UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported):   January 30, 2019
 
Northfield Bancorp, Inc.
(Exact name of registrant as specified in its charter)

Delaware
001-35791
80-0882592
(State or other jurisdiction
of incorporation)

(Commission File No.)
(I.R.S. Employer
Identification No.)

 
581 Main Street, Woodbridge, New Jersey
 
07095
(Address of principal executive offices)
 
(Zip code)
 
Registrant’s telephone number, including area code:  (732) 499-7200
  
Not Applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨




Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Approval of Management Cash Incentive Governing Plan and Management Cash Incentive Plan

On January 30, 2019, the Board of Directors of Northfield Bancorp, Inc. (the Company) approved the Company’s Management Cash Incentive Governing Plan and its 2019 Management Cash Incentive Plan. The Management Cash Incentive Governing Plan is attached to this Form 8-K as Exhibit 10.1. The 2019 Management Cash Incentive Plan is attached to this Form 8-K as Exhibit 10.2.


Item 9.01.      Financial Statements and Exhibits.

(a)
Not Applicable.

(b)
Not Applicable.

(c)
Not Applicable.

(d)
Exhibits.


Exhibit No.        Exhibit
Management Cash Incentive Governing Plan
2019 Management Cash Incentive Plan




SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
NORTHFIELD BANCORP, INC.

 
 
 
DATE:  February 5, 2019
By:
/s/ William R. Jacobs
 
 
William R. Jacobs
 
 
Chief Financial Officer
 
 
(Principal Financial and Accounting Officer)


Exhibit 10.1


EXHIBIT101IMAGE1.JPG


MANAGEMENT CASH INCENTIVE GOVERNING PLAN
Effective January 1, 2019

1. Purpose of the Plan
The purpose of the Management Cash Incentive Governing Plan (the “Plan”) is to provide the foundation for the Management Cash Incentive Plan, and all other cash incentive plans. The Plan is designed to (i) motivate, recognize, and reward designated Plan Participants for their contributions to the sustained performance and success of Northfield Bancorp, Inc. and its subsidiaries (the “Company” or the “Bank”) and (ii) link executive compensation to the attainment of specific corporate performance. The Plan serves as a critical component of a competitive total compensation package that enables the Company to attract and retain talent needed to drive the Company’s future success.
2. Definitions
Affiliate means Northfield Bank, or any other entity controlled by the Company.
Award means a cash payment made to a Participant pursuant to the terms of this Plan.
Base Salary means, as to a Performance Period, a Participant’s actual salary rate in effect as of the last business day of the Performance Period. Such salary shall be before (i) deductions for taxes and benefits, and (ii) deferrals of compensation pursuant to Company- or Affiliate-sponsored plans.
Board means the Board of Directors of the Company.
Code means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code shall include such section, any valid regulation promulgated there under, and any comparable provision of any future legislation or regulation amending, supplementing or superseding, such section or regulation.
Committee means the Compensation Committee of the Company’s Board of Directors, or any other committee appointed by the Board pursuant to Section 3.1 of the Plan.
Company means Northfield Bancorp, Inc, a Delaware corporation.
Determination Date means, as to a Performance Period, the date upon which the Committee sets forth in writing the Performance Measures attributable to a Participant or the Participants.  The Determination Date shall be no later than the earlier of (i) 90 days after the commencement of the Performance Period or (ii) the date on which 25 percent of the Performance Period has elapsed, provided, in either case, that the outcome is substantially uncertain at the time the Committee actually establishes the Performance Measures. 1  
Participant means, as to any Performance Period, an officer of the Company or an Affiliate at the level of senior vice president or above, or one who has been selected by the Committee for participation in the Plan for such Performance Period.
Performance Measure means the performance criteria set forth in Section 5.4 of the Plan.


_______________________________________________________________________________________________________________________________________________________________________________  
1 The “Determination Date” concept is set forth under the Code Section 162(m) regulations. Accordingly, since the qualified performance-based compensation exemption has been eliminated, technically, this concept is no longer required. However, we believe this may be a valuable concept to preserve, i.e., actually setting the performance measures before the outcome is likely to be quantified.


