Filed by Bowne Pure Compliance





Exhibit 10.9




FIRST AMENDMENT TO THE

FIRST NIAGARA FINANCIAL GROUP
PINNACLE INCENTIVE COMPENSATION PLAN


WHEREAS, First Niagara Financial Group (the “Company”) established the Pinnacle Incentive
Compensation Plan (the “Plan”), effective January 1, 2005, as a short-term cash incentive
compensation plan; and



WHEREAS, under the Plan, if specified performance targets are met, eligible individuals will
receive a cash lump sum payment in February following the close of the calendar year in which the
incentive compensation was earned; and



WHEREAS, Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the
2007 final regulations issued thereunder (the “Final Regulations”), provide that, so long as bonus
plans provide for payment by March 15 of the year after the year in which the amounts are earned,
all payments under such written bonus plans (i) are exempt from 409A under the “short term deferral
rule” and (ii) payments may actually be made, under a rule of administrative convenience, by
December 31 of the year after the year in which the incentive compensation was earned;




NOW THEREFORE, the Plan is hereby amended as follows:




Page 7 of the Plan is hereby amended to read as follows, effective January 1, 2005:




How and When Awards Are Paid




In general, incentive awards will be paid in a separate check in the
mid-February time period to allow for complete end-of-prior-year performance
results to be finalized. However, in any event, payments shall be made no later
than March 15 of the year after the year in which the incentive awards are
earned, such that the payments will be exempt from Section 409A of the Internal
Revenue Code, as amended, under the “short term deferral rule” set forth in the
2007 Final Treasury Regulations issued under Code Section 409A.




IN WITNESS WHEREOF, this First Amendment has been signed on the date set forth below.



	 	 	 	 	 
	 	FIRST NIAGARA FINANCIAL GROUP, INC.
 	 
	December 4, 2008	By:  	/s/  John R. Koelmel
 	 
	Date	 	Date                              John R. Koelmel 	 
	 	 	President & CEO 	 



 


 









 





	 	 	 	 	 








“Get Involved” in

Top Performance




Share FNFG’s Success through the Pinnacle Incentive Compensation Plan





 


 









 







“Get Involved,” Get Recognized, Get Rewarded





First Niagara Financial Group is committed to being the best in all we do. To achieve that goal,
FNFG developed the Pinnacle Incentive Compensation Plan to recognize and reward our collective
success and those who make significant contributions to that success. The Plan takes effect as of
January 1, 2005 for performance during 2005 and subsequent calendar years.



The Pinnacle of our Strategy




The Pinnacle Incentive Plan encourages and rewards your involvement and contributions directly in
line with the goals of our Strategic Blueprint, driving for top results in the following areas:




	 	•	 	improved financial performance
	 
	 	•	 	holistic financial solutions
	 
	 	•	 	improved Human Capital Management
	 
	 	•	 	simplified business processes, and
	 
	 	•	 	delivery of a unique brand of service.





Your Pinnacle Incentive Plan award will take into account your individual contributions as well as
the contributions of the entire team. Here are the components of your incentive opportunity:



Pinnacle Incentive Compensation Opportunity Based On...





	 	•	 	Individual goals—your performance, beyond daily responsibilities, supporting the
broader goals of your team/business unit and the Company
	 
	 	•	 	Team goals—your business unit, department, or function’s performance in achieving key
metrics and performance standards
	 
	 	•	 	Company goals—FNFG achieving Earnings Per Share (EPS) and Return on Assets (ROA) goals





Our total compensation philosophy



FNFG is committed to offering compensation and benefits programs that
motivate, recognize, and reward employees for offering products and services
that meet all the financial needs and exceed the expectations
of our customers.




Rewards Where You Make a Positive Impact




FNFG expects everyone to work as a team for the Company’s success. That’s why a portion of
everyone’s incentive opportunity is tied to Company performance and team/Business Unit performance.


 


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How much of your total incentive is tied to Company goals depends on the extent to which you have
direct accountability for First Niagara’s Company Goals. If your accountability for Company
performance is significant, a slightly greater portion of your incentive will be tied to Company
performance than someone in a job with indirect accountability for Company performance, as shown
below.








Your manager will discuss your specific goals and target incentive opportunity when you plan for
the year.



To sum it up, pinnacle performance—as an individual, a team, and a Company— will result in top
rewards.



