Exhibit 10.21
 
CFS BANCORP, INC. AND CITIZENS FINANCIAL BANK
COMPENSATION CLAWBACK POLICY
 
     If the Board of Directors of CFS Bancorp, Inc. (the “Company”), or an
appropriate committee thereof, has determined that the Company must restate the
financial statements that it is required to file with the Securities and
Exchange Commission (“SEC”) pursuant to applicable securities laws as a result
of material noncompliance with the financial reporting requirements of such
securities laws, or misstatement of financial metrics, then the Company shall
have the right to recoup certain incentive compensation paid to its current or
former executive officers (collectively, the “Affected Individuals”).
Specifically, the Company shall have the right to recoup certain incentive
compensation paid to such Affected Individuals for the three year period
preceding the restatement of the Company’s financial statements. In determining
what remedies to pursue, the Board of Directors, or applicable committee, will
take into account all relevant factors, including such factors as required or
recommended by the SEC.
 
     The Board will, to the extent it determines to be appropriate and
consistent with the intent of this policy, require reimbursement of any bonuses,
incentive payments, commissions, equity awards or other compensation (a “Covered
Payment”) that is paid to the Affected Individual(s) during the three (3) year
period preceding the restatement of the Company’s financial statements, cause
the cancellation of awards (or portions of such awards) of restricted stock,
stock appreciation rights, performance units, performance shares and outstanding
stock options that were awarded during such time period, and seek reimbursement
of any gains realized on the exercise of stock options attributable to such
awards, if and to the extent that a) the amount of incentive compensation was
calculated based upon the achievement of certain financial results that were
subsequently modified due to a restatement of all or a portion of the financial
statements of the Company or its subsidiary, Citizens Financial Bank and b) the
amount of the Covered Payment or any award that would have been made to the
Affected Individual had the financial results been properly reported would have
been lower than the amount actually earned, awarded or paid. In addition, the
Board may terminate the employment of the Affected Individual, authorize legal
action or take such other action to enforce the Affected Individual’s
obligations to the Company or Citizens Financial Bank as it may deem appropriate
in the event that the Affected Individual engaged in any fraud, negligence or
intentional misconduct that contributed to the need to restate the Company’s
financial statements.
 
     It is the duty of each Affected Individual to attest to the accuracy of any
financial statements or incentive metrics in determining their Covered Payments
or any award. The acceptance by an Affected Individual of a Covered Payment or
any award will be deemed by the Company and Citizens Financial Bank as an
attestation that the incentive metrics or underlying financial statements are
not based on materially inaccurate or fraudulent information.
 
     It is the intent of the Company that this Policy be construed and
interpreted consistent with the requirements of the Dodd-Frank Wall Street
Reform and Consumer Protection Act (the “Dodd-Frank Act”) and any other
applicable banking laws or regulations. The Board may amend this Policy at any
time in its sole discretion, including without limitation, to ensure that this
Policy meets the requirements of the Dodd-Frank Act and any other applicable law
or regulation. The Company will provide notice of any amendment to this Policy
to all relevant parties. Finally, this Policy is in addition to the requirements
of Section 304 of the Sarbanes-Oxley Act of 2002 that are applicable to the
Company’s Chief Executive Officer and Chief Financial Officer.
 
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