exv10w3






Exhibit 10.3




LEGACY BANCORP, INC.

2010 CEO INDUCEMENT PLAN

PERFORMANCE SHARES AWARD AGREEMENT




	 	 	 

	Participant’s Name:

	 	Patrick J. Sullivan






          Pursuant to that certain Employment Agreement (the “Employment Agreement”) dated
February 26, 2010 and effective as of April 1, 2010 between you, Legacy Bancorp, Inc. (the “Holding
Company”) and Legacy Banks, you have been granted a potential award (“Award”) of shares of Legacy
Bancorp, Inc. performance based restricted common stock (“Common Stock”) at no cost to you subject
to the terms and conditions of this Performance Shares Award Agreement (the “Agreement”).




	 	 	 

	Number of Shares

Subject to the Stock Award:

	 	 
20,000 shares of Common Stock (Target Award)
	 
	 	 
	 

	 	40,000 shares of Common Stock (Maximum Award
Potential)
	 
	 	 
	Date of Grant:

	 	May 17, 2010
	 
	 	 
	Term of Stock Award

and Vesting Schedule:

	 	 
Subject to other provisions of this Agreement,
the actual Award (“Actual Award”) shall be
determined and shall vest as follows:
	 
	 	 
	 

	 	The Award shall be based upon a multiple derived from
the ranking of a financial performance metric within
a “Peer Group”. The Peer Group shall be determined
using the SNL database consisting of all bank and
thrift institutions whose stock is traded on the
NYSE, NASDAQ, or Amex exchanges in the New England
and Mid Atlantic regions with total assets ranging
between $500 million to $2 billion. The financial
performance metric shall be the Peer Group year-end
return on average equity (ROAE).
	 
	 	 
	 

	 	The Actual Award shall be shares of Common Stock
determined by a multiple applied to the Target Award
based on ROAE achieved in 2012 relative to the Peer
Group.
	 
	 	 
	 

	 	If the ROAE for 2012 is below the 40th
percentile of the Peer Group, the Target Award shall
be






 









 






	 	 	 

	 

	 	multiplied by zero, resulting in an Actual Award of
zero shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 40th to
the 59th percentile of the Peer Group, the
Target Award shall be multiplied by .5, resulting in
an Actual Award of 10,000 shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 60th to
the 79th percentile of the Peer Group, the
Target Award shall be multiplied by 1.0, resulting in
an Actual Award of 20,000 shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 80th to
the 89th percentile of the Peer Group, the
Target Award shall be multiplied by 1.5 multiplied,
resulting in an Actual Award of 30,000 shares of
Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 90th to
and including the 100th percentile of the
Peer Group, the Target Award shall be multiplied by
2.0, resulting in an Actual Award of 40,000 shares of
Common Stock (the “Maximum Award Potential”).
	 
	 	 
	 

	 	The Actual Award shall vest 50% on the date which is
two and one-half months following the end of the 2012
calendar year (or March 15, 2013).
	 
	 	 
	 

	 	The remaining 50% of the Actual Award may vest on
March 15, 2014 subject to the ROAE for 2013 being not
less than 90% of the ROAE achieved in 2012 upon which
the initial vesting was based. Notwithstanding the
foregoing, the entire Award shall be forfeited and
refundable if at any time it is discovered that
Participant participated in a misstatement of
earnings or fraudulent activities.
	 
	 	 
	 

	 	Except as provided below, an installment shall not
vest on the otherwise applicable vesting date if you
terminate employment with Legacy Bancorp, Inc. or an
Affiliate prior to such vesting date.
	 
	 	 
	Change of Control:

	 	In the event of a Change of Control (as defined in Section 7 of the Employment
Agreement) at any time after the Participant/Executive’s first year of employment, all options
shall vest as follows:






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	 	(i) On or after the first year of employment but
prior to the completion of the second year of
employment, upon the event of a Change of Control,
the Actual Award shall vest at 33%.
	 
	 	 
	 

	 	For example, if the ROAE for 2010 is below the 40th percentile of the
Peer Group, the Target Award shall be multiplied by zero, resulting in an Actual
Award of zero shares of Common Stock.
	 
	 	 
	 

	 	For example, if the ROAE for 2010 is within the 40th to the
59th percentile of the Peer Group, the Target Award shall be
multiplied by .5, resulting in an Actual Award of 10,000 shares of Common Stock,
which then shall vest under a Change of Control at 33% or 3,333 shares.
	 
	 	 
	 

	 	For example, if the ROAE for 2010 is within the 60th to the
79th percentile of the Peer Group, the Target Award shall be
multiplied by 1.0, resulting in an Actual Award of 20,000 shares of Common Stock,
which then shall vest under a Change of Control at 33% or 6,666 shares.
	 
	 	 
	 

	 	For example, if the ROAE for 2010 is within the 80th to the
89th percentile of the Peer Group, the Target Award shall be
multiplied by 1.5 multiplied, resulting in an Actual Award of 30,000 shares of
Common Stock, which then shall vest under a Change of Control at 33% or 10,000
shares.
	 
	 	 
	.

	 	For example, if the ROAE for 2010 is within the 90th to and including
the 100th percentile of the Peer Group, the Target Award shall be
multiplied by 2.0, resulting in an Actual Award of 40,000 shares of Common Stock
(the “Maximum Award Potential”), which then shall vest under a Change of Control
at 33% or 13,333 shares.
	 
	 	 
	 

	 	(ii) On or after the second year of employment, but prior to the completion of
the third year of employment, upon the event of a Change of Control, the Actual
Award shall vest at 66%.
	 
	 	 
	 

	 	For example, if the ROAE for 2011 is below the 40th percentile of the
Peer Group, the Target Award






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	 	shall be multiplied by zero, resulting in an Actual Award of zero shares of Common Stock.
	 
