Provident Bancorp, Inc.





Proxy Statement





This proxy statement is furnished in connection with the solicitation of proxies by the Board of Directors of Provident Bancorp, Inc. (the “Company”) to be used at a specialthe annual meeting of stockholders of the Company. The Company is the holding company for BankProv (formerly “The Provident Bank”). The Provident Bank. The specialannual meeting will be held online at https://www.cstproxy.com/theprovidentbank/sm2020the Blue Ocean Event Center, 4 Oceanfront North, Salisbury, Massachusetts 01952 on May 18, 2023 on November 23, 2020 at 9:3:30 a.m.p.m., local time. This proxy statement and the enclosed proxy card are being mailed to stockholders of record on or about October 19, 2020.April 18, 2023.

Voting and Proxy Procedure

Who Can Vote at the Meeting

You are entitled to vote your Company common stock if the records of the Company show that you held your shares as of the close of business on October 2, 2020.April 6,  2023. If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in “street name” and these proxy materials are being forwarded to you by your broker or other nominee. As the beneficial owner, you have the right to direct your broker or other nominee how to vote.

As of the close of business on October 2, 2020,April 6,  2023, there were 19,476,248 17,693,818 shares of Company common stock outstanding for voting purposes.outstanding. Each share of common stock has one vote. The Company’s Articles of Organization provide that, subject to certain exceptions, record owners of the Company’s common stock that is beneficially owned by a person who beneficially owns in excess of 10% of the Company’s outstanding shares, are not entitled to any vote in respect of the shares held in excess of the 10% limit.

Attending the Meeting

If you were a stockholder as of the close of business on October 2, 2020,April 6,  2023, you may attend the meeting. As a registered stockholder, you received a proxy card with this proxy statement.  The proxy card contains instructions on how to attend the virtual meeting, including the website along with your control number.  You will need your control number for access.  If you do not have your control number, contact our transfer agent, Continental Stock Transfer at (917) 262-2373, or proxy@continentalstock.com.

IfHowever, if your shares of Company common stock are held by a bank, broker, or other nominee, you will need proof of ownership to contactbe admitted to the meeting. A recent brokerage statement or a letter from a bank or broker are examples of proof of ownership. If you want to vote your bank,shares of Company common stock held in street name in person at the meeting, you will have to get a written proxy in your name from the broker or other nominee and obtain a legal proxy.  Once you have receivedwho holds your legal proxy, contact Continental Stock Transfer to have a control number generated.  The contact information for Continental Stock Transfer is (917) 262-2373, or proxy@continentalstock.com.shares.

Quorum and Vote Required

A majority of the outstanding shares of common stock entitled to vote is required to be represented at the meeting to constitute a quorum for the transaction of business. If you return valid proxy instructions or attend the meeting online,in person, your shares will be counted for determining whether there is a quorum, even if you abstain from voting. Broker non-votes also will be counted for determining the existence of a quorum. A broker non-vote occurs when a broker, bank or other nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received voting instructions from the beneficial owner.

In voting on the election of directors, you may vote in favor of all nominees, withhold votes as to all nominees or withhold votes as to specific nominees. There is no cumulative voting for the election of directors. Directors are elected by a plurality of the votes cast at the annual meeting. This means that the nominees receiving the greatest number of votes will be elected. Votes that are withheld and broker non-votes will have no effect on the outcome of the election.

In voting to approveratify the Provident Bancorp, Inc. 2020 Equity Incentive Plan,appointment of Crowe LLP as our independent registered public accounting firm, you may vote in favor of the proposal, against the proposal or abstain from voting. To be approved, this matter requires the affirmative vote of a majority of the votes cast at the specialannual meeting. Broker non-votes and abstentions will not be counted as votes cast and will have no effect on this proposal.

In voting to approve the adjournment ofadvisory, non-binding resolution with respect to the special meeting, if necessary, to solicit additional proxiesexecutive compensation as described in the event that there are not sufficient votes at the time of the special meeting to approve the 2020 Equity Incentive Plan,this Proxy Statement, you may vote in favor of the proposal, against the proposal or abstain from voting. To be approved, this matter requires the affirmative vote of a majority of the votes cast at the specialannual meeting. Broker non-votes and abstentions will not be counted as votes cast and will have no effect on this proposal. While this vote is required by law, it will neither be binding on us or our Board of Directors, nor will it create or imply any change in the fiduciary duties of, or impose any additional fiduciary duty on us or our Board of Directors. However, the Compensation Committee and the Board of Directors will take into account the outcome of the vote when considering future executive compensation arrangements.

Voting by Proxy

The Company’s Board of Directors is sending you this proxy statement to request that you allow your shares of Company common stock to be represented at the specialannual meeting by the persons named in the enclosed proxy card. All shares of Company common stock represented at the meeting by properly executed and dated proxies will be voted according to the instructions indicated on the proxy card. You may also vote by telephonemobile or internet, as indicated on the proxy card. If you sign, date and return a proxy card without giving voting instructions, your shares will be voted as recommended by the Company’s Board of Directors. The Board of Directors recommends that you vote:you:

If any matters not described in this proxy statement are properly presented at the specialannual meeting, the persons named on the proxy card will use their judgment to determine how to vote your shares. This includes a motion to adjourn or postpone the meeting to solicit additional proxies. The Company does not currently know of any other matters to be presented at the meeting.

You may revoke your proxy at any time before the vote is taken at the meeting. To revoke your proxy, you must either advise the Corporate Secretary of the Company in writing before your common stock has been voted at the specialannual meeting, deliver a later dated proxy or attend the meeting online and vote your shares online at the special meeting.in person by ballot. Attendance at the specialannual meeting online will not in itself constitute revocation of your proxy.

If your Company common stock is held in street name, you will receive instructions from your broker or other nominee that you must follow to have your shares voted. Your broker or other nominee may allow you to deliver your voting instructions via the telephone or the Internet. Please review the proxy card or instruction form provided by your broker or other nominee that accompanies this proxy statement.

Participants in the ESOP and 401(k) Plan

If you participate in The Provident Bankthe BankProv Employee Stock Ownership Plan (the “ESOP”) or the BankProv 401(k) Plan (the “401(k) Plan”), you will receive a vote authorization form for each plan that reflects all shares you may direct the trustee to vote on your behalf under the plan. Under each plan, the terms of the ESOP, the ESOP trustee will vote all shares held by the ESOP,plan, but each ESOPplan participant may direct the trustee how to vote the shares of common stock allocated to his or her account. The ESOP trustee will vote all unallocated shares of Company common stock held by the ESOPeach plan and all allocated

shares for which no voting instructions are received in the same proportion as shares for which it has received timely voting instructions.

Under the terms of the SBERA 401(k) Plan as Adopted by The Provident Bank (the “401(k) Plan”), the plan administrator, Thomas Forese, Jr., President of SBERA, will vote all shares of Company common stock in the Provident Bancorp, Inc. stock account.  The plan administrator has a fiduciary obligation to vote the shares of Company common stock solely in the best interests of 401(k) plan participants and beneficiaries. 

The deadline for returning your ESOP Vote Authorization Form, and the telephonic and internet voting cutoff for providing your ESOP or 401(k) vote authorization, is November 16, 2020Monday, May 15, 2023 at 11:59 p.m. Eastern time.

If you have any questions about voting under the ESOP or 401(k) Plan, please contact Carol Houle, Co-President and Co-Chief Executive Vice PresidentOfficer, and Chief Financial Officer, at (603)-334-1253.(617)-546-7365.

References to our Website Address

References to our website address throughout this proxy statement and the accompanying materials are for informational purposes only, or to fulfill specific disclosure requirements of the Securities and Exchange Commission’s rules. These references are not intended to, and do not, incorporate the contents of our website by reference into this proxy statement or the accompanying materials.

Corporate Governance

General

The Company periodically reviews its corporate governance policies and procedures to ensure that the Company meets the highest standards of ethical conduct, reports results with accuracy and transparency and maintains full compliance with the laws, rules and regulations that govern the Company’s operations. As part of this periodic corporate governance review, the Board of Directors reviews and adopts best corporate governance policies and practices for the Company.

Code of Ethics for Senior Officers

Provident Bancorp, Inc. has adopted a Code of Ethics for Senior Officers that applies to Provident Bancorp, Inc.’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. The Code of Ethics for Senior Officers is available on our website at investors.bankprov.com. Amendments to and waivers from the Code of Ethics for Senior Officers will also be disclosed on our website.

The Company has also established procedures to receive, retain and treat complaints regarding accounting, internal accounting controls and auditing matters. These procedures ensure that individuals may submit concerns regarding questionable accounting or auditing matters in a confidential and anonymous manner.

Meetings of the Board of Directors

The Company conducts business through meetings of its Board of Directors and through activities of its committees. During 2022, the Board of Directors of the Company held eight regularly scheduled meetings and four special meetings (not including committee meetings), and eight additional meetings of our independent directors. Other than former director Mohammad Shaikh, no director attended fewer than 75% of the total meetings of the Boards of Directors and the committees on which such director served (held during the period for which the director has served as a director or committee member, as appropriate).

Committees of the Board of Directors

The following table identifies the membership on our Audit, Compensation and Nominating and Corporate Governance committees. All members of each committee are independent in accordance with the listing rules of the Nasdaq Stock Market. The Company also maintains an Executive Committee as a standing committee. The charters of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee are available in the “Investor Relations—Governance—Governance Documents” section of the Company’s website, investors.bankprov.com.

