Document:

Document

Exhibit 10.4

ENTEGRIS, INC.
2021 Stock Option Award Agreement
(2020 Stock Plan)
    In consideration of services rendered to Entegris, Inc. (the “Company”), the Company may periodically make equity incentive awards consisting of stock options with respect to the Company’s Common Stock, $0.01 par value (“Stock”), to certain key employees, non-employee directors, consultants or advisors of the Company under the Company’s 2010 Stock Plan (as amended from time to time, the “Plan”).  Any key employee, non-employee director, consultant or advisor (a “Participant”) who receives a stock option award (the “Award”) is notified in writing or via email and the Award is credited to the Participant’s account as reflected on the Overview tab under the Stock Options Plan section on Fidelity’s NetBenefits website. By clicking on the “Accept” button for the Award in the Stock Options Plan section on the Overview tab or by otherwise receiving the benefits of the Award, Participant:  (i) acknowledges that Participant has received a copy of the Plan, of the related prospectus providing information concerning awards under the Plan and of the Company’s most recent Annual Report on Form 10-K; and (ii) accepts the Award and agrees with the Company that the Award is subject to the terms of the Plan and to the following terms and conditions:
Article I –Stock Option Grant
1.1.  Option Grant.  Effective as of the grant date specified in the Stock Options Plan section provided to you online (the “Grant Date”), the Company hereby grants Participant a non-statutory stock option to purchase that number of shares of Stock that has been approved for the Award to the Participant by the Administrator (“Option”).  The shares of Stock awarded are specified in the Stock Options Plan section in the Granted column online through Fidelity’s NetBenefits website. The Option is not intended to be an incentive stock option under Section 422 of the Internal Revenue Code of 1986, as amended, and will be interpreted accordingly.
1.2.  Option Exercise Price.  The exercise (grant) price of the Option shall be 100% of the closing price of the Stock on the NASDAQ stock market on the Grant Date.  The exercise price is provided to Participant online through Fidelity’s NetBenefits website.
1.3.   Option Vesting Schedule.  This Option shall vest and become exercisable, except as hereinafter provided, in whole or in part, as follows:
•25% on ________, 2022;
•an additional 25% on _________, 2023; 
•an additional 25% on ________, 2024; 
•the final 25% on ________, 2025.
1.4.  Expiration of Option.  To the extent that the Option shall not have been exercised, this Option shall expire at 5:00 p.m. local time at the Company’s headquarters on ________, _____ and no part of the Option may be exercised thereafter.  If an expiration, termination or forfeiture date described herein falls on a weekday, Participant must exercise the Option before 5:00 p.m. local time at the Company’s headquarters on that date.  If an expiration, termination or forfeiture date described herein falls on a weekend or any other day on which the NASDAQ stock market is not open, Participant must exercise the Option before 

5:00 p.m. local time at the Company’s headquarters on the last NASDAQ business day prior to the expiration, termination or forfeiture date.

1.5.   Exercise of Option.  When and as vested, this Option may be exercised up to the number of shares of Stock specified in Section 1.1 above only by serving written notice on the designated stock plan administrator. Payment of the Option exercise price specified in Section 1.2 above may be made (i) in cash or by certified check, (ii) through net share settlement procedures whereby that number of the Option shares being exercised that are needed to cover the payment of the Option exercise price (calculated using the Fair Market Value of the Company’s stock on the date of exercise) shall be cancelled to fund the payment of the Option exercise price, (iii) by broker assisted sale of shares to satisfy the Option exercise price; or (iv) by any other method specified in the Plan or as permitted by the Administrator. No fractional shares of Stock shall be issued pursuant to this Agreement.  Participant will have the rights of a stockholder only after the shares of Stock have been issued to the Participant in accordance with this Agreement.

