exv10w30



 





EXHIBIT 10.30




CITIZENS BANKING CORPORATION

MANAGEMENT INCENTIVE PLAN

2006





	I.	 	  PURPOSE:






	 	1.	 	Ensure achievement of strategic goals.
	 
	 	2.	 	Align management more closely with shareholder
	 
	 	3.	 	Strengthen links between pay and performance.






	II.	 	ELIGIBILITY:
	 
	 	 	Senior Vice Presidents and above and certain other officers based upon corporate
responsibility who are not participants in another established incentive plan with payment
amounts determined by performance in relation to goal. Awards will be pro-rated based on
months served for staff members with less than 12 months of service in a Plan Year. Staff
members become eligible to participate in the plan by virtue of promotion or new hire. A
staff member who terminates employment before the Plan Year is not eligible to receive an
award.
	 
	III.	 	PARTICIPATION RATE:
	 
	 	 	The participation rate for individual positions is benchmarked from market data research
provided by various surveys and consultants.
	 
	VI.	 	INCENTIVE COMPONENTS:
	 
	 	 	The Management Incentive Plan components consist of:






	 	•	 	Initial factors: Net Interest Income, Low Cost Deposits, Total Deposits, Fee
Income, Net Charge-Offs, Non-Performing Assets and Expense Management.
	 
	 	•	 	Secondary factors: A weighted EPS and ROE factor will be placed against the
initial factor weighted average to determine an adjusted weighted average payout.
	 
	 	•	 	Tertiary factors: An NII Peer Ranking vs. Peer Group factor may be used to
determine the FINAL weighted average factor for the Corporate Component portion of
the payout.






	V.	 	AWARD DETERMINATION:
	 
	 	 	Salary x Participation Rate x Service Factor = Pool





Pool is broken for the Leadership Group Members as follows:






	 	 	 	 	 	 
	75%	 	 
	Components	 	Percentage	 	 
	Net Interest Income
	 	 	25	%	 
	Low Cost Deposits
	 	 	20	%	 
	Total Deposits
	 	 	10	%	 
	Fee Income
	 	 	15	%	 
	Net Charge-Offs
	 	 	10	%	 
	Non Performing Assets
	 	 	10	%	 
	Expense Management
	 	 	10	%	 









	 	 	 	 	 
	25%	 
	Component	 	Percentage	 
	Discretionary
	 	 	100	%











     ü All independent components



 









 





Pool is broken for the Senior Management and other Participants as follows:






	 	 	 	 	 	 
	65%	 	 
	Components	 	Percentage	 	 
	Net Interest Income
	 	 	25	%	 
	Low Cost Deposits
	 	 	20	%	 
	Total Deposits
	 	 	10	%	 
	Fee Income
	 	 	15	%	 
	Net Charge-Offs
	 	 	10	%	 
	Non Performing Assets
	 	 	10	%	 
	Expense Management
	 	 	10	%	 









	 	 	 	 	 	 	 	 	 
	35%	 
	Component	 	 	 	 	 	Percentage	 
	Line of Business
	 	 	ü	 	 	 	 	 
	Market
	 	 	ý	 	 	 	100	%
	Discretionary
	 	 	þ	 	 	 	 	 











     üAll independent components




	VI.	 	PERFORMANCE FACTOR:
	 
	 	 	For the discretionary component, a performance indicator of 0% to 150% will be applied.
Goals should be set at levels that are challenging to reach at 100% — Achievement should be
based on meeting all expectations in every way. It is possible to exceed 100% performance
but this type of evaluation should be reserved for truly extraordinary performance
	 
	VII.	 	SERVICE FACTOR:
	 
	 	 	The service factor is equal to the number of months the participant is employed with the
corporation during the plan year. Example: 1.0 is equal to 12 months, .5 is equal to 6
months.
	 
	VIII.	 	AWARD PAYMENTS:
	 
	 	 	All awards earned under Management Incentive Plan will be paid as soon as practical following
approval by the Compensation and Human Resources Committee.
	 
	IX.	 	ADDITIONAL PROVISIONS:
	 
	 	 	The Management Incentive Plan shall be administered by the Compensation and Human Resources
Committee of the Corporation.
	 
	 	 	While all attempts will be made to follow the incentive formulas and metrics, subjective
adjustments occasionally can and will be made both upwards and downwards based on management
discretion which will require CEO approval. Adjustments will be considered based on value of
an individual’s contribution to performance during the year and not based on comparison to
prior year awards, comparison to peer’s incentive levels, attitude, effort, etc. In general,
subjective adjustments will be the exception and not the rule. Management will however
reserve the right to make these subjective adjustments if necessary to be equally fair to
shareholders and plan participants.
	 
	 	 	The incentive award for the Chairman and President and CEO will be determined by the
Compensation and Human Resources Committee of Citizens Banking Corporation Board of
Directors.
	 
	 	 	A special award fund (Discretionary) equal to 15% of the aggregate incentive award will be
available for individual awards as determined by the President and CEO. Awards from this
fund are made to staff members who are not participants in the Management Incentive Plan.
	 
