EX-10.5



 Exhibit 10.5 

[YEAR] PERFORMANCE STOCK AWARD AGREEMENT 

Pursuant to the 

FINANCIAL INSTITUTIONS, INC. 

2015 LONG-TERM INCENTIVE PLAN 
  

			
	Name of Participant:	  	
		
	Date of Grant:	  	
		
	Number of Shares:	  	
		
	Service Period:	  	The three-year period beginning on [DATE] and ending on [DATE]
		
	Earned Shares and Vesting Schedule:	  	The Number of Shares set forth above shall become Earned Shares based on the achievement of the applicable Performance Goals during the applicable Performance Period and shall vest based on completion of the Service Period in
accordance with Exhibit B.

 This PERFORMANCE STOCK AWARD AGREEMENT (this “Agreement”), dated as of [DATE], is made
between Financial Institutions, Inc. (the “Company”) and the above-named individual (the “Participant”) to record the grant to the Participant of a Performance Stock Award (the “Award”) on the Date of Grant set forth
above pursuant to Section 6.4 and Section 6.6 of the Financial Institutions, Inc. 2015 Long-Term Incentive Plan (the “Plan”). The Award is intended to qualify as “performance-based compensation” under Code
Section 162(m), and will be interpreted and administered accordingly. Capitalized terms not defined in this Agreement shall have the meaning given to such terms under the Plan. 

The Company and the Participant hereby agree as follows: 

Section 1. Grant of Shares. The Company hereby grants to the Participant, as of the Date of Grant, subject to and in accordance
with the terms and conditions of the Plan and this Agreement, a Performance Stock Award for the Number of Shares set forth above (the “Shares”). 

Section 2. Achievement and Vesting of Shares. Subject to Section 3 below, and the achievement of the applicable Performance
Goals during the applicable Performance Period (both as set forth on Exhibit B), provided that the Participant provides substantial services and remains in continuous employment with the Company or a Subsidiary through the end of the Service Period
set forth above, the Earned Shares shall vest on the last day of the Service Period. Except as otherwise provided by Section 3 below, if the Participant ceases to provide substantial services or remain in continuous employment with the Company
or a Subsidiary for any reason before the completion of the Service Period, the Shares shall be immediately forfeited to the Company. Notwithstanding the foregoing, before the Award will be earned, the Committee must determine and certify in
accordance with the requirements of Code Section 162(m), that the Performance Goals and other material terms of the Award have been satisfied, and if applicable, the level of performance achieved. 

Section 3. Effects of Certain Events. 
  

	 	(a)	Change in Control. Subject to the terms of the Plan, if prior to the completion of the Service Period set forth above there is a Change in Control: 


 

	 	(i)	if Replacement Awards are not provided to the Participant to replace unvested Shares, then the number of the Participant’s Earned Shares shall be determined at the target level of performance, and such Earned
Shares shall vest as of such date. 

  

	 	(ii)	if Replacement Awards are provided to the Participant to replace unvested Shares, then in the event of the Participant’s Involuntary Termination during the period of two (2) years immediately following the
Change in Control, the number of Earned Shares under such Replacement Awards shall be determined at the target level of performance, and such Earned Shares shall become fully vested and, if applicable, free of restrictions as of such date.










	 	(b)	Death or Disability. If during the Service Period, the Participant’s employment with the Company or a Subsidiary terminates due to death or Disability, then performance shall be determined as of the date of
the Participant’s termination of employment due to death or Disability, and the Earned Shares, if any, from such performance, shall vest on a pro-rata basis on the date of termination of employment due to death or Disability. The pro-rata
portion shall be determined by multiplying the number of Earned Shares by a fraction, the numerator of which is the number of completed months in the Service Period during which the participant was employed by the Company or a Subsidiary, and the
denominator of which is the number of months in the Service Period. 

  

	 	(c)	Retirement. If a Participant terminates employment during the Service Period due to Retirement, then the Award shall continue and a pro-rata number of Earned Shares shall vest at the time specified by
Section 2 above based on actual performance through the end of the applicable Performance Period. Unless Exhibit B provides otherwise, the pro-rata portion shall be determined by multiplying the number of Earned Shares by a fraction, the
numerator of which is the number of completed months in the Service Period during which the participant was employed by the Company or a Subsidiary, and the denominator of which is the number of months in the Service Period. 


“Retirement” shall mean the resignation or voluntary termination of employment after attainment of age 65 and ten or more years of
service with the Company or a Subsidiary. 
 Section 4. Dividends. Notwithstanding Section 6.4(d) of the Plan, no dividends
shall accrue or be paid to the Participant with respect to any Shares subject to the Award that have not become vested Shares or that are subject to any restrictions or conditions on the record date for dividends. 