1.6.   No Assignment of Option.  This Option may not be assigned or transferred except as may otherwise be provided by the terms of this Agreement.
1.7.  Equitable Adjustments.  The Award is subject to adjustment pursuant to Section 15.1 of the Plan.
1.8.  Termination of Employment or Service with the Company.  All exercisable Options granted herein must be exercised within ninety (90) days following the date on which the employment or services of Participant with the Company or an Affiliate terminates (i.e., last day worked, excluding any severance period), or, if earlier, prior to the original expiration date of the Option (“Termination Date”), or be forfeited, except as provided in Sections 2.2 and 2.3 below and as follows:
(a)    In the event of Participant’s death during employment/services, each Option granted hereunder will be exercisable, whether or not vested on or prior to the date of Participant’s death, until the earlier of:  (1) the first anniversary of Participant’s date of death; or (2) the original expiration date of the Option.  In the event of Participant’s death during a Special Exercise Period as specified in Section 2.3 below, each Option will continue to be exercisable in accordance with the provisions of that Section.
(b)    In the event of the termination of employment/services of Participant due to Disability, Participant may exercise the Option, whether or not vested on or prior to the date of employment or service termination, at any time prior to the earlier of the original expiration date of the Option and 365 days following the later of the date of Participant’s separation from service due to Participant’s Disability or the date of determination of Participant’s Disability, provided, however, that while the claim of Disability is pending, Options that were unvested at termination of services may not be exercised and Options that were vested at termination of services may be exercised only during the period set forth in the introductory clause to this Section 1.8.  The Option shall terminate on the earlier of the original expiration date of the Option and 365 days following the later of the date of Participant’s separation from 

-2-

service due to Participant’s Disability or the date of determination of Participant’s Disability, to the extent that it is unexercised.  For these purposes “Disability” shall be determined in accordance with the standards and procedures of the then-current Long-Term Disability policies maintained by the Company, which is generally a physical condition arising from an illness or injury which renders an individual incapable of performing work in any occupation, as determined by the Company.
(c)    If Participant’s employment/services is terminated for “Cause”, all granted but unexercised stock Options, whether vested or unvested, shall be forfeited on Participant’s Termination Date.
1.9.  Suspension of Option Exercises.  For administrative or other reasons, the Company may, from time to time, suspend the ability of Participants to exercise options for limited periods of time.  Notwithstanding the above, the Company shall not be obligated to deliver any shares of Stock during any period when the Company determines that the exercisability of the Option or the delivery of shares hereunder would violate any federal, state or other applicable laws.
1.10. Withholding of Income Taxes.  The Company shall have no obligation to issue shares upon exercise of this Option unless the Participant has satisfied any tax withholding obligation with respect to such exercise.  Payment of Participant’s withholding tax obligations may be made through any method specified in the Plan or as permitted by the Administrator. 
Article II – GENERAL PROVISIONS
2.1.  Definitions.  Except as otherwise expressly provided, all terms used herein shall have the same meaning as in the Plan.
2.2.   Change in Control.
        (a)    Assumption or Substitution.
            (i)     If the Change in Control is one in which there is an acquiring or surviving entity, the Administrator may provide for the assumption or continuation of some or all outstanding Awards or for the grant of new awards in substitution therefor by the acquiror or survivor or an affiliate of the acquiror or survivor.
            (ii)    In the event of a Change in Control in which the successor company assumes or substitutes for the Option (or in which the Company is the ultimate parent corporation and continues the Award), if Participant’s employment with such successor company (or the Company) or an affiliate thereof is involuntarily terminated without Cause by the successor employer or Participant resigns for Good Reason, in either case within 24 months following such Change in Control: the Option will immediately vest, become fully exercisable, and may thereafter be exercised for 24 months (but in no event after the original expiration date specified in Section 1.4 above).  For the purposes of this Section 2.2, the Option shall be considered assumed or substituted for if following the Change in Control the Award confers the right to purchase or receive, for each share of Stock subject to the Option immediately prior to the Change in Control, the consideration (whether stock, cash or other securities or property) received in the transaction 