___________________________

*Denotes Chairperson

Audit Committee. Pursuant to Provident Bancorp, Inc.’s Audit Committee Charter, the Audit Committee oversees the Company’s accounting and reporting practices and assists the Board of Directors in fulfilling its oversight responsibilities for the Company’s system of internal controls and the Company’s process for monitoring compliance with laws and regulations. The Audit Committee is also responsible for engaging the Company’s independent registered public accounting firm and monitoring its conduct and independence. In addition to meeting the independence requirements of the Nasdaq Stock Market., each member of the Audit Committee meets the audit committee independence requirements of the Securities and Exchange Commission. The Board of Directors has determined that James A. Deleo qualifies as an audit committee financial expert under the rules of the Securities and Exchange Commission. The report of the Audit Committee required by the rules of the Securities and Exchange Commission is included in this proxy statement. See “Audit Committee Report.”

Compensation Committee. Pursuant to Provident Bancorp, Inc.’s Compensation Committee Charter, the Compensation Committee approves the overall compensation philosophy for the Company and BankProv and establishes or recommends to the full Board of Directors the compensation for our Co-Chief Executive Officers and other executive officers. The Compensation Committee establishes subjective and objective criteria relevant to the compensation of our Co-Chief Executive Officers and other executive officers, evaluates performance in light of those criteria, and approves or recommends to the full Board of Directors compensation levels based on this evaluation. The Compensation Committee may consult with the Co-Chief Executive Officers with respect to the compensation of other executive officers. Our Co-Chief Executive Officers do not participate in discussions related to their compensation or the Committee’s review of any documents related to the determination of their compensation.

The base salary levels for our executive officers are set to reflect the duties and levels of responsibilities inherent in the position. Comparative salaries paid by other financial institutions are also considered in establishing the salary for our executive officers. The Compensation Committee has utilized bank compensation surveys compiled by an independent benefits consultant, Pearl Meyer & Partners. The benefit consultant researched several publicly traded companies and the latest proxy statements filed with the Securities and Exchange Commission, and identified a peer group with executive positions similar to the Company. In setting the base salaries, the Compensation Committee also considers a number of factors relating to the executive officers, including individual performance, job responsibilities,

experience level and ability and knowledge of the position. These factors are considered subjectively and none of the factors are accorded a specific weight.

Nominating and Corporate Governance Committee. Pursuant to Provident Bancorp, Inc.’s Nominating and Corporate Governance Committee Charter, the Company’s Nominating and Corporate Governance Committee assists the Board of Directors in identifying qualified individuals to serve as Board members, in determining the composition of the Board of Directors and its committees, in developing, recommending and overseeing a process to assess Board effectiveness and in developing and recommending the Company’s corporate governance guidelines. The Nominating and Corporate Governance Committee also considers and recommends the nominees for director to stand for election at the Company’s annual meeting of stockholders. The procedures of the Nominating and Corporate Governance Committee required to be disclosed by the rules of the Securities and Exchange Commission are included in this proxy statement. See “Nominating and Corporate Governance Committee Procedures.”

Risk Oversight

The Board of Directors has an active role, as a whole and also at the committee level, in overseeing management of the Company’s risks. The Board of Directors regularly reviews information regarding the Company’s credit, liquidity and operations, as well as the risks associated with such areas. The Company’s Compensation Committee is responsible for overseeing the management of risks relating to the Company’s executive compensation plans and arrangements. The Audit Committee oversees management of financial and regulatory risks. The Nominating and Corporate Governance Committee manages risks associated with the independence of the Board of Directors and potential conflicts of interest. BankProv also has a Risk Management Committee that assists BankProv’s board in understanding the risks the bank faces for each of these types of risk: capital adequacy, credit, risk management, financial, information technology, cybersecurity, interest rate risk, investments, asset liability, liquidity, lending, and other risks. Strategic risks are governed by the full BankProv board with input from all committees.

While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire Board of Directors is regularly informed about such risks.

Attendance at the Annual Meeting

The Board of Directors encourages each director to attend annual meetings of stockholders. All of our then-current directors attended the 2022 annual meeting of stockholders.

Board Leadership Structure

Our Board of Directors is chaired by Laurie H. Knapp, who is a non-management independent director. An independent chair ensures a greater role for the independent directors in the oversight of Provident Bancorp, Inc. and BankProv and active participation of the independent directors in setting agendas and establishing priorities and procedures for the work of the Board.

To further assure effective independent oversight, the Board of Directors has adopted a number of governance practices, including:

The Board of Directors recognizes that, depending on the circumstances, other leadership models might be appropriate. Accordingly, the Board of Directors periodically reviews its leadership structure.

Stock Ownership



The following table provides information as of October 2, 2020,April 6,  2023, with respect to persons known by the Company to be the beneficial owners of more than 5% of the Company’s outstanding common stock. The percentage is based on 19,476,248 17,693,818shares of Company common stock outstanding for voting purposes as of October 2, 2020. April 6,  2023.



The following table provides information as of October 2, 2020April 6,  2023 about the shares of Provident Bancorp, Inc. common stock that may be considered to be beneficially owned by each director, nominee and named executive officer as of October 2, 2020April 6,  2023 and all directors, nominees and executive officers of the Company as a group. A person may be considered to beneficially own any shares of common stock over which he or she has, directly or indirectly, sole or shared voting or investment power, or which he or she has the right to acquire beneficial ownership within 60 days after October 2, 2020.April 6,  2023. Unless otherwise indicated, none of the shares listed are pledged as collateral for a loan, and each of the named individuals has sole voting power and sole investment power with respect to the number of shares shown. Percentages are based on 19,476,248 17,693,818shares of Company common stock outstanding for voting purposes as of October 2, 2020.  April6,2023.

*Less than 1%.



Proposal 1—ApprovalElection of theDirectors

The Board of Directors of Provident Bancorp, Inc. 2020 Equity Incentive Planis composed of nine members. The Board is generally divided into three classes, each with three-year staggered terms, with approximately one-third of the directors elected each year. The nominees for election this year are James A. DeLeo, Laurie H. Knapp and Barbara A. Piette, each of whom is being nominated for a three-year term and until their successors shall have been elected and qualified. Each nominee is a current director of the Company.

The Board of Directors has adopted, subject to stockholder approval, the Provident Bancorp, Inc. 2020 Equity Incentive Plan (the “2020 Equity Incentive Plan”).  The Board of Directors believes the adoption of the 2020 Equity Incentive Plan is in the best interests of Provident Bancorp, Inc. and its stockholders as a means of providing Provident Bancorp, Inc. and The Provident Bank with the ability to retain, reward and, to the extent necessary, attract and incentivize employees, officers and directors to promote growth, improve performance and further align their interests with those of Provident Bancorp, Inc. stockholders through the ownership of additional common stock of Provident Bancorp, Inc.     

Why We Are Seeking Approval of the Equity Incentive Plan

Many companies with which we compete for directors and management-level employees are stockholder-owned companiesdetermined that offer equity compensation as part of their overall director and officer compensation programs. By approving the 2020 Equity Incentive Plan, our stockholders will give us the flexibility we need to continue to attract and retain highly-qualified officers, employees and directors by offering a competitive compensation program linked to the performance of our common stock.  In addition, the 2020 Equity Incentive Plan further aligns the interestseach of our directors and managementnominees, with the interestsexception of our stockholders by increasingdirector Reilly, is “independent” as defined in, and for purposes of satisfying the ownership interestslisting standards of, directors and officers in the common stockNasdaq Stock Market, Inc. Director Reilly is not independent as an executive officer of Provident Bancorp, Inc.

We have 117,956 shares available for grant under

In determining the Provident Bancorp, Inc. 2016 Equity Incentive Plan (the “2016 Equity Incentive Plan”),independence of which 83,917 shares are available for the grant of stock options and 34,039 shares are available for the grant of restricted stock or restricted stock units.  Accordingly, we have no meaningful way to continue to provide equity-based compensation grants to attract, retain and reward qualified personnel and management.

We completed our second-step mutual-to-stock conversion and related stock offering on October 16, 2019.  A substantial majority of financial institutions that complete a mutual-to-stock conversion have adopted an equity-based incentive plan following the transaction.  Our prospectus made clear our intent to adopt an equity incentive plan and described the regulatory requirements applicable to equity incentive plans, and included the pro forma effect of awards granted under an equity incentive plan.  

Highlights of the 2020 Equity Incentive Plan

General

The information summarizes the material features of the 2020 Equity Incentive Plan, which is qualified in its entirety by reference to the provisions of the 2020 Equity Incentive Plan, which is attached hereto as Appendix A.  In the event of conflict between the terms of this disclosure and the terms of the 2020 Equity Incentive Plan, the terms of the 2020 Equity Incentive Plan will control.

Subject to permitted adjustments for certain corporate transactions, the 2020 Equity Incentive Plan authorizes the issuance or delivery to participants of up to 1,429,734 shares of Provident Bancorp, Inc. common stock pursuant to grants of incentive and non-qualified stock options, restricted stock awards and restricted stock units.  Of this number, the maximum number of shares of common stock we may issue under the 2020 Equity Incentive Plan pursuant to the exercise of stock options is 1,021,239 shares, and the maximum number of shares of common stock we may issue as restricted stock awards or restricted stock units is 408,495 shares.  These amounts represent 10.0% and 4.0%, respectively, of the number of shares of common stock sold in connection with the mutual-to-stock conversion.