	 	 	Awards for the Discretionary Fund will be made only in recognition of exemplary achievements.
Distribution of all available amounts in this fund is not mandatory.
	 
	 	 	Participation in the Management Incentive Plan shall not be construed as giving any employee
the right to continued employment with the corporation for the full or for any subsequent
period.





 









 





Performance Plan Guidelines





	 	•	 	If participant is on corrective action on the last day of the quarter/year they are not
eligible for incentive payment
	 
	 	•	 	Minimum annual performance rating of Productive required in most recent Annual
Performance Review in both Key Performance Activities and Competencies
	 
	 	•	 	This plan does not represent a contract with any individual plan participant
	 
	 	•	 	The plan may be changed, modified or terminated at any time throughout the plan year






	X.	 	DISCRETIONARY AWARD GUIDELINES:
	 
	 	 	Objectives: Recognize and promote exemplary individual performance or initiative.
	 
	 	 	Eligible Participants: All staff members are eligible except staff members who are in
established incentive plans with payment amounts determined by performance in relation to
established goals.
	 
	 	 	Nomination Process: Managers would nominate staff member(s) according to established
guidelines. They would also obtain concurrence and approval from their respective Direct
Report to the CEO.
	 
	 	 	Monetary Guidelines: Range of $500 to $3000. Larger amounts could be given in exceptional
circumstances.
	 
	 	 	Guidelines: Discretionary awards should be given in recognition for one or more of the
following performance criteria:






Earnings:




	 	•	 	Expense reduction
	 
	 	•	 	Revenue enhancement






Innovation:




	 	•	 	Continuous improvement efforts
	 
	 	•	 	Innovative delivery alternatives
	 
	 	•	 	Foresight and planning to prevent crises






Achievement:




	 	•	 	Unique/specialized skills or knowledge of value to the company, i.e., Key Performers
	 
	 	•	 	Sustained high performance
	 
	 	•	 	Exemplary performance during unusual circumstances or specific events
	 
	 	•	 	Special projects completed in an exceptional manner or ahead of schedule
	 
	 	•	 	Extraordinary client service






 









 








     


MIP will be initially calculated based on the following components and payout tier structure.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	25%
	 	Net Interest Income	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 
	 
	 	2004 Actual = 275.3	 	% to Actual (Actual/Budget)	 	 	<98.7	%	 	 	 	98.7	%	 	 	98.9	%	 	 	99.1	%	 	 	99.3	%	 	 	99.5	%	 	 	99.6	%	 	 	99.8	%	 	 	100	%	 	 	100.2	%	 	 	100.4	%	 	 	100.5	%	 	 	100.7	%	 	 	100.9	%	 	 	101.1	%	 	 	101.3	%	 	No Cap
	 
	 	2005 Actual = 275.7	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	105	%	 	 	110	%	 	 	115	%	 	 	120	%	 	 	 	 
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	20%
	 	Low Cost Deposits	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 
	 
	 	2005 Actual = 2,747	 	% to Actual (Actual/Budget)	 	 	<90	%	 	 	 	90	%	 	 	91	%	 	 	92	%	 	 	93	%	 	 	94	%	 	 	95	%	 	 	96	%	 	 	97	%	 	 	98	%	 	 	99	%	 	 	100	%	 	 	101.7	%	 	 	103.5	%	 	 	105.2	%	 	 	107.0	%	 	No Cap
	 
	 	2006 Budget = *	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	105	%	 	 	110	%	 	 	115	%	 	 	120	%	 	 	 	 
	 
	 	 	 	(YE Avg Bal)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	10%
	 	Total Deposits	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 
	 
	 	2005 Actual = 5,091	 	% to Actual (Actual/Budget)	 	 	<97.5	%	 	 	 	97.5	%	 	 	97.9	%	 	 	98.2	%	 	 	98.6	%	 	 	98.9	%	 	 	99.3	%	 	 	99.6	%	 	 	100	%	 	 	100.4	%	 	 	100.7	%	 	 	101.1	%	 	 	101.4	%	 	 	101.8	%	 	 	102.1	%	 	 	102.5	%	 	No Cap
	 
	 	2006 Budget = *	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	105	%	 	 	110	%	 	 	115	%	 	 	120	%	 	 	 	 
	 
	 	 	 	(YE Avg Bal)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	15%
	 	Fee Income	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 
	 
	 	2004 Actual = 93.4	 	% to Actual (Actual/Budget)	 	 	< 94.2	%	 	 	 	94.2	%	 	 	95.1	%	 	 	95.9	%	 	 	96.7	%	 	 	97.5	%	 	 	98.4	%	 	 	99.2	%	 	 	100	%	 	 	100.8	%	 	 	101.6	%	 	 	102.5	%	 	 	103.3	%	 	 	104.1	%	 	 	104.9	%	 	 	105.8	%	 	No Cap
	 
	 	2005 Actual = 91.5	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	105	%	 	 	110	%	 	 	115	%	 	 	120	%	 	 	 	 
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	10%
	 	Net Charge-Offs	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 
	 
