Exhibit 10.3
Wintrust Financial Corporation
Cash Incentive and Retention Award Agreement
(Minimum Payout Amount: Par Plus 91-Day T-Bill Rate)
Cycle I (2008-2012)
[Award Date]

 

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Wintrust Financial Corporation
Cash Incentive and Retention Award Agreement
(Minimum Payout Amount: Par Plus 91-Day T-Bill Rate)
THIS AGREEMENT, effective as of [award date] represents the grant of a long-term
cash incentive and retention award (“CIR Award”) by Wintrust Financial
Corporation (the “Corporation”), to the Participant named below, pursuant to the
provisions of the 2008 Long-Term Cash Incentive and Retention Plan (the “Plan”)
or any amended or successor plan thereto. The cash payout ultimately earned and
paid, if any, for this CIR Award will be determined pursuant to Section 3 of
this Agreement.
     This Agreement is an Award Agreement as contemplated by the Plan, the terms
and provisions of which are incorporated herein by reference. All capitalized
terms will have the meanings ascribed to them in the Plan, unless specifically
set forth otherwise herein. The parties hereto agree as follows:
     1. Grant Information. The individual named below has been selected to
receive a long-term CIR Award as specified below:

         
 
  (a)  Participant:    
 
     
 
 
  (b) Target CIR Award:   $                                         
 
       
 
  (c) Performance Measure:   Earnings per share (“EPS”)

     2. Performance Period. The performance period commences on January 1, 2008,
and ends on December 31, 2012 (“Performance Cycle”).
     3. Performance Grid; Calculation of CIR Award. The CIR Award earned by the
Participant who remains continuously employed by the Corporation or any
Subsidiary from the date of this Agreement through the last day of the
Performance Cycle will be equal to the Target CIR Award amount set forth above,
multiplied by the “Multiple” determined in accordance with the Performance Grid
set forth on Appendix A attached hereto, subject to a maximum amount equal to
the Maximum CIR Award Amount set forth on Appendix A and a Minimum Payout Amount
reflecting a retention credit percentage (“RC%”) as set forth on Appendix A. For
example, if the sixty (60) month cumulative earnings per share at the end of
2012 is $18.00, the Participant will earn one-hundred eighty percent (180%) of
the Target CIR Award amount as set forth in Section 1(b) of this Agreement.
     The amount of CIR Award earned will be determined after the conclusion of
the Performance Cycle by the Compensation Committee of the Board of Directors
(the “Committee”), in its sole discretion, based on the performance of the
Corporation, calculated using the Performance Grid. Earned CIR Awards will be
paid in accordance with Section 5 below.

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     For purposes of this Agreement, “Earnings Per Share” or “EPS” shall mean
the Corporation’s “primary earnings per share,” as determined on a fully-diluted
basis in accordance with generally accepted accounting principles, consistently
applied, as publicly reported by the Corporation on its fiscal year financial
reports. Cumulative EPS will be equal to the sum of the EPS for each of the five
years in the Performance Cycle.
     The Committee shall have the authority to modify calculation of Cumulative
EPS and the Cumulative EPS objectives set forth in the Performance Grid in
Section 3 of this Agreement, in the Committee’s good faith discretion, as the
Committee deems appropriate in connection with any repurchases by the
Corporation of its Common Stock from shareholders, acquisition, reorganization,
recapitalization, merger, consolidation, spin-off, extraordinary dividend or
other distribution, or similar transaction; provided, however, that the
Committee shall make such adjustments in the event of a stock dividend or stock
split, reverse stock split or similar change in the capital structure of the
Corporation, in order to prevent the dilution or enlargement of rights.
     4. Effect of Termination of Employment during the Performance Cycle. In the
event the Participant does not remains continuously employed by the Corporation
or any Subsidiary from the date of this Agreement through the last day of the
Performance Cycle, then the amount, if any, payable to the Participant (or, in
the event of death, the Participant’s beneficiary) under this Agreement will be
determined in accordance with this Section 4 and paid in accordance with Section
5 below. For purposes of this Section 4, “vested percentage” means the
percentage determined in accordance with Vesting Table set forth on Appendix A.
     Termination for Cause. Termination of the Participant’s employment during
the Performance Cycle by the Corporation for cause will result in immediate
forfeiture of the CIR Award, with no payment to the Participant. For purposes of
this Agreement, “cause” shall have the same meaning given to such term under an
employment or similar agreement applicable to the Participant and, in the
absence of such an agreement or definition of “cause” therein, “cause” shall
have the meaning set forth on Appendix B attached hereto.
     Disability or Death. If the Participant’s employment terminates as a result
of disability or death during the Performance Cycle, the Participant (or, in the
event of death, the Participant’s beneficiary) will receive the vested
percentage of the Truncated CIR Award Amount described below. For purposes of
this Agreement the term disability shall have the same meaning given to such
term in the Corporation’s Long-Term Disability Plan, or any successor plan.
     Termination not for Cause; Resignation. If the Participant’s employment is
terminated during the Performance Cycle for any reason other than death,
disability or by the Corporation for Cause, the Participant will receive an
amount equal to the Participant’s vested percentage multiplied by the Minimum
CIR Award Amount set forth on Appendix A.

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     Retirement. If the Participant’s employment terminates during the
Performance Cycle in circumstances constituting Retirement (as defined on
Appendix B) and the Participant remains Retired from the Industry (as defined on
Appendix B) through the end of the Performance Cycle, then, in addition to the
vested percentage of the Minimum CIR Award Amount described above, the
Participant will be eligible to receive an amount equal to the Participant’s
vested percentage multiplied by the Top-Up Amount described below.
     The “Truncated CIR Award Amount” is the amount determined by multiplying
the Target CIR Award set forth in Section 1(b) above by the applicable Multiple
determined by reference to the Performance Grid and based on the Compound Annual
Growth Rate of EPS achieved during the Performance Cycle through the end of the
fiscal year which coincides with or immediately precedes the date on which
termination of employment occurs. For example, if the termination of employment
occurs in 2010, and the Compound Annual Growth Rate of EPS achieved through the
end of 2009 is 14.0%, then the applicable multiple would be one hundred forty
percent (140%).
     The “Top Up Amount” is the amount by which the CIR Award that the
Participant would have earned at the end of the Performance Cycle based on
actual performance during the full Performance Cycle exceeds the Minimum CIR
Award Amount.
     5. Payment of Earned Incentive Award. Unless deferred in accordance with
procedures set forth by the Committee and otherwise subject to the requirements
set forth in the Plan relating to Code Section 409A, the earned CIR Award
determined in accordance with Section 3 above will be paid to the Participant as
soon as practicable after the end of the Performance Cycle and the Compensation
Committee’s determination of amount of the earned CIR Award; provided that such
payment shall be made no later than March 15th of the calendar year following
the end of the Performance Cycle. Any Top Up Amount payable to a retired
Participant shall be paid at the same time as the earned CIR Award would have
been paid in accordance with this paragraph.
     Unless deferred in accordance with procedures set forth by the Committee
and otherwise subject to the requirements set forth in the Plan relating to Code
Section 409A, the amounts determined and payable in accordance with Section 4
due to termination of employment during the Performance Cycle shall be payable
as follows: if the date of termination of employment occurs prior to July 1 of a
calendar year, payment shall be made (without interest) as soon as practicable
after December 31 of such year, provided that such payment shall be made no
later than March 15th of the calendar year following such termination of
employment; and if such termination occurs after June 30 of a calendar year,
such payment shall be made as soon as practicable after July 1 of the following
calendar year, provided such payment shall be made no later than December 31 of
such following calendar year.

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     6. Change in Control of the Corporation. In the event of a Change in
Control during the Performance Cycle, the Participant will be paid a CIR Award
under this Agreement. The amount of such CIR Award will be determined in the
same manner as a Truncated CIR Award Amount described in Section 4 above, based
on the Compound Annual Growth Rate of EPS though the last day of the calendar
year coinciding with or next preceding the date of the Change of Control. For
example, if the Change of Control occurs during the third quarter of 2009, and
the Compound Annual Growth Rate in EPS at the end of 2008 was 18% then the
applicable multiple would be two hundred ten percent (210%). The amount of the
CIR Award determined in accordance with this Section 6 shall not be subject to
proration and shall be paid in full to the Participant upon or within 15 days
after the date of the Change of Control.
     7. Nontransferability. The CIR Award may not be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated (“Transfer”) other than by will
or by the laws of descent and distribution, except as provided in the Plan. If
any Transfer, whether voluntary or involuntary, of an CIR Award is made, the
Participant’s right to such CIR Award will be immediately forfeited to the
Corporation, and this Agreement will lapse.
     8. Tax Withholding. The Corporation will have the power and the right to
deduct or withhold, or require the Participant or the Participant’s beneficiary
to remit to the Corporation, an amount sufficient to satisfy federal, state, and
local taxes, domestic or foreign, required by law or regulation to be withheld
with respect to any taxable event arising as a result of this Agreement.
     9. Administration. This Agreement and the Participant’s rights hereunder
are subject to all the terms and conditions of the Plan, as the same may be
amended from time to time, as well as to such rules and regulations as the
Committee may adopt for administration of the Plan. It is expressly understood
that the Committee is authorized to administer, construe, and make all
determinations necessary or appropriate to the administration of the Plan and
this Agreement, all of which will be binding upon the Participant.
     10. Continuation of Employment. This Agreement will not confer upon the
Participant any right to continuation of employment by the Corporation or its
subsidiaries, nor will this Agreement interfere in any way with the
Corporation’s or its subsidiaries’ right to terminate the Participant’s
employment at any time.
     11. Amendments. The Plan is discretionary in nature and the Committee may
terminate, amend, or modify the Plan or this Agreement; provided, however, that
no such termination, amendment, or modification of the Plan or this Agreement
may adversely affect in any material way the CIR Award subject to this Agreement
without the Participant’s written approval, except amendments or modifications
made in accordance with Section 3 or required to conform to laws.
     12. Amendment to this Agreement. Any amendment and/or termination of this
Agreement will not accelerate a payment date if such amendment or termination
would subject such amounts to taxation under Code Section 409A.
     13. Successor. All obligations of the Corporation under the Plan and this
Agreement, with respect to the CIR Award, will be binding on any successor to
the Corporation, whether the existence

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of such successor is the result of a direct or indirect purchase, merger,
consolidation, or otherwise, of all or substantially all of the business and/or
assets of the Corporation.
     14. Severability. The provisions of this Agreement are severable and if any
one or more provisions are determined to be illegal or otherwise unenforceable,
in whole or in part, the remaining provisions will nevertheless be binding and
enforceable.
     15. Applicable Laws and Consent to Jurisdiction. The validity,
construction, interpretation, and enforceability of this Agreement will be
determined and governed by the laws of the State of Illinois without giving
effect to the principles of conflicts of law. For the purpose of litigating any
dispute that arises under this Agreement, the parties hereby consent to
exclusive jurisdiction and agree that such litigation will be conducted in the
federal or state courts of the State of Illinois.
     16. Restrictions and Clawback. This Award shall be subject to forfeiture
and cancellation in the discretion of the Committee upon the occurrence of the
any of the events described in clauses (a) through (e) of Section 8(e) of the
Plan prior to the payment of any amounts under this Agreement. If any such event
occurs within one year after the payment of any amount under this Agreement,
then upon demand from the Committee, the Participant shall reimburse the
Corporation the amount of any such payment. Payments under this Agreement shall
also be subject to repayment to the Corporation in upon the occurrence of events
described in the final sentence of Section 8(e) of the Plan.
     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
effective as of [award date].