The Compensation Committee (the “Committee”) will administer the 2020 Equity Incentive Plan.  The Committee has full and exclusive power within the limitations set forth in the 2020 Equity Incentive Plan to make all decisions and determinations regarding: (1) the selection of participants and the granting of awards; (2) establishing the terms and conditions relating to each award; (3) adopting rules, regulations and guidelines for carrying out the purposes of the plan; and (4) interpreting the provisions of the plan and award agreements.  The 2020 Equity Incentive Plan also permits the Committee to delegate all or part of its responsibilities and powers to any person or persons selected by it.  The Committee may, subject to the limitations set forth in the 2020 Equity Incentive Plan, grant stock options and awards of restricted stock or restricted stock units to themselves and other members of the Board of Directors as well asconsidered the following relationships between BankProv and our directors and officers, which are not required to employeesbe reported under “Transactions With Certain Related Persons.” BankProv has made loans to the following directors or their related entities: Jay E. Gould, commercial real estate loans, and service providerscommercial lines of Provident Bancorp, Inc.credit; and Arthur Sullivan, commercial real estate line of credit and demand note. BankProv also provides overdraft lines of credit to all of its subsidiaries.directors.

Except

It is intended that the proxies solicited by the Board of Directors will be voted for accelerating the vestingelection of awardsthe nominees named below. If any nominee is unable to avoidserve, the minimum vesting requirements specifiedpersons named in the plan or acceleratingproxy card will vote your shares to approve the vesting requirements applicable to an award aselection of any substitute proposed by the Board of Directors. Alternatively, the Board of Directors may adopt a result of or in connection with a change in control, the Committee has the authorityresolution to reduce eliminate or accelerate any restrictions or vesting requirements applicable to an award at any time after the grantsize of the awardBoard. At this time, the Board of Directors knows of no reason why any nominee might be unable to serve. Except as indicated herein, there are no arrangements or understandings between the nominees and directors continuing in office and any other person pursuant to extendwhich such persons were selected.

The Board of Directors recommends a vote “FOR” the time period to exercise a stock option,election of all nominees.

Information regarding the nominees and the directors continuing in office is provided below. Unless otherwise stated, each individual has held his or her current occupation for the extension complies with Section 409Alast five years. The age indicated in each biography is as of December 31, 2022. The address for each director and executive officer is 5 Market Street, Amesbury, Massachusetts 01913.

All of the Internal Revenue Code. 

Eligibility

All employees,nominees and directors and service providerscontinuing in office are long-time residents of Provident Bancorp, Inc.the communities served by the Company and its subsidiaries including The Provident Bank, are eligible to receive awards underand many of such individuals have operated, or currently operate, businesses located in such communities. As a result, each nominee and director continuing in office has significant knowledge of the 2020 Equity Incentive Plan, exceptbusinesses that non-employees may not receive incentive stock options underoperate in the plan.  AsCompany’s market area, an understanding of October 9, 2020, there were ten non-employee directorsthe general real estate market, values and 151 employees of Provident Bancorp, Inc. and it’s subsidiary, The Provident Bank, eligible to receive awards under the 2020 Equity Incentive Plan. 

Types of Awards

The Committee may determine the type and terms and conditions of awards under the 2020 Equity Incentive Plan.  Awards will be evidenced by award agreements approved by the Committee and delivered to participants.  The award agreements will set forth the terms and conditions of each award.  The Committee may grant incentive and non-qualified stock options, restricted stock awards or restricted stock units under the plan.

Stock Options. A stock option gives the recipient or “optionee” the right to purchase shares of common stock at a specified price for a specified period of time. The exercise price may not be less than the fair market valuetrends in such communities and an understanding of the common stock onoverall demographics of such communities. As a community banking institution, the dateCompany believes that the local knowledge and experience of grant. “Fair Market Value”its directors assists the Company in assessing the credit and banking needs of its customers, developing products and services to better serve its customers and in assessing the risks inherent in its lending operations. As local residents, our nominees and directors are also exposed to the advertising, product offerings and community development efforts of competing institutions which, in turn, assists the Company in structuring its marketing efforts and community outreach programs.

Nominees for purposesElection of the 2020 Equity Incentive Plan means, if the common stock of Provident Bancorp, Inc. is listed on a securities exchange, the closing sales price of the common stock or, if the common stock was not traded on a specific date, then on the immediately preceding date on which sales were reported.  If the common stock is not traded on a securities exchange, the Committee will determine the fair market value in good faith and on the basis of objective criteria consistent with the requirements of the Internal Revenue Code.  Stock Options may not have a term longer than ten years from the date of grant.Directors

Stock options are either “incentive” stock options or “non-qualified” stock options. Incentive stock options have certain tax advantages and must comply with the requirements of Section 422 of the Internal Revenue Code. Only employees are eligible to receive incentive stock options. Shares of common stock purchased upon the exercise of a stock option must be paidThe nominees standing for in full at the time of exercise: (1) either in cash or with stock valued at fair market value as of the day of exercise; (2) by a “cashless exercise” through a third party; (3) by a net settlement of the stock option using a portion of the shares obtained on exercise in payment of the exercise price; (4) by personal, certified or cashiers’ check; (5) by other property deemed acceptable by the Committee; or (6) by a combination of the foregoing. Stock options are subject to vesting conditions and restrictions as determined by the Committee.election are:

Restricted StockJames A. DeLeo. A restricted stock award, age 57, is a grantcertified public accountant and the leading Partner at Gray, Gray & Gray, where he also co-chairs the Merger & Acquisition Practice Group. He has more than 25 years of common stockexperience and an educational background in entrepreneurial finance, making him a key contributor to a participant for no consideration, or any minimum consideration that may be required by applicable law. Restricted stock awards underfundless sponsors, search funds and larger private equity firms with established funds, all of which seek his advice when acquiring target companies in the 2020 Equity Incentive Plan will be granted onlymiddle market. Mr. DeLeo also works closely with private equity and mezzanine lenders. Mr. DeLeo’s educational and professional experience assist the Board of Directors in whole sharesassessing our accounting practices, tax matters and operational needs, as well as providing knowledge of common stock and are subjectaccess to vesting conditionsthe capital markets and other restrictions established by the Committee consistent with the 2020 Equity Incentive Plan.  Prior to awards vesting, unless otherwise determined by the Committee, the recipient of a restricted stock award may exercise voting rightsadvice with respect to mergers and acquisitions. Director of BankProv since 2017.

Laurie H. Knapp,age 65, is a certified public accountant and sole owner of Laurie H. Knapp CPA PC, an accounting firm located in Amesbury, Massachusetts. Ms. Knapp specializes in personal and corporate taxes. Her experience as a certified public accountant assists the common stock subjectBoard of Directors in assessing our accounting practices and tax matters. Director of BankProv since 1998.

Barbara A. Piette, age 65,  is currently a Managing Principal of Knightsbridge Advisers, co-heading this SEC-regulated venture capital fund of funds. At Knightsbridge, Ms. Piette is actively involved in all aspects of portfolio management, including investment due diligence and decision-making processes. In addition to Knightsbridge, Ms. Piette works as an advisor to five emerging venture capital firms: Tera Ventures, focused on born-global digital startups; Hyperplane VC, focused on artificial intelligence; the award.  Unless otherwise determined byMaterial Impact Fund, focused on materials; Underscore, focused on the Committee, the company will retain dividends paidcloud; and Will Ventures, focused on unvested awardssports technology. She also advises several early stage technology companies spanning industry sectors such as robotics, blockchain enterprise software, and distribute them to the participant within 30 dayscybersecurity. Before joining Knightsbridge, Ms. Piette spent more than 20 years as a venture capitalist, holding partner positions with both Charles River Ventures and Schroder Ventures and co-founding Schroder Ventures Life Sciences. Ms. Piette’s experience provides knowledge of the vestingcapital markets and the operations of the award.both private and public companies.

Restricted Stock Units. Restricted stock units are similar to restricted stock awards in that the valueDirector of a restricted stock unit is denominated in shares of stock. However, unlike a restricted stock award, no shares of stock are transferred to the participant until certain requirements or conditions associated with the award are satisfied. The limitation on the number of restricted stock awards available described above also applies to restricted stock units.BankProv since 2019.

Limitations on Awards Under the Equity Incentive Plan

The following limits apply to awards underdirectors have terms ending at the 2020 Equity Incentive Plan:annual meeting following December 31, 2023:

In the event of a corporate transaction involving the stockJoseph B. Reilly, age66,  was appointed Interim Co-President and Co-Chief Executive Officer of Provident Bancorp, Inc. (including, without limitation, any stock dividend, stock split or other special and nonrecurring dividend or distribution, recapitalization, reorganization, merger, consolidation, spin-off, combination or exchangeBankProv effective January 2023, and Co-President and Co-Chief Executive Officer effective February 2023. He has more than 35 years of shares),experience in the Committee will,New Hampshire banking industry and was the Co-Founder and President/CEO of Centrix Bank, which merged with Eastern Bank in an equitable manner, adjust the number2014. Prior to Centrix, Reilly held positions at Bank of New Hampshire, TD Bank, Centerpoint Bank and kind of securities available for grants of stock options, restricted stock awards or restricted stock units, the numberFleet Bank. Mr. Reilly is a former Chairman and kind of securities that may be delivered or deliverable with respect to outstanding stock options, restricted stock awards and restricted stock units, and the exercise price of stock options.

In addition, the Committee is authorized to make certain other adjustments to the terms and conditions of stock options, restricted stock awards and restricted stock units consistent with the termsDirector of the plan.

The closing sale priceNew Hampshire Bankers Association (NHBA); Chairman of the NHBA Legislative Committee; State of New Hampshire Captain for Team 21, a national organization of the American Bankers Association (ABA); and a member of the Government Relations Council of the ABA. Mr. Reilly has also served on numerous not-for-profit board leadership positions. Mr. Reilly was elected Chairman of the Board of Provident Bancorp, Inc.’s common stock and BankProv in 2019 and served in those positions until his appointment as quotedInterim Co-President and Co-Chief Executive Officer effective January 2023. Mr. Reilly’s positions as Co-President and Co-Chief Executive Officer foster clear accountability, effective decision-making, a clear and direct channel of communication from senior management to the full Board of Directors, and alignment on the NASDAQ Stock Market on October 9, 2020 was $8.19. corporate strategy. Director of BankProv since 2018.

