Document:

Exhibit 10.15

 

MIDLAND STATES BANCORP, INC.

 

AMENDED AND RESTATED 2010 LONG-TERM INCENTIVE PLAN

 

RESTRICTED STOCK AWARD TERMS

 

The Participant specified below has been granted this Restricted Stock Award (“Award”) by MIDLAND STATES BANCORP, INC., an Illinois corporation (the “Company”), under the terms of the MIDLAND STATES BANCORP, INC. AMENDED AND RESTATED 2010 LONG-TERM INCENTIVE PLAN (the “Plan”).  The Award shall be subject to the Plan as well as the following terms and conditions (the “Award Agreement”):

 

Section 1.              Award.  In accordance with the Plan, the Company hereby grants to the Participant this Award which represents the right to receive Stock (the “Covered Shares”) as set forth in Section 2. This Award is in all respects limited and conditioned as provided herein.

 

Section 2.              Terms of Restricted Stock Award.  The following words and phrases relating to the grant of the Award shall have the following meanings:

 

(a)           The “Participant” is [                ].

 

(b)           The “Grant Date” is [                ].

 

(c)           The number of “Covered Shares” is [                ] shares of Stock.

 

Except where the context clearly implies to the contrary, any capitalized term in this Award Agreement shall have the meaning ascribed to that term under the Plan.

 

Section 3.              Restricted Period.  This Award Agreement evidences the Company’s grant to the Participant as of the Grant Date, on the terms and conditions described in this Award Agreement and in the Plan, the right of the Participant to receive stock free of restrictions once the Restricted Period ends.

 

(a)           Subject to the limitations of this Award Agreement, the “Restricted Period” for each installment of such Covered Shares (“Installment”) shall begin on the Grant Date and end as described in the following schedule (but only if the Participant has not had a Termination of Service before the end of the Restricted Period):

 

	
 
    	
INSTALLMENT
    	
 
    	
RESTRICTED PERIOD WILL END ON:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

(b)           Notwithstanding the foregoing provisions of this Section 3, the Restricted Period for the Restricted Stock shall cease immediately, and the Restricted Stock shall become immediately and fully vested, upon (i) a Change in Control that occurs on or before the Participant’s Termination of Service or (ii) upon the Participant’s Termination of Service due to Disability or death.

 

(c)           In the event the Participant’s Termination of Service, other than as provided in subsection (b) above, occurs prior to the expiration of one or more Restricted Periods, the Participant shall forfeit all rights, title and interest in and to any Installment(s) of Covered Shares still subject to a Restricted Period as of the Participant’s Termination of Service date.

 

For purposes of this Award Agreement “Disability” shall mean that a Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering the Company’s employees.

 

Section 4.              Delivery of Shares.  Delivery of Stock or other amounts under this Award Agreement and the Plan shall be subject to the following:

 

(a)           Compliance with Applicable Laws.  Notwithstanding any other provision of this Award Agreement or the Plan, the Company shall have no obligation to deliver any Stock or make any other distribution of benefits under this Award Agreement or the Plan unless such delivery or distribution complies with all applicable laws (including, the requirements of the Securities Act), and the applicable requirements of any securities exchange or similar entity.

 

(b)           Certificates.  To the extent that this Award Agreement and the Plan provide for the issuance of Stock, the issuance may be effected on a non-certificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange.

 

Section 5.              Withholding.  All deliveries of Covered Shares pursuant to this Award Agreement shall be subject to withholding of all applicable taxes.  The Company shall have the right to require the Participant (or if applicable, permitted assigns, heirs or Designated Beneficiaries) to remit to the Company an amount sufficient to satisfy any tax requirements prior to the delivery date of any certificate or certificates for Stock under this Award Agreement.  At the election of the Participant, subject to the rules and limitations as may be established by the Committee, such withholding obligations may be satisfied through the surrender of shares of Stock which the Participant already owns, or to which Participant is otherwise entitled under the Plan.

 

Section 6.              Non-Transferability of Award.  During the Restricted Period, the Participant shall not sell, assign, transfer, pledge, hypothecate, mortgage, encumber or dispose of any Covered Shares awarded under this Award.

