Document:

Exhibit

EXHIBIT 10.3

ANSYS, INC. 
THIRD AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN
		
	1.
	Purpose

This Third Amended and Restated Long-Term Incentive Plan (the “Plan”) is intended to provide an incentive for superior work and to motivate executives and employees of ANSYS, Inc. (the “Company”) toward even higher achievement and business results, to tie their goals and interests to those of the Company and its stockholders and to enable the Company to attract and retain highly qualified executives and employees.  The Plan is for the benefit of Participants (as defined below).  Awards made under this Plan constitute Restricted Stock Unit Awards under Section 11 of the Company’s Fifth Amended and Restated 1996 Stock Option and Grant Plan (the “1996 Option Plan”) and shall be granted under, and subject to, the terms of the 1996 Option Plan.
		
	2.
	Definitions

For purposes of this Plan:
		
	(a)
	“Award” means a grant to a Participant hereunder.  From and after a Change in Control, any references to an Award shall mean the fixed number of Restricted Stock Units eligible to be earned by a Participant, as determined by the Committee pursuant to Section 6 hereof.

		
	(b)
	“Award Notice” means a notice or agreement provided to a Participant that sets forth the terms, conditions and limitations of the Participant’s participation in this Plan, including, without limitation, the Participant’s Target Award.

		
	(c)
	“Board” means the Board of Directors of the Company.

		
	(d)
	“Cause” means, and shall be limited to a determination by the Company that the Participant’s employment shall be terminated as a result of any one or more of the following events: 

(i)    any material breach by the Participant of any agreement between the Participant and the Company; or
(ii)    the conviction of, indictment for or plea of nolo contendere by the Participant to a felony or a crime involving moral turpitude; or 
(iii)    any material misconduct or willful and deliberate non-performance (other than by reason of disability) by the Participant of the Participant’s duties to the Company; or
(iv)    willful failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by the Company to cooperate, or the willful destruction or failure to preserve documents or other materials known to be relevant to such investigation or the willful inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation.
		
	(e)
	“Change in Control” means any of the following:

(i)    any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Act”) (other than the Company, any of its subsidiaries, or any trustee, fiduciary or other person or entity holding securities under any employee benefit plan or trust of the Company or any of its subsidiaries), together with all “affiliates” and “associates” (as such terms are 

defined in Rule 12b-2 under the Act) of such person, shall become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, of securities of the Company representing 50 percent or more of the combined voting power of the Company’s then outstanding securities having the right to vote in an election of the Board (“Voting Securities”) (in such case other than as a result of an acquisition of securities directly from the Company); or
(ii)    the consummation of (A) any consolidation or merger of the Company where the stockholders of the Company, immediately prior to the consolidation or merger, would not, immediately after the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, shares representing in the aggregate more than 50 percent of the voting shares of the Company issuing cash or securities in the consolidation or merger (or of its ultimate parent corporation, if any), or (B) any sale or other transfer (in one transaction or a series of transactions contemplated or arranged by any party as a single plan) of all or substantially all of the assets of the Company.
Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred for purposes of the foregoing clause (i) solely as the result of an acquisition of securities by the Company which, by reducing the number of shares of Voting Securities outstanding, increases the proportionate number of Voting Securities beneficially owned by any person to 50 percent or more of the combined voting power of all of the then outstanding Voting Securities; provided, however, that if any person referred to in this sentence shall thereafter become the beneficial owner of any additional shares of Voting Securities (other than pursuant to a stock split, stock dividend, or similar transaction or as a result of an acquisition of securities directly from the Company) and immediately thereafter beneficially owns 50 percent or more of the combined voting power of all of the then outstanding Voting Securities, then a “Change in Control” shall be deemed to have occurred for purposes of the foregoing clause (i).
		
	(f)
	“Change in Control Date” means with respect to each Change in Control Performance Measurement Period, the last day of the month immediately preceding the effective date of the Change in Control.

		
	(g)
	“Change in Control Performance Measurement Period” means the Performance Measurement Period that is shortened by the Committee such that such period shall be deemed to have concluded as of the Change in Control Date and which may shorten one or more Performance Sub-Periods.

		
	(h)
	“Change in Control Terminating Event” means during the 18-month period following the occurrence of a Change in Control, any of the following events: (i) termination by the Company of the Participant’s employment for any reason other than for Cause, death or disability; or (ii) the termination by the Participant of his or her employment with the Company for Good Reason.  Notwithstanding the foregoing, a Change in Control Terminating Event shall not be deemed to have occurred herein solely as a result of the Participant being an employee of any direct or indirect successor to the business or assets of the Company.

		
	(i)
	“Closing Index Value” means the Performance Measurement Index Value as of the last day of each Performance Sub-Period.

		
	(j)
	“Closing Stock Price” means the Stock Price as of the last day of each Performance Sub-Period.

		
	(k)
	“Code” means Internal Revenue Code of 1986, as amended.

		
	(l)
	“Committee” means the Compensation Committee of the Board.

		
	(m)
	“Effective Date” means as of January 1, 2017.