-3-

constituting a Change in Control by holders of Stock for each Share held on the effective date of such transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Stock); provided, however, that if such consideration received in the transaction constituting a Change in Control is not solely common stock of the successor company, the Administrator may, with the consent of the successor company, provide that the consideration to be received upon the exercise or vesting of the Option, for each Share subject thereto, will be solely common stock of the successor company substantially equal in fair market value to the per Share consideration received by holders of Stock in the transaction constituting a Change in Control.  The determination of such substantial equality of value of consideration shall be made by the Administrator in its sole discretion and its determination shall be conclusive and binding.
        (b)    Awards Not Assumed or Substituted.  In the event of a Change in Control in which the successor company does not assume or substitute for the Option (or in which the Company is the ultimate parent corporation and does not continue the Award): the Option shall immediately vest and become fully exercisable.
        (c)    Good Reason Definition.  For purposes of this Section 2.2, “Good Reason” means (i) “Good Reason” as defined in any individual agreement to which Participant and the Company or an Affiliate are parties, or (ii) if there is no such agreement or if it does not define Good Reason, without the Participant’s prior written consent:  (A) a reduction in the Participant’s base salary; (B) a relocation of the Participant’s primary work location to a distance of more than 50 miles from its location as of immediately prior to such change; or (C) a material breach by the Company or an Affiliate of any employment agreement with the Participant.  In order to invoke a termination of employment for Good Reason, a Participant shall provide written notice to the Company of the existence of one or more of the conditions described in clauses (A) through (C) within 90 days following the Participant’s knowledge of the initial existence of such condition or conditions, and the Company shall have 30 days following receipt of such written notice (the “Cure Period”) during which it may remedy the condition(s).  In the event that the Company fails to remedy the condition(s) constituting Good Reason during the Cure Period, the Participant must terminate employment, if at all, within 90 days following the Cure Period in order for such termination to constitute a termination of employment for Good Reason.
    (d)    Cause Definition.  “Cause” means (i) “Cause” as defined in any individual agreement to which the Participant and the Company or an Affiliate are parties or (ii) if there is no such agreement or if it does not define Cause, the Company’s termination of the Participant’s employment with the Company or any Affiliate following the occurrence of any one or more of the following: (A) the Participant’s conviction of, or plea of guilty or nolo contendere to, a felony; (B) the Participant’s willful and continual failure to substantially perform the Participant’s duties after written notification by the Company; (C) the Participant’s willful engagement in conduct that is materially injurious to the Company or an Affiliate monetarily or otherwise; (D) the Participant’s commission of an act of gross misconduct in connection with the performance of the Participant’s duties; or (E) the Participant’s material breach of any employment, confidentiality, or other similar agreement between the Company or an Affiliate and the Participant.

-4-

2.3.  Retirement.  If Participant is an employee of the Company or an Affiliate and ceases to be an employee due to retirement with the consent of the Administrator, Participant will be entitled to a special exercise period with respect to the Option (the “Special Exercise Period”) which will begin on Participant’s retirement date and will end on the earlier of the 4th anniversary of Participant’s retirement date or the expiration date specified in Section 1.4 above.  During the Special Exercise Period, the Option will continue to vest in accordance with the schedule specified in Section 1.3 above and will be exercisable to the same extent that it would have been exercisable had Participant remained in service with the Company or an Affiliate.  As used herein the term “retirement with the consent of the Administrator” means that Participant’s retirement must be with the consent of the Administrator, which consent may be granted or withheld in the discretion of the Administrator.  In the event that Participant ceases to be an employee under circumstances that would otherwise qualify for retirement but the consent of the Administrator has not been granted, then Participant shall not be entitled to the benefits of this Section 2.3.
2.4.  No Understandings as to Employment, etc.  The Participant further expressly acknowledges that nothing in the Plan or any modification thereto, in the Award or in this Agreement shall constitute or be evidence of any understanding, express or implied, on the part of the Company to employ or retain the Participant for any period or with respect to the terms of the Participant’s employment or to give rise to any right to remain in the service of the Company or any Affiliate, and the Participant shall remain subject to discharge to the same extent as if the Plan had never been adopted or the Award had never been made.
2.5.   Acts of Misconduct.  If Participant has allegedly committed an act of serious misconduct, including, but not limited to, embezzlement, fraud, dishonesty, unauthorized disclosure of trade secrets or confidential information, breach of fiduciary duty or nonpayment of an obligation owed to the Company, an Executive Officer of the Company may suspend Participant’s rights under the Award, including the vesting of Options and the exercise of vested Options, subject to the Administrator’s final decision regarding termination of the award.  No rights under the Award may be exercised during such suspension or after such termination.
2.6.  Data Protection Waiver.  Participant understands and agrees that in order to process and administer the Award and the Plan, the Company and the Administrator may process personal data and/or sensitive personal information concerning the Participant.  Such data and information includes, but is not limited to, the information provided in the Award grant package and any changes thereto, other appropriate personal and financial data about Participant, and information about Participant’s participation in the Plan and transactions under the Plan from time to time.  Participant hereby gives his or her explicit consent to the Company and the Administrator to process any such personal data and/or sensitive personal information.  Participant also hereby gives his or her explicit consent to the Company and the Administrator to transfer any such personal data and/or sensitive personal data outside the country in which Participant works, is employed or provides services and to the United States.  The legal persons granted access to such Participant personal data are intended to include the Company, the Administrator, the outside plan administrator as selected by the Company from time to time, and any other compensation consultant or person that the Company or the Administrator may deem appropriate for the 