Performance Period means a period of not less than 12 months and not greater than 36 months that is designated by the Committee for the purposes specified herein. Subject to Code Section 162(m), the Committee may designate one or more Performance Periods which may or may not run concurrently.
Termination of Employment means the time when the employee-employer relationship between the Participant and the Company and its Affiliates is terminated for any reason, including, but not limited to, a termination by resignation, discharge, death, permanent disability, or retirement, but excluding any such termination where there is a simultaneous reemployment by either the Company or an Affiliate.
3. Administration of the Plan
3.1 The Plan shall be administered by the Compensation Committee (the “Committee”) of the Company who are “independent directors” as defined by the stock exchange rules to which the Company is subject..
3.2 Subject to the provisions of the Plan, the Committee shall have exclusive authority to select the Plan Participants for a Performance Period, determine the relative percentages of the Award based upon Company performance and individual performance, and determine the Award levels and the performance thresholds that must be achieved prior to payment of Awards. For each Performance Period, all such actions shall be taken by the Determination Date. Notwithstanding anything to the contrary herein, all Awards made by the Committee and any performance criteria established by the Committee with respect to an Award, shall be subject to the ratification of the Board of Directors.
3.3 The Committee shall have all discretion and authority necessary or appropriate to administer the Plan, including, but not limited to, the power to interpret the Plan, to prescribe, amend, and rescind rules and regulations relating to it and to make all other determinations necessary or advisable in the administration of the Plan. Such determination shall be final and binding upon all persons having an interest in the Plan.
3.4 A majority of the Committee shall constitute a quorum, and the acts of a majority of the members present at a meeting at which a quorum is present, or any action taken without a meeting by a writing executed by a majority of the Committee, shall constitute the act of the Committee.
3.5 All expenses and liabilities incurred by the Committee in the administration of the Plan shall be borne by the Company. The Committee may employ attorneys, consultants, accountants, or other persons, and the Committee, the Company and its officers and directors shall be entitled to rely upon the advice, opinion, or valuations of any such persons, in accordance with the Committee’s charter approved by the Board of Directors. No member of the Committee shall be personally liable for, and all members of the Committee shall be fully protected by the Company in respect of, any action, determination, or interpretation taken or made with respect to the Plan, unless such action, determination, or interpretation constitutes criminal misconduct, willful negligence, or demonstrates bad faith.
4. Eligibility and Participation
The Plan is designed for the benefit of those senior officers, and selected team members of the Company and its Affiliates whose responsibilities and performance significantly influence Company results. Plan Participants shall be selected by the Committee for each Performance Period prior to or on the Determination Date for such Performance Period. Participation in the Plan is on a Performance Period basis only and in the sole discretion of the Committee. No Participant with respect to a specific Performance Period shall be entitled to participate in the Plan in a subsequent Performance Period unless selected as a Participant for such Performance Period by the Committee.
5. Determination of Awards
5.1 Prior to or on the Determination Date, the Committee, in its sole discretion, shall assign each Participant a target Award and prescribe all other factors to be used for determining the amount of the Awards to be paid to Participants pursuant to the Plan for a Performance Period. The Committee shall also prescribe the percentage of the target Award for each Participant that will be determined based upon