		
	(n)
	“Good Reason” means that the Participant has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events:

2

(i)    a material diminution in the Participant’s responsibilities, authority or duties; or
(ii)    a material reduction in the Participant’s Base Salary and Target Bonus except for across-the-board salary reductions similarly affecting all or substantially all management employees; or
(iii)    a material change in the geographic location at which the Participant is principally employed.
For purposes of this Section 2(n)(i), a change in the reporting relationship, or a change in a title will not, by itself, be sufficient to constitute a material diminution of responsibilities, authority or duty.
		
	(o)
	“Good Reason Process” means:

(i)    the Participant reasonably determines in good faith that a “Good Reason” condition has occurred; 
(ii)    the Participant notifies the Company in writing of the occurrence of the Good Reason condition within 60 days of the first occurrence of such condition; 
(iii)    the Participant cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “Cure Period”), to remedy the condition; 
(iv)    notwithstanding such efforts, the Good Reason condition continues to exist following the Cure Period; and 
(v)    the Participant terminates his or her employment within 30 days after the end of the Cure Period.  
If the Company cures the Good Reason condition during the Cure Period, Good Reason shall be deemed not to have occurred.
		
	(p)
	“Initial Index Value” means, the Performance Measurement Index Value as of January 1 of the first calendar year in any Performance Measurement Period.

		
	(q)
	“Initial Stock Price” means the Stock Price as of January 1 of the first calendar year in any Performance Measurement Period.  

		
	(r)
	“Participant” means an executive or employee of the Company selected by the Committee to participate in the Plan.

		
	(s)
	“Performance Measurement Index” means the NASDAQ Composite Index (^IXIC), or, in the event such index is discontinued or its methodology significantly changed, a comparable index selected by the Committee in good faith.

		
	(t)
	“Performance Measurement Index Value” means, with respect to any date, the average value of the Performance Measurement Index for the ten consecutive trading days immediately preceding such date.

		
	(u)
	“Performance Measurement Period” means a three year period commencing on January 1 and ending on the third December 31 thereafter, and which consists of three Performance Sub-Periods. There shall be overlapping Performance Measurement Periods.  

3

		
	(v)
	“Performance Multiplier” means the percentage between 0% and 150% by which the applicable portion of the Target Award is multiplied to determine the number of credited Restricted Stock Units for a Performance Sub-Period.  

		
	(w)
	“Performance Sub-Period” means one of three periods (each a Performance Sub-Period) within a Performance Measurement Period where each period commences on January 1 of the first calendar year within the Performance Measurement Period and concludes on the immediately following December 31 of such year for the first Performance Sub-Period, December 31 of the following year for the second Performance Sub-Period and December 31 of the second year thereafter for the third Performance Sub-Period.  For the avoidance of doubt, the first Performance Measurement Period under the Plan will commence on January 1, 2017 and will contain the following three Performance Sub-Periods: January 1, 2017 – December 31, 2017; January 1, 2017 – December 31, 2018; and January 1, 2017 – December 31, 2019.  Performance Measurement Periods will commence on each January 1 thereafter (and will contain three such Performance Sub-Periods) while the Plan is effective.

		
	(x)
	“Restricted Stock Units” means the stock units of the Company to be settled in shares of Stock.

		
	(y)
	“Stock” means the Company’s common stock, par value $0.01 per share.

		
	(z)
	“Stock Price” means, as of a particular date, the average closing price of one share of Stock for the ten consecutive trading days ending on, and including, such date; provided however, that in the event of a Change in Control of the Company, the Stock Price shall equal the fair market value, as determined by the Committee in its discretion, of the total consideration paid or payable in the transaction resulting in the Change in Control for one share of Stock.

		
	(aa)
	“Target Award” means the target number of Restricted Stock Units that comprise a Participant’s Award for each Performance Measurement Period, as set forth in the Participant’s Award Notice.

		
	(bb)
	“Total Shareholder Return” means, with respect to a Performance Sub-Period, the total percentage return per share, achieved by the Stock assuming contemporaneous reinvestment in the Stock of all dividends and other distributions (excluding dividends and distributions paid in the form of additional shares of Stock) at the closing price of one share of Stock on the date such dividend or other distribution was paid, based on the Initial Stock Price, and the Closing Stock Price for the last day of the applicable Performance Sub-Period.

		
	3.
	Administration

(a)    The Plan shall be administered by the Committee.  The Committee shall have the discretionary authority to make all determinations (including, without limitation, the interpretation and construction of the Plan and the determination of relevant facts) regarding the entitlement to any Award hereunder and the amount of any Award to be paid under the Plan (including the number of shares of Stock issuable to any Participant), provided such determinations are made in good faith and are consistent with the purpose and intent of the Plan.  In particular, but without limitation and subject to the foregoing, the Committee shall have the authority:
(i)    to select Participants under the Plan;
(ii)    to determine the Target Award and any formula or criteria for the determination of the Target Award for each Participant;

4

(iii)    to determine the terms and conditions, not inconsistent with the terms of this Plan, which shall govern Award Notices and all other written instruments evidencing an Award hereunder, including the waiver or modification of any such conditions;
(iv)    to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable; and
(v)    to interpret the terms and provisions of the Plan and any Award granted under the Plan (and any Award Notices or other agreements relating thereto) and to otherwise supervise the administration of the Plan.
(b)    Notwithstanding anything herein to the contrary, the Committee may, in its discretion, make appropriate adjustments to any Award, any Target Award, any Initial Stock Price, any Closing Stock Price or the Total Shareholder Return for any period in connection with or as a result of any of the following events which occur or have occurred after the Effective Date: reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Company’s capital stock, if the outstanding shares of Stock are increased or decreased or are exchanged for a different number or kind of shares or other securities of the Company, or additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Stock or other securities.
(c)    Subject to the terms hereof, all decisions made by the Committee pursuant to the Plan shall be final, conclusive and binding on all persons, including the Company and the Participants.  No member of the Board or the Committee, nor any officer or employee of the Company acting on behalf of the Board or the Committee shall be personally liable for any action, determination or interpretation taken or made in good faith with respect to the Plan, and all members of the Board or Committee and each and any officer or employee of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination or interpretation.
		