-5-

administration of the Plan or the Award.  Participant has been informed of his or her right of access and correction to Participant’s personal data by contacting the Company.  Participant also understands that the transfer of the information outlined herein is important to the administration of the Award and the Plan and failure to consent to the transmission of such information may limit or prohibit Participant’s participation under the Plan and/or void the Award.
2.7.  Disputes.  The Administrator or its delegate shall finally and conclusively determine any disagreement concerning the Award.
2.8.  Savings Clause.  In the event that Participant is employed or provides services in a jurisdiction where the performance of any term or provision of this Agreement by the Company:  (i) will result in a breach or violation of any statute, law, ordinance, regulation, rule, judgment, decree, order or statement of public policy of any court or governmental agency, board, bureau, body, department or authority, or (ii) will result in the creation or imposition of any penalty, charge, restriction, or material adverse effect upon the Company or an Affiliate, then any such term or provision shall be null, void and of no effect.
2.9.  Amendment.  The Company may amend the provisions of this Agreement at any time; provided that an amendment that would materially adversely affect the Participant’s rights under this Agreement shall be subject to the written consent of the Participant.  No course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.
2.10.     Plan.  The terms and provisions of the Plan are incorporated herein by reference, a copy of which has been provided or made available to the Participant.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.
2.11.    Successors.  The terms of this Agreement shall be binding upon and inure to the benefit of the Company, its successors and assigns, and the Participant and the beneficiaries, executors, administrators, heirs and successors of the Participant.
2.12.    Entire Agreement.  This Agreement and the Plan contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereof; provided, however, that to the extent that the Participant has entered into an employment agreement, severance agreement or change in control termination agreement with the Company that provides for vesting and/or exercise terms that are more favorable than the vesting and/or exercise terms set forth in this Agreement or the Plan, such more favorable vesting and/or exercise terms shall apply.
2.13    Claw Back Policy.  This grant is subject to the terms of the Company’s Claw Back Policy, as it may be amended, modified, superseded or replaced from time to time.

-6-Document

 

Strategic Operating Committee Incentive Program

Effective Date: July 1, 2020

This Program is proprietary and confidential to HomeTrust Bancshares, Inc. and its employees and should not be shared outside the organization other than as required by executive compensation reporting and disclosure requirements
-1-

Introduction
HomeTrust Bancshares, Inc. (“HomeTrust” or the “Bank”) is committed to rewarding senior executives for their contributions to the Bank’s success. The HomeTrust Bancshares, Inc. Strategic Operating Committee Incentive Program (the “Program”) is part of a total compensation package which includes base salary, annual incentives and benefits. The Program is designed to:
▪Focus executives on building a strong foundation for success and sustainability over the long term.
▪Recognize and reward achievement of the Bank’s annual business goals.
▪Focus executives’ attention on key business metrics.
▪Motivate and reward superior performance.
▪Attract and retain talent needed for the Bank’s success.
▪Be competitive with the market.
▪Encourage teamwork and collaboration.
▪Ensure incentives are appropriately risk-balanced.
▪Recognize the accomplishment of key business goals that are critical to long-term success of the organization that are less quantifiable and/or more subjective in nature by utilizing a discretionary component.
▪Assure alignment of the executive’s behavior, consistent with our culture, core values, and code of conduct.

Effective Date, Program and Administrator
The Plan is effective July 1, 2020 and will remain in effect until such time that HomeTrust Bank issues a subsequent plan that by its terms expressly replaces and supersedes it (the "Subsequent Plan"). Upon HomeTrust Bank’s issuance of the Subsequent Plan, this Plan shall automatically terminate and no participant in this Plan shall thereafter be eligible to earn any compensation under this Plan, regardless of whether the participant executes or otherwise signifies his or her agreement to the Subsequent Plan. HomeTrust Bank is free to amend or modify this Plan as it deems appropriate. 
This Plan will be approved annually by the Compensation Committee (the “Committee”) of the Board of Directors. 
Participation and Eligibility
Each year, employees are selected for Program participation:
•CEO participation is determined by the Compensation Committee. 
•The CEO recommends the other executive officers for approval by the Compensation Committee.