Prohibition Against RepricingArthur Sullivan, age 64, is Principal Partner of Options. The 2020 Equity Incentive PlanBrady Sullivan Properties based in Manchester, New Hampshire. Mr. Sullivan is a 40-year commercial and real estate industry veteran. A licensed Real Estate Broker, Mr. Sullivan has become one of New England’s largest developer of affordable commercial and residential real estate. Under his leadership, Brady Sullivan has successfully procured and managed a diverse portfolio of over four million square feet of mill, office and industrial space, over 2,000 residential units and over 5,000 condominium conversions throughout New England and Florida. Mr. Sullivan is the recipient of the 2013 Commerce Citizen of the Year Award from the Manchester Chamber of Commerce. Mr. Sullivan provides that neither the Committee nor the Board of Directors with significant knowledge of commercial real estate as well as experience in managing a large business in Southern New Hampshire. Director of BankProv since 2016.

The following directors have terms ending at the annual meeting following December 31, 2024:

Lisa DeStefano, age 59, is a Principal Architect of Maugel DeStefano Architects. A LEED certified and registered architect in New Hampshire, Maine, Massachusetts and Connecticut, Ms. DeStefano has been a practicing architect since 1983 and founded DeStefano Architects in 1995. Her design work has won multiple awards including the 2016 AIANH Excellence in Architecture People’s Choice Award and in 2015 her firm was named one of the fastest growing women-led companies in Boston by Inc. 5000. Ms. DeStefano was awarded the 2015 Business Excellence Award in the Real Estate and Construction category from New Hampshire Business Review magazine. Ms. DeStefano’s experience provides the Board of Directors with extensive knowledge of real estate and business matters, and she is well-known in our New Hampshire seacoast market area. Director of BankProv since 2013.

Jay E. Gould,  age 69, is the founder of Flatbread Company, a clay-oven restaurant specializing in all-natural, wood-fired pizza, salads and desserts. Founded in Amesbury, Massachusetts in 1998, Flatbread Company has grown into 15 restaurants with locations in New England, Hawaii and British Columbia. Mr. Gould has extensive developmental and operational experience developing a distinct and unique brand within the full-service restaurant market. Mr. Gould also owned and operated a successful family insurance business in Amesbury, Massachusetts from 1977 until its sale in 2015. As a business owner and entrepreneur, Mr. Gould offers a valuable perspective on developing a successful business as well as the challenges and risks an organization may make any adjustment or amendmentface as it grows its product offerings and markets into new areas. Director of BankProv since 1995. 

Kathleen Chase Curran, age 48, is Chief Operating Officer at Coin Metrics, a cryptoasset financial intelligence provider. Ms. Chase Curran brings 25 years of experience in the financial industry to the plan or an award that reduces or would haveCompany’s Board of Directors having, most recently, worked at Fidelity Investments for over a decade prior to joining Coin Metrics. Throughout her career, she has advised clients and organizations on their growth and enterprise strategies. Her experience spans a wide breadth of disciplines including strategy, product, marketing and research and development. At Coin Metrics, Ms. Chase Curran is helping build the effectmarket infrastructure for cryptoassets through her contributions to the creation of reducingtransparent and accessible data and intelligence. Ms. Chase Curran’s experience provides the exercise priceBoard of a previously granted stock option.

Prohibition on Transfer. Generally, all awards, except non-qualified stock options, granted under the 2020 Equity Incentive Plan are not transferable, except by will orDirectors with expertise in accordance with the lawsdigital assets and strategic planning. Director of intestate succession. Awards may be transferable pursuant to a qualified domestic relations order.  At the Committee’s sole discretion, an individual may transfer non-qualified stock options for valid estate planning purposes in a manner consistent with the Internal Revenue Code and federal securities laws.  During the life of the participant, only the participant may exercise awards.  However, a participant may designate a beneficiary to exercise stock options or receive any rights that may exist upon a participant’s death with respect to awards granted under the 2020 Equity Incentive Plan.BankProv since 2022.

Performance Measures

The Committee may use performance measures for vesting purposes with respect to awards granted under the 2020 Equity Incentive Plan.  The performance measures may include one or more of the following: book value or tangible book value per share; basic earnings per share; basic cash earnings per share; diluted earnings per share; diluted cash earnings per share; return on equity; net income or net income before taxes; cash earnings; net interest income; non-interest income; non-interest expense to average assets ratio; cash general and administrative expense to average assets ratio; efficiency ratio; cash efficiency ratio; return on average assets; cash return on average assets; return on average stockholders’ equity; cash return on average stockholders’ equity; return on average tangible stockholders’ equity; cash return on average tangible stockholders’ equity; core earnings; operating income; operating efficiency ratio; net interest rate margin or net interest rate spread; growth in assets, loans, or deposits; loan production volume; non-performing loans; total stockholder return; cash flow; strategic business objectives, consisting of one or more objectives based upon meeting specified cost targets, business expansion goals, goals relating to acquisitions or divestitures, or goals relating to capital raising and capital management; any other measure determined by the Committee or any combination of the foregoing performance measures.

The Committee may base the measures on the performance of Provident Bancorp, Inc. as a whole or of any one or more subsidiaries or business units and may measure performance relative to a peer group, an index or a business plan.  Performance measures may be considered as absolute measures or changes in measures. In establishing performance measures, the Committee may provide for the inclusion or exclusion of certain items.

Dividend Equivalents

In accordance with Nasdaq Stock Market board diversity disclosure requirements, below are diversity statistics for our nine Board members as of April 18, 2023.

Proposal 2—Ratification of Independent Registered Public Accounting Firm

The Audit Committee is authorized to grant dividend equivalents with respect to restricted stock units available under the 2020 Equity Incentive Plan. Dividend equivalents confer on the participant the right to receive payments equal to cash dividends or distributions with respect to all or a portion of the numberBoard of shares of stockDirectors has appointed Crowe LLP to be the Company’s independent registered public accounting firm for the 2023 fiscal year, subject to ratification by stockholders. A representative of Crowe LLP is expected to be available at the award.  Unless otherwise determinedannual meeting to respond to appropriate questions from stockholders and will have the opportunity to make a statement should he or she desire to do so.

If the ratification of the appointment of the firm is not approved by a majority of the votes cast by stockholders at the annual meeting, other independent registered public accounting firms may be considered by the Audit Committee the dividend equivalent right will be paid at the same time as the shares subject to the restricted stock unit are distributed to the participant.

Vesting of Awards

The Committee will specify the vesting schedule or conditions of each award. Unless the Committee specifies a different vesting schedule at the time of grant, awards under the 2020 Equity Incentive Plan, other than performance awards, will be granted with a vesting rate not exceeding 20% per year, with the initial installment vesting no earlier than the one-year anniversary of the dateBoard of grant.  If the vesting of an award under the 2020 Equity Incentive Plan is conditioned on the completion of a specified period of service with Provident Bancorp, Inc. or its subsidiaries, without the achievement of performance measures or objectives, then the required period of service for full vesting will be determined by the Committee and evidenced in an award agreement. Notwithstanding anything to the contrary in the 2020 Equity Incentive Plan, at least 95% of the awards available under the plan may not vest more rapidly than over a period of one year, unless accelerated due to death, disability or involuntary termination of employment or service at or following a change in control. Unless otherwise determined by the Committee, vesting will accelerate in the event of death, disability, or upon involuntary termination of employment or service at or following a change in control or, subject to the foregoing requirements and in a manner consistent with the plan, at the discretion of the Committee.

Change in Control

Unless otherwise provided in an award agreement, at the time of an involuntary termination of employment or service at or following a change in control, all stock options then held by the participant will become fully earned and exercisable (subject to the expiration provisions otherwise applicable to the stock option). All stock options may be exercised for a period of one year following the participant’s involuntary termination, provided, however, that no stock option will be eligible for treatment as an incentive stock option in the event the individual exercises the stock option more than three months following involuntary termination of employment. At the time of an involuntary termination of employment or service at or following a change in control, all awards of restricted stock and restricted stock units will immediately become fully vested. In the event of a change in control, any performance measures will be deemed satisfied at the “target” level as of the date of the change in control and vest pro-rata based on the portion of the performance period elapsed at the date of the change in control, unless data supports and the Committee certifies that the performance measures have been achieved at a level higher than the target level as of the effective date of the change in control, in which case, the performance award will vest at the higher level.

Notwithstanding the foregoing, if an acquiring corporation of Provident Bancorp, Inc. or The Provident Bank fails to assume the awards granted under the 2020 Equity Incentive Plan, with the exception of performance awards, or fails to convert the awards to awards for the acquiring corporation’s stock options, restricted stock or restricted stock units, the awards will vest immediately upon the effective time of the change in control. 

Amendment and TerminationDirectors.

The Board of Directors may, at any time, amend or terminaterecommends that stockholders vote “FOR” the 2020 Equity Incentive Plan or any award grantedratification of the appointment of Crowe LLP as the Company’s independent registered public accounting firm.

Fees

The following table sets forth the fees paid by the Company for the years ended December 31, 2022 and 2021 to Crowe LLP.