	4.
	Determination and Payment of Awards

(a)    Measurement Period Target.  Each Participant’s Award Notice shall specify such Participant’s Target Award, one third of which (the “Measurement Period Target”) is eligible to be credited for each Performance Sub-Period.  The Target Award shall be expressed as a number of Restricted Stock Units.  The percentage of the Measurement Period Target that is eligible to be credited shall be determined by reference to the Company’s performance for the applicable Performance Sub-Period as measured by the Total Shareholder Return relative to the percentage appreciation of the Performance Measurement Index for such calendar year or years.   The percentage appreciation of the Performance Measurement Index shall be established by comparing the Initial Index Value to the Closing Index Value.  
(b)    Performance Multiplier: If Total Shareholder Return for a Performance Sub-Period is less than the Performance Measurement Index, the Performance Multiplier shall be 100% minus A, where A is (the amount by which the Performance Measurement Index exceeds Total Shareholder Return) times three; provided however that the Performance Multiplier shall be zero if A results in a number greater than 75.  If Total Shareholder Return for a Performance Sub-Period is equal to the Performance Measurement Index, the Performance Multiplier shall be 100%.   If Total Shareholder Return for a Performance Sub-Period is greater than the Performance Measurement Index, the Performance Multiplier is 100% plus B, where B is (the amount by which Total Shareholder Return exceeds the Performance Measurement Index) times two.  
Subject to Section 4(c), in no event will any portion of a Participant’s Target Award be credited for a Performance Sub-Period in which either: (A) the Performance Multiplier calculates to a number of less than 25% 

5

(i.e., in such event the Performance Multiplier shall be 0% for such Performance Sub-Period); or (ii) both absolute Total Shareholder Return and relative Total Shareholder Return (i.e., where Total Shareholder Return is less than the Performance Measurement Index) are negative. For purposes of clarity, see the following examples: 
	
				
	Sample ANSYS Total Shareholder Return
	Sample Performance Measurement Index
	Difference between Sample ANSYS Total Shareholder Return and Performance Measurement Index
	Performance Multiplier

	40
	15
	+25
	150%

	40
	30
	+10
	120%

	40
	40
	0
	100%

	40
	42
	-2
	94%

	40
	56
	-16
	52%

	40
	65
	-25
	25%

	40
	70
	-30
	0%

	-10
	-20
	+10
	100%

	-10
	-5
	-5
	0%

  Notwithstanding the foregoing, in no event shall the Performance Multiplier be less than 0% or exceed 150%,  regardless of a Total Shareholder Return that would result in a Performance Multiplier of less than 0% or in excess of 150%.   
Notwithstanding the foregoing, if the Total Shareholder Return in a Performance Sub-Period is a negative percentage, then a maximum of 100% of the Measurement Period Target may be credited for such calendar year, even if the Total Shareholder Return relative to the median percentage appreciation (depreciation) of the Performance Measurement Index would result in a greater Performance Multiplier.  
(c)    Retroactive Crediting.  If the Performance Multiplier for the third and final Performance Sub-Period within a Performance Measurement Period exceeds the Performance Multiplier of any of the two earlier Performance Sub-Periods within such Performance Measurement Period, the Committee, at its first meeting following the conclusion of the Performance Measurement Period, shall retroactively credit the previous Measurement Period Target(s) based upon the third and final Performance Sub-Period’s Performance Multiplier.  For the avoidance of doubt, in no event shall a Participant receive more than 150% of the Target Award in a Performance Measurement Period.   
(d)    Committee Determination.  The Committee, at its first meeting following the conclusion of each Performance Sub-Period within a Performance Measurement Period, shall determine the actual number of Restricted Stock Units that will be deemed to have been credited as of the final day of such Performance Sub-Period. For each Performance Sub-Period, the number of Restricted Stock Units credited for such period shall equal the Measurement Period Target multiplied by the Performance Multiplier, subject to the terms and conditions hereof.  
(e)    Vesting and Settlement.  Subject to Section 5, as soon as practicable (but in no event later than 74 days) following the conclusion of the Performance Measurement Period, the cumulative number of Restricted Stock Units, if any, that were credited in each of the three Performance Sub-Periods will be vested and settled in an equal number of shares of Stock.
		
	5.
	Termination of Employment.  Unless otherwise provided in any Award Notice or as provided in Section 6 below, if at any time prior to the conclusion of a Performance Measurement Period, a Participant’s employment with the Company terminates for any reason, such Participant shall automatically forfeit the right to receive any Award credited as of the date of termination of employment.