Section 5. Rights as Shareholder. Except for the transfer and other restrictions set forth elsewhere in this Agreement (including
the limitations on dividends set forth in Section 4 above) and in the Plan, the Participant, as record holder of the Shares, shall possess all the rights of a holder of Common Stock (including voting); provided, however, that prior to becoming
vested and transferable the certificates representing such Shares shall be held by the Company for the benefit of the Participant. As the Shares become vested Shares, the Company shall, as applicable, either remove the notations on any Shares issued
in book entry form which have vested or deliver to the Participant a certificate or certificates evidencing the number of vested Shares. As noted above, the Participant shall not receive any dividends on unvested Shares, and such dividends shall be
permanently forfeited. 
 Section 6. Legend. Each share certificate representing the Shares shall bear a legend indicating that
such Shares are “Restricted Stock” and are subject to the provisions of this Agreement and the Plan. 
 Section 7. No
Transferability. The Shares may not be sold, transferred, pledged, assigned, encumbered, or otherwise alienated or hypothecated until they become fully vested and transferable in accordance with Section 2 of this Agreement and then only to
the extent permitted under this Agreement and the Plan and by applicable securities laws. Prior to full vesting and transferability, all rights with respect to the Shares granted to a Participant under the Plan shall be available, during such
Participant’s lifetime, only to such Participant, or in the event of the Disability of the Participant, to the Participant or the legal representative of the Participant, or in the event of the death of the Participant, to the legal
representative of the Participant’s estate, or if no legal representative has been appointed to the successor in interest determined under the Participant’s will. 

Section 8. Stock Power. Concurrently with the execution of this Agreement, the Participant shall deliver to the Company a stock
power, endorsed in blank, relating to the Shares. Such stock power shall be in the form attached hereto as Exhibit A. The stock power with respect to any certificate representing Shares that do not vest shall be completed in the name of the Company
by an officer of the Company, and the Shares shall be returned to either authorized but unissued shares or treasury shares, depending on their original source. 

Section 9. Withholding Taxes. As a condition of and prior to the delivery or release of any Shares, the Company shall be entitled
to require the Participant to remit to the Company an amount sufficient to satisfy the amount of any federal, state, or local taxes required to be withheld with respect to the transfer or vesting of the Shares, or any other taxable event related
thereto. The Committee may permit the Participant to make such payment in any form or manner authorized by the Committee in its sole discretion, including, but not limited to one or more of the forms specified below: 

  
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	 	(a)	U.S. dollars by personal check, bank draft, or money order payable to the Company, by money transfer or direct account debits; 

  

	 	(b)	Delivery to the Company of a number of shares of Common Stock having an aggregate fair market value of not less than the minimum tax withholding required for the Award; 


 

	 	(c)	Involvement of a stockbroker in accordance with the federal margin rules set forth in Regulation T; 

  

	 	(d)	A cashless exercise if and to the extent permissible by applicable law; or 

  

	 	(e)	Any combination of the above forms and methods. 

 In the event the Participant fails to provide timely payment
of all sums required by the Company pursuant to this Section 9, the Company shall have the right and option, but not obligation, to treat such failure as an election by the Participant to provide all or any portion of such required payment by
means of tendering Shares. 
 Section 10. Adjustments. As provided by the Plan, in the event of any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, stock dividend, combination or exchange of shares, exchange for other securities, reclassification, reorganization, recapitalization, or any other increase or decrease in the
number of outstanding shares of Common Stock effected without consideration to the Company, the specified number of Shares shall be proportionately adjusted to prevent dilution or enlargement of the rights granted to, or available for, the
Participant hereunder. Furthermore, if and to the extent permissible for purposes of the “performance-based compensation” exception under Code Section 162(m), the Committee shall adjust the Performance Goals to the extent (if any) it
determines that the adjustment is necessary or advisable to preserve the intended incentives and benefits to reflect any material change in corporate capitalization, any material corporate transaction (such as a reorganization, combination,
separation, merger, acquisition, or any combination of the foregoing), or any complete or partial liquidation of the Company, or any other similar special circumstances, including the issuance of a significant number of shares of Common Stock. 

Section 11. No Employment Rights. Nothing in the Plan or this Agreement confers upon the Participant any right with respect to
continuance of employment by the Company or any of its Subsidiaries, or affects the right of the Company or any of its Subsidiaries may have to terminate the Participant’s employment at any time. 