Audit fees related to the audit of the Company’s annual consolidated financial statements, review of the financial statements included the Company’s quarterly reports on Form 10-Q and fees associated with the audit of internal controls over financial reporting as required under Part 363 of the 2020 Equity Incentive Plan, provided that, except as provided inFDIC annual reporting requirements. Audit-related fees pertain to additional audit fees incurred related to the plan, no amendment or termination may adversely impairreview of the rights of a participant or beneficiary under an award without the participant’s (or the affected beneficiary’s) written consent. The Board of Directors may not amend the 2020 Equity Incentive Plan to materially increase the benefits accruing to participants under the plan, materially increase the aggregate number of securities that may be issued under the plan (other than as provided in the 2020 Equity Incentive Plan), or materially modify the requirements for participation in the plan, without approval of stockholders. Notwithstanding the foregoing, the Committee may amend the 2020 Equity Incentive Plan or any award agreement, to take effect retroactively or otherwise, to conform the plan or an award agreement to current or future law or to avoid an accountingCompany’s digital asset lending practices

treatment resulting from an accounting pronouncement or interpretation issuedfollowing the events that caused the losses recorded during and for the year ended December 31, 2022.  All other fees include fees paid to Crowe LLP pertaining to regulatory filings and assessment tools. 

Pre-Approval of Services by the SecuritiesIndependent Registered Public Accounting Firm

The Audit Committee is responsible for appointing, setting compensation for and Exchange Commissionoverseeing the work of the independent registered public accounting firm. In accordance with its charter, the Audit Committee approves, in advance, all audit and permissible non-audit services to be performed by the independent registered public accounting firm. Such approval can be given either by approving an engagement in advance or Financial Accounting Standards Board subsequentpursuant to a pre-approval policy with respect to particular services. Such approval process ensures that the independent registered public accounting firm does not provide any non-audit services to the adoptionCompany that are prohibited by law or regulation.

During the years ended December 31, 2022 and 2021, 100% of audit and other services provided by Crowe LLP were approved, in advance, by the Audit Committee. 

Audit Committee Report

The Company’s management is responsible for the Company’s internal controls and financial reporting process. The Company’s independent registered public accounting firm is responsible for performing an independent audit of the 2020 Equity Incentive Plan, orCompany’s consolidated financial statements and issuing an opinion on the makingconformity of those financial statements with generally accepted accounting principles. The Audit Committee oversees the award affected thereby, which, in the sole discretionCompany’s internal controls and financial reporting process on behalf of the Committee, may materially and adversely affect the financial condition or results of operations of Provident Bancorp, Inc.

Duration of Plan

The 2020 Equity Incentive Plan will become effective upon approval by the stockholders at the special meeting. The 2020 Equity Incentive Plan will remain in effect as long as any award under it is outstanding; however, no awards may be granted under the 2020 Equity Incentive Plan on or after the ten-year anniversary of the effective date of the plan.  As discussed above, at any time, the Board of Directors may terminateDirectors.

In this context, the 2020 Equity Incentive Plan. Audit Committee has met and held discussions with management and the independent registered public accounting firm. Management represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles and the Audit Committee has reviewed and discussed the consolidated financial statements with management and the independent registered public accounting firm. The Audit Committee discussed with the independent registered public accounting firm matters required to be discussed under Public Company Accounting Oversight Board (“PCAOB”) standards including the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments and the clarity of the disclosures in the financial statements.

Federal Income Tax ConsiderationsIn addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by the PCAOB and has discussed with the independent registered public accounting firm the firm’s independence from the Company and its management. In concluding that the registered public accounting firm is independent, the Audit Committee considered, among other factors, whether the non-audit services provided by the firm were compatible with its independence.

The following is a summaryAudit Committee discussed with the Company’s independent registered public accounting firm the overall scope and plans for their audit. The Audit Committee meets with the independent registered public accounting firm, with and without management present, to discuss the results of their audit, their evaluation of the current federal income tax consequences with respect to awards underCompany’s internal controls, and the 2020 Equity Incentive Plan:overall quality of the Company’s financial reporting.

Non-Qualified Stock Options. The grant of a non-qualified stock option will not result in taxable income toIn performing these functions, the participant.  Except as described below, the participant will recognize ordinary income at the time of exerciseAudit Committee acts only in an amount equal tooversight capacity. In its oversight role, the excessAudit Committee relies on the work and assurances of the fair market valueCompany’s management, which has the primary responsibility for financial statements and reports, and of the shares acquired overindependent registered public accounting firm who, in its report, express an opinion on the exercise price for those shares, and Provident Bancorp, Inc. will be entitled to a corresponding deduction for tax purposes.  Gains or losses realized by the individual upon dispositionconformity of the acquired shares will be treated as capital gainsCompany’s financial statements to generally accepted accounting principles. The Audit Committee’s oversight does not provide it with an independent basis to determine that management has maintained appropriate accounting and losses,financial reporting principles or policies, or appropriate internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the cost basisAudit Committee’s considerations and discussions with management and the independent registered public accounting firm do not assure that the Company’s financial statements are presented in accordance with generally accepted accounting principles, that the shares equal to the fair market valueaudit of the shares at the time of exercise.

Incentive Stock Options. The grant of an incentive stock option will not resultCompany’s financial statements has been carried out in taxable income to the participant. The exercise of an incentive stock option also will not result in taxable income to the participant, provided the participant was, without a break in service, an employee of Provident Bancorp, Inc. or a subsidiary during the period beginning on the date of the grant of the option and ending on the date three months prior to the date of exercise (one year prior to the date of exercise if the participant becomes disabled, as that term is defined in the Internal Revenue Code).

The excess of the fair market value of the shares at the time of the exercise of an incentive stock option over the exercise price is an adjustment that is included in the calculation of the participant’s alternative minimum taxable income for the tax year in which the incentive stock option is exercised. For purposes of determining the participant’s alternative minimum tax liability for the year of disposition of the shares acquired pursuant to the incentive stock option exercise, the participant will have a basis in those shares equal to the fair market value of the shares at the time of exercise.

If the participant does not sell or otherwise dispose of the shares within two years from the date of the grant of the incentive stock option or within one year after the exercise of the stock option, then, upon disposition of the acquired shares, any amount realized in excess of the exercise price will be taxed as a capital gain. A capital loss will be recognized to the extent that the amount realized is less than the exercise price.    If these holding period requirements are not met, the participant will generally recognize ordinary income at the time of the disposition of the shares, in an amount equal to the lesser of: (1) the excess of the fair market value of the shares on the date of exercise over the exercise price; or (2) the excess, if any, of the amount realized upon disposition of the shares over the exercise price, and Provident Bancorp, Inc. will be entitled to a corresponding deduction. If the amount realized exceeds the value of the shares on the date of exercise, any additional amount will be a capital gain. If the amount realized is less than the exercise price, the participant will recognize no income, and a capital loss will be recognized equal to the excess of the exercise price over the amount realized upon the disposition of the shares.

Restricted Stock. A participant will not realize taxable income at the time of the grant of restricted stock, provided that the stock subject to the award is not delivered at the time of grant, or if the stock is delivered, it is subject to restrictions that constitute a “substantial risk of forfeiture” for federal income tax purposes. Upon the later of

deliveryaccordance with generally accepted auditing standards or vestingthat the Company’s independent registered public accounting firm is in fact “independent.”

In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of sharesDirectors, and the Board has approved, that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, for filing with the Securities and Exchange Commission. The Audit Committee also has approved, subject to an award,stockholder ratification, the holder will recognize ordinary income in an amount equal toselection of Crowe LLP as the then fair market value of those shares and Provident Bancorp, Inc. will be entitled to a corresponding deductionCompany’s independent registered public accounting firm for tax purposes. Gains or losses realized by the participant upon dispositionfiscal year ending December 31, 2023.

Audit Committee of the shares will be treated as capital gains and losses, with the basis in the shares equal to the fair market valueBoard of the shares at the time of delivery or vesting. Dividends paid to the holder during the restriction period, if so provided, will also be compensation income to the participant, and Provident Bancorp, Inc. will be entitled to a corresponding deduction for tax purposes. A participant who makes an election under Section 83(b) of the Internal Revenue Code will include the full fair market value of the restricted stock award in taxable income in the year of grant at the grant date fair market value.

Restricted Stock Unit. A participant who has been granted a restricted stock unit will not realize taxable income as long as the award remains in the form of a restricted stock unit. When the restricted stock unit is extinguished and the award is settled, the tax consequences for restricted stock awards (see paragraph above) will be recognized. A restricted stock unit does not have voting rights or dividend rights. However, the Committee may grant dividend equivalent rights.  Since no stock is transferred to the participant on the grant date of the restricted stock unit, an election to have the restricted stock unit taxed at the grant date cannot be made since Section 83(b) of the Internal Revenue Code requires a transfer of stock.

Withholding of Taxes.  Provident Bancorp, Inc. may withhold amounts from participants to satisfy tax withholding requirements. Except as otherwise provided by the Committee, participants may have shares withheld from awards to satisfy the tax withholding requirements, provided the withholding does not trigger adverse accounting consequences.

Change in Control. Any acceleration of the vesting or payment of awards under the 2020 Equity Incentive Plan in the event of a change in control or termination of employment or service following a change in control may cause part or all of the consideration involved to be treated as an “excess parachute payment” under Section 280G of the Internal Revenue Code, which may subject the participant to a 20% excise tax and preclude a deduction by Pioneer Bancorp, Inc. with respect to the awards.

Deduction Limits. Section 162(m) of the Internal Revenue Code generally limits our ability to deduct for tax purposes compensation in excess of $1.0 million per year for each of our principal executive officer, principal financial officer and three additional highest compensated officers during any taxable yearDirectors of Provident Bancorp, Inc. after December 31, 2016.

James A. DeLeo (Chair)

Frank G. Cousins, Jr.