 

2

 

Section 7.              Dividends.  The Participant shall be [not] entitled to receive dividends and distributions paid on the Covered Shares during the Restricted Period [; provided, however, that no dividends or distributions shall be payable to or for the benefit of the Participant with respect to record dates for such dividends or distributions occurring before or prior to the Grant Date, or with respect to record dates for such dividends or distributions occurring on or after the date, if any, on which the Participant has forfeited those Covered Shares].

 

Section 8.              Voting Rights.  The Participant shall be entitled to vote the Covered Shares during the Restricted Period; provided, however, that the Participant shall not be entitled to vote Covered Shares with respect to record dates for any Covered Shares occurring on or after the date, if any, on which the Participant has forfeited those Covered Shares.

 

Section 9.              Deposit of Restricted Stock Award.  Each certificate issued with respect to Covered Shares awarded under this Award Agreement and subject to the restrictions contained herein, shall be registered in the name of the Participant and shall be retained by the Company, or an agent of the Company, until the end of the Restricted Period with respect to such Covered Shares.

 

Section 10.            Heirs and Successors.  This Award Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, and upon any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets and business.  If any rights of the Participant or benefits distributable to the Participant under this Award Agreement have not been settled or distributed, respectively, at the time of the Participant’s death, such rights shall be settled and payable to the Designated Beneficiary, and such benefits shall be distributed to the Designated Beneficiary, in accordance with the provisions of this Award Agreement and the Plan.  The “Designated Beneficiary” shall be the beneficiary or beneficiaries designated by the Participant in a writing filed with the Committee in such form as the Committee may require.  The designation of beneficiary form may be amended or revoked from time to time by the Participant.  If a deceased Participant fails to designate a beneficiary, or if the Designated Beneficiary does not survive the Participant, any rights that would have been payable to the Participant and shall be payable to the legal representative of the estate of the Participant.  If a deceased Participant designates a beneficiary and the Designated Beneficiary survives the Participant but dies before the settlement of Designated Beneficiary’s rights under this Award Agreement, then any rights that would have been payable to the Designated Beneficiary shall be payable to the legal representative of the estate of the Designated Beneficiary.

 

Section 11.            Administration.  The authority to manage and control the operation and administration of this Award Agreement and the Plan shall be vested in the Committee, and the Committee shall have all powers with respect to this Award Agreement as it has with respect to the Plan. Any interpretation of this Award Agreement or the Plan by the Committee and any decision made by it with respect to this Award Agreement or the Plan are final and binding on all persons.

 

Section 12.            Plan Governs.  Notwithstanding anything in this Award Agreement the contrary, this Award Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the office of the Secretary of the Company; and this Award

 

3

 

Agreement are subject to all interpretations, amendments, rules and regulations promulgated by the Committee from time to time pursuant to the Plan.  Notwithstanding anything in this Award Agreement to the contrary, in the event of any discrepancies between the corporate records and this Award Agreement, the corporate records shall control.

 

Section 13.            Not an Employment Contract.  The Award will not confer on the Participant any right with respect to continuance of employment or other service with the Company or any Subsidiary, nor will it interfere in any way with any right the Company or any Subsidiary would otherwise have to terminate or modify the terms of such Participant’s employment or other service at any time.

 

Section 14.            No Rights As Shareholder.  Except as otherwise provided herein, the Participant shall not have any rights of a shareholder with respect to the Covered Shares, until Stock has been duly issued and delivered to Participant.

 

Section 15.            Amendment.  This Award Agreement may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written Award Agreement of the Participant and the Company without the consent of any other person.

 

Section 16.            Governing Law.  This Award Agreement, the Plan, and all actions taken in connection herewith shall be governed by and construed in accordance with the laws of the State of Illinois without reference to principles of conflict of laws, except as superseded by applicable federal law.

 

Section 17.            Section 409A Amendment.  The Committee reserves the right (including the right to delegate such right) to unilaterally amend this Award Agreement without the consent of the Participant in order to maintain an exclusion from the application of, or to maintain compliance with, Code Section 409A.  Participant’s acceptance of this Award constitutes acknowledgement and consent to such rights of the Committee.

 

IN WITNESS WHEREOF, the Company has caused this Award Agreement to be executed in its name and on its behalf, all as of the Grant Date and the Participant acknowledges acceptance of the terms and conditions of this Award Agreement.