6

		
	6.
	Change in Control.  Unless otherwise provided in any Award Notice, upon a Change in Control of the Company, the following shall occur:

(a)    With respect to each Change In Control Performance Measurement Period, the Committee, in accordance with Section 4, shall determine the actual number of Restricted Stock Units that are eligible to be credited based on the Total Shareholder Return for the Change in Control Performance Measurement Period relative to the median percentage appreciation of the Performance Measurement Index for such Change in Control Performance Measurement Period and such Award shall not be deemed fully vested until the conclusion of the Performance Measurement Period, subject to the continued employment of the Participant through such date.  For example, if a Change in Control occurs during the last month of the first Performance Sub-Period within the Performance Measurement Period, the Committee shall determine the number of Restricted Stock Units that are eligible to be credited with respect to the applicable Change in Control Performance Measurement Period based on performance for such period, but the Award shall not be deemed vested and will not be settled until the end of the full 36 month Performance Measurement Period.  For the avoidance of doubt, since the Plan contemplates overlapping Performance Measurement Periods, there may be up to three different Change In Control Performance Measurement Periods.  
(b)    In the event that subsequent to a Change in Control, a Participant’s employment with the Company terminates for any reason other than a Change in Control Terminating Event, such Participant shall automatically forfeit the right to receive all outstanding Awards that have been credited as of the date of termination of employment.  
(c)    In the event a Change in Control Terminating Event occurs with respect to a Participant, all outstanding Awards held by such Participant shall immediately vest and become payable.
(d)    If as a result of a Change in Control, no Stock remains outstanding and the surviving corporation (or its ultimate parent) does not agree to convert the Awards into a number of restricted stock units of equivalent value of the surviving corporation (or its ultimate parent), then the Awards shall be converted to a dollar value based on the Stock Price. 
		
	7.
	Miscellaneous

		
	(a)
	Amendment and Termination.  The Company reserves the right to amend or terminate the Plan at any time in its discretion without the consent of any Participants, but no such amendment shall adversely affect the rights of the Participants with regard to outstanding Awards.  In the event the Plan is terminated, the Company shall determine the Awards payable to Participants based on the Total Shareholder Return relative to the Performance Measurement Index for each Performance Measurement Period ending on the date of Plan termination.  The Awards for each Performance Measurement Period shall be further prorated to reflect the shortened Performance Measurement Period.

		
	(b)
	No Contract for Continuing Services.  This Plan shall not be construed as creating any contract for continued services between the Company or any of its subsidiaries and any Participant and nothing herein contained shall give any Participant the right to be retained as an employee or consultant of the Company or any of its subsidiaries.

		
	(c)
	No Transfers. A Participant’s rights in an interest under the Plan may not be assigned or transferred.

		
	(d)
	Unfunded Plan.  The Plan shall be unfunded and shall not create (or be construed to create) a trust or separate fund.  Likewise, the Plan shall not establish any fiduciary relationship between the 

7

Company or any of subsidiaries or affiliates and any Participant. To the extent that any Participant holds any rights by virtue of an Award under the Plan, such right shall be no greater than the right of an unsecured general creditor of the Company or any of its subsidiaries.
		
	(e)
	Governing Law.  The Plan and each Award Notice awarded under the Plan shall be construed in accordance with and governed the laws of the State of Delaware, without regard to principles of conflict of laws of such state.

		
	(f)
	Tax Withholding.  Any issuance of shares of Stock to a Participant shall be subject to tax withholding.  The minimum tax withholding obligation shall be satisfied through a net issuance of shares.  The Company shall withhold from shares of Stock to be issued to the Participant a number of shares of Stock with an aggregate fair market value that would satisfy the minimum withholding amount due.

		
	(g)
	Construction.  Wherever appropriate, the use of the masculine gender shall be extended to include the feminine and/or neuter or vice versa; and the singular form of words shall be extended to include the plural; and the plural shall be restricted to mean the singular.

		
	(h)
	Headings.  The Section headings and Section numbers are included solely for ease of reference.  If there is any conflict between such headings or numbers and the text of this Plan, the text shall control.

		
	(i)
	Effect on Other Plans.  Nothing in this Plan shall be construed to limit the rights of Participants under the Company’s or its subsidiaries’ benefit plans, programs or policies.

		
	(j)
	Effective Date.  The Plan shall be effective as of the Effective Date.

		
	8.
	Section 409A.

		
	(a)
	All payments and benefits described in this Plan are intended to constitute a short term deferral for purposes of Section 409A of the Internal Revenue Code of 1986, as amended.  To the extent that any payment or benefit described in this Plan constitutes “non-qualified deferred compensation” under Section 409A of the Code, and to the extent that such payment or benefit is payable upon the Participant’s termination of employment, then such payments or benefits shall be payable only upon the Participant’s “separation from service.”  The determination of whether and when a separation from service has occurred shall be made in accordance with the presumptions set forth in Treasury Regulation Section 1.409A‐1(h).

		
	(b)
	The parties intend that this Plan will be administered in accordance with Section 409A of the Code.  To the extent that any provision of this Plan is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code.  The parties agree that this Plan may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A of the Code and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party.

		
	(c)
	The Company makes no representation or warranty and shall have no liability to the Participant or any other person if any provisions of this Plan are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section.