Kathleen Chase Curran

Barbara Piette

Proposal 3—Advisory (Nonbinding) Vote on Executive Compensation resulting from awards under

Our stockholders are being given the 2020 Equity Incentive Planopportunity to vote on an advisory (nonbinding) resolution to approve the compensation of our “Named Executive Officers,” as described in this proxy statement in the compensation tables and narrative disclosure. This proposal, commonly known as a “say-on-pay” proposal, gives stockholders the opportunity to endorse or not endorse the Company’s executive pay program. As a result of a determination made following the recommendation of stockholders at our 2021 Annual Meeting of Stockholders, this vote will be counted toward the $1.0 million limit.held annually until 2027, at which time as we will provide our stockholders with another opportunity to consider such frequency.

Tax Advice. The preceding discussionpurpose of our compensation policies and procedures is based on federal tax lawsto attract and regulations currently in effect, which are subject to change, and the discussion does not purport to be a complete description of the federal income tax aspects of the 2020 Equity Incentive Plan.  A participant may also be subject to state and local taxes in connection with the grant of awards under the 2020 Equity Incentive Plan. Provident Bancorp, Inc. suggests participants consult with their individual tax advisors to determine the applicability of the tax rulesretain experienced, highly qualified executives critical to the awards granted to them.

Accounting Treatment

Under Financial Accounting Standards Board Accounting Standards Codification Topic 718, Provident Bancorp, Inc. is required to recognize compensation expense on its income statement over the requisite service period or performance period based on the grant date fair valueCompany’s long-term success and enhancement of stock options and other equity-based compensation (such as restricted stock).

Awards to be Granted

stockholder value. The Board of Directors has adoptedbelieves the 2020 Equity Incentive Plan, contingent upon stockholder approval. IfCompany’s compensation policies and procedures achieve this objective, and therefore recommend stockholders vote “FOR” the 2020 Equity Incentive Planproposal. Specifically, stockholders are being asked to approve the following resolution:

“RESOLVED, that the compensation paid to the Company’s Named Executive Officers, as disclosed in this proxy statement pursuant to Item 402 of Securities and Exchange Commission Regulation S-K, including the compensation tables and narrative discussion is approved byhereby APPROVED.”

Although nonbinding, the Board of Directors and the Compensation Committee value constructive dialogue on executive compensation and other important governance topics with our stockholders and encourage all stockholders to vote their shares on this matter. The Board of Directors and the Compensation Committee intends to meet promptly after stockholder approval to determinewill review the specific termsvoting results and take them into consideration when making future decisions regarding our executive compensation programs.

Unless otherwise instructed, validly executed proxies will be voted “FOR” this resolution.

The Board of Directors unanimously recommends that you vote “FOR” the resolution set forth in Proposal 3.

Information about Executive Officers

The following provides information regarding our executive officers who are not directors of the awards, including the allocationCompany.

Carol L. Houle, age 51, was appointed Interim President and Chief Executive Officer of awards to executive officers, employees,Provident Bancorp, Inc and non-employee directors. At the present time,BankProv in December 2022, Interim Co-President and exceptCo-Chief Executive Officer effective January 2023, and Co-President and Co-Chief Executive Officer effective February 2023. Ms. Houle has also retained her position as set forth below, no specific determination has been made as to the grant or allocation of awards.

Chief

Clawback Policy

The 2020 Equity Incentive Plan provides that if Provident Bancorp, Inc. is required to prepare an accounting restatement due to its material noncompliance, as a result of misconduct, with any financial reporting requirement under the federal securities laws, any participant who is subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley Act of 2002 or who, if applicable, is subject to clawback under Section 954 of the Dodd-Frank Act must reimburse Provident Bancorp, Inc. with the required amount of any payment in settlement of an award earned or accrued during the 12-month period following the first public issuance or filing with the Securities and Exchange Commission (whichever first occurred) of the financial document embodying such financial reporting requirement. In addition, awards granted under the 2020 Equity Incentive Plan are subject to any clawback policy adopted by the Board of Directors.

Initial Grants to Certain Non-Employee Directors

Non-employee directors who are in the serviceFinancial Officer of Provident Bancorp, Inc. and BankProv, having also previously served as Executive Vice President. Ms. Houle is a Certified Public Accountant, and joined BankProv in 2013. Previously, Ms. Houle was a partner at the accounting firm of the date of the special meeting will automatically be granted the following stock options and restricted stock awards, as of the date of the special meeting, provided that stockholders approve the 2020 Equity Incentive Plan:

_________________________

__________________________Shatswell, MacLeod & Company, P.C., where she worked for 17 years.

(1)Joseph ManciniAmounts are not determinable, as the actual value of the stock options realized will depend on the extent to which the fair market value, age 41, is Executive Vice President and Chief Operating Officer of Provident Bancorp, Inc. common stock exceeds the exercise price of the stock option on the date of exercise. 

These grants will vest over a five-year period, with 20% becoming vested after the completion of one year of service following the date of grant and then 20% percent becoming vested each year of continued service thereafterBankProv. Mr. Mancini joined BankProv in June 2020 as Senior Vice President, Risk and was subsequently promoted in April 2021. Previously, Mr. Mancini was at Radius Bank for the next four years subject to accelerated vestingas Senior Vice President and Chief Information Security Officer and East Boston Savings Bank for 10 years in the event of death, disability or an involuntary termination of service at or following a change in control.  The exercise price of the stock options will equal the fair market value of Provident Bancorp, Inc. common stock on the date of grant.   

The Compensation Committee reviewed peer data and consulted with an independent compensation consultant regarding the initial grants to certain non-employee directors.  The Compensation Committee believes the proposed awards are reasonable and intended to continue to align the economic interest of the directors with other stockholders, consistent with prevailing compensation practices in the competitive marketplace for similarly-situated financial institutions.  

Any future grants to employees and directors under the 2020 Equity Incentive Plan will be determined at the discretion of the Committee which may meet promptly after the approval of the plan.  As of this time, the Committee has made no determination with respect to future grants to directors of Provident Bancorp, Inc. or to any named executive officer.

Required Vote and Recommendation of the Board of Directors

In order to approve the 2020 Equity Incentive Plan, the proposal must receive the affirmative vote of the affirmative vote of a majority of the votes cast at the special meeting.

The Board of Directors recommends a vote “FOR” the approval of the 2020 Equity Incentive Plan.

Proposal 2—Approval of the Adjournment of the Special Meeting

If there are not sufficient votes to constitute a quorum or to approve the 2020 Equity Incentive Plan at the time of the special meeting, the proposal may not be approved unless the special meeting is adjourned to a later date or dates in order to permit further solicitation of proxies.  In order to allow proxies that have been received by the Company at the time of the special meeting to be voted for an adjournment, if necessary, the Company is submitting the question of adjournment to its stockholders as a separate matter for their consideration.  The board of directors of the Company recommends that stockholders vote “FOR” the adjournment proposal.  If it is necessary to adjourn the special meeting, no notice of the adjourned special meeting is required to be given to stockholders (unless a new record date is fixed), other than an announcement at the special meeting before adjournment of the date, time and place to which the special meeting is adjourned.

Executive Compensation

We are a smaller reporting company. As such, we are eligible to take advantage of certain exemptions from various reporting requirements. These include, but are not limited to, reduced disclosure obligations regarding executive compensation in our proxy statements, including the requirement to include a specific form of Compensation Discussion and Analysis.

The objective of our executive compensation program is to attract, retain, and motivate leaders who are committed to executing on our business strategy and creating long-term value for our stakeholders. To help us achieve these objectives, the Compensation Committee has designed an executive compensation program that consists of fixed and variable pay elements in the form of base salaries, annual cash and long-term equity incentives. The program is built on a foundation of sound compensation governance practices and policies, which include the following:

The formal stockholder advisory votes on pay (“Say-on-Pay”) provides a valuable barometer for how our programs are perceived by the full spectrum of our investors. We take this advisory vote seriously and work diligently to understand the stockholder and proxy advisory firm perspectives. Over 95% of the votes cast by stockholders were cast in favor of our Say-on-Pay vote in 2022.

Summary Compensation Table



The table below summarizes, for the years ended December 31, 20192022 and 2018,2021, the total compensation paid to, or earned by, Mr.David P. Mansfield, who servesserved as The Provident Bank’sBancorp, Inc. and BankProv’s President and Chief Executive Officer Mr. Withee, who serves as The Provident Bank’s President and Chief Lending Officer, and Ms.for the majority of the year ended December 31, 2022, Carol L. Houle, who servesserved as TheInterim Chief Executive Officer for the remainder of the year ended December 31, 2022, and the other individual who served as an executive officer for Provident Bank’s Executive Vice PresidentBancorp, Inc. and Chief Financial Officer.BankProv during the year ended December 31, 2022. We refer to these individuals as “Named Executive Officers.” named executive officers (“NEOs”).



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(1)Reflects discretionary cash bonuses.

(2)Represents cash incentives earned under The Provident Bank Executive Annual Incentive Plan. See “—Executive Annual Incentive Plan” for further details. 

(3)The amounts reflect what we have paid to, or reimbursed, the applicable Named Executive Officer for various benefits we provide.  A break-down of the various elements of compensation in this column for the year ended December 31, 2019 is set forth in the table immediately below.



