Exhibit 10.6

BELMONT SAVINGS BANK

INCENTIVE COMPENSATION PLAN

2016

Purpose of the Plan

Belmont Savings Bank (the Bank) has adopted this Incentive Compensation Plan
(the Plan) for the purpose of supporting the organizational and financial
objectives of the Bank as defined in the Bank’s Business Plan. This Plan
provides incentive compensation (Incentive Awards) to certain named Executive
Officers and other key contributing officers (the Participants). The Plan is
designed to insure that participants do not take on undue risk to achieve
payouts. All participants with responsibility for managing risk have goals for
risk control and clawback provisions in the Plan.

The Plan is further intended to attract, motivate, and retain high quality
executives and to support continued growth and profitability of the Bank.
Participation in the Incentive Plan is dependent upon one’s responsibility
within the Bank and ability to influence the Bank’s strategic outcomes.
Individual incentive payout targets will be shared with each participant. It is
important to note that this Plan is established to reward and recognize
participants for meeting set objectives. This Plan is not meant to be a
substitute for salary increases.

Key Terms

 

  •   Incentive Awards

 

  •   Plan year

 

  •   Business Plan

 

  •   Company-Wide Goals

 

  •   Individual Goals

 

  •   Performance Categories

 

  •   Maximum Target

 

  •   Clawback Policy

Performance Objectives

 

  •   The Business Plan outlines key strategic initiatives approved by the Board
of Directors. Each Division Head will review the Business Plan with Participants
within his or her group. Together, they should identify up to six specific and
measurable Individual Goals to support the Business Plan. Company-Wide Goals and
their weightings must be approved by the Compensation Committee.

 

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Company-Wide Goals include the Performance Categories and associated weighting:

 

Category

     Weighting   

Deposit Growth

     10 % 

Loan Growth

     10 % 

Net Interest Income

     5 % 

Fee Income

     5 % 

Non-Interest Expense

     10 % 

Net Income

     40 % 

Credit Quality and Portfolio Management

     20 % 

Individual Goals should include up to six of the following:

 

  •   Deposit Growth

 

  •   Loan Growth

 

  •   Expense Control

 

  •   Credit Quality / Portfolio Management

 

  •   Fee Income

 

  •   Net Interest Margin

 

  •   Teamwork

 

  •   Compliance

 

  •   Customer Service – externally and to other colleagues

 

  •   Community Involvement

 

  •   Referrals to other business units

 

  •   Personal goals include major projects or initiatives

After the year end close, Participants in the Plan will report on the
achievement of their Individual Goals. Division Heads will summarize individual
achievements and recommend to the Bank President the percentage payout based on
the Individual Goals achieved. The Director of Human Resources will calculate
the payouts and report to the President for approval of the Compensation
Committee. Incentive awards will be calculated on year to date regular earnings
(exclusive of commissions or incentive payments).

The Compensation Committee will be responsible for any interpretation of the
Plan relating to the Executive Officers named in the Company’s annual proxy
statement (“Named Executive Officers”), including the Bank President, and the
Compensation Committee’s decision shall be final and binding on all parties. The
Bank President will be responsible for any interpretation of the Plan relating
to all Participants, other than the Named Executive Officers, and his decision
shall be final and binding on all parties.

Before the beginning of each Plan year, the Compensation Committee will consider
changes for the upcoming year.

The Compensation Committee may consider extraordinary occurrences impacting Bank
earnings which may be excluded when determining the performance against goals to
ensure that the best interests of the Bank are protected.

 

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Incentive Plan Participants

The Compensation Committee shall designate the Participants in the Plan who are
Named Executive Officers. The Bank President is authorized to name Participants
in the Plan other than the Named Executive Officers. Officers hired prior to the
third Quarter (October 1), will be included in the plan. A master list of
Participants will be shared with the Bank President, Compensation Committee, and
Senior Management.

At the Beginning of Plan Year

 

  •   Participants will identify up to six specific and measurable individual
goals in support of the Business Plan.

 

  •   The Division Head will review those goals and approve.

 

  •   A copy will be provided to the Participant, the Division Head, and Human
Resources for their recordkeeping.

 

  •   The Incentive Plan will be reviewed and approved by the Compensation
Committee and recommended to the Board.

 

  •   Plan Participants will be notified of approved Performance Categories and
weightings.

After Close of the Plan Year

 

  •   The Chief Financial Officer will calculate and report the Bank financials
for the prior year.

 

  •   The Division Head will receive each Participant’s self evaluation of their
performance to Individual Goals.

 

  •   The Human Resource Director will calculate the Percent Awards for each
participant based on the weighting of Company-Wide and Individual Goal
achievement.

 

  •   The results will be recommended to the Compensation Committee for approval
by the Board.

 

  •   Payouts will be made in March of the year following the Plan
Year. Participants must be employed at the time of payout.

Definitions

Each group of Officers has a Maximum Target bonus as a percentage of their
salaries. The Maximum Target is met when an individual achieves all objectives
and exceeds the important objectives.

The incentive payout for each officer classification will be weighted to include
a percentage based on Company-Wide Goals and a percentage based on Individual
Goals. Company-Wide Goals will be weighted higher than Individual Goals when
considering incentive recommendations for Executive Officers.

For the President and Executive Vice Presidents, Company-Wide Goals are weighted
at 75%, for Senior Vice Presidents 50%, and for Vice Presidents and other
Officers 25%. The Compensation Committee will determine the performance against
the Company-Wide Goals.

 

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The following table represents the weighting structure.

 

Title

   Weight attributed to
Company-Wide Goals     Weight attributed to
Individual Goals  

President / CEO and Executive Officers

     75 %      25 % 

Senior Vice Presidents

     50 %      50 % 

Vice Presidents

     25 %      75 % 

Other Officers

     25 %      75 % 

Other Colleagues

     0        100 % 

Other Considerations

It is not possible to consider all issues that will invariably materialize as
plans are developed and implemented. Therefore, the Bank President will act on
individual cases as issues are identified. The plan is “discretionary” based on
individual performance consistent with the business plan. Participants on final
written warning will be disqualified from receiving an incentive payout for the
plan year. The Compensation Committee will also weigh progress on Regulatory
matters in determining the performance of management with respect to
Company-Wide Goals.

Eligible participants are required to return a signed acknowledgement of this
policy by March 15 annually.

Withholding for Taxes

The Bank shall deduct from all payments under this Plan any federal or state
taxes required by law to be withheld with respect to such payments.    This
payment is subject to 401k deductions and bank match. No other voluntary
deductions will be taken from this payment.

Clawback Policy

The Bank reserves the right to recover any bonus or incentive compensation
payment to any officer if the payments were based on materially inaccurate
financial statements, other materially inaccurate reporting or fraud by that
Officer. The Clawback Policy will also apply to material losses in future
years. The look back period is one year from the incentive payment.

 

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Belmont Savings Bank

2016 Incentive Plan Ranges

 

President / CEO    0 – 50% Executive Vice Presidents    0 – 40% Senior Vice
Presidents    0 – 30% Vice Presidents    0 – 25% All Other Officers    0 – 15%
All Other Colleagues    0 – 6%

Approved by the Compensation Committee January 27, 2016

 

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BELMONT SAVINGS BANK

INCENTIVE COMPENSATION PLAN

2016 ACKNOWLEDGEMENT

 

Employee Name  

 

   

                             (Print Name)

 

I acknowledge the receipt of the 2016 Incentive Plan document and I understand
it is my responsibility to read and understand the plan.

The Plan is subject to change annually.

 

 

Employee Signature                                        
                                                                             
Date

Return the signed copy to HR by March 15 for recordkeeping.

 

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