8Exhibit

Exhibit 10.1

INDEPENDENT BANK CORP. 2017 EXECUTIVE INCENTIVE PLAN

1.     Purpose

The purpose of this plan (the “Plan”) is to enable Independent Bank Corp. (the “Company”) and its Subsidiaries to attract, retain, motivate and reward Participants by providing Participants with the opportunity to earn incentive compensation under the Plan related to the Company’s performance. Incentive compensation granted under the Plan to Covered Employees is intended to qualify as performance-based compensation within the meaning of Section 162(m). Unless defined elsewhere in the Plan, capitalized terms shall have the definitions set forth in Section 9.
    
2.     Administration

(a) Power and Authority of the Committee.

The Committee shall administer the Plan. Subject to the express provisions of the Plan, the Committee shall have full power and authority:

		
	i.
	to designate Participants; 

		
	ii.
	to establish the Performance Targets during a Performance Period and to determine whether Performance Targets have been achieved; 

		
	iii.
	to prescribe, amend, and rescind rules and procedures relating to the Plan; 

		
	iv.
	subject to the provisions of the Plan, to delegate to one or more officers of the Company some or all of its authority under the Plan; 

		
	v.
	to employ legal counsel, independent auditors or consultants, as may be necessary or advisable in the sole discretion of the Committee, for the administration of the Plan and to rely upon any opinion or computation received therefrom; and 

		
	vi.
	to make all determinations, to adopt rules, and to formulate procedures, as may be necessary or advisable in the sole discretion of the Committee, for administration of the Plan. 

(b) Plan Construction and Interpretation.

The Committee shall have full power and authority to construe and interpret the Plan.

(c) Determinations of Committee Final and Binding.

All determinations by the Committee in carrying out and administering the Plan and in construing and interpreting the Plan shall be made in the Committee’s sole discretion and shall be final, binding, and conclusive for all purposes and upon all persons.

(d)  Delegation of Authority.

With respect to matters relating to Participants other than the Chief Executive Officer, except with respect to matters that are required to be certified by the Committee under the Plan, or that are required to be handled exclusively by the Committee under Section 162(m) with respect to Awards intended to qualify for the exemption from the limitation on deductibility imposed by Section 162(m), the Committee may, in its discretion, authorize the Chief Executive Officer of the Company or the full Board to act on its behalf.  With respect to matters relating the Chief Executive Officer, except with  respect to matters that are required to be certified by the Committee under the Plan, or that are required to be handled exclusively by the Committee under Section 162(m) with respect to Awards intended to qualify for the exemption from the 

limitation on deductibility imposed by Section 162(m), the Committee may, in its discretion, authorize the full Board to act on its behalf.

3.    Awards

(a) Performance Targets.

The Committee may make a determination to give a Participant the opportunity to earn incentive compensation under the Plan during a Performance Period. If the Committee decides to offer such an opportunity to one or more Participants, then with respect to Awards that are intended to qualify for the exemption from the limitation on deductibility under Section 162(m), no later than 90 days after the beginning of the Performance Period (or any earlier or later date as may be required by Section 162(m)), the Committee shall:

		
	i.
	designate each Participant for the Performance Period;

		
	ii.
	determine and establish in writing one or more Performance Goals to be applicable to the Performance Period for each Participant;

		
	iii.
	establish one or more specific Performance Targets related to Performance Goal or Goals and the incentive amount that could be earned for the Performance Period by each Participant (with sufficient specificity to satisfy the requirements of Section 162(m)); and 

		
	iv.
	specify the relationship between Performance Targets and the amount of incentive compensation each Participant may earn for the Performance Period. 

The Performance Targets may be described in terms of objectives that are related to the individual Participant or objectives that are Company-wide or related to a Subsidiary, division, department, region, function or business unit of the Company or one or more Subsidiaries.  The Performance Targets may be measured on an absolute or cumulative basis or on the basis of percentage of improvement over time, and may be measured in terms of Company performance (or performance of a Subsidiary, division, department, region, functional or business unit) or measured relative to selected peer companies or a market index.

With respect to Awards that are not intended to qualify for the exemption from the limitation on deductibility imposed by Section 162(m), the establishment of Performance Goals and Performance Targets, the determination of the level of achievement of Performance Goals and Performance Targets and the determination of the amount of any Award shall be consistent with the administrative processes of the Company.

(b) Discretion to Structure Awards.

The Committee shall have the sole discretion to structure Awards in any manner it deems advisable, including, without limitation:

		
	i.
	specifying that the incentive amount for a Performance Period will be earned if the applicable Performance Target is achieved for one Performance Goal or for any one of a number of Performance Goals;

		
	ii.
	providing that the incentive amount for a Performance Period will be earned only if the applicable Performance Target(s) are achieved for more than one Performance Goal; or

		
	iii.
	providing that the incentive amount to be earned for a given Performance Period will vary based upon different levels of achievement of the applicable Performance Targets. 

(c) Determination of Award.

Following the completion of each Performance Period, with respect to Awards to Covered Employees that are subject to the requirements of Section 162(m), the Committee shall certify in writing whether the applicable Performance Target(s) were achieved for the Performance Period and the incentive amounts, if any, earned by Participants for the Performance Period. In determining the incentive amount earned by a Participant for a given Performance Period, the Committee shall have the right to reduce (but not to increase) the incentive amount payable at a given level of performance. In doing so, the Committee may take into account additional factors that the Committee may deem relevant in its sole discretion to the assessment of 

individual’s performance or business or financial performance for the Performance Period. The exercise of negative discretion with respect to one Participant, however, is not permitted to result in an increase in the amount payable to another Participant.