 

	
 
    	
MIDLAND STATES BANCORP, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Its:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
PARTICIPANT
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[                 ]
    	
Date
    
				

 

4Exhibit 10.16

 

 

Midland States Bancorp, Inc. Management Incentive Program

 

Compensation Philosophy

 

It is the desire of the Compensation Committee of Midland States Bancorp, Inc. (the “Company”) to provide the Executive Management Team of the Company and Midland States Bank (the “Bank”) a compensation plan that aligns with the overall performance and health of the Company and the Bank.  The Compensation Committee has developed an overall compensation plan based on a total reward strategy including base salaries and short term and long term rewards that it believes are in the best interests of the shareholders .  That plan is designed using independent third party compensation information, is Compensation Committee driven and includes relevant risk management metrics.  This Management Incentive Plan is designed to specify certain aspects of that overall compensation plan.

 

Total Rewards Strategy

 

Base Salary is established using a third party Executive Compensation Survey of selected peer group companies representative of the Company’s and the Bank’s size, growth and complexity.  The Compensation Committee believes that upper market performance should translate into upper market base salary.

 

Short Term and Long Term Bonus plans are built using qualifying metrics that incentivize the Executives for managing the Company’s and the Bank’s growth balanced with the assumption of reasonable risk.  One element of our bonus program is the annual performance based bonus, which is intended to be based on specific performance measures subject to achievement of certain risk based metrics.

 

Annual Performance Based Bonus Payment Calculations

 

Each Executive is assigned a target bonus based on their roles and responsibilities within the Company and/or the Bank.

 

Having evaluated other options as well as published peer group metrics, the Compensation Committee will annually select one or more of the performance metrics, including adjustments, described in Section 2.3 of the Company’s 2010 Long-Term Incentive Plan, as the most applicable metric for increasing shareholder value , and such metric(s) will be the major driver in the annual bonus payments for that year.  Each year, the Company’s Compensation Committee will also establish a target level of performance with respect to such performance metric(s) which takes into consideration: previous performance, budgeted performance, and peer performance. This target will be commensurate with the strategic direction established at the annual planning session of the Company’s Board of Directors (the “Board”) and may incorporate metrics and adjustments different from those used by the Board for

 

As approved on November 2, 2015

 

 

planning purposes.  At such times as the Company is subject to the reporting requirements of the Securities Exchange Act of 1934, the Compensation Committee shall take such steps as it believes appropriate, with the advice of counsel, to seek to insure that publicly filed documents disclose that the Compensation Committee’s chosen metrics or performance thresholds do not necessarily reflect the Board’s or management’s forecasts, budgets, or projections for the Company or the Bank.

 

Qualifying Metrics

 

The Board believes that having appropriate risk metrics within the bonus plan encourages management to remain focused on the long term performance of the Bank and, therefore, Company shareholder value.  The Board has identified two qualifying metrics that will be used in determining the level of bonus paid to the Executives: Capital Quality and Asset Quality; and believes that the failure to meet specified targets of capital and asset quality should result in a partial or complete reduction of a performance bonus for such year, subject to certain restoration opportunities if corrective measures are successfully executed within specified time periods.

 

Capital Quality.  Maintaining sufficient capital is critical to the continued success and growth of the Bank.  In order for a full bonus to be earned with respect to any year, the Bank must maintain a Tier 1 Leverage Capital Ratio of 7.25%. Partial bonuses will be paid if the Capital Ratio is between 7.25% and 6.75%. No bonus will be paid if the Tier 1 Leverage Ratio is below 6.75%. The foregoing notwithstanding, in any case the Compensation Committee shall be entitled to take into consideration strategic or other events which, while believed to be in the long term interests of the Company and shareholder value, had a short term downward effect on the Tier 1 Leverage Capital Ratio as of the end of any fiscal year, and to partially or fully restore bonuses based on such factors.

 

Asset Quality.  Maintaining Asset Quality is critical to the health of the Bank and the shareholders’ investment in the Company.  The Company will benchmark its performance with respect to Non-Performing Assets to Total Assets against the selected peer group as part of the Executive Compensation Survey. The Company must either achieve (i) a ratio of Non-Performing Assets to Total Assets not greater than 120% of Peer performance, or (ii) a ratio below 2% for full bonuses to be paid, as set forth below:

 

 . . . . . . . . . . . . . . . . progressive reduction in earned bonus;

 

120% of Peer. . . . . . . full bonus earned (but in any event , at or below 2% the full bonus will be earned);

 

 . . . . . . . . . . . . . . . . full bonus earned.