Company Performance Measures and the percentage that will be determined based upon individual performance factors. Target Awards shall be expressed as a percentage of Base Salary. Notwithstanding any other provision of the Plan, the maximum Award payable pursuant to the Plan to a Participant for any Performance Period shall be 150% of the Target Award.
5.2 The Committee shall prescribe what portion of the target Award will be determined based upon each type of Performance Measure to be used for a Performance Period, and the level of achievement of each such goal for the Performance Period that must be reached to earn the portion of the target Award related to such goal. The Committee may also prescribe levels of achievement that will result in an Award higher or lower than the target Award and set minimum achievement thresholds below which no Award based on the particular performance goal will be paid.
5.3 Actual corporate performance will determine the amount of the portion of the Award related to Company performance for each individual Participant that has been earned based on the extent to which the pre-determined thresholds are achieved or exceeded by the Company. All calculations related to the Performance Measures listed in Sections 5.4 shall be made in accordance with generally accepted accounting principles and may exclude any significant non-recurring items that are specified by the Committee. Specifically, (i) Performance Measures based upon cash earnings or cash returns may refer to, or be calculated based upon, net income adjusted to exclude non-cash charges for goodwill amortization and non-cash amortization expenses relating to employee stock ownership plans and restricted stock plans and (if applicable) related tax benefits and (ii) Performance Measures based upon cash operating expenses shall refer to operating expenses, calculated in accordance with GAAP, adjusted to eliminate non-cash charges for goodwill amortization and non-cash amortization expenses relating to employee stock ownership plans and restricted stock plans and (if applicable) related tax benefits.
5.4 The Committee, in its sole discretion, may select the Performance Measures for any Performance Period from among the following:
i. Book value or tangible book value per share
ii. basic earnings per share;
iii. basic cash earnings per share;
iv. diluted earnings per share;
v. diluted cash earnings per share;
vi. net income or net income before taxes;
vii. cash earnings;
viii. net interest income;
ix. non-interest income;
x. non-interest expense to average assets ratio;
xi. efficiency ratio;
xii. cash efficiency ratio;
xiii. return on average assets;
xiv. cash return on average assets;
xv. return on average stockholders' equity;
xvi. cash return on average stockholders' equity;
xvii. return on average tangible stockholders' equity;
xviii. cash return on average tangible stockholders' equity;
xix. core earnings;


xx. operating income;
xxi. operating efficiency ratio;
xxii. net interest rate margin or net interest rate spread;
xxiii. growth in assets, loans, or deposits;
xxiv. loan production volume;
xxv. non-performing loans;
xxvi. cash flow;
xxvii. strategic business objectives, consisting of one or more objectives based upon meeting specified cost targets, business expansion goals, and goals relating to acquisitions or divestitures, or goals relating to capital raising and capital management; or
xxviii. any combination of the foregoing.
5.5 The Committee shall prescribe the portion of the target Award that will be determined based upon each type of individual performance goal to be used for a Performance Period, and the levels of achievement of each such goal for the Performance Period that must be reached to earn the portion of the target Award related to such goal. The Committee may also prescribe levels of achievement that will result in an Award higher or lower than the target Award and set minimum achievement thresholds below which no Award based on the particular performance goal will be earned. The portion of the Award related to individual performance goals shall be based upon satisfactory achievement of the individual performance goals established by the Committee. The Committee shall take into consideration the advice of the President and Chief Executive Officer of the Company for this purpose, but the Committee shall make the final determination.
5.6 Except as provided in this Section 5.6, Performance Measures established for a specified Performance Period shall not thereafter be subject to revision or alteration. In the event the Committee determines that a revision or alteration of the target Awards or Performance Measures for a specified Performance Period is appropriate, the Committee shall reestablish such target Awards or Performance Measures to maintain as closely as possible the previously established expected level of overall performance, taken as a whole, as is practicable. In connection with a possible revision or alteration of Performance Measures, the Committee may consider factors including, but not limited to, the occurrence of a business combination involving the Company, the declaration and distribution of stock dividends or stock splits, mergers, consolidation or reorganizations, acquisitions or dispositions of a material business units, or infrequently occurring or extraordinary gains or losses.
5.7 The Committee may, in its sole discretion, adjust the amount of an Award for any or all Participants if it determines that circumstances (including, but not limited to, the subjective appraisal of the Participant’s performance for the Performance Period) warrant.
5.8 Any provision of this Plan to the contrary notwithstanding, in the event that an individual becomes employed by the Company or an Affiliate after the beginning of the Performance Period and the Committee, in its sole discretion, selects such individual for participation in the Plan for such initial Performance Period of employment, the Committee may designate a short performance period (instead of the Performance Period) for purposes of this Plan for such Participant that ends on the last day of such Performance Period but begins on a date that is later than the first day of such Performance Period. In such event, the Committee shall establish levels of achievement for the short performance period for those performance factors selected by the Committee for such Participant under the preceding provisions of this Article 5. References in the Plan to the “Performance Period” with respect to any such Participant shall refer to the short performance period established by the Committee pursuant to this Section 5.6.