(d) Payment of Awards.

Subject to Section 4, Awards shall be paid to the Participant on a date after the end of the Performance Period that is no later than 21⁄2 months following the end of the Performance Period.   Notwithstanding the foregoing, an Award may be paid later than 21⁄2 months following the end of the Performance Period if (i) it is administratively impracticable to make payment by that date, provided that the Award is paid during the first taxable year of the Participant in which the calculation of the amount is administratively practicable; or (ii) paying the Award by that date would jeopardize the ability of the Company to continue as a going concern, provided that the Award is paid in the first taxable year of the Participant in which the payment of the Award would not have that effect. Until paid to a Participant, Awards may not be assigned, alienated, transferred or encumbered in any way.

Except to the extent set forth in the Plan, no Award will be paid to a Participant unless the Participant is employed by the Company or a Subsidiary as of the date of payment.

(e) Maximum Amounts.

The maximum aggregate incentive amount that may be earned under the Plan by a Participant for all Performance Periods completed during any given fiscal year of the Company is two million dollars ($2,000,000) If an Award is cancelled, the cancelled Award shall continue to be counted toward the applicable limitation on deductibility imposed by Section 162(m).

(f) Performance Goals.

In the case of any Award that is intended to qualify for the exemption from the limitation on deductibility imposed by Section 162(m), the Performance Goals with respect to which the Committee may establish Performance Targets shall relate to one or more of the following performance criteria, as the Committee deems appropriate in its sole discretion (in each case as established by the Committee within the time periods and with the specificity intended to meet the requirements of Section 162(m)):

		
	i.
	earnings or earnings per share and any potential variant of earnings or earnings per share, including but not limited to net earnings per share, diluted earnings per share, diluted net earnings per share, operating earnings or operating earnings per share, operating net earnings per share, operating diluted earnings per share, operating diluted net earnings per share, adjusted operating earnings, net earnings from continuing operations, EBITA, adjusted EBITA, EBITDA, adjusted EBITDA;

		
	ii.
	return on assets and any potential variant of return on assets, including but not limited to return on net assets, return on average assets, core return on average assets, cash return on average assets;

		
	iii.
	return on equity and any potential variant of return on equity, including but not limited to core return on equity, return on average equity, return on average tangible common equity, return on average common tangible equity, cash return on average tangible equity; 

		
	iv.
	return on capital and any potential variant of return on capital, including but not limited to return on invested capital, average assets, shareholder equity as a percentage of assets;

		
	v.
	income and any potential variant of income, including but not limited to income before or after taxes, net income or net income before or after taxes, interest income, net interest income, noninterest income, noninterest income as a percentage of revenue, noninterest income as a percentage of revenue on an operating basis;

		
	vi.
	cash flow and any potential variant of cash flow, including but not limited to operating cash flow, free cash flow, or free cash flow per share; 

		
	vii.
	asset quality and any potential variant of asset quality, including but not limited to asset quality of loan portfolio, credit quality, net charge-offs or net charge-off percentage, net recoveries, charge-offs, recoveries, reduction in nonperforming assets, delinquency, delinquency as a percentage of loans, allowance for loan 

losses, provision for loan losses as a percentage of loans, impairments, nonperforming loans, asset quality ratios;

		
	viii.
	internal rate of return, increase in net present value; 

		
	ix.
	revenue, gross revenues, and pre-provision net revenue;

		
	x.
	gross margins, efficiency ratios, operating efficiency ratio;

		
	xi.
	expenses, expense reduction, expense control, expense efficiency ratios, noninterest expenses;

		
	xii.
	strategic plan development and implementation; 

		
	xiii.
	capital levels, capital preservation (core or risk based); 

		
	xiv.
	loan growth, loan closings, loan sales, loan portfolio composition;

		
	xv.
	stock price (including, but not limited to, total shareholder return, stock price, stock price appreciation, market capitalization) or market share;

		
	xvi.
	sustainability measures (such as percentage reduction in paper consumption); 

		
	xvii.
	growth in managed assets, return on securities held for investment, return on securities portfolio;

		
	xviii.
	book values, tangible book value;

		
	xix.
	change in deposits (including but not limited to an increase, decrease, or change in mix of deposits);

		
	xx.
	net interest margin, net interest margin on a fully tax equivalent basis; 

		
	xxi.
	capital ratios, leverage ratios, risk-weighted assets, equity to assets ratio, dividend payout ratio; or

		
	xxii.
	profit and any potential variant of profit or profitability. 

A Performance Goal need not be based upon an increase or positive result under a business criterion and could include, for example, maintaining the status quo or limiting economic losses.

(g) Adjustments.