Participants are subject to meeting the following requirements:
•New hires must be employed prior to April 1 of the Program year to be eligible to participate in the Program for the performance period. Employees hired after that date must wait until the next fiscal year to be eligible for an award under the Program. Eligibility begins the first full month worked. Participants receive a prorated award using full months worked during the Program year.
•Awards under the Program shall be limited to individuals employed on a full-time basis by HomeTrust on the date of payment, except in the case of disability, death, or retirement. 
•Participants on a performance improvement plan or with an unsatisfactory performance rating at the time of payment or who have given notice of resignation at the time of payment are not eligible to receive an award.

Performance Period
The Program operates on a fiscal year schedule - July 1 through June 30.

-2-

Incentive Award Opportunities 
Each participant will have a specified target annual incentive award opportunity, expressed as a percentage of the participant’s base salary. Incentive award opportunities are based on the participant’s job duties and responsibilities and competitive practices.
Performance Goals and Award Levels 
Program goals will be established using three performance levels:
•Threshold - is the minimum level of performance in which the Bank would consider it reasonable to provide an award. If performance is below Threshold, the payout for that goal is zero. Performance at Threshold allows for payment equal to 25% to 50% of the participant’s targeted annual incentive award opportunity. 
•Target - is the level of performance that the Bank considers “good” performance. Goals at this level are challenging but considered reasonably obtainable. Performance at Target allows for payment equal to 100% of the participant’s targeted annual incentive award opportunity. 
•Stretch - is the level of performance the Bank considers outstanding performance. Goals at this level are challenging and considered a best case scenario. Performance at Stretch allows for payment equal to 130%  of the participant’s targeted annual incentive award opportunity, which is the highest amount to be paid under the Program. 
Performance between Threshold and Target and Target and Stretch are interpolated to provide for a range of payouts between 25% to 130% of a participant’s targeted annual incentive, based on incremental results between Threshold and Stretch performance.
Incentive Program Performance Measures and Weights 
The Program uses a balanced scorecard with performance measures weighted between Corporate and Team/Individual goals. All Corporate goals, weightings and Team/Individual goals for the CEO and Executive Officers are presented to the Compensation Committee for review and approval. Team/Individual goals for other Program participants are approved by the CEO.
The following schedules are attached to this Program document. Schedules A and B are approved by the Compensation Committee prior to the beginning of each performance period:
Schedule A: Award Percentages and Performance Measures Weightings
Schedule B: Bank Goals, Weightings and Definitions
Schedule C: Example Payout Calculation
Program Discretion 
The Program provides discretion that allows the Compensation Committee to modify the final award for Corporate and Team/Individual goals based on a subjective assessment of performance and contributions to the Bank’s success.
Award Distributions 
At the end of the fiscal year, performance is measured and award amounts are calculated. Awards are paid in cash (generally) within two and one half months following the end of the fiscal year or as soon as practical after approval of the award payout by the Committee.
Awards are paid out as a percentage of a participant’s annual base earnings as of June 30th. Base earnings are defined as the base salary in effect on June 30th and excludes referral fees, commissions and any other previously-paid performance compensation.
Payments under this Program are considered taxable income to participants in the year paid and will be subject to tax withholding. 

-3-

Risk Mitigation
HomeTrust seeks to appropriately balance risk with financial rewards in the Program design and implementation. The compensation arrangements in this Program are designed to be sufficient to incent participants to achieve approved strategic and tactical goals while at the same time not be excessive or lead to material financial loss to the Bank. 
Awards may be reduced or eliminated for credit quality and/or regulatory action. Unless the Compensation Committee deems otherwise, awards will not be paid, regardless of Corporate or Team/Individual performance, if 1) any regulatory agency issues a formal, written enforcement action, memorandum of understanding or other negative directive action where the Committee considers it imprudent to provide awards under this Program, and/or 2) after a review of the Company’s credit quality measures the Committee considers it imprudent to provide awards under this Program.
Coordination with Other Incentives
The Program does not inhibit the Bank from approving Program participants for inclusion in other Bank plans, bonuses, commissions and/or incentive compensation arrangements. The Board of Directors or the Committee may make discretionary bonuses to participants regardless of their participation in this Program.
Please see “Terms and Conditions” for further details on the Program provisions. 