Pinnacle Performance: What It Means To You




Who’s Eligible




All non-exempt and exempt non-Officers and Officers of FNFG, employed as of October 1st
of the plan year, who do not earn commission are eligible for the Pinnacle Incentive Compensation
Plan.



	 
	The following employees are not eligible for the incentive compensation plan:








	 	•	 	participants under the Consumer Bank Incentive Compensation Plan
	 
	 	•	 	employees who earn commissions
	 
	 	•	 	participants in another producer or commissioned sales plan already established by the
Company for 2005
	 
	 	•	 	temporary employees




 


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At a Glance...How the Plan Works




There are four main phases that lead to an incentive payout for achievement of performance goals.
The main phases span a complete calendar (performance) year, beginning with goal setting in Quarter
1 and payouts taking place in Quarter 1 of the following calendar year.




	 	•	 	Getting Involved






	 	•	 	Goal Setting
	 
	 	•	 	Making Successful Contributions to the Strategic Blueprint






	 	•	 	Incentive Pool Funding
	 
	 	•	 	Getting Recognized & Rewarded—Determining and Delivering Individual Incentive Awards









 


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Determining and Communicating Measures, Goals, Objectives




Company goals, team (Business unit/dept) measures, and individual objectives are determined at the
beginning of the performance year. Each business unit sets up goals that ultimately link to the
Strategic Blueprint. Your manager will meet with you to share the Company’s and the team’s
performance measures and goals as well as to discuss and define your Individual measures and goals
for the year.



Individual performance measures and goals will be tied to the Strategic Blueprint and will be SMART
goals, Specific, Measurable, Action oriented, Realistic, and Time/budget controlled.



The table below shows how each performance category (its weighting, measures, and goals) relates to
the Company’s job roles to make up a target incentive opportunity. Important: the Company must
achieve threshold Net Income in order to fund the incentive pool.



Your Incentive Compensation Opportunity




Performance Categories and Performance Measures




	 	 	 	 	 	 	 	 	 	 	 
	 	 	Performance	 	Weighting*	 	Performance	 	 
	Job Role	 	Category	 	(% of Target)	 	Measure	 	Goal
	Non-Exempt 

Employees 
(not covered under the 
Consumer Bank 
Incentive Plan)
	 	Company	 	 	10%		 	EPS

ROA	 	84¢ per share

1.17%
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	Team (Business

Unit/Department)	 	 	60% — 90	%	 	Service standards	 	Exceed Objective
	 
	 	 	 	 	 	 	 	Key Financial

Measures	 	For ex., end year at 90% of operating budget
	 
	 	 	 	 	 	 	 	Employee Development	 	Completing

Individual

Development Plans
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	Individual	 	 	0% — 30	%	 	Contribution to
success of
Strategic Blueprint
action plans	 	Achievement of Goal
	 
	 	 	 	 	 	 	 	Sales/Service Goals	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Exempt Employees
and Individual
Contributor Role
Officers without
Direct Reports
	 	Company	 	 	15%		 	EPS

ROA	 	84¢ per share

1.17%
	 
	 	Team (Business

Unit/Department)	 	 	45% — 65	%	 	Service standards	 	Exceed Objective
	 
	 	 	 	 	 	 	 	Key Financial

Measures	 	For ex., end year
at 90% of operating
budget
	 
	 	 	 	 	 	 	 	Retention of Key
Talent	 	Retain 100% of high
performing talent
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	Individual	 	 	20% — 40	%	 	Contribution to
success of
Strategic Blueprint
action plans	 	Achievement of Goal
	 
	 	 	 	 	 	 	 	Sales/Service Goals	 	 








	 	 	 
	*	 	Weighting is based on how much your role and responsibilities directly influence the performance category.
Weightings add up to 100% of your incentive opportunity. Actual weightings will be communicated during performance
planning.



