordance herewith shall be disregarded and, upon the Chairperson's instructions, the inspector or judge of elections (if voting is conducted by a judge appointed by the Board) shall disregard all votes cast for such nominee.

In addition, as noted above, Section 2.3 of the Bylaws provide that no person shall be eligible to stand for election as a Director after attaining 72 years of age.

As it relates to the 2025 Annual Meeting of Stockholders (the "2025 Annual Meeting"), a stockholder's nomination notice must be received no earlier than November 9, 2024 and no later than December 9, 2024.

Stockholder Communications with Directors

Stockholders may send communications to the Board of Directors by contacting its Corporate Secretary, Neil L. Christ, at Harford Bank, 8 West Bel Air Avenue, P.O. Box 640, Aberdeen, Maryland 21001 or 410-272-5000. All communications will be forwarded directly to the Board Chair.

Family Relationships Among Directors, Nominees and Executive Officers

None.

Policy with Respect to Hedging Transactions

The Bank has not adopted any practices or policies regarding the ability of employees (including officers) or Directors, or any of their designees, to purchase financial instruments (including prepaid variable forward contracts, equity swaps, collars, and exchange funds), or otherwise engage in transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of the Bank's equity securities (i) granted to the employee or Director by the Bank as part of his or her compensation or (ii) held, directly or indirectly, by the employee or Director.

Insider Trading Policy

The Bank has adopted insider trading policies and procedures governing the purchase, sale, and/or other dispositions of shares of Common Stock by directors, officers and employees of the Bank and its subsidiaries that it believes are reasonably designed to promote compliance with insider trading laws, rules and regulations, and any listing standards applicable to the Bank. A copy of the Bank's Insider Trading Policy was filed as Exhibit 19.1 to the Bank's Annual Report on Form 10-K for the year ended December 31, 2023. The Bank has not adopted an insider trading policy governing the Bank's purchase, sale, and/or other dispositions of shares of Common Stock. Section 2-310(a) of the Maryland General Corporation Law requires the Board to approve any acquisition by the Bank of shares of Common Stock, and it has been the Bank's policy to consult with its legal counsel prior to the Board's approval of any plan or other arrangement to acquire any shares to ensure compliance with applicable laws.

9