Exhibit 10.3

 

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First Midwest Bancorp, Inc.

 

 

SHORT TERM INCENTIVE COMPENSATION PLAN

 

PLAN DOCUMENT

 

 

Revised February 22, 2012

 

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FIRST MIDWEST BANCORP, INC.

SHORT TERM INCENTIVE COMPENSATION PLAN

PLAN DOCUMENT

 

 

 

PAGE

 

 

 

1.

Concept

1

2.

Eligibility and Participation

1

3.

Award Scale

1

4.

Company Performance Categories and Measurement

1

5.

Reserved

1

6.

Individual Performance Measurements

2

7.

Minimum Performance Levels

2

8.

Calculation of a Participant’s Award

2

9.

Discretionary Awards

3

10.

Effect of Termination of Employment on Award Payment

3

11.

Maximum Amount of Awards Paid in a Plan Year

3

 

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FIRST MIDWEST BANCORP, INC. (“COMPANY”)

SHORT TERM INCENTIVE COMPENSATION PLAN

PLAN SPECIFICATIONS AND PROCEDURES

 

* * *

 

1.

Concept

 

 

 

The Short Term Incentive Compensation Plan (the “Plan”) is intended to be an
annual incentive plan for key managers and employees of the Company where Target
Awards are established and communicated to each participant each Plan year. 
Based on the level of achievement of predetermined performance goals for both
the Company and the individual participants, an amount less than or greater than
the Target Award can be earned.

 

 

2.

Eligibility and Participation

 

 

 

Participation in the Plan will be limited to key managers and employees of the
Company as determined by the Compensation Committee of the Board of Directors of
First Midwest Bancorp, Inc. (the “Compensation Committee”) from time to time.

 

3.

Award Scale

 

 

 

Each Plan year payout amounts shall be set for each performance metric
designated by the Compensation Committee (see Section 4 and Section 6) based on
a graduated scale that includes “Minimum”, “Target” and “Maximum” performance
levels and corresponding bonus payment levels, with “Target” performance being
the level at which a participant will earn 100% of his or her award.  Target
Awards will be expressed as a percentage of base salary earned during the Plan
year (excluding overtime, where applicable, and any other components of
compensation).  Based on the achievement of the predetermined performance goals
set for the Plan year, an amount less than or greater than the “Target” award
can be earned. 

 

4.

Company Performance Categories and Measurement

 

 

 

Company performance categories, metrics and measurements for the each Plan year
will be determined by the Compensation Committee in its discretion. 
Notwithstanding the forgoing, the Compensation Committee may in its discretion
modify any payouts of awards (upwards or downwards) to be granted under the Plan
to insure plan objectives are met taking into consideration any factors it deems
necessary or appropriate.

 

5.

Reserved

 

1

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6.

Individual Performance Measurements

 

 

 

Individual performance will be based on the achievement of predetermined
performance standards as determined by each participant’s supervisor.  Such
performance standards should primarily consider the participant’s area of
responsibility (where the participant is responsible for management of a
department, division, banking center or other business unit) or the
participant’s individual performance (where such participant has little or no
management responsibilities).

 

 

 

The individual performance standards may consider:

 

·

Supportive of the Company’s Mission Statement;

·

Varied in scope and complexity in relation to the participant’s level of
responsibility within the Company; and

·

Controllable by the participant.

 

 

For each Plan year the portion of a participant’s “Target” award attributable to
individual performance will be determined by the Compensation Committee in its
discretion and be based upon the Supervisor’s recommended percentage, within the
parameters established by the participant’s performance rating level.  The
performance rating (Far Exceeds Expectations, Exceeds Expectations, Meets
Expectations, Meets conditionally and Does Not Meet Expectations), used to
determine this portion of a Participant’s award must be the same as the
evaluator’s “Overall Performance Rating” as indicated on the First Midwest
Performance Evaluation Form.  Any participant who receives an overall
performance rating of “Meets conditionally or Does Not Meet Expectations” will
also experience a reduction in that participant’s company performance award as
described in Section 4.

 

7.

Minimum Performance Levels

 

 

 

For each Plan year, the Compensation Committee in its discretion may determine
any minimum level of performance for any performance metric required for awards.

 

8.

Calculation of a Participant’s Award

 

 

 

For each Plan year, the award payable to each participant shall be calculated
based upon the results of each performance metric designated by the Compensation
Committee (see Section 4 and 6) based on the graduated scale approved by the
Compensation Committee (see Section 3).  As described in Section 6, a reduction
in the calculated awards for company performance will be made for participants
receiving a Meets conditionally or Does Not Meet Expectations as his or her
individual performance rating.

 

2

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9.

Discretionary Awards

 

 

 

The purpose of the Plan is to reward key managers and employees of the Company
based upon the level of achievement of predetermined performance goals. 
Accordingly, the Company has provided, within the structure of the Plan, a
mechanism to reward certain outstanding employees for their individual
contribution, in addition to their Plan-calculated awards.  Discretionary,
awards shall be based upon the recommendation of the Chief Executive Officer for
his direct reports, and at the recommendation of the Compensation Committee for
our Chief Executive Officer.

 

10.

Effect of Termination of Employment on Award Payment

 

 

 

Termination of employment prior to payment of an award under the Plan (which
will generally occur in mid-February following the end of each Plan year), even
if it occurs after the Plan year-end, will result in forfeiture of the award.

 

 

11.

Maximum Amount of Awards Paid in a Plan Year

 

 

 

 

 

The awards earned by participants will generally be paid in accordance with the
terms of the Plan as described above.  However, the Compensation Committee may
in its discretion establish a maximum aggregate dollar amount of awards paid
under the Plan in any year, regardless of the aggregate awards calculated based
upon the level of performance in any of the categories described above.  If the
aggregate Plan awards in any year exceed such amount, a reduction in aggregate
Plan awards may be directed by the Committee.

 

 

3

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