 


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Performance Categories and Performance Measures




Continued




	 	 	 	 	 	 	 	 	 
	 	 	Performance	 	Weighting*	 	Performance	 	 
	Job Role	 	Category	 	(% of Target)	 	Measure	 	Goal
	Non-commissioned Producers
	 	Company	 	10%	 	EPS	 	84¢ per share

	 
	 	 	 	 	 	ROA	 	1.17%
	 
	 	 	 	 	 	 	 	 
	 
	 	Team (Business	 	 	 	 	 	 
	 
	 	Unit/Department)	 	30%	 	Service standards	 	Exceed Objective
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Key Financial	 	For ex., end year
	 
	 	 	 	 	 	Measures	 	at 90% of operating
	 
	 	 	 	 	 	 	 	budget
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Employee Development	 	Completing
Individual
	 
	 	 	 	 	 	 	 	Development Plans
	 
	 	 	 	 	 	 	 	 
	 
	 	Individual	 	60%	 	Contribution to	 	Achievement of Goal
	 
	 	 	 	 	 	success of	 	 
	 
	 	 	 	 	 	Strategic Blueprint	 	 
	 
	 	 	 	 	 	action plans	 	 
	 
	 	 	 	 	 	 	 	 
	Officers and Managers
with Direct Reports
	 	Company	 	20%	 	EPS
ROA	 	84¢ per share
1.17%
	 
	 	 	 	 	 	 	 	 
	 
	 	Team (Business	 	 	 	 	 	 
	 
	 	Unit/Department)	 	65%	 	Service standards	 	Exceed Objective
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Key Financial	 	For ex., end year
	 
	 	 	 	 	 	Measures	 	at 90% of operating
	 
	 	 	 	 	 	 	 	budget
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Retention of Key Talent	 	Retain 100% of high
	 
	 	 	 	 	 	 	 	performing talent
	 
	 
	 	Individual	 	15%	 	Contribution to	 	Achievement of
	 
	 	 	 	 	 	success of	 	Goal
	 
	 	 	 	 	 	Strategic Blueprint	 	 
	 
	 	 	 	 	 	action plans	 	 
	 
	 	 	 	 	 	 	 	 
	Senior Officers (VP/SVP)
Reporting Directly to
Executive Steering
	 	Company	 	30%	 	EPS
ROA	 	84¢ per share
1.17%
	 
	 	 	 	 	 	 	 	 
	 
	 	Team (Business	 	 	 	 	 	 
	 
	 	Unit/Department)	 	50% — 60%	 	Service standards	 	Exceed Objective
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Key Financial	 	For ex., end year
	 
	 	 	 	 	 	Measures	 	at 90% of operating
	 
	 	 	 	 	 	 	 	budget
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Retention of Key	 	Retain 100% of high
	 
	 	 	 	 	 	Talent	 	performing talent
	 
	 
	 	Individual	 	10% — 20%	 	Contribution to	 	Achievement of Goal
	 
	 	 	 	 	 	success of	 	 
	 
	 	 	 	 	 	Strategic Blueprint	 	 
	 
	 	 	 	 	 	action plans	 	 








	 	 	 
	*	 	Weighting is based on how much your role and responsibilities directly influence the performance category. Weightings
add up to 100% of your incentive opportunity. Actual weightings will be communicated during performance planning.




Funding the Incentive Pool




Funding of the incentive pool is based on FNFG achieving pre-determined Net Income goals. If
threshold, or minimum, Net Income goals are not achieved, incentive payments are not funded and may
not be paid.


 


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Determining and Delivering Your Individual Incentive Compensation Award




Following are a few examples of what a Pinnacle Incentive Compensation award can look like based on
varying levels of Company, team (business unit), and individual performance.



Branch Managers’ Note: Branch Managers will receive 80% of their incentive from the Consumer Bank
Incentive Plan and 20% from the Pinnacle Plan (assuming that incentive pools are funded and
performance goals are achieved).



At Target Performance




Let’s see how an incentive award is determined for a mid-level supervisor, assuming the Company,
the team (business unit) and the employee meet 100% of performance goals. This employee’s annual
base salary is $40,000, with a target incentive of 10% of salary. For example purposes, the target
incentive opportunity is $40,000 x 10% = $4,000.



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Weighting	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Performance	 	(% of target	 	 	Performance	 	 	 	 	 	 	Attainment	 	 	Incentive	 
	Category	 	award)	 	 	Measures	 	 	Goal	 	 	of Goal	 	 	Payout	 
	Company
	 	 	20	%	 	Earnings per Share	 	84¢ per share	 	 	100	%	 	$	400	 
	Assumes FNFG meets
threshold Net
Income goal & pool
is funded

	 	 	 	 	 	Return on Assets	 	 	1.17%		 	 	100	%	 	$	400	 
	 
	Team
	 	 	65	%	 	Unit/Department	 	Achievement of goal	 	 	100	%	 	$	866	 
	(Business Unit/Department)
	 	 	 	 	 	Service Standards	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	Key Financial	 	Achievement of goal	 	 	100	%	 	$	867	 
	 
