Short Term Annual Incentive Compensation. Pursuant to Employer’s short term annual incentive plan, as in effect from time to time (which plan shall be intended to be compliant with Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”)), subject to Section 4(b)(iv) below, Officer shall receive Short Term Annual Incentive Compensation (“STAIC”) for each fiscal year of the Employment Term. The STAIC shall be calculated utilizing a base level amount equal to one percent (1%) of Employer’s prior fiscal year net income as reflected in the Employer’s financial statements for the prior fiscal year (subject to adjustment as provided herein) (the “Base Level”), which Base Level shall be multiplied by a percentage determined by the one-year earnings per share growth (“EPS”) as follows (the “Base Level Multiplier”) and with linear interpolation between each Base Level Multiplier (except if below five percent (5%) or above seventeen percent (17%)), subject to this Section 4(b)(i) and Section 4(b)(iv) below: EPS Base Level Multiplier Below 5% 0 5% 25 % 10% 50 % 13% 75 % 15% 100 % Greater than or equal to 17% 125 % The STAIC award may be adjusted downward from zero (0) to twenty percent (20%) based on mutually agreed upon qualitative factors including, but not limited to, succession planning, leadership, quality of earnings, quality and effectiveness of enterprise risk management and quality of relationship and compliance with regulatory agencies that are, in good faith, established at the beginning of the performance period by the Compensation Committee and subjectively evaluated by the Compensation Committee at the end of the performance period. Notwithstanding the foregoing definition of Base Level, in the event that Employer’s net income for a prior year was negative or, in the sole discretion of the Compensation Committee, reflected a substantial decline from the previous year, the Compensation Committee may, in its sole discretion, within the time period permitted by section 162(m) of the Code for setting such year’s annual bonus goals, elect to use one percent (1%) of Employer’s current fiscal year net income (the “Alternative Base Level”). In such event, Officer’s STAIC award for such fiscal year shall be the greater of the amount calculated pursuant to the terms described in this Section 4(b)(i) without regard to the prior sentence, or seventy-five percent (75%) of the Alternative Base Level.
Short Term Annual Incentive Compensation. Pursuant to Employer’s short term annual incentive plan, as in effect from time to time (which plan shall be intended to be compliant with Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”)), subject to Section 4(b)(iv) below, Officer shall receive Short Term Annual Incentive Compensation (“STAIC”) for each fiscal year of the Employment Term. The STAIC shall be calculated utilizing a base level amount equal to one-half of one percent (0.5%) of Employer’s prior fiscal year net income as reflected in the Employer’s financial statements for the prior fiscal year (subject to adjustment as provided herein) (the “Base Level”), which Base Level shall be multiplied by a percentage determined by an individual annual short-term incentive plan pursuant to the Senior Manager Cash Incentive Plan Policy. Notwithstanding the foregoing definition of Base Level, in the event that Employer’s net income for a prior year was negative or, in the sole discretion of the Compensation Committee, reflected a substantial decline from the previous year, the Compensation Committee may, in its sole discretion, within the time period permitted by section 162(m) of the Code for setting such year’s annual bonus goals, elect to use one-half of one percent (0.5%) of Employer’s current fiscal year net income (the “Alternative Base Level”). In such event, Officer’s STAIC award for such fiscal year shall be the greater of the amount calculated pursuant to the terms described in this Section 4(b)(i) without regard to the prior sentence, or seventy-five percent (75%) of the Alternative Base Level. The STAIC shall be paid in the calendar year following the calendar year to which the STAIC relates but no later than March 15 of such year.