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Employment Agreements

The Provident Bank

BankProv has entered into employment agreements with Messrs. MansfieldReilly and WitheeMancini and Ms. Houle. ThePursuant to the employment agreements, with Messrs. MansfieldMr. Reilly and Withee have termsMs. Houle, serve as Co-President and Co-Chief Executive Officers of three years.the Company and BankProv, and. Ms. Houle also serves as the Chief Financial Officer of the Company and BankProv. Mr. Mancini serves as the Chief Operating Officer of the Company and BankProv. The employment agreement with Mr. Reilly has a term of one year and the amended and restated employment agreements with Ms. Houle hasand Mr. Mancini each have a term of two years. TheEach year the disinterested members of the Board of Directors must conduct

a comprehensive annual performance evaluation and affirmatively approve any extension of the terms of the agreements with Ms. Houle and Mr. Mancini for an additional year or determine not to extend the term of any of the agreements. The Board of Directors may also extend the term of the employment agreement with Mr. Reilly for one year.

The employment agreements provide Messrs. MansfieldMr. Reilly, Ms. Houle and Withee and Ms. HouleMr. Mancini with current base salaries of $533,000, $375,000$472,750, $472,750 and $309,850,$345,000, respectively. The Provident BankBankProv may increase the base salaries from time to time. In addition to base salaries, the executives are entitled to participate in any employee benefit plans and bonus programs in effect from time to time for senior executives of The Provident Bank. The Provident BankBankProv. Mr. Reilly and Ms. Houle have a short-term incentive bonus opportunity of at least 35% of their base salaries. BankProv will also reimburse the executives for all reasonable business expenses incurred by them in the performance of their duties and responsibilities.  Mr. Reilly also receives a monthly payment of $597.50 as reimbursement for after-tax Medicare payments.

In the event of an executive’s involuntary termination of employment for reasons other than cause, disability or death,without “cause” (as defined in the agreements), or in the event of his or her resignation for “good reason,”reason” (as defined in the agreements) in either case prior to the attainment of age 68 or 65, he or sherespectively, Mr. Reilly and Ms. Houle will each receive a severance payment equal to the sum of (i) his or herthe base salary then in effect and (ii) his or her “Average Bonus”, (defined below) that would have been paid through the expiration date of the respective employment agreement. These payments increaseMr. Mancini will receive a lump sum severance payment equal to three times (in the casebase salary that would have been paid through the expiration date of Messrs. Mansfield and Withee) and two times (in the case of Ms. Houle) the sum of (i) and (ii), above, in the eventhis employment agreement as well as his pro rata “Average Bonus” (defined below). If the termination of employment occurs in connection with or following a change onin control, or if the agreement has a remaining termseverance payments for Mr. Reilly and Ms. Houle will equal two times the sum of more than 24 months attheir base salary and Average Bonus and the time of termination, in the case ofseverance payment for Mr. Mansfield.Mancini will equal two times his base salary. For purposes of the employment agreements, the term “Average Bonus” means the average of the aggregate bonuses or other cash

incentive compensation paid (or accrued, but not yet paid) to the executive for the three calendar years immediately preceding the termination of employment. The Provident Bank will make the payments in 12 monthly installments, unless the termination of employment occurs within two years of a change in control, in which case The Provident Bank will make the payment in a lump sum at the time of the termination of employment.  In addition, the executivesMs. Houle and Mr. Mancini will be entitled to receive from The Provident Bank continued life insurance and non-taxable medical and dental insurance coverage through the then remaining unexpired term of the agreementagreements, and all outstanding awards under The Provident Bank Amended and Restated Long-Term Incentive PlanMs. Houle will become immediately and fully vested. Underalso be entitled to receive continued life insurance coverage through the employment agreements, thethen remaining unexpired term “good reason” includes: (i) the failure of the Board of Directors to elect or continue to employ the executive in his or her current position or a material reduction in the executive’s authority, duties or responsibilities; (ii) a reduction in the executive’s base salary; or (iii) a material breach of any provision of the agreement that is not cured within 30 days of notice of the breach from the executive. In addition, the term “good reason” includes, if the event occurs within two years following a change in control: (i) a relocation of his or her principal place of employment by more than ten miles; (ii) the failure of The Provident Bank to continue to provide the executive with certain employee benefits substantially similar to those available to the executive prior to the change in control; or (iii) the failure of The Provident Bank to obtain a satisfactory agreement from any successor to assume and honor the employment agreement.

In addition, should The Provident BankBankProv terminate an executive’sthe employment of either Mr. Reilly or Ms. Houle following the executive becoming disabled, The Provident BankBankProv will continue to pay the executive his or her base salary from the date of the termination of employment until the earlier of: (i) the expiration offor up to 180 days; (ii) the date on which long-term disability benefits are payable to the executive under any plan covering employees of The Provident Bank; (iii) the executive’s death; or (iv) the date the term of the employment agreement expires.days. If at the end of 180 days, the executive is not yet receiving disability payments under a plan covering employees of The Provident Bank, The Provident BankBankProv, BankProv will continue to pay the executive his or her base salary at a rate of 60% until the earlier of: (i) the date he or she becomes entitled to disability benefits under such a plan; (ii) his or her death; or (iii) the expiration of the term of the respective employment agreement.

In the event of the death of any of the executives The Provident Bankduring the term of the respective agreement, BankProv will pay his or her beneficiaries the base salary the executive would have earned for six months following his or her death, and his or herMs. Houle’s and Mr. Mancini’s family will continue to receive medical coverage for one year at the same out-of-pocket expense that the executive paid prior to her or his death, respectively.

If either Mr. Reilly, Ms. Houle, or her death.

If the executiveMr. Mancini voluntarily terminates employment on account of his or her “retirement” (that is on or after attaining age 6268 for Messrs. Mansfield and Withee,Mr. Reilly, or 65 for Ms. Houle)Houle or Mr. Mancini), no severance shall be paid. In the executiveevent of such voluntary termination on account of her retirement, Ms. Houle will be entitled to continue to receive medical benefits at the same level in effect on, and onat the same out-of-pocket cost to the executive as of, his orthe date of her termination of employmentretirement for a period of one year.  The executive

None of the executives will not be entitled to any severance benefits under thetheir respective employment agreement if The Provident BankBankProv terminates the executive’s employment for “cause” (as defined under the employment agreement).



Upon any termination of employment that would entitle an executive to a severance payment (other than a termination in connection with a change in control), the executive will be required to adhere to one-year non-competition and non-solicitation covenants.covenants for up to one year.

Executive Annual Incentive Plan

The Provident Bank

BankProv has adopted The Provident Bank Executive Annual Incentive Plan, which is designed to align the interests of the executives of The Provident BankBankProv with the overall performance of The Provident BankBankProv and Provident Bancorp, Inc.

Employees selected by the Compensation Committee, which include the Named Executive Officers, are eligible to participate in the plan. For each plan year (which is the calendar year), theThe Compensation Committee determine thedetermines an annual bonus award amount, designated as a percentage of base salary, and the performance objectivesmetrics and goals that must be satisfied for the participant to receive the annual bonusincentive award. The specific performance objectives will bePlan metrics are determined annually by the Compensation Committee, but generally include objective performance targetsquantitative goals based on financial performance, growth, asset quality and risk management and subjective performance objectives, such as particular qualitative factors for the participant,assessments of individuals, based on his or her duties to The Provident Bank.a  participant’s job duties. Each performance objective will specify level of achievements at “threshold,”metric is defined using “minimum”, “target” and “maximum” performance levels and will beare weighted by priority as a percentage of the total annual bonus award payable to the participant.

The bank-wide performance objectives for 2019 focused on the following metrics, with different metrics selected for different Named Executive Officers: (i) return on average assets, (ii) efficiency ratio, and (iii) loan growth.  Each performance objectivemetric was assigned a percentage weightweighting to reflect its importance and the Named Executive Officer’s directOfficers’ impact in meetingachieving the performance objective.

For 2019, peer group target results, and The Provident Bank’s results were as follows:

Based on these results, Messrs. Mansfield and Withee, and Ms. Houle, earned an annual incentive award for the year ended December 31, 2019 equal to 44.80% of base salary, 38.40% of base salary and 38.40% of base salary, respectively.goal.

The bank-wide performance objectives for 20182022 focused on the following metrics, with different metrics selected for different Named Executive Officers:metrics: (i) return on average assets (40% weighting), (ii) deposit growth (30% weighting), (iii) efficiency ratio (15% weighting) and (iii) loan growth.  Each(iv) team/individual performance objective was assigned a percentage weight to reflect its importance(15% weighting). Return on average assets, efficiency ratios and deposit growth are based on the Named Executive Officer’s direct impact in meeting the performance objective.

For 2018, peer group target results, and The Provident Bank’s results were as follows:

Based on these results, Messrs. Mansfield and Withee, and Ms. Houle, earned an annual incentive awardapproved budget for the year ended December 31, 2018 equal to 48.30% of base salary, 41.40% of base salary and 41.40% of base salary, respectively.BankProv.

The annual bonusNamed Executive Officers award will be payable to each participant inopportunities under the Executive Annual Incentive Plan, as a cash lump sum within 2.5 months following the endpercentage of each plan year,base salary, were:

Target results are established using percentile performance of a reference group of similarly-sized banks that focus on commercial business. BankProv’s results were adjusted for non-recurring items and were as follows:

Although BankProv met its goal with respect to the extentefficiency ratio component of the performance objectives are determined to be satisfied byExecutive Annual Incentive Plan, the Compensation Committee.Committee determined that no annual incentive award would be paid for the year ended December 31, 2022 to Messrs. Mansfield and Mancini, or to Ms. Houle, based upon the Company’s net loss for the year.

Benefit Plans

401(k) Plan.  The Provident BankBankProv currently maintains a  401(k) plan that is a tax-qualified profit sharingprofit-sharing plan with a salary deferral feature under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”).  All employees who have attained age 21 arefor eligible toemployees. The Named Executive Officers participate in the 401(k) Plan provided, however thaton the employee must complete one yearsame terms as other employees of service to be eligible to receive a safe harbor matching contribution or discretionary profit sharing contribution from The Provident Bank.BankProv.

