Company: MCHB
Filing Date: 2025-04-15
Form Type: DEF 14A
Source: 0001518715-25-000066
Chunk: 49

Company: Mechanics Bancorp
Filing Date: 2025-04-15
Form: DEF 14A
Chunk 49
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 80%          |     | 20%          |

(1) Mr. Mason’s corporate goal achievements are more heavily weighted because he is responsible for Company-wide results as CEO.

(2) Mr. Michel's corporate goal achievements are more heavily weighted because his oversight directly affects Company-wide results.

Corporate Performance Goals, Metrics and Results

In 2024, corporate performance measured against our 2024 strategic plan (“2024 Plan”) was the basis for awards. The target level, thresholds and maximums were established by the Board based on the 2024 Plan. Any performance results below the threshold would result in no payout. Performance results between threshold and target and between target and maximum would be calculated on a straight-line interpolation basis.

Below are the performance measures used for 2024:

• Core ROAA : Defined as net income, adjusted to exclude any non-core items such as loss on loan sale, deferred tax allowance and merger expenses.

• Core ROATE : Defined as net income, excluding any amortization of intangible assets and adjusted to exclude any non-core items such as loss on loan sale, and merger expenses, as a percentage of total average tangible equity, which is average equity less average intangible assets.

• Efficiency Ratio : Defined as noninterest expenses, adjusted to exclude any nonrecurring or unusual items, as a percentage of the total of net interest income and noninterest income, adjusted to exclude any nonrecurring or unusual items. In 2024, loss on loan sale and merger expenses were excluded as nonrecurring items. A lower ratio is a more positive result.

• Nonperforming Assets (“NPAs”) to Total Assets : Defined as nonperforming loans plus other real estate owned divided by total assets. This is considered a key measure of the quality of HomeStreet Bank’s loan portfolio. Credit risk management remains a major focus of HomeStreet Bank. A lower ratio is a more positive result.

• Core Deposit Balances : Core deposits for these purposes is defined as total deposits less certificates of deposit. Core deposits are the most beneficial source of funding due to their relatively low cost and tendency to be more stable. Growth is calculated as the change from the average core deposits for the fourth quarter of the current year as compared to the average core deposits for the fourth quarter of the prior year. Any deposits added through mergers or acquisitions are excluded from the computation and any deposits sold are removed from this computation.

A core ROATE of 11% or higher is required to receive a combined award in excess of 100