 

In order to be eligible to receive an annual bonus for an applicable year under this program, an Executive must be employed by the Company or the Bank at the end of the year in which such bonus is earned, subject to any provision in an employment or other written agreement between the Executive and the Company or Bank.  The Compensation Committee intends that earned bonuses shall be paid within 21⁄2 months following the end of the year in which they are earned, but in the event the information it deems to be relevant for making such awards is not available prior to such date, the Committee reserves the right to delay making such award and/or authorizing such payment.

 

 

Restoration Bonuses

 

To the extent either the Qualifying Capital or Asset Quality Metric results in a reduction or an elimination of the bonus that would have been earned for a given year (Year 1), each Executive affected by such reduction or elimination shall be eligible to earn a Restoration Bonus payment for the following fiscal year (Year 2) if at the end of Year 2 the Bank’s capital and/or the Company’s asset quality, as the case may be, has returned to the level that would have been required for a full or partial bonus to have been earned for the applicable Year 1.  The amount of the Restoration Bonus shall be equal to (i) the amount the Year 1 bonus which would have been earned if the Qualifying Capital or Asset Quality Metric had been measured at the end of Year 2 instead of Year 1, minus (ii) the actual bonus paid to such Executive in Year 1.

 

In order to be eligible to receive a Restoration Bonus for an applicable year, an Executive must be employed by the Company or the Bank at the end of the year in which such Restoration Bonus is earned (Year 2).  Earned Restoration Bonuses shall be paid within 21⁄2 months following the end of the year in which they are earned (Year 2).

 

Form of Payment

 

The Compensation Committee believes it is appropriate for annual bonuses above a certain level to be paid in the form of Company equity.  However, the Compensation Committee also believes that in determining the appropriate split between cash and equity, it is appropriate to take into consideration the current level of equity ownership by the respective Executive and the overall mix of after-tax cash and equity.  Based on the current significant level of equity ownership levels and current tax rates, the Compensation Committee believes that the following is an appropriate mix of cash and equity, until such time as it shall determine otherwise:

 

	
Title
    	
 
    	
Bonus Target
    	
 
    	
Maximum
    	
 
    	
Form of Payout
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CEO
    	
 
    	
50% of Base Salary
    	
 
    	
200% of Base Salary
    	
 
    	
Target – 125% of Base = Cash Payment

126% - 200% = Equity   Payment
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CFO
    	
 
    	
40% of Base Salary
    	
 
    	
200% of Base Salary
    	
 
    	
Target – 125% of Base = Cash Payment

126% - 200% = Equity Payment
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Others
    	
 
    	
% of Base Salary per Empl. Agrmt.
    	
 
    	
200% of Base Salary
    	
 
    	
Target – 150% of Base = Cash Payment

151% - 200% = Equity   Payment
    

 

The Compensation Committee reserves the discretion to include other of the Company’s or the Bank’s senior Executives in this Program.

 

The selected performance metric (if not reduced by the Qualifying Metrics of Capital Quality or Asset Quality) will provide for a potential incentive payout up to two times the Executive’s annual salary.  The Compensation Committee maintains discretionary authority for eliminating the payment of bonuses as

 

 

deemed appropriate for underperformance in any area that would place the Bank, the Company or its shareholders at risk.

 

2010 Long-Term Incentive Plan

 

All cash and equity payments made as a result of this Management Incentive Program shall be paid pursuant to the Midland States Bancorp, Inc. 2010 Long-Term Incentive Plan.

 

Other Performance Awards

 

This MIP is designed to outline the metrics, risk based metrics and form of payment provisions for our Executive’s annual performance bonus.  The Compensation Committee expressly reserves the right to award cash or equity bonuses, including other short and long-term awards, based on other metrics deemed to be appropriate by the Compensation Committee for any given year.

 

Officers Hired Pursuant to Acquisitions

 

The Compensation Committee shall have the right, on a case by case basis following a recommendation to the Compensation Committee by the Company’s CEO, to exempt any officer whose employment with the Company or the Bank (or any subsidiary of either entity) arises as a result of an acquisition transaction (whether by merger, stock purchase, asset purchase or otherwise) from any portion of this plan, including the applicability of any qualifying metric, for such period as the Compensation Committee in its sole discretion shall determine.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00256-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00256-of-00352.parquet"}]]