EXHIBIT 10.4

 

AMENDED AND RESTATED

MANAGEMENT INCENTIVE PLAN

OF THE COLONIAL BANCGROUP, INC.

 

This Management Incentive Plan of The Colonial BancGroup, Inc., a Delaware
corporation with its principal place of business in Montgomery, Alabama
(“BancGroup”), is amended and restated as of the 8th day of March, 2005.

 

WITNESSETH:

 

WHEREAS, on January 19, 2000, the Board of Directors of BancGroup adopted the
Management Incentive Plan, subject to shareholder approval; and

 

WHEREAS, at the annual meeting of shareholders of BancGroup held on April 19,
2000, the shareholders approved the adoption of the Management Incentive Plan,
including the terms and conditions of the performance goals under which
compensation thereunder is to be paid to certain executive officers of
BancGroup; and

 

WHEREAS, pursuant to the terms of the Management Incentive Plan, the Personnel
and Compensation Committee of the Board of Directors of BancGroup (the
“Committee”), which assumed the responsibilities of the Executive Compensation
Subcommittee following its dissolution in January 2003, has the authority to
amend the Management Incentive Plan, subject to certain limitations; and

 

WHEREAS, the Committee hereby desires to amend and restate the Management
Incentive Plan;

 

NOW, THEREFORE, the Committee hereby amends and restates the Management
Incentive Plan as follows:

 

1. DEFINITIONS

 

1.1. “BancGroup” means The Colonial BancGroup, Inc., a corporation organized and
existing under the laws of the State of Delaware, with its principal place of
business in Montgomery, Alabama, and any successor thereto, whether by merger,
consolidation, sale of assets, liquidation, or otherwise.

 

1.2. “Board” means the Board of Directors of BancGroup.

 

1.3. “Code” means the Internal Revenue Code of 1986, as amended.

 

1.4. “Committee” means the Personnel and Compensation Committee of the Board.

 

1.5. “Compensation” means the base salary paid to Participants, excluding
overtime, commissions, awards from other incentive programs, BancGroup
contributions to fringe benefit programs, and other “non-salary” income.

 

1.6. “Executive Officer” means those officers of BancGroup within the meaning of
Rule 16a-1(f) under the Securities and Exchange Act of 1934, as amended.

 

1.7. “Participant” means an Executive Officer who has been designated for
participation in the Plan by the Committee in accordance with Section 3 of the
Plan and who has commenced participation in the Plan.

 

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1.8. “Performance Agreement” means the written notice described in Section 3.2
of the Plan, executed by an Executive Officer of BancGroup and transmitted on
behalf of the Committee by BancGroup to each Participant, setting forth the
terms and conditions of each Participant’s participation in the Plan.

 

1.9. “Plan” means the Management Incentive Plan of BancGroup established by this
document, as amended from time to time, and any related Performance Agreements.

 

1.10. “Plan Year” means any performance period which begins on January 1 of a
particular year and ends on December 31 of that same year.

 

2. PURPOSE

 

The Plan is intended to promote and encourage excellence in the performance of
responsibilities by the Executive Officers, to maximize BancGroup’s soundness,
profitability and growth, and to provide an incentive opportunity that will
permit those members of management who are positioned to make significant
contributions to BancGroup’s success to receive appropriate total cash
compensation.

 

3. PARTICIPATION

 

3.1. Selection to Participate. The Committee, prior to the close of each Plan
Year, may designate in writing one or more Executive Officers as persons
eligible to participate in the Plan during the next succeeding Plan Year. The
Committee shall solicit the recommendation of the Chairman with respect to the
participation of an Executive Officer, other than the Chairman, in the Plan.
Participation in the Plan is conditional; participation in one Plan Year does
not guarantee participation in successive years.