A participant may contribute up to 100% of his or her compensation to the 401(k) Plan on a pre-tax or after tax (“Roth”) basis, subject to the limitations imposed by the Internal Revenue Code. For 2019,2023, the pre-tax deferral contribution limit is $19,000$22,500 provided, however, that a participant over age 50 may contribute on a pre-tax basis, an additional $6,000$7,500 to the 401(k) Plan (subject to applicable cost-of-living adjustments in future years). In addition to salary deferral contributions, the 401(k) Plan provides that The Provident BankBankProv will make a safe harbor matching contribution to each participant’s account equal to 100% of the participant’s contribution, up to a maximum of 6% of the participant’s eligible compensation earned duringcontributed to the plan year.401(k) Plan.  BankProv may also make a nonelective contribution to eligible employees, as determined by the Board of Directors. A participant is always 100% vested in his or her salary deferral contributions and safe harbor matching contributions.  However,contributions, and a participant will vest 100% in his or herBankProv’s discretionary profit sharing contributions following the completion of three years of service. Participants also become fully vested in the event of their death or disability. The 401(k) Plan permits a participant to direct the investment of his or her own account into various investment options. 

Participants inoptions, including the 401(k) Plan are permitted to invest elective deferrals and employer matching contributions incommon stock of Provident Bancorp, Inc. common stock. 

Employee Stock Ownership Plan. In connection with its second-step conversionBankProv currently maintains a tax-qualified ESOP for eligible employees. The Named Executive Officers participate in 2019, the ESOP on the same terms as other employees of BankProv.  

The Provident Bank’s employee stock ownership plan trustee purchased, on behalf of the employee stock ownership plan, 816,992ESOP holds the shares of Provident Bancorp, Inc. commonpurchased in connection with our stock and refinanced the original loanofferings. Shares that have not been allocated to the employee stock ownership plan with an additional $8.2 million.  When combined with the remaining shares purchased in Old Provident’s initial stock offering in 2015, the employee stock ownership planaccounts of participants are held 1,538,868 shares as of December 31, 2019.

The loan will be repaid principally through The Provident Bank’s contribution to the employee stock ownership plan and dividends payable on common stock held by the employee stock ownership plan over the anticipated 15-year term of the loan.  The interest rate for the employee stock ownership plan loan is an adjustable-rate equal to the prime rate, as published in The Wall Street Journal,on the closing date of the offering.  The interest rate will adjust annually and will be the prime rate on the first business day of the calendar year, retroactive to January 1 of such year.  

The trustee holds the shares purchased by the employee stock ownership plan in an unallocated suspense account. Shares will beUnallocated shares are released from the suspense account on a pro-rata basis as the loan is repaid by the employee stock ownership plan.  The trustee allocatesrepaid. Each year, the shares released amongare allocated to the participants’ accounts based on the basis of each participant’s proportional share of compensation relative to all participants.compensation. Participants will become 100% vested in their benefitbenefits under the ESOP after the completion of three years of service. Participants who were employed immediately prior to the stock offering will receive credit for vesting purposes for years of service prior to adoption of the employee stock ownership plan.  Participants also will become fully vested upon normal retirement, death or disability, a change in control, or termination of the employee stock ownership plan.ESOP. Generally, participants will receive distributions from the employee stock ownership planESOP upon severance from employment.  The employee stock ownership plan reallocates any unvested shares forfeited upontheir termination of employment among the remaining participants.

employment.

Supplemental Executive Retirement Plans.  The Provident BankBankProv has entered into supplemental executive retirement agreements (“SERPs”) with Messrs.Mr. Mansfield and Withee and Ms. Houle. Under the SERPs, each executive becomes entitled to receive a benefit following his or her separation from service other than on account of

cause (as defined in the agreements). Upon a separation from service, The Provident BankBankProv will pay a lump sum benefit to the executive equal to the actuarial equivalent of a 20-year stream of annual payments of a certain benefit percentage multiplied by the executive’s final average compensation.

Under the agreements,agreement with Ms. Houle, the benefit percentage equals a certain percentage (62% for Mr. Mansfield, 60% for Mr. Withee and 20% for Ms. Houle) multiplied by a factor that represents theher service of the executive through his or her attainment of age 62. Messrs. Mansfield and Withee are fully vested, while Ms. Houle is subject to a five-year cliff vesting schedule.  The executives’fully vested in her benefits under the SERP. Ms. Houle’s SERP benefits will be immediately forfeited in the event of a termination by The Provident Bank as a result of aBankProv for “specially defined cause” (as such term is defined in the SERPs)SERP). The benefit percentage factor will automatically equal 62%20%, 60% or 20% in the event of the executive’sMs. Houle’s death or disability or upon a change in control,control. Benefits under Ms. Houle’s SERP are paid in a single lump sum.

Deferred Bonus Agreement. In conjunction with a decision to fix the “final average compensation” for Mr. Mansfield’s SERP in 2020, BankProv entered into a deferred cash bonus agreement with Mr. Mansfield, effective December 23, 2020. Under the terms of the deferred cash bonus agreement, Mr. Mansfield was to receive a total bonus of $354,900 payable in three installments of $118,300, which vested on September 30, 2021 and Ms. Houle would also become fully vested under such circumstances.   InSeptember 30, 2022, with the casefinal installment set to vest on September 30, 2023, respectively. Each installment was paid within 30 days following the vesting date, with the exception of Messrs. Mansfieldthe final installment which was unvested and Withee, if the executive dies, or terminates employment involuntarily or with “good reason” within three years or a change in control or if the executive experiences a disability, he will become entitled to the retirement benefit he would have earned at age 62 by providing for an assumed increase inforfeited upon his annual compensation for each year from his separation from service, death or disability until the date he would have attained age 62.  If Messrs. Mansfield or Withee experiences a disability, the benefits will be paid to them at age 62.resignation.

2016 Equity Incentive Plan.Plans. In 2016, our Board of Directors adopted, and stockholders approved,We currently maintain two equity incentive plans, the Provident Bancorp, Inc. 2016 Equity Incentive Plan (the “Equityand the 2020 Equity Incentive Plan”), which providesPlan. The Equity Incentive Plans allow us to provide officers, employees and directors of Provident Bancorp, Inc. and its subsidiaries, including The Provident Bank,BankProv, with additional incentives to promote the growth and performance of Provident Bancorp, Inc. Subject to permitted adjustments for certain corporate transactions, the Equity Incentive Plan authorizes the issuance or delivery to participants of up to 1,263,279 shares (split-adjusted) of Provident Bancorp, Inc. common stock pursuant toThe plans permit grants of restricted stock awards, restricted unit awards, incentive stock options and non-qualified stock options; provided, however, thatoptions. As of December 31, 2022, there were 3,027 shares available for the maximum number of shares of stock that may be delivered pursuant to the exercisegrant of stock options is 902,344 (split-adjusted)  (alland 986 shares available for the grant of which may be granted as incentive stock options) and the maximum number of shares of stock that may be issued as restricted stock awards orand restricted stock units is 360,935 (split-adjusted).under the 2016 Equity Incentive Plan. As of that date, there were 256,814 shares available for the grant of stock options and 116,624 shares available for the grant of restricted stock and restricted stock units under the 2020 Equity Incentive Plan.



Outstanding Equity Awards at Year End. The following table sets forth information with respect to outstanding equity awards as of December 31, 2019 for the Named Executive Officers.Officers that have been granted under our 2016 and 2020 Equity Incentive Plans.



APPENDIX A

PROVIDENT BANCORP, INC.

2020 Equity Incentive Plan

ARTICLE 1 — GENERAL

Section 1.1Purpose, Effective Date and Term.    The purpose of the Provident Bancorp, Inc. 2020 Equity Incentive Plan (the “Plan”) is to promote the long-term financial success of Provident Bancorp, Inc. (the “Company”), and its Subsidiaries, including The Provident Bank (the “Bank”), by providing a means to attract, retain and reward individuals who contribute to that success and to further align their interests with those of the Company’s stockholders through the ownership of additional shares of common stock of the Company and/or through compensation tied to the value of the Company’s common stock. The “Effective Date” of the Plan shall be the date on which the Plan satisfies the applicable stockholder approval requirements. The Plan shall remain in effect as long as any Awards are outstanding; provided, however, that no Awards may be granted under the Plan after the day immediately prior to the ten-year anniversary date of the Effective Date.

Section 1.2Administration.    The Plan shall be administered by the Compensation Committee of the Board of Directors (the “Committee”) in accordance with Section 5.1.

Section 1.3Participation.    Each individual who is granted and holds an Award in accordance with the terms of the Plan shall be a Participant in the Plan (a “Participant”). The grant of Awards shall be limited to Employees, Directors and service providers of the Company or any Subsidiary.

Section 1.4Definitions.    Capitalized terms used in this Plan are defined in Article 8 and elsewhere in this Plan.

ARTICLE 2 — AWARDS

Section 2.1General.    Any Award under the Plan may be granted singularly or in combination with another Award or other Awards. Each Award under the Plan shall be subject to the terms and conditions of the Plan and any additional terms, conditions, limitations and restrictions as the Committee shall provide with respect to the Award and as evidenced in an Award Agreement. In the event of a conflict between the terms of an Award Agreement and the Plan, the terms of the Plan will control. Subject to the provisions of Section 2.2(d), an Award may be granted as an alternative to or replacement of an existing Award under the Plan or any other plan of the Company or any Subsidiary or as the form of payment for grants or rights earned or due under any other compensation plan or arrangement of the Company or any Subsidiary, including without limitation the plan of any entity acquired by the Company or any Subsidiary. The types of Awards that may