6. Payments To Participants and Reimbursements to the Company
Prior to the payment of any Awards, the Committee shall certify in writing the level of achievement for each Company performance goal for the Performance Period and the level of achievement by each Participant with respect to any individual performance goals applicable to such Participant’s award and determine the amount of the Award, if any, payable to each Participant. Payment of Awards shall be made in cash as soon as administratively practicable following the Committee’s certification. Participants shall be entitled to elect, prior to a date specified by the Compensation Committee, to defer receipt of a cash payment in accordance with the terms of any Company deferred compensation plan in effect at the time and applicable to such cash payment. Notwithstanding any contrary provision of the Plan, (a) if a Participant experiences a Termination of Employment prior to the end of a Performance Period and the established performance goals have been satisfied fully or partially, the Committee, in its sole discretion, may reduce or eliminate the Award to be paid to such Participant for such Performance Period pursuant to this Plan and the Award, if any, paid to such a Participant will be paid at the same time as applicable to all Participants, and (b) no provision of the Plan shall be construed to create a trust or to establish or evidence any Participant’s claim of any right other than as an unsecured general creditor with respect to any payment to which he or she may be entitled. The Company shall withhold all applicable taxes required by law from any payment, including any federal, FICA, state, and local taxes.
Participants of this Plan agree that the Company has the right to recoup or “clawback” awards paid under this Plan if the Compensation Committee concludes that such awards were based on information that was later found to be materially incorrect, including awards that were determined, in whole or in part, on financial statement information that is subsequently restated. This includes any error that is material to previously-issued financial statements that results in notification that they cannot be relied upon. Additionally, if the Committee determines, upon review of the facts and circumstances, that an executive officer conducted his or herself in violation of the terms of the executive officer’s Employment Agreement, the Committee may determine that incentive compensation awards may or may not be revoked. Participants of the Plan agree that such recoupment would be made in accordance with prevailing laws and regulations. The Company also has the right to revise its clawback requirements, or policies subject to this Plan, if changes in laws and regulations require (or permit) the Company to do so.
7. Employment Rights
Nothing in the Plan shall confer upon any Participant the right to continue in the employ of the Company or its Affiliates or shall interfere with or restrict in any way the rights of the Participant’s employer to discharge or change the terms of employment of any Participant at any time for any reason whatsoever, with or without cause.
8. Effect Upon Other Plans
The adoption of the Plan shall not affect any other equity or other compensation or incentive plan in effect for the Company or any Affiliate, and the Plan shall not preclude the Board from establishing any other forms of incentive compensation for employees of the Company or its Affiliates.
9. Governing Law
The Plan shall be construed, administered, and enforced according to the laws of the State of New Jersey, without giving effect to the conflict of laws principles thereof, except to the extent that such laws are preempted by federal law.
10. Notices
Any communication required or permitted to be given under the Plan, including any notice, direction, designation, comment, instruction, objection, or waiver, shall be in writing and shall be deemed to have been given at such time as it is delivered personally or five (5) days after mailing if mailed, postage prepaid, by registered or certified mail, return receipt requested, addressed to the Committee, at


the Company’s principal executive offices, and to a Participant, to the Participant’s address as shown in the Company’s personnel records.
11. Successors and Assigns
The provisions of the Plan shall inure to the benefit of and be binding upon, the Participants and their respective legal representatives and testate or intestate distributes, and the Company, its Affiliates, and their respective successors and assigns, including any successor by merger or consolidation or a statutory receiver or any other person or firm or corporation to which all or substantially all of the assets and business of the Company may be sold or otherwise transferred.
12. Amendment, Suspension, or Termination of the Plan
The Board, in its sole discretion, may alter, amend, or terminate the Plan, or any part thereof, at any time and for any reason.
13. Severability
If any provision of the Plan is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the purpose or intent of the Plan, such provision shall be stricken as to such jurisdiction, and the remainder of the Plan shall remain in full force and effect.
15. Effective Date
The Plan shall be effective upon adoption by the Board of Directors of the Company.