Terms and Conditions
The information represented below is subject to change and does not constitute a binding agreement. 
Definition of “Program”
“Program” refers to the HomeTrust Bancshares, Inc. Strategic Operating Committee Incentive Program.
Definition of the “Bank”
For the purposes of this Program, the “Bank” refers to HomeTrust Bancshares, Inc. and HomeTrust Bank, collectively.
Definition of “Board of Directors”
For the purposes of this Program, “Board of Directors” refers to the boards of directors of HomeTrust Bancshares, Inc. and HomeTrust Bank, collectively.
Effective Date
This Program became effective July 1, 2020. The Program may be amended from time to time with the approval of the Compensation Committee of the Board.
Performance Period/Program Year
The performance period is July 1 through June 30 and may be referred to in this document as the Program year.
Program Administration
The Program is authorized by the Board of Directors. Each of the Board and the Compensation Committee has the authority to make or nullify any rules and procedures, as necessary, for proper administration of the Program. 
The Program will be reviewed annually by the Compensation Committee to ensure proper alignment with the Bank’s business objectives. 
The Compensation Committee will approve all final award distributions paid to Program participants. Any determination by the Compensation Committee will be final and binding. 
-4-

Program Changes or Discontinuance
The Bank has developed the Program on the basis of existing business, market and economic conditions; current services; and staff assignments. If substantial changes occur that affect these conditions, services, assignments, or forecasts, the Bank may add to, amend, modify or discontinue any of the terms or conditions of the Program at any time. Examples of substantial changes may include mergers, dispositions or other corporate transactions, changes in laws or accounting principles or other events that would in the absence of some adjustment, frustrate the intended operation of this arrangement.
The Compensation Committee may, at its sole discretion, waive, change or amend any of the Program as it deems appropriate. 
Program Interpretation
If there is any ambiguity as to the meaning of any terms or provisions of this Program or any questions as to the correct interpretation of any information contained therein, the Bank's interpretation expressed by the Compensation Committee will be final and binding. 
Participation
CEO participation is determined by the Compensation Committee. Executive officers are recommended by CEO and approved by the Compensation Committee. Other employees may participate upon approval of the CEO. 
New employees must be employed by April 1 of the performance period (July 1 - June 30) to be considered for participation in a given Program year.
Award Determinations 
Program participants are eligible for a distribution under the Program only upon attainment of certain performance objectives defined under the Program and after the approval of the award by the Compensation Committee.
Performance at Threshold, Target and Stretch are interpolated to encourage and reward incremental performance improvement. 
Award Distributions
Awards are paid in cash (generally) within two and one half months following the end of the fiscal year or as soon as practical after approval of the award payout by the Compensation Committee.
Awards are paid out as a percentage of a participant’s annual base earnings as of June 30. Base earnings are defined as base salary in effect as of June 30 and excludes referral fees, commissions and any other previously-paid performance compensation.
Incentive awards are considered taxable income to participants in the year paid and will be subject to tax withholding. 
New Hires, Reduced Work Schedules, Promotions, and Transfers
New hires that meet the eligibility criteria and are hired prior to April 1 of the Program year receive a prorated award based on the number of full months worked during the Program year. New hires employed by the Bank on or after April 1 are not eligible to receive an award for the current Program year.
Participants that are promoted or change roles where the participant becomes eligible or ineligible for an award or experience a change in incentive opportunity will receive a prorated award based on their status and the effective date of the promotion or role change. Award amounts will be calculated using the participant’s base earnings and the incentive target for the applicable period. Base earnings refers to the base salary in effect on June 30 and excludes referral fees, commissions and any other previously-paid performance compensation.
-5-