Section 12. Coordination with Plan. The Participant hereby acknowledges receipt of a copy of the Plan and agrees to be bound by
all of the terms and provisions thereof including any that may conflict with those contained in this Agreement. 
 Section 13.
Notices. All notices to the Company shall be in writing and sent to the Company’s Director of Human Resources at the Company’s offices. Notices to the Participant shall be addressed to the Participant at the Participant’s address
as it appears on the Company’s records. 
 Section 14. Amendment. The Company may alter, amend or terminate this Agreement
only with the Participant’s consent, except as otherwise expressly provided by the Plan or this Agreement. 
 Section 15.
Governing Law. This Agreement shall be governed by the laws of the State of New York to the extent not preempted by federal law, without reference to principles of conflict of laws, and construed accordingly. 

Section 16. Compensation Recovery Policy. Notwithstanding any other provision of this Agreement to the contrary, any Shares
granted and/or issued hereunder, and/or any amount received with respect to any sale of any such Shares, shall be subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company’s
compensation recovery policy, if any, or any similar policy that the Company may adopt from time to time (the “Policy”). The Participant agrees and consents to the Company’s application, implementation and enforcement of (i) the
Policy that may apply to the Participant and (ii) any provision of applicable law relating to cancellation, rescission, payback or recoupment of compensation, including, but not limited to Section 10D of the Exchange Act, and expressly
agrees that the Company may take such actions as are necessary to effectuate the Policy or applicable law without further consent or action being required by the Participant. To the extent that the terms of this Agreement and the Policy or any
similar policy conflict, then the terms of such policy shall prevail. 

  
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 Section 17. Excise Tax Cap. In the event that a Participant becomes entitled to any
payment or benefit under this Agreement (such benefits together with any other payments or benefits payable to the Participant under any other agreement with the Participant, or plan or policy of the Company, are referred to in the aggregate as the
“Total Payments”), if all or any part of the Total Payments will be subject to the tax imposed by Code Section 4999, or any similar tax that may hereafter be imposed (the “Excise Tax”), then: 

 

	 	(a)	Within 30 days following the Participant’s termination of employment, the Company will notify the Participant in writing: (1) whether the payments and benefits under this Agreement, when added to any other
payments and benefits making up the Total Payments, exceed an amount equal to 299% of the Participant’s “base amount” as defined in Code Section 280G(b)(3) (the “299% Amount”); and (2) the amount that is equal to
the 299% Amount. 

  

	 	(b)	The payments and benefits under this Agreement shall be reduced such that the Total Payments do not exceed the 299% Amount, so that no portion of the payments and benefits under this Agreement will be subject to the
Excise Tax. Any payment or benefit so reduced will be permanently forfeited and will not be paid to the Participant. 

  

	 	(c)	The calculation of the 299% Amount and the determination of how much the Participant’s payments and benefits must be reduced in order to avoid application of the Excise Tax will be made by the Company’s public
accounting firm prior to the Participant’s termination of employment, which firm must be reasonably acceptable to the Participant (the “Accounting Firm”). The Company will cause the Accounting Firm to provide detailed supporting
calculations of its determinations to the Company and the Participant. Notice must be given to the Accounting Firm within 15 business days after an event entitling the Participant to a payment under this Agreement. All fees and expenses of the
Accounting Firm will be borne solely by the Company. 

  

	 	(d)	For purposes of making the reduction of amounts payable under this Agreement, such amounts will be eliminated in compliance with the requirements of Code Section 409A, to the extent applicable. 


IN WITNESS WHEREOF, the Company and the Participant have caused this Agreement to be executed on the date set forth opposite their respective
signatures, but effective as of the Date of Grant. 
  

							
	Dated:                     	 		 	FOR THE COMPANY:
				
		 		 	By:	 	  

		 		 	Name:	 	  

		 		 	Title:	 	  

			
	Dated:                     	 		 	PARTICIPANT:
				
		 		 	By:	 	  

		 		 	Name:	 	  



  
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 EXHIBIT A 

STOCK POWER 
 FOR VALUE
RECEIVED, the undersigned does hereby sell, assign and transfer to Financial Institutions, Inc. (the “Company”), XXXX shares of the Company’s common stock represented by Certificate No. XXXXXXX. The undersigned
authorizes the Secretary of the Company to transfer the stock on the books of the Company in the event of the forfeiture of any shares issued under the Performance Stock Award Agreement dated as of [DATE], between the Company and the
undersigned. 
  

			
	Dated:	 	  

	
	  

	Name


  
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 EXHIBIT B 

PERFORMANCE PERIOD AND PERFORMANCE GOALS 

Performance Period 
 The three-year
period beginning on January 1, [YEAR] and ending on December 31, [YEAR]. 
 Performance Goals 

XXX 
 Definitions. 

XXX 
 Pro-Ration of Earned Shares

 XXX 

  
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