At the time the Committee determines the terms of the Award, the Committee may specify adjustments to be applied to the calculation of the Performance Targets with respect to the relevant Performance Period to take into account certain items to the extent identified in the financial statements of the Company, including footnotes or in the Management’s Discussion and Analysis of Financial Condition accompanying the financial statements, or in the Compensation Discussion and Analysis section, if any, of the Company’s annual proxy statement, including, without limitation, any one or more of the following:
    
		
	i.
	the impact of changes in GAAP, tax rates, tax provisions, tax valuation allowances, regulations, or laws; 

		
	ii.
	the gain, loss, income, cost or expense reported publicly by the Company that are unusual in nature or infrequent in occurrence determined in accordance with GAAP; 

		
	iii.
	the gain, loss, income, cost or expense resulting from the disposition of a business, in whole or in part, or the sale of investments or non-core assets; 

		
	iv.
	the gain, loss, income, cost or expense from litigation or claims or settlements, including, but not limited to tax claim judgments or settlements;

		
	v.
	the gain, loss, income, cost or expense from regulatory proceedings or inquiries to the extent such proceeding or inquiries are not routine or ordinary course proceedings or inquires;

		
	vi.
	the gain, loss, income, cost or expense related to insurance recoveries, including but not limited to life insurance benefits; 

		
	vii.
	the impact of impairment of tangible or intangible assets, including but not limited to impairment on acquired facilities;

		
	viii.
	the impact of restructuring or business recharacterization activities, including but not limited to reductions in force, that are reported publicly by the Company; 

		
	ix.
	mergers and acquisition costs or expenses or impacts, purchase accounting items, acquisition integration costs or expenses, or costs or expenses or other impacts from acquisitions or dispositions of assets or liabilities; 

		
	x.
	pension costs or expenses;

		
	xi.
	the gain, loss, income, cost or expense from the sale of securities, including but not limited to fixed income securities;

		
	xii.
	the gain, loss, income, cost or expense on extinguishment of debt;

		
	xiii.
	the gain, loss, income, cost or expense on termination of derivatives;

		
	xiv.
	severance or termination related costs or expenses.

Notwithstanding anything to the contrary in the Plan, the Committee’s adjustment of any Performance Target(s) to take into account any of the items identified above shall not preclude the Committee’s exercise of negative discretion to the extent permitted under Section 3(c).

4.    Termination of Employment

(a) Death, Disability, or Retirement.

Unless otherwise determined by the Committee, if a Participant’s employment with the Company and its Subsidiaries terminates prior to payment of an Award by reason of the Participant’s death, Disability, or by reason of the Participant’s retirement from the Company and/or its Subsidiaries, the Participant will remain eligible, subject to Section 3, to receive an Award with respect to the applicable Performance Period. The Award shall be determined and payable in accordance with Section 3, except that the amount, if any, shall be prorated to take into account the number of days that the Participant was employed by the Company and its Subsidiaries during the Performance Period.

(b) Other Terminations.

Unless otherwise determined by the Committee, or otherwise required by applicable law, if a Participant’s employment with the Company and its Subsidiaries terminates prior to the payment of an Award for any reason not described in Section 4(a), the Participant’s participation in the Plan for the applicable Performance Period shall terminate and the Participant shall not be entitled to an Award for the applicable Performance Period.

5.    Deferral

Subject to applicable laws, including, without limitation, Section 409A, the Committee may permit a Participant to elect to defer a portion of an Award in accordance with the terms established by the Committee.   A deferral election may be made by a Participant no later than six (6) months prior to the end of the performance period, provided that (i) the performance period is at least 12 months long; (ii) the Participant performs services for the Company or a Subsidiary continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date the election is made; and (iii) the election to defer performance-based compensation is not made after such compensation has become readily ascertainable.  For these purposes, a right to payment is treated as readily ascertainable when it is substantially certain that the Performance Target(s) related to the Performance Goal(s) will be met.  The timing of any deferral election shall be further governed by the principles of and regulations under Section 409A.

6.    Effective Date

The Plan shall become effective upon its adoption by the Board.  The Company intends to seek shareholder approval of the Plan. Prior to shareholder approval, the Company may grant Awards under the Plan, including Awards intended to qualify as performance based compensation under Section 162(m). If shareholder approval is not obtained at or before the first annual meeting of shareholders to occur after adoption of the Plan by Board, (including any adjournment or adjournments of the meeting), the Plan and any Awards made under the Plan shall terminate ab initio and be of no further force and effect.

7.     Amendment and Termination

Subject to applicable laws, rules, and regulations, the Board or the Committee may at any time amend, suspend, discontinue or terminate the Plan; provided, however, that no such action shall be effective without approval by the shareholders of the Company to the extent necessary to continue to qualify the amounts payable under the Plan as performance-based compensation under Section 162(m).

8.     Miscellaneous

(a) Tax Withholding.

The Company or a Subsidiary, as appropriate, may require any Participant entitled to receive a payment of an Award to remit to the Company, prior to payment, an amount sufficient to satisfy any applicable tax withholding requirements. The Company or a Subsidiary, as appropriate, shall also have the right to deduct from all cash payments made to a Participant (whether or not the cash payment is made in connection with an Award) any applicable taxes required to be withheld with respect to the cash payment.

(b) No Rights to Awards or Employment.

The Plan is not a contract between the Company and a Participant. No Participant shall have any claim or right to receive Awards under the Plan. Nothing in the Plan shall confer upon any employee of the Company or any Subsidiary any right to continued employment with the Company or any Subsidiary or interfere in any way with the right of the Company or any Subsidiary to terminate the employment of any of its employees, in accordance with the laws of the applicable jurisdiction, at any time, with or without cause, including, without limitation, any individual who is then a Participant in the Plan.