	 	 
	 

	 	For example, if the ROAE for 2011 is within the 40th to the
59th percentile of the Peer Group, the Target Award shall be
multiplied by .5, resulting in an Actual Award of 10,000 shares of Common Stock,
which then shall vest under a Change of Control at 66% or 6,666 shares.
	 
	 	 
	 

	 	For example, if the ROAE for 2011 is within the 60th to the
79th percentile of the Peer Group, the Target Award shall be
multiplied by 1.0, resulting in an Actual Award of 20,000 shares of Common Stock,
which then shall vest under a Change of Control at 66% or 13,200 shares.
	 
	 	 
	 

	 	For example, if the ROAE for 2011 is within the 80th to the
89th percentile of the Peer Group, the Target Award shall be
multiplied by 1.5 multiplied, resulting in an Actual Award of 30,000 shares of
Common Stock, which then shall vest under a Change of Control at 66% or 20,000
shares.
	 
	 	 
	.

	 	For example, if the ROAE for 2011 is within the 90th to and including
the 100th percentile of the Peer Group, the Target Award shall be
multiplied by 2.0, resulting in an Actual Award of 40,000 shares of Common Stock
(the “Maximum Award Potential”), which then shall vest under a Change of Control
at 66% or 26,400 shares.
	 
	 	 
	 

	 	(iii) On or after the third year of employment, upon the event of a Change of
Control, the Actual Award shall vest at 100%.
	 
	 	 
	 

	 	If the ROAE for 2012 is below the 40th percentile of the Peer Group,
the Target Award shall be multiplied by zero, resulting in an Actual Award of
zero shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 40th to the 59th
percentile of the Peer Group, the Target Award shall be multiplied by .5,
resulting in an Actual Award of 10,000 shares of Common Stock.






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	 	If the ROAE for 2012 is within the 60th to the 79th
percentile of the Peer Group, the Target Award shall be multiplied by 1.0,
resulting in an Actual Award of 20,000 shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 80th to the 89th
percentile of the Peer Group, the Target Award shall be multiplied by 1.5
multiplied, resulting in an Actual Award of 30,000 shares of Common Stock.
	 
	 	 
	 

	 	If the ROAE for 2012 is within the 90th to and including the
100th percentile of the Peer Group, the Target Award shall be
multiplied by 2.0, resulting in an Actual Award of 40,000 shares of Common Stock
(the “Maximum Award Potential”).






	 	 	 

	Effect of Termination of

Employment because of:
	 	 
	 
	 	 
	     (a)   Termination for Cause:

	 	In the event you are terminated for Cause, all your rights to this Award will
expire immediately as of the effective date of your termination for Cause.
	 
	 	 
	     (b)   Retirement:

	 	Unless otherwise determined by the Compensation Committee (the
“Committee”), upon your Retirement, you will forfeit any rights to all unvested shares
of Company Common Stock subject to this Award.
	 
	 	 
	     (c)    Other reasons:

	 	Unless otherwise determined by the Committee, all unvested
shares subject to this Stock Award are forfeited as of your termination date and any
rights you have to this Award become null and void.
	 
	 	 
	Designation of Beneficiary:

	 	You may designate a beneficiary on a form
acceptable to the Committee, to receive rights
under this Agreement, in the event of your
death. If a beneficiary is not designated,
the Award will become part of your estate.
	 
	 	 
	Tax Withholding:

	 	Upon payment of a Award, the Committee is
entitled to require as a condition of delivery
(i) that you remit an amount sufficient to
satisfy all federal, state and local tax
withholding requirements related thereto, (ii)
that the withholding of such sums come






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	 	from compensation otherwise due to you or from shares of Common Stock due to
you, or (iii) any combination of the foregoing. Any withholding shall comply
with Rule 16b-3 or any amendments or successive rule.
	 
	 	 
	Employment Agreement Governs:

	 	Notwithstanding anything in this Agreement
to the contrary, the terms of this Award
shall be subject to the terms and conditions
of the Employment Agreement. Any
capitalized terms shall have the meaning
given to such terms in the Employment
Agreement.
	 
	 	 
	 

	 	This Agreement shall not create any right on the part
of any individual to continue in the employ or
service of Legacy Bancorp, Inc. or any Affiliates of
Legacy Bancorp, Inc.
	 
	 	 
	Non-Transferability:

	 	You shall not sell, transfer, assign, pledge or otherwise encumber shares
subject to this Award until full vesting of such shares has occurred.
	 
	 	 
	 

	 	Unless determined otherwise by the Committee and
except in the event of your death or pursuant to a
domestic relations order, this Award is not
transferable and may only be earned by you in your
lifetime. Upon your death, this Award is
transferable by will or the laws of descent and
distribution.
	 
	 	 
	Modification and Amendment:

	 	The Committee may amend or modify this Award from time to time,
prospectively or retroactively; provided, however, that no such amendment or modification will
adversely affect your rights under this Award without your written consent.






          The Participant hereby acknowledges that all decisions, determinations and interpretations of
the Board of Directors, or the Committee thereof, in regards to this Agreement are final and
conclusive.







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          IN WITNESS WHEREOF, Legacy Bancorp, Inc. has caused this Performance Shares Stock Award
Agreement to be executed, and said Participant has hereunto set his hand, as of the 17th
day of May, 2010.




	 	 	 	 	 
	 	LEGACY BANCORP, INC.

 	 
	 	By:  	/s/ J. Williar Dunlaevy
 	 
	 	 	For the Committee Administering the Plan 	 
	 	 	 	 
	 



	 	 	 	 	 
	 	PARTICIPANT

 	 
	 	/s/ Patrick J. Sullivan
 	 
	 	Patrick J. Sullivan 	 
	 	 	 
	 




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