	 	 	 	 	 	Measures	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Retention of Key	 	Retention of top	 	 	100	%	 	$	867	 
	 
	 	 	 	 	 	Talent	 	talent	 	 	 	 	 	 	 	 
	 
	Individual
	 	 	15	%	 	Contribute to	 	Achievement of goal	 	 	100	%	 	$	300	 
	 
	 	 	 	 	 	Strategic Blueprint	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	actions	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Sales/Service Goals	 	Achievement of goal	 	 	100	%	 	$	300	 
	 	 	 
	Total Incentive Payout: 100% Goal Attainment, 100% of Target	 	$	4,000	 
	 	 	 







Note: For the purpose of this example, the category weight was divided equally among the number of
performance measures in the category. Managers have full discretion to allocate category weight
among performance measures as appropriate, with the exception of Company goals where the weight
must be divided equally between Growth in EPS and ROA.


 


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Below Target Performance




Let’s see how an incentive award is determined for the same supervisor, assuming the Company meets
goals, but the team (business unit) and the employee do not meet target performance goals. This
employee’s annual base salary is $40,000, with a target incentive of 10% of salary. For example
purposes, the target incentive opportunity is $40,000 x 10% = $4,000.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Weighting	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Performance	 	(% of target	 	 	Performance	 	 	 	 	 	 	Attainment	 	 	Incentive	 
	Category	 	award)	 	 	Measures	 	 	Goal	 	 	of Goal	 	 	Payout	 
	Company
	 	 	20	%	 	Earnings per Share	 	84¢ per share	 	 	100	%	 	$	400	 
	Assumes FNFG meets
threshold Net
Income goal & pool
is funded

	 	 	 	 	 	Return on Assets	 	 	1.17%		 	 	100	%	 	$	400	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Team
	 	 	65	%	 	Unit/Department	 	Achievement of goal	 	 	95	%	 	$	823	 
	(Business
	 	 	 	 	 	Service Standards	 	 	 	 	 	 	 	 	 	 	 	 
	Unit/Department)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Key Financial	 	Achievement of goal	 	 	95	%	 	$	823	 
	 
	 	 	 	 	 	Measures	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Retention of Key	 	Retention of top	 	 	95	%	 	$	823	 
	 
	 	 	 	 	 	Talent	 	talent	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Individual
	 	 	15	%	 	Contribute to	 	Achievement of goal	 	 	90	%	 	$	270	 
	 
	 	 	 	 	 	Strategic Blueprint	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	actions	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Sales/Service Goals	 	Achievement of goal	 	 	90	%	 	$	270	 
	 	 	 
	Total Incentive Payout (95% of target)	 	$	3,809	 
	 	 	 







Please note that the projections above are displayed for the sole purpose of providing you with a
better understanding of the incentive compensation plan. Actual incentive awards are determined by
Company, team, and individual performance goals and results—and are subject to review and approval
by the Executive Officer of your business unit.



How and When Awards Are Paid




In general, incentive awards will be paid in a separate check in the mid-February time period to
allow for complete end-of-prior-year performance results to be finalized.


 


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What Happens If....




Promotions





	 	•	 	If your promotion impacts your target award amount, your manager will inform you. You
will be eligible for a revised target award on a pro-rated basis, effective from the date
of your promotion.





Transfers





	 	•	 	If you transfer from a participating business unit to a non-participating business unit
or from a non-participating business unit to a participating business unit, you may be
eligible for a pro-rated incentive award. Any pro-rated incentive will be based on FNFG
achievement of Net Income, EPS and ROA goals, individual/team accomplishments and the
portion of the plan year worked at the participating business unit.





Demotions





	 	•	 	If your demotion impacts your target award amount, your manager will inform you. You
will be eligible for a revised target award on a pro-rated basis, effective from the date
of your demotion.





Leave FNFG





	 	•	 	Rehire— Individuals who terminate employment from the Company during the year and are
later rehired will have their incentive eligibility determined as of the date of their
rehire.






	 	•	 	Voluntary termination— If you terminate employment voluntarily before the incentive
payout date, you will not be eligible to receive an incentive award.






	 	•	 	Involuntary termination— If employment is terminated involuntarily, you will not be
eligible for an incentive award.




 


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Defining Important Terms



Business Unit/Business Unit Pool




	 	•	 	FNFG’s business units are Consumer Banking, Commercial Banking, Financial Services
(Wealth and Risk Management) Finance, Technology & Operations, and Administration.






	 	•	 	The Company Pool is allocated to the Business Unit Pool based on eligible wages and
target awards for that team/Business Unit. The CEO may distribute more or less than the
Company-funded percentage to the team/Business Unit, based on its performance and
contribution to the organization’s results.





Earnings Per Share




	 	•	 	Earnings, also known as net income or net profit, are the money that is left over after
a Company pays all of its bills. Earnings Per Share is calculated by dividing the dollar
amount of the earnings the Company reports over the past 12 months by the number of shares
it currently has outstanding.





Company Pool



	 	•	 	The Company Pool, also known as the Pinnacle Incentive Plan Pool, begins to be funded
when FNFG achieves a threshold percentage of its Net Income goal. As FNFG improves the
percent of Net Income goal achieved, the Company Pool continues to increase. No incentive
payments will be made if FNFG does not achieve the minimum threshold of its Net Income
goal.





Net Income Goal



	 	•	 	FNFG’s Net Income is the Bank’s earnings after paying taxes and all other expenses.
FNFG must achieve a minimum threshold Net Income goal in order to fund incentive payments.






	 	 	 	 	 	 	 	 	 	 	 
	Performance Year







	 	•	 	The performance year for determining incentive awards is the calendar year.





Return on Assets





	 	•	 	Return on Assets (ROA) tells you “what the Company can do with what it’s got,” i.e.,
how many dollars of profits we can achieve for each dollar of assets we control. Return
on Assets is determined by dividing net earnings by total assets.





Strategic Blueprint





	 	•	 	Our Strategic Blueprint is the plan that will guide FNFG to the next performance level
by placing customers at the center of what we do. The Strategic Blueprint clearly defines
FNFG’s Vision, Values, and strategic business drivers, and articulates “what,” “how,” and
“when” FNFG will execute on each driver to achieve our stretch performance goals.





Target Award





	 	•	 	Your target award is a percentage of your wages. Your target percentage is based on
your job position and ability to influence Company performance results. Your manager will
communicate your target award during performance planning for the year, or, if you are
newly hired, your target award will be stated in your employment offer letter.




 


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Defining Important Terms (continued)




Threshold




	 	•	 	Threshold means the minimum level of goal attainment.





Wages





	 	•	 	Wages include base salary, special situations pay, and your contributions to 401(k) and
Flex 125 deferrals during the calendar year. Wages do not include other benefit pay,
incentive pay under this Pinnacle Plan, The Consumer Bank Incentive Plan, EIP/MIP or
predecessors, other special incentive pay, and non-cash, or stock, compensation paid in
the calendar year.





Weighting





	 	•	 	Weighting-or how much of your total incentive is tied to a performance category-
depends on the extent to which you have direct accountability for First Niagara’s Company
Goals. If your accountability for Company performance is significant, a slightly greater
portion of your incentive will be tied to Company performance than someone in a job with
indirect accountability for Company performance. Total weightings in all performance
categories add up to 100% of your incentive opportunity.




 


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An Overview of Our Pay & Performance System




Before your manager sits down with you to develop a performance plan or communicate pay or
incentives, FNFG has done a substantial amount of industry research and job analysis. It’s a key
part of our Strategic Blueprint: to offer a competitive pay program and effective performance
development process. Here’s an overview of how we constructed our pay and performance management
system to do just that.







 


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About This Summary




This is a brief summary of the
Pinnacle Incentive Compensation
Plan effective January 1, 2005
for the 2005 calendar year. It is
not a guarantee of eligibility
for incentive compensation or the
receipt of an incentive
compensation award.



Nothing in this brochure or the
plan document gives FNFG the
right to require an employee to
remain employed, to interfere
with an employee’s right to
terminate employment, or gives an
employee the right to be employed
or remain employed by FNFG.



FNFG can modify, suspend,
reinstate, or terminate the
incentive compensation plan at
any time with or without notice
to employees. The actual terms
and conditions of FNFG’s
incentive compensation program
are contained in the
administrative documents, which
will govern in case of any
questions about eligibility,
opportunities, and rewards.




 


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