(c) Section 409A.

If any provision of the Plan contravenes any regulations or guidance promulgated under Section 409A or could cause any Award to be subject to taxes, interest, or penalties under Section 409A, the Company may, in its sole discretion, modify the Plan to (a) comply with, or avoid being subject to, Section 409A, (b) avoid the imposition of taxes, interest, and penalties under Section 409A, or (c) maintain, to the maximum extent practicable, the original intent of the applicable provision without violating the provisions of Section 409A. The Company is not obligated to modify the Plan and there is no guarantee that any payments will be exempt from interest and penalties under Section 409A. Moreover, any discretionary authority that the Board or the Committee may have pursuant to the Plan shall not be applicable to an Award that is subject to Section 409A to the extent discretionary authority will contravene Section 409A.

(d) Other Compensation.

Nothing in the Plan shall preclude or limit the ability of the Company or any Subsidiary to pay any compensation to a Participant under the Company’s or the Subsidiary’s other compensation and benefit plans and programs, including without limitation any equity plan or bonus plan program or arrangement.

(e) No Limitation on Corporate Actions.

Nothing contained in the Plan shall be construed to prevent the Company or any Subsidiary from taking or not taking any corporate action, whether or not the action could have an adverse effect on any Awards made under the Plan. No Participant, beneficiary, or other person shall have any claim against the Company or any Subsidiary as a result of any corporate action that has an adverse effect on any Awards made under the Plan.

(f) Unfunded Plan.

To the extent an Award is deemed to constitute nonqualified deferred compensation within the meaning of Section 409A, the Plan is intended to constitute an unfunded plan for incentive compensation. Prior to the payment of any Award, nothing contained in the Plan shall give any Participant any rights that are greater than those of a general creditor of the Company. The Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan.

(g) Non-Transferability.

Except as set forth in Section 8(h), no Participant or beneficiary shall have the power or right to sell, transfer, assign, pledge, or otherwise encumber or dispose of the Participant’s interest under the Plan.

(h) Designation of Beneficiary.

A Participant may designate a beneficiary or beneficiaries to receive any payments which may be made following the Participant’s death in accordance with the Company’s policies as in effect from time to time. If a Participant does not designate a beneficiary, or the designated beneficiary or beneficiaries predeceases the Participant, any payments which may be made following the Participant’s death shall be made to the Participant’s estate.

(i) Severability.

If any provision of the Plan is held unenforceable, the remainder of the Plan shall continue in full force and effect without regard to the unenforceable provision and shall be applied as though the unenforceable provision were not contained in the Plan. Likewise, if any provision of the Plan would cause Awards not to constitute “qualified performance-based compensation” under Section 162(m) to a Covered Employee, that provision shall be severed from, and shall be deemed not to be a part of, the Plan, but the other provisions of the Plan shall remain in full force and effect. Any specific action by the Committee that would violate Section 162(m) shall be void.

(j) Expenses.

The costs and expenses of administering the Plan shall be borne by the Company.

(k) Governing Law.

The Plan and all actions taken thereunder shall be governed by and construed in accordance with and governed by the laws of the Commonwealth of Massachusetts.

(l) Clawback Provisions.

Any Awards made under the Plan are subject to the Incentive Compensation Recovery Policy (the “Clawback Policy”) approved by the Board, and/or any revisions or amendments to the Clawback Policy that the Board may subsequently adopt.  Participants in the Plan who are subject to the Clawback Policy acknowledge and agree by their participation in the Plan that, if the Clawback Policy is triggered, the Company will be entitled to recover any Award paid to them under this Plan in accordance with the terms and conditions of the Clawback Policy as now in existence and/or as it may be amended or revised by the Board.

9.     Definitions

For purposes of the Plan, the following terms shall be defined as follows:

“Award” means incentive compensation awarded under the Plan pursuant to Section 3.

“Board” means the Board of Directors of the Company.

“Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time, and the applicable rulings, regulations (including any proposed regulations) and guidance thereunder.

“Committee” means the Compensation Committee of the Board; provided, however if any member of the Compensation Committee does not qualify as an “outside director” for purposes of Section 162(m) (or any successor standard thereto), such individual shall not participate in the granting or administration of Awards intended to qualify as performance-based compensation exempt from the limitation on deductibility imposed by Section 162(m); provided, further, however, that the inadvertent participation by any member of the Committee not so qualified shall not otherwise invalidate any action or determination made by the Committee.

“Covered Employee”  means any Participant that the Committee reasonably expects to be a “covered employee” within the meaning of Section 162(m) with respect to the applicable Performance Period.

“Disability” means eligibility for disability benefits under the terms of the Company’s or a Subsidiary’s long-term disability plan in effect at the time the Participant becomes disabled; provided, however, that, if payment or settlement of an Award subject to Section 409A is to be accelerated solely as a result of a Participant’s Disability, Disability shall have the meaning set forth in Section 409A.

“EBITA” means the Company’s earnings before interest, taxes, and amortization.

“EBITDA” means the Company’s earnings before interest, taxes, depreciation, and amortization.

 “GAAP” means the United States Generally Accepted Accounting Principles, as in effect from time to time.

“Participant” means each executive officer and key employee of the Company or a Subsidiary whom the Committee designates as a participