EXHIBIT 10(w)
OLD NATIONAL BANCORP
1999 EQUITY INCENTIVE PLAN
“PERFORMANCE-BASED” RESTRICTED STOCK AWARD AGREEMENT
     THIS AWARD AGREEMENT (the “Agreement”), made and executed as of the 25th
day of January, 2007, between Old National Bancorp, an Indiana corporation (the
“Company”), and                                         , an officer or employee
of the Company or one of its Affiliates (the “Participant”).
WITNESSETH:
     WHEREAS, the Company has adopted the Old National Bancorp 1999 Equity
Incentive Plan (the “Plan”) to further the growth and financial success of the
Company and its Affiliates by aligning the interests of Participants, through
the ownership of Shares and through other incentives, with the interests of the
Company’s shareholders; to provide Participants with an incentive for excellence
in individual performance; and to promote teamwork among Participants; and
     WHEREAS, it is the view of the Company that this goal can be achieved by
granting Restricted Stock to eligible officers and other key employees; and
     WHEREAS, the Participant has been designated by the Compensation Committee
as an individual to whom Restricted Stock should be granted as determined from
the duties performed, the initiative and industry of the Participant, and his or
her potential contribution to the future development, growth and prosperity of
the Company;
     NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the Company and the Participant agree as follows:
     1. Award of Restricted Stock. The Company hereby awards to the Participant
                                         (                    ) Shares of
performance-based Restricted Stock (hereinafter, the “Restricted Stock”),
subject to the terms and conditions of this Agreement and the provisions of the
Plan. This award will be earned if target level performance is achieved. All
provisions of the Plan, including defined terms, are incorporated herein and
expressly made a part of this Agreement by reference. The Participant hereby
acknowledges that he or she has received a copy of the Plan.
     2. Performance Goals. Except as otherwise provided in Sections 4 and 5 of
this Agreement, the Restricted Stock will be treated as earned to the extent the
Performance Goals specified in Exhibit A are satisfied. To the extent the
Performance Goals are not satisfied (with the result that either no Shares or
less than all Shares of Restricted Stock have been earned), then the unearned
Shares will be forfeited, effective as of the last day of the Performance
Period, regardless of whether the Period of Restriction has otherwise lapsed
under Section 3 of this Agreement. To the extent the Performance Goals are
exceeded, the participant will earn 100% of the shares awarded in Section 1,
plus the participant will be awarded additional shares in accordance with the
schedule set forth Exhibit A (Calculation of Performance). For example, if the
Performance Level is 130%, the participant will be awarded additional shares
equal to 30% of the shares awarded in Section 1. Notwithstanding the preceding
provisions on this Section, the Compensation Committee may, in its discretion,
reduce the number of Shares treated as earned, if it determines that a
significant corporate transaction or other event during the Performance Period,
other than the acquisition of St. Joseph Capital Corporation, either alone or in
combination with other transactions or events, has distorted the intent of one
or more of the Performance Goals.
     3. Period of Restriction. The Period of Restriction shall begin on the
Grant Date and lapse, except as otherwise provided in Sections 2, 4 and 5 of
this Agreement, on February 1, 2010.

 

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     4. Change in Control. Notwithstanding any other provision of this
Agreement, any Shares of Restricted Stock, as stated in Section 1, which have
not been earned or are subject to the Period of Restriction, shall be treated as
fully earned and the Period of Restriction shall lapse upon a Change in Control
of the Company as provided in Section 12.1 of the Plan.
     5. Termination of Service. Notwithstanding any other provision of this
Agreement, in the event of the Participant’s Termination of Service due to
death, Disability or Retirement, the following shall apply:

  (a)   If the Participant’s Termination of Service is due to death, the
(i) Period of Restriction shall lapse, and (ii) the Shares shall be treated as
earned, at the “Target” level specified in Exhibit A, effective as of the date
of death.     (b)   If the Participant’s Termination of Service is due to
Disability or Retirement, (i) he shall continue to be treated as a Participant,
(ii) the Period of Restriction shall lapse at the time specified in Section 3 of
this Agreement, and (iii) the Shares shall be treated as earned to the extent
the applicable Performance Goals are satisfied; provided, however, that if the
Participant dies prior to the end of the Period of Restriction, then the
provisions of subsection (a) of this Section 5 shall apply.

     Unless otherwise determined by the Committee in its sole discretion, in the
event of the Participant’s Termination of Service for any other reason, any
Shares of Restricted Stock which have not been earned and/or with respect to
which the Period of Restriction has not lapsed, shall be forfeited effective as
of the date of the Participant’s Termination of Service.
     6. Dividends on Restricted Stock. During the Period of Restriction, the
Participant shall be entitled to receive any cash dividends paid with respect to
the Shares of Restricted Stock, regardless of whether such Shares have been
earned or the Period of Restriction has not lapsed. All stock dividends paid
with respect to Shares of Restricted Stock shall be (a) added to the Restricted
Stock, and (b) subject to all of the terms and conditions of this Agreement and
the Plan.
     7. Voting Rights. During the Period of Restriction, the Participant may
exercise all voting rights with respect to the Shares of Restricted Stock as if
he or she is the owner thereof.
     8. Participant’s Representations. The Participant represents to the Company
that:

  (a)   The terms and arrangements relating to the grant of Restricted Stock and
the offer thereof have been arrived at or made through direct communication with
the Company or person acting in its behalf and the Participant;     (b)   The
Participant has received a balance sheet and income statement of the Company and
as an officer or key employee of the Company:

  (i)   is thoroughly familiar with the Company’s business affairs and financial
condition and     (ii)   has been provided with or has access to such
information (and has such knowledge and experience in financial and business
matters that the Participant is capable of utilizing such information) as is
necessary to evaluate the risks, and make an informed investment decision with
respect to, the grant of Restricted Stock; and

  (c)   The Restricted Stock is being acquired in good faith for investment
purposes and not with a view to, or for sale in connection with, any
distribution thereof.

     9. Income and Employment Tax Withholding. All required federal, state, city
and local income and employment taxes which arise on the satisfaction of the
Performance Goals and the lapse of

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the Period of Restriction shall be satisfied through the (a) withholding of the
Shares required to be issued under Section 11, or (b) tendering by the
Participant of Shares which are owned by the Participant, as described in
Section 6.6(a) of the Plan. The Fair Market Value of the Shares to be withheld
or tendered shall be equal to the dollar amount of the Company’s aggregate
withholding tax obligations, calculated as of the day prior to the day on which
the Period of Restriction ends.
     10. Nontransferability. Until the end of the Period of Restriction, the
Restricted Stock cannot be (i) sold, transferred, assigned, margined,
encumbered, bequeathed, gifted, alienated, hypothecated, pledged or otherwise
disposed of, whether by operation of law, whether voluntarily or involuntarily
or otherwise, other than by will or by the laws of descent and distribution; or
(ii) subject to execution, attachment or similar process. Any attempted or
purported transfer of Restricted Stock in contravention of this Section 10 or
the Plan shall be null and void ab initio and of no force or effect whatsoever.
     11. Issuance of Shares. At or within a reasonable period of time following
execution of this Agreement, the Company will issue, in book entry form, the
Shares representing the Restricted Stock.
     As soon as administratively practicable following the date on which the
Shares of Restricted Stock are earned and the Period of Restriction lapses, the
Company will issue to the Participant or his Beneficiary the number of Shares of
Restricted Stock specified in Exhibit A, less any withholdings required by
Section 9 of this Agreement. In the event of the Participant’s death before the
Shares are issued, such stock certificate will be issued to the Participant’s
Beneficiary or estate in accordance with Section 14.7 of the Plan.
     Notwithstanding the foregoing provisions of this Section 11, the Company
will not be required to issue or deliver any certificates for Shares prior to
(i) completing any registration or other qualification of the Shares, which the
Company deems necessary or advisable under any federal or state law or under the
rulings or regulations of the Securities and Exchange Commission or any other
governmental regulatory body; and (ii) obtaining any approval or other clearance
from any federal or state governmental agency or body, which the Company
determines to be necessary or advisable. The Company has no obligation to obtain
the fulfillment of the conditions specified in the preceding sentence. As a
further condition to the issuance of certificates for Shares, the Company may
require the making of any representation or warranty which the Company deems
necessary or advisable under any applicable law or regulation. Under no
circumstances shall the Company delay the issuance of shares pursuant to this
Section to a date that is later than 2-1/2 months after the end of the calendar
year in which the Period of Restriction lapses, unless issuance of the shares
would violate federal securities law or other applicable law, in which case the
Company shall issue such shares as soon as administratively feasible after such
issuance would no longer violate such laws.
     Notwithstanding the preceding provisions of this Section or any other
provision of this Agreement, no Shares of Restricted Stock shall be transferred
to the Participant to the extent that the Compensation Committee has determined
that such transfer would result in the Participant’s compensation for the year
exceeding the applicable compensation limit under Code Section 162(m). Shares of
Restricted Stock whose transfer is affected by the preceding sentence shall be
transferred to the Participant on the earliest date thereafter on which the
transfer would not, in the Compensation Committee’s judgment, result in the
Participant’s compensation for the year exceeding the applicable compensation
limit under Code Section 162(m).
     12. Mitigation of Excise Tax. Except to the extent otherwise provided in a
written agreement between the Company and the Participant, the Restricted Stock
issued hereunder is subject to reduction by the Committee for the reasons
specified in Section 14.10 of the Plan.
     13. Indemnity. The Participant hereby agrees to indemnify and hold harmless
the Company and its Affiliates (and their respective directors, officers and
employees), and the Committee, from and against any and all losses, claims,
damages, liabilities and expenses based upon or arising out of the incorrectness
or alleged incorrectness of any representation made by the Participant to the
Company or any failure on the part of the Participant to perform any agreements
contained herein. The Participant

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hereby further agrees to release and hold harmless the Company and its
Affiliates (and their respective directors, officers and employees) from and
against any tax liability, including without limitation, interest and penalties,
incurred by the Participant in connection with his or her participation in the
Plan.
     14. Financial Information. The Company hereby undertakes to deliver to the
Participant, at such time as they become available and so long as the Period of
Restriction has not lapsed and the Restricted Stock has not been forfeited, a
balance sheet and income statement of the Company with respect to any fiscal
year of the Company ending on or after the date of this Agreement.
     15. Changes in Shares. In the event of any change in the Shares, as
described in Section 4.5 of the Plan, the Committee will make appropriate
adjustment or substitution in the Shares of Restricted Stock, all as provided in
the Plan. The Committee’s determination in this respect will be final and
binding upon all parties.
     16. Effect of Headings. The descriptive headings of the Sections and, where
applicable, subsections, of this Agreement are inserted for convenience and
identification only and do not constitute a part of this Agreement for purposes
of interpretation.
     17. Controlling Laws. Except to the extent superseded by the laws of the
United States, the laws of the State of Indiana, without reference to the choice
of law principles thereof, shall be controlling in all matters relating to this
Agreement.
     18. Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which will be deemed an original, but all of which
collectively will constitute one and the same instrument.
     IN WITNESS WHEREOF, the Company, by its officer thereunder duly authorized,
and the Participant, have caused this Restricted Stock Award Agreement to be
executed as of the day and year first above written.
PARTICIPANT

         
 
Signature
 
 
Printed Name    

OLD NATIONAL BANCORP

         
By:
       
 
 
 
    Allen R. Mounts
EVP, Chief Human Resources Officer
Old National Bancorp    

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EXHIBIT A
Grant Date: January 25, 2007
Shares of Restricted Stock Awarded: See Section 1 of the Agreement
Performance Period: January 1, 2007 through December 31, 2009
OVERVIEW
To continue its objective of focusing the executive officers on creation of
stockholder value, Old National Bancorp’s Compensation Committee has approved a
3-year Performance Based Restricted Stock award to executive officers, which
could be earned on December 31, 2009 based on the collective results of the
following three performance factors:

  1.   Earnings Per Share (EPS) Growth     2.   Total Revenue (defined as net
interest income and total non-interest income, as reflected in year end
financial statements) Growth     3.   Net Charge Off Ratio

DEFINITION OF PERFORMANCE FACTORS
Earnings Per Share (EPS):
Earnings Per Share is defined as GAAP EPS, disregarding, however, extraordinary
items and non-recurring charges, both as determined under GAAP, recognized in a
period after the quarter ending March 31, 2007.
Total Revenue:
The sum of net interest income and total non-interest income (as reflected in
year-end financial statements), disregarding, however, extraordinary items, as
determined under GAAP, recognized in a period after the quarter ending March 31,
2007.
Net Charge Off Ratio:
Net Charge Off Ratio is defined as the three year average ratio of Net Charge
Offs to Average Loans for the periods ending 2007, 2006 and 2009.
PERFORMANCE WEIGHTS
“Performance Weight” equals the relative importance of each performance measure
in evaluating performance and determining the number of Performance Based
Restricted Shares earned. The following weight has been assigned to each
performance factor:

                  EPS   Revenue     Growth   Growth   Net Charge Off Ratio
50%
    25 %     25 %

 

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CALCULATION OF PERFORMANCE
For each Performance Factor, the performance level (1) will be determined at the
end of the performance period. The performance level will then be multiplied
times the Performance Weight for each Performance Factor, resulting in Old
National’s Weighted Average Performance Level. (1) The table below shows the
percent of the Shares Awarded (Section 1 of Agreement) that may be earned at
various performance levels:

                                              2009 Total   Net Charge Off    
Performance   2009 GAAP   Revenue   Ratio (3yr   Performance Range   EPS  
($000)   Average)   Level
MAXIMUM
  $ 1.44     $ 455,083       0.200 %     200 %
 
            451,328       0.210 %     190 %
 
    1.43       447,572       0.220 %     180 %
 
            443,817       0.230 %     170 %
 
    1.41       440,061       0.240 %     160 %
 
            436,306       0.250 %     150 %
 
    1.40       432,550       0.260 %     140 %
 
            428,795       0.270 %     130 %
 
    1.39       425,039       0.280 %     120 %
 
            421,284       0.290 %     110 %
TARGET
  $ 1.38       417,528       0.300 %     100 %
 
    1.37       414,546       0.325 %     90 %
 
    1.36       411,565       0.350 %     80 %
 
    1.34       408,583       0.375 %     70 %
 
    1.33       405,602       0.400 %     60 %
 
    1.32       402,620       0.425 %     50 %
 
    1.31       399,638       0.450 %     40 %
 
    1.29       396,657       0.475 %     30 %
MINIMUM
  $ 1.28       393,675       0.500 %     25 %

Example 1:
 

*   The results for a given Performance Factor will be reduced to the next
lowest level if the final financial result does not equal one of the levels
listed in the above schedule. For Example:

                                              2009 Total   Net Charge        
2009 GAAP   Revenue   Off Ratio (3yr         EPS   ($000)   Average)   Total
Actual Results
  $ 1.39     $ 412,000       0.395 %        
Adjusted Results
  $ 1.39       411,565       0.400 %        
Performance Level (a)
    120 %     80 %     60 %        
Factor Weight (b)
    50 %     25 %     25 %        
Weighted Performance (a times b)
    60 %     20 %     15 %     95 %
 
                               
Restricted Shares
                               
Granted
                            1,000  
Restricted Shares Earned
                            950  

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Example 2:
 

*   The results for a given Performance Factor will be reduced to the next
lowest level if the final financial result does not equal one of the levels
listed in the above schedule. For Example:

                                              2009 Total   Net Charge        
2009 GAAP   Revenue   Off Ratio (3yr         EPS   ($000)   Average)   Total
Actual Results
  $ 1.36     $ 412,000       0.520 %        
Adjusted Results
  $ 1.36       411,565       0.000 %        
Performance Level (a)
    80 %     80 %     0 %        
Factor Weight (b)
    50 %     25 %     25 %        
Weighted Performance (a times b)
    40 %     20 %     0 %     60 %
 
                               
Restricted Shares
                               
Granted
                            1,000  
Restricted Shares Earned
                            600  

Example 3:
 

*   The results for a given Performance Factor will be reduced to the next
lowest level if the final financial result does not equal one of the levels
listed in the above schedule. For Example:

                                              2009 Total   Net Charge        
2009 GAAP   Revenue   Off Ratio (3yr         EPS   ($000)   Average)   Total
Actual Results
  $ 1.39     $ 426,000       0.285 %        
Adjusted Results
  $ 1.39     $ 425,039       0.290 %        
Performance Level (a)
    120 %     120 %     110 %        
Factor Weight (b)
    50 %     25 %     25 %        
Weighted Performance (a times b)
    60 %     30 %     27.5 %     117.5 %
 
                               
Restricted Shares
                               
Granted
                            1,000  
Restricted Shares Earned
                            1,175  

TIMING FOR AWARD DETERMINATION
Once performance results for Old National are known and approved by the
auditors, the Compensation Committee will review and approve the final
performance results for the each performance factor. The final determination of
the results including action related determining the overall final Performance
Level will occur on or before
February 1, 2010.

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