                  Wintrust Financial Corporation      
 
           
 
  By:        
 
     
 
         
 
           
 
           
 
           Participant    

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Appendix A to Cash Incentive and Retention Award Agreement
(Minimum Payment Amount: Par Plus 91-Day T-Bill Rate)
Cumulative EPS Performance Grid for Cycle I (2008-2012)

          Compound Annual         Growth Rate       Multiple of Target Range  
Cumulative EPS1   CIR Award             20.0% or greater   $20.00 or greater  
240%           17.5% – 19.99%   $18.65 – $19.99   210%           15.0% – 17.49%
  $17.37 – $18.64   180%           12.5% – 14.99%   $16.17 – $17.36   140%      
    10.0% – 12.49%   $15.04 – $16.16   110%           <10.0%   <$15.04   RC%

     For purposes of this Appendix A, the “Maximum Payout Amount” is 240% times
the Target CIR Award and the “Minimum Payout Amount” is RC% times the Target CIR
Award. The RC% is equal to 100% plus a compound annual interest rate based on
(a) the 91-day T-bill rate as in effect on the first business day of January of
each year commencing in 2008 and (b) the period from January 1, 2008 through
December 31, 2012, or if earlier, the date as of which the Minimum Payment
Amount is being determined.
 

1   This column reflects the cumulative EPS for the five years, assuming a CAGR
equal to the amount set forth in the left hand column and a starting point equal
to 2007 EPS of $2.24.

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Vested Percentage Table

                          Termination   Termination   Termination   Termination
  Termination     Occurs in   Occurs in   Occurs in   Occurs in   Occurs in    
2008   2009   2010   2011   2012                         Vested Percentage   0%
  20%   40%   60%   80%

     For purposes of the Vested Percentage Table, if the date of termination of
a Participant’s employment (that is, his or her last day of employment) is
December 31 of such year, the termination of employment will be deemed to occur
in the following year.

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Appendix B to Cash Incentive and Retention Award Agreement
Definitions
For purposes of this Agreement, “cause” shall mean the following:

  (i)  
misappropriation of any funds or property of the Corporation or its
subsidiaries; or
    (ii)  
attempting to obtain any personal profit from any transaction in which the Key
Employee has a personal financial interest, unless the Key Employee shall have
first obtained the consent of the Board of Directors; or
    (iii)  
material neglect or refusal to perform the duties reasonably assigned to the Key
Employee given the Key Employee’s current job description; or
    (iv)  
participating in a course of conduct which is injurious to the Corporation or
its subsidiaries, as interpreted by the Board of Directors; or
    (v)  
being convicted of a felony; or
    (vi)  
being adjudicated a bankrupt; or
    (vii)  
suspension due to the direction of any authorized bank regulatory agency.

To the extent that there is a dispute arising over the application of the
definition of Cause, the Committee or the Board of Directors of the Corporation
shall have the authority to interpret and apply such definitions in a reasonable
manner.
For purposes of this Agreement, the termination of a Participant’s employment
shall be deemed a “Retirement” if such termination of the Participant’s
employment is for any reason other than death, disability or termination by the
Corporation for cause, and such termination occurs on or after age 65, or on or
after age 55 and, as of the date of termination, the sum of the Participant’s
attained age as of his or her most recent birthday and full and completed years
of service with the Corporation or any Subsidiary (including for this purpose
continuous years of service, if any, with a Subsidiary as of the date such
Subsidiary was acquired by the Corporation) equals or exceeds 75.

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The Participant shall be deemed to be “Retired from the Industry” so long as
such Participant (A) does not thereafter perform services as an employee,
officer, director or consultant for, or in any other capacity assist, any bank,
thrift, bank or thrift holding Corporation, asset management Corporation, trust
Corporation, investment advisor, or any other financial services Corporation
(other than the Corporation or a Subsidiary), whether existing or in formation,
that provides or plans to provide banking or other financial services, including
but not limited to, those relating to loans, deposits, treasury management,
custodial or trust services, or investment or wealth management services within
the Chicago or Milwaukee metropolitan area, and (B) certifies to the
Corporation, at such times and in such manner as the Committee may require, that
since Participant’s’ Retirement, Participant has not performed any such
services.

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