Exhibit 10.2



EXHIBIT102IMAGE1.JPG

2019 Management Cash Incentive Plan





Introduction and Objectives

Northfield Bancorp, Inc.’s (A Delaware Corporation) “Northfield” or the “Company” 2019 Management Cash Incentive Plan (the “MIP” or the “Plan”) is designed to retain, motivate, recognize, and reward designated management team members, within appropriate risk management objectives, for their collective contributions to Northfield Bancorp, Inc. and its subsidiaries ( including Northfield Bank, referred to as the “Company” or the “Bank”). The Plan focuses on measures that are critical to the Company’s longer-term growth and profitability. The MIP serves as a critical component of a competitive total compensation package that enables the Company to attract and retain talent needed to drive the Company’s future success. This MIP is governed by all terms and conditions of the Northfield Management Cash Incentive Plan approved by the Company’s stockholders on May 28, 2014 (the “Governing Plan”), which shall be the prevailing document if the terms and conditions detailed below are unclear or in contradiction to such plan.

Objectives of the Plan include:

•
Align management compensation with Company performance.
•
Provide clear focus on key strategic business objectives.
•
Position the Company’s total cash compensation to be competitive with market.
•
Enable the Company to attract, retain and develop the talent needed to drive success.
•
Motivate and reward management for achieving/exceeding performance goals.
•
Encourage teamwork across the Company’s operating groups.
•
Balance performance goals and incentives with appropriate risk management objectives.

Eligibility/Participation

• Eligibility will be limited to key members of management and key employees. Participants will be nominated by management and approved by the Compensation Committee. Unless specifically approved by the Compensation Committee, the Offices of the Chief Risk Officer and Chief Internal Auditor, Bank Secrecy Act Officer, and the Compliance Officer (collectively, Risk Management Officers), are not eligible to participate in the Corporate performance incentive awards. Incentive awards will be based on individual goals for these employees with goals and final incentive awards to be approved by the Board Committees that the individual reports to.
New employees must be hired by July 1 to participate in that year’s incentive. Incentive awards for employees hired between January 1 and July 1 will be pro-rated based on the employee’s date of hire (i.e., for these purposes, “base salary” shall mean the base salary in effect on the last day of the performance period). Participants must maintain a satisfactory level of performance to be eligible for an incentive award.
•
Except as set forth below under “Death or Disability,” participants must be an active employee as of the award payout date to receive an award.
Performance Period
The performance period and plan operate on a calendar year basis (January 1, 2019– December 31, 202019).




Performance Gate/Trigger
In order for the incentive plan to activate, Northfield must achieve at least 80% of budgeted net income. If the Company does not achieve this level of performance, the MIP will not fund awards (corporate or individual) for participants that year. The Committee, and the respective Board Committees as it relates to Risk Management Officers, will retain discretion, at all times, to recommend individual discretionary bonuses.
Incentive Award Opportunity
Each participant will have a target cash incentive opportunity that is expressed as a percentage of his or her base salary (i.e., base salary shall mean the base salary in effect on the last day of the performance period).
. Cash incentive awards are based, in part, on the Company’s philosophy to target total cash compensation at approximately the 50 th percentile of market for executive management, with individual adjustments made for each participant’s specific experience, responsibilities and performance. The 2019 incentive cash targets consider market practice and the Company’s current base salary levels. For 2019, participants, as detailed by title below, will have an opportunity to earn a target award as a percentage of base salary as defined above, for meeting defined goals. The Actual payouts can range from 0% (for not meeting any performance goals) to up to 150% of target for exceeding all performance goals.

Achieving performance goals will generally result in a full award at target. Actual payouts will vary above and below the target incentive to reflect actual performance relative to the goals and weights. The Compensation Committee retains the discretion to determine awards relative to goals and may consider other factors in making the award (e.g. extraordinary events).

The total incentive opportunity and range is summarized below. These are subject to change based on market practice, internal Company practices, and compensation philosophy.

 
Annual Incentive as a % of Base Salary
(in future years these targets may change and be   different by   tier)
Positions
Below Threshold
Threshold Performance
Target Performance
Stretch
Performance
Pres./CEO
0%
25%
50%
75%
EVP
0%
20%
40%
60%
SVP
0%
12.5%-15%
25-30%
37.5%-45%

Incentive Plan Measures

For 2019, the Compensation Committee will determine the Corporate performance goal(s) in conformity with the Governing Plan. A significant portion of all participants’ incentive will be based on our overall corporate performance. This approach supports our desire to foster a collaborative team-oriented culture among our senior leadership team. The Compensation Committee, at its sole discretion, may determine to exclude from actual 2019 performance results, items that are considered non-recurring in nature, and not suitable for consideration in measuring financial performance. In addition to corporate performance, individual/division performance goals will also be considered. By considering multiple performance goals and perspectives, our Plan supports our goal to provide a balanced and reasonable approach to risk management.





Below is a summary of the weighting of awards based on Corporate and Individual/Division Goals:

Role
Corporate Performance
Individual/Division Performance
Pres./CEO
0% - 100%
0% - 100%
EVP
0% - 100%
0% - 100%
SVP (Individual percentages to be determined by the CEO)
0% - 100%
0% - 100%

Goal Setting

The Corporate Performance goal(s) will be recommended by the Compensation Committee as part of the Board’s annual business planning process, and approved by the Board of Directors. The Compensation Committee will approve the performance range and weights associated with the Corporate Performance goals.

The Compensation Committee, at its discretion, may define goals that have a defined threshold, target and stretch performance and payout range. The relationship between performance goals and payout ranges will be determined by the Compensation Committee. Once threshold performance is achieved, the award will increase incrementally. Actual payouts between threshold, target, and stretch will be prorated between levels to reward incremental performance

Individual/Division goals will be developed and recommended by management and approved by the Compensation Committee at the beginning of the year. As it relates to Risk Management Officers, the respective Board committee will develop and approve individual/division goals at the beginning of the year. Generally, Individual goals should be limited to no more than three goals that reflect critical financial and strategic goals. Each individual goal is at a target payout. However, where possible, individual goals should also define a threshold and stretch level which will correspond to the appropriate payout in the table immediately above. Such goals will help clarify potential pay-performance relationship. In recognition that some individual goals may not be quantitative, the Compensation Committee and the respective Board Committees as it relates to Risk Management Officers, retains the discretion to determine payouts in a manner that appropriately reflects performance.

Award Payouts and Discretion of the Compensation Committee

Payouts relative to the target will be recommended by management (except for the CEO), certified and approved by the Compensation Committee and the respective Board Committees as it relates to Risk Management Officers, and ratified by the Board of Directors. In the case of the CEO, the payout will be determined by the Compensation Committee and ratified by the Board of Directors.

Payouts will be made in cash within a reasonable time period after the Company’s independent registered public accounting firm has made its final report to the Audit Committee on the Company’s 2019 consolidated financial statements. Generally, payouts will occur within two and a half months following the close of the fiscal year. Awards are calculated based on actual performance relative to target. Payouts will be based on percentage of a participant’s base salary in effect as of the last business day of the performance period. This will allow for ease of calculation of incentives to reflect participants who work a partial year or part time hours.