 

  3.2.   Designation of Award and Performance Goals.

 

        3.2.1. Not later than ninety (90) days after the commencement of each
Plan Year, the Committee shall approve and establish, and communicate in writing
to each Participant in the Plan for such Plan Year, the terms and conditions of
each such Participant’s participation in the Plan for such Plan Year, including
the award that each such Participant will be eligible to earn during such Plan
Year (which shall be expressed as a percentage of each such Participant’s
Compensation as of the first day of such Plan Year and which shall specify a
minimum, maximum, and target award for each such Participant) and the
performance goals that must be achieved in order for each such Participant to
earn such award; provided, however, that in no event shall the Committee grant
any Participant under the Plan an award that could result in such Participant
earning an amount under the Plan greater than $3,000,000 with respect to any
Plan Year.

 

        3.2.2. The Committee shall establish corporate performance goals of one
or more of the following business criteria: return on equity, return on assets,
earnings per share, nonperforming assets, stock price, and net income.
Performance goals established by the Committee shall be objective performance
goals within the meaning of Section 162(m) of the Code and Treasury Regulations
promulgated thereunder. Furthermore, and notwithstanding any other provision of
the Plan to the contrary, once the Committee has established performance goals
for a Participant, the Committee shall have no discretion to (i) increase the
amount of compensation that would otherwise be due upon the attainment of the
goals, or (ii) alter the goals for the Plan Year to which they relate.

 

        3.2.3. In establishing the award and performance goals of Participants
in the Plan, the Committee shall consider the Participant’s level of
responsibility with BancGroup and the Participant’s potential contribution to
the performance goals of BancGroup. In establishing the award and performance
goals of any Participant other than the Chairman of BancGroup, the Committee
shall solicit the recommendation of BancGroup’s Chairman.

 

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        3.2.4. The Committee shall assign weightings to indicate the relative
importance of each business criteria in determining incentive awards earned
under the Plan. The sum of weightings assigned to any Participant must equal
100%. These weightings may vary from Plan Year to Plan Year, and, except with
respect to the Chairman, shall be based on recommendations by the Chairman
subject to approval by the Committee. The Committee shall assign such weightings
not later than ninety (90) days after the commencement of each Plan Year, and
such weightings shall remain in effect for the remainder of the Plan Year.

 

4. PAYMENT OF AWARDS

 

4.1. Calculation of Award Payments. Within sixty (60) days following the close
of each Plan Year in which a Participant is participating in the Plan, the
Committee shall compare the terms and conditions of the award of each
Participant and the performance goals assigned to each such Participant.
Following such determination, and prior to the payment of awards pursuant to
Section 4.2 below, the Committee shall certify in writing to each Participant
and to the Board whether each Participant has met the terms and conditions of
the award for the Plan Year in question.

 

4.2. Payment of Award Amounts. All awards determined to have been earned
pursuant to Section 4.1 of the Plan shall be payable in cash, as soon as
administratively possible following the certification described in Section 4.1
above, but in no event later than seventy-five (75) days following the close of
the Plan Year to which such award related.

 

4.3. Effect of Termination of Employment on Payment of Award.

 

        4.3.1. If a Participant terminates employment during a Plan Year for any
reason other than retirement, disability, or death, no award will be payable
under the Plan.

 

        4.3.2. If a Participant’s employment terminates during a Plan Year as a
result of retirement, disability, or death, the Participant, his beneficiary, or
his estate will receive a pro-rata portion of the incentive award determined as
of the end of the Plan Year. The proration will be based on the Participant’s
year-to-date Compensation for the Plan Year and the achieved levels of
performance as of the end of the Plan Year. The pro-rated award will be paid at
the same time as awards are paid to active Participants.

 

        4.3.3. If a Participant’s employment is terminated during a Plan Year
for willful dishonesty or gross misconduct, no award will be payable. If a
Participant’s employment is terminated other than for willful dishonesty or
gross misconduct, the Participant will receive a pro-rata portion of the
incentive award determined as of the end of the Plan Year. The proration will be
based on the Participant’s year-to-date Compensation for the Plan Year and the
achieved levels of performance as of the end of the Plan Year. The pro-rated
award will be paid at the same time as awards are paid to active Participants.