	 	2004 Actual = 20.8	 	% to Actual (Actual/Budget)	 	 	> 119.0	%	 	 	 	119.0	%	 	 	116.3	%	 	 	113.6	%	 	 	110.9	%	 	 	108.1	%	 	 	105.4	%	 	 	102.7	%	 	 	100	%	 	 	97.8	%	 	 	95.6	%	 	 	93.4	%	 	 	89.0	%	 	 	84.6	%	 	 	80.1	%	 	 	75.7	%	 	 	71.3	%
	 
	 	2005 Actual = 14.6	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	110	%	 	 	120	%	 	 	130	%	 	 	140	%	 	 	150	%
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	10%
	 	Non Performing Loans	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 
	 
	 	2004 Actual = 50.8	 	% to Actual (Actual/Budget)	 	 	> 111.1	%	 	 	 	111.1	%	 	 	109.5	%	 	 	107.9	%	 	 	106.3	%	 	 	104.7	%	 	 	103.2	%	 	 	101.6	%	 	 	100	%	 	 	99.1	%	 	 	98.3	%	 	 	97.4	%	 	 	95.7	%	 	 	94.0	%	 	 	92.3	%	 	 	90.6	%	 	 	88.9	%
	 
	 	2005 Actual = 46.6	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	110	%	 	 	120	%	 	 	130	%	 	 	140	%	 	 	150	%
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	10%
	 	Expense	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 
	 
	 	2004 Actual = 244.8	 	% to Actual (Actual/Budget)	 	 	>101.8	%	 	 	 	101.8	%	 	 	101.5	%	 	 	101.3	%	 	 	101.0	%	 	 	100.8	%	 	 	100.5	%	 	 	100.3	%	 	 	100	%	 	 	99.9	%	 	 	99.7	%	 	 	99.6	%	 	 	99.3	%	 	 	99.0	%	 	 	98.8	%	 	 	98.5	%	 	 	98.2	%
	 
	 	2005 Actual = 243.0	 	Payout Factor	 	 	0	%	 	 	 	50	%	 	 	55	%	 	 	60	%	 	 	65	%	 	 	70	%	 	 	75	%	 	 	80	%	 	 	85	%	 	 	90	%	 	 	95	%	 	 	100	%	 	 	110	%	 	 	120	%	 	 	130	%	 	 	140	%	 	 	150	%
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	100%	 	Payout % is incremental between tiers (ex. Each % over budget earns x% additional incentive)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	EPS and ROE factors will provide an additional weighted average calculation to be applied against the above results.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	60%
	 	EPS Factor	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2004 Actual = 1.74	 	% to Actual (Actual/Budget)	 	 	< 96.3	%	 	 	 	96.3	%	 	 	97.1	%	 	 	97.8	%	 	 	98.5	%	 	 	99.3	%	 	 	100	%	 	 	100.7	%	 	 	101.5	%	 	 	102.2	%	 	 	102.9	%	 	 	103.7	%	 	No Cap	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2005 Actual = 1.85	 	Payout Factor	 	 	0	%	 	 	 	85	%	 	 	88	%	 	 	91	%	 	 	94	%	 	 	97	%	 	 	100	%	 	 	103	%	 	 	106	%	 	 	109	%	 	 	112	%	 	 	115	%	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Budget	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	40%
	 	ROE Factor	 	Actual	 	 	*	 	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	*	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2004 Actual = 11.90	 	% to Actual (Actual/Budget)	 	 	< 94.4	%	 	 	 	94.4	%	 	 	95.5	%	 	 	96.7	%	 	 	97.8	%	 	 	98.9	%	 	 	100	%	 	 	101.1	%	 	 	102.2	%	 	 	103.2	%	 	 	104.3	%	 	 	105.4	%	 	No Cap	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2005 Actual = 12.33	 	Payout Factor	 	 	0	%	 	 	 	85	%	 	 	88	%	 	 	91	%	 	 	94	%	 	 	97	%	 	 	100	%	 	 	103	%	 	 	106	%	 	 	109	%	 	 	112	%	 	 	115	%	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	2006 Budget = *	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	100%	 	Payout % is incremental between tiers (ex. Each % over budget earns x% additional incentive)





Discretionary Modifier — Guidelines Only



An additional peer group ranking modifier may be used to determine final payouts of MIP






	 	 	 
	Component	 	Weighting
	NII
	 	50%
	EPS
	 	50%






	 	 	 	 	 
	 	 	 	 	Equates to x% payout
	Peer Ranking	 	Factor	 	@ 100% of budget
	Above 75th Percentile
	 	118%
	 	100%
	Below 25th Percentile
	 	59%
	 	50%
	2006 vs 2005 performance
	 	 	 	(factor x 85%)















Peer Group*









1 Discretion may be used by the comp committee to over-ride the formula under appropriate circumstances



2 Any adjustments for unusual items (such as acquisitions, divestitures) will require comp committee approval



3 The above numbers will not include the impact of extra-ordinary items



4 The above numbers will be adjusted to neutralize the impact of equity compensation



5 The above numbers will be adjusted to normalize the impact of equity adjustments due to interest rate movements




 





 




			
	*	 	Portions of this exhibit have been omitted pursuant to Citizens’ request to the
Secretary of the Securities and Exchange
Commission for confidential treatment pursuant to
Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.