All award payouts under the Plan are subject to the discretion of the Compensation Committee and the respective Board Committees as it relates to Risk Management Officers. In determining an award level


(both corporate awards and individual awards) consideration may be given to the overall performance of the Company and each individual’s performance and may include, but are not limited to, consideration of audit and regulatory findings, internal control assessments and the amount and direction of risk being assumed by the Company. The Compensation Committee may, at its sole discretion, consider the effect of “passed” audit adjustments proposed by the Company’s independent registered public accounting firm in determining the achievement of the Corporate or Individual goals established under the Plan.

PLAN TERMS AND CONDITIONS
Plan Authorization
The Plan is authorized by the Board of Directors of the Company and administered by the Compensation Committee.
Program Changes or Discontinuance
The Company has developed this Plan based on current objectives and business conditions. The Plan was developed based on existing business, market and economic conditions; current services; and staff assignments. If substantial changes occur that affect these conditions, services, assignments, or forecasts, the Company may add to, amend, modify, or discontinue any of the terms or conditions of the Plan at any time.
Compensation Committee Discretion
The Compensation Committee may, at its sole discretion, waive, change, or amend the Plan as it deems appropriate.
The Committee and the respective Board Committees, as it relates to Risk Management Officers may, at its or their sole discretion, increase or decrease an award based upon its consideration of a Plan participant’s performance or achievements.
Termination of Employment
If a Plan participant leaves or is terminated by the Company before awards are paid, no incentive award will be paid. Participants must be an active employee of the Company on the date the incentive is paid to receive an award. (See exceptions for death and disability below.)
Disability or Death
If a participant is disabled by an accident or illness, his/her bonus award for the Plan period will be prorated so that the award is based on the period of active employment only (i.e. the award will be reduced by the period of time of disability).
In the event of death, the Company will pay to the participant’s estate the pro rata portion of the award that had been earned by the participant as of the date of death.
No award will be earned on a pro-rata basis for disability or death if such an event occurs within six months from the beginning of the Plan year.
Payments made in the event of death or disability will be made at the same time payment is made to active employees under the Plan.



Ethics and Interpretation
If there is any ambiguity as to the meaning of any terms or provisions of this Plan or any questions as to the correct interpretation of any information contained therein, the Company’s interpretation expressed by the Compensation Committee will be final and binding.
The altering, inflating, and/or inappropriate manipulation of performance/financial results or any other infraction of recognized ethical business standards, will subject the employee to disciplinary action up to and including termination of employment. In addition, any incentive compensation as provided by the Plan to which the employee would otherwise be entitled will be revoked.
Recoupment of Awards

Participants of this Plan agree that the Company has the right to recoup or “clawback” awards paid under this Plan if the Compensation Committee concludes that such awards were based on information that was later found to be materially incorrect, including awards that were determined, in whole or in part, on financial statement information that is subsequently restated. This includes any error that is material to previously-issued financial statements that results in notification that they cannot be relied upon. Additionally, if the Committee determines, upon review of the facts and circumstances, that an executive officer conducted his or herself in violation of the terms of the executive officer’s Employment Agreement, the Committee may determine that incentive compensation awards may or may not be revoked. Participants of the Plan agree that such recoupment would be made in accordance with prevailing laws and regulations. The Company also has the right to revise its clawback requirements, or policies subject to this Plan, if changes in laws and regulations require (or permit) the Company to do so.

Miscellaneous
The Plan will not be deemed to give any participant the right to be retained in the employ of the Company nor will the Plan interfere with the right of the Company to discharge any participant at any time.
The Compensation Committee will determine on at least an annual basis, those employees of the Company and its consolidated subsidiaries that will be eligible to participate in the Plan.
In the absence of an authorized, written employment contract, the relationship between employees and the Company is one of at-will employment. The Plan does not alter the relationship. The Plan will not supersede any specific employment contract obligations the Company may have with a Plan participant.
This Plan and the transactions and payments hereunder shall, in all respect, be governed by, and construed and enforced in accordance with applicable governmental laws and regulations.
Each provision in this Plan is severable, and if any provision is held to be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not, in any way, be affected or impaired thereby.

* * * * *