 

5. ADMINISTRATION

 

5.1. The Committee, as Plan administrator, is authorized to administer the Plan,
subject to and in accordance with the provisions set forth herein, and shall
have all powers necessary and appropriate to enable it to properly administer
the Plan, including but not limited to the power to:

 

        5.1.1. approve the establishment and range of corporate goals,
recommendations regarding participation, the amount of individual award
payments, and all matters relating to the day-to-day operation of the Plan;

 

        5.1.2. construe and interpret the Plan, establish rules and regulations,
delegate such administrative responsibilities as it deems proper, and to perform
all other acts it deems necessary to carry out the intent and purpose of the
Plan;

 

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        5.1.3. suspend or terminate, in whole or in part, or amend the terms of
the Plan, at any time, without the need for obtaining approval of the
shareholders, by an instrument in writing; provided, however, that shareholder
approval shall be required for any amendment that changes the material terms of
the Plan applicable to any Participant;

 

        5.1.4. cancel the participation of any person who conducts himself in a
manner which the Committee, in the exercise of reasonable discretion, determines
to be inimical to the best interests of BancGroup; and

 

        5.1.5. correct any defect, supply any omission, or reconcile any
inconsistency in the Plan, in the manner and to the extent it shall deem
necessary.

 

5.2. The Committee’s determination under the Plan of the persons to participate
and receive awards and the terms and conditions of such awards need not be
uniformly applicable to all Participants, but may be made by the Committee on a
selective basis among persons who receive or are eligible to receive awards
under the Plan, whether or not such persons are similarly situated. The
Committee shall have final approval authority over the payment of all awards
under this Plan, whether individually or collectively.

 

6. PLAN FUNDING AND ACCRUALS OF AWARDS

 

The Plan is unfunded and awards hereunder shall be paid from general corporate
funds.

 

7. NEW PARTICIPANTS, PROMOTIONS, OR TRANSFERS

 

All participation in the Plan is subject to approval by the Committee. Newly
hired or promoted employees who enter positions which are considered to be
eligible for participation in the Plan normally will, upon approval by the
Committee, enter the Plan on January 1 next following the date of hire or
promotion. The Chairman, however, subject to approval by the Committee, may
authorize immediate participation upon hire or promotion.

 

8. MISCELLANEOUS

 

8.1. Construction of Plan. Except as provided under federal law, the provisions
of the Plan shall be governed by and construed in accordance with the laws of
the State of Delaware, and shall be binding on and inure to the benefit of any
successor or successors to BancGroup.

 

8.2. Right to Employment. Participation in this Plan shall not be construed as
giving any Participant the right to be retained in the employ of BancGroup.
Further, BancGroup expressly reserves the right at any time to dismiss any
Participant with or without cause, such dismissal to be free from any liability
or any claim under the Plan, except as provided herein.

 

8.3. Nonalienation of Benefit. No benefit under the Plan shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge, and any attempt to do so shall be void.

 

8.4. Withholding of Taxes. BancGroup shall have the right to deduct from any
award payable under this Plan all applicable withholding and employment taxes at
such times as they are due.

 

8.5. Plan Expenses. Any expenses incurred in the administration of this Plan
shall be borne by BancGroup.

 

8.6. Entire Agreement. This Plan, as completed and executed by BancGroup, the
Performance Agreements, and all amendments thereto, will constitute the entire
agreement between BancGroup and Participants regarding the Plan.

 

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8.7. Captions. The captions or headings in this Plan are made for convenience
and general reference only and shall not be construed to describe, define, or
limit the scope or intent of the provisions of this Plan.

 

8.8. Number and Gender. The masculine pronoun used shall include the feminine
pronoun and the singular number shall include the plural number unless the
context of the Plan requires otherwise.

 

IN WITNESS WHEREOF, The Colonial BancGroup, Inc. has caused this Amended and
Restated Management Incentive Plan to be executed as of the 8th day of March,
2005.

 

THE COLONIAL BANCGROUP, INC.

By:

 

/s/    Robert E. Lowder

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Robert E. Lowder

Chairman & Chief Executive Officer