Participants that have an approved leave of absence are eligible to receive a prorated award calculated using their time in active status as permitted by the Family Medical Leave Act or other applicable state and federal laws and regulations. 
Termination of Employment
To encourage employee retention, a participant must be an active employee of the Bank on the date the incentive award is paid to receive an award (please see exceptions for death, disability and retirement below). Participants who terminate employment during the Program year will not be eligible to receive an award. Participants who have given notice of resignation during the Program year and before payout are not eligible to receive an award.
Death, Disability or Retirement
If a participant ceases to be employed by the Bank due to disability, his/her cash incentive award for the Program year will be prorated to the date of termination. 
In the event of death, the Bank will pay to the participant’s estate the pro rata portion of the cash award that had been earned by the participant during his/her period of employment. 
Individuals who retire are eligible to receive a cash incentive payout if they are actively employed through March 31 of the performance period. 
Clawback
In the event that the Bank is required to prepare an accounting restatement due to the material noncompliance of the Bank with any financial reporting requirement under the securities laws, the Participants shall, unless otherwise determined in the sole discretion of the Committee, reimburse the Bank upon receipt of written notification for any excess incentive payment amounts paid under the Program calculation(s) which were based on financial results required to be restated. In calculating the excess amount, the Committee shall compare the calculation of the incentive payment based on the relevant results reflected in the restated financials compared to the same results reflected in the original financials that were required to be restated. Participants may write a check payable to the Bank for amounts equal to the written notification. In its discretion, the Compensation Committee has the right to adjust compensation and/or modify a Participant’s future incentive payments as it deems necessary. 
Ethics Statement
The altering, inflating, and/or inappropriate manipulation of performance/financial results or any other infraction of recognized ethical business standards, will subject the employee to disciplinary action up to and including termination of employment. In addition, any incentive compensation as provided by this Program to which the employee would otherwise be entitled will be revoked or if paid, be obligated to repay any incentive award earned during the award period in which the wrongful conduct occurred regardless of employment status.
Miscellaneous
Any participant awards shall not be subject to assignment, pledge or other disposition, nor shall such amounts be subject to garnishment, attachment, transfer by operation of law, or any legal process.
Participation in the Program does not confer rights to participation in other Bank programs, including annual or long-term incentive programs, non-qualified retirement or deferred compensation programs or other executive perquisite programs.
The Program will not be deemed to give any participant the right to be retained in the employ of the Bank, nor will the Program interfere with the right of the Bank to discharge any participant at any time for any reason.
In the absence of an authorized, written employment contract, the relationship between employees and the Bank is one of at-will employment. The Program does not alter the relationship.
This Program and the transactions and payments hereunder shall, in all respect, be governed by, and construed and enforced in accordance with the laws of the state in which the participant is employed.
-6-

Each provision in this Program is severable, and if any provision is held to be invalid, illegal, or unenforceable, the validity, legality and enforceability of the remaining provisions shall not, in any way, be affected or impaired thereby.

-7-

																											
	Schedule A: 2021 Award Percentages and Performance Measures Weighting
	Participant		Title		Target %		Corporate 
Weighting
		Unit/Function 
Weighting

	Dana Stonestreet		CEO		55%		80%		20%
	Hunter Westbrook		COO		40%		75%		25%
	Tony VunCannon		CFO		30%		75%		25%
	Marty Caywood		CIO		30%		75%		25%
	Keith Houghton		CCO		30%		75%		25%
	Parrish Little		CRO		30%		75%		25%

															
	Schedule B: Bank Goals, Weightings and Definitions
	Performance 
Measure
		CEO		Others
	Pretax, Pre-Provision Income		40%		35%
					
	Noninterest income		20%		20%
					
	Efficiency Ratio		10%		10%
					
	Total Loans (Excluding Purchased HELOCs and Paycheck Protection Program Loans)		10%		10%
					
	Functional Team		20%		25%
					
			100%		100%

The Compensation Committee may reduce the amount of incentive payments at their discretion based on the changes in key asset quality indicators and/or performance in comparison to a specific peer group.

Note: Payouts for performance between Threshold and Target and Target and Stretch will be calculated using straight line interpolation.
-8-

																																				
	Schedule C: Example Payout Calculation at $250,000 base salary
	2021 POTENTIAL BASED ON TARGET	Performance Goals
	Performance Measures	Incentive		Threshold	Target	Stretch	Actual	
		at Target	Weight	50%	100%	150%	Performance	Payout
								
	Corporate							
	Pretax, Pre-Provision Income	$	26,250 		35%	TBD	TBD	TBD	Target	$	26,250 	
	Noninterest Income	$	15,000 		20%	TBD	TBD	TBD	Target	$	15,000 	
	Efficiency Ratio	$	7,500 		10%	TBD	TBD	TBD	Target	$	7,500 	
	Total Loans	$	7,500 		10%	TBD	TBD	TBD	Target	$	7,500 	
								
	Corporate Goal Achievement	$	56,250 		75%					$	56,250 	
								
	Unit/Function							
	Goal 1	$	7,500 		10%		Goal 1			$	7,500 	
	Goal 2	$	7,500 		10%		Goal 2			$	7,500 	
	Goal 3	$	3,750 		5%		Goal 3			$	3,750 	
								
	Team/Individual Achievement	$	18,750 		25%				Target	$	18,750 	
								
	Grand Total	$	75,000 		100%					$	75,000 	

-9-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00320-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00320-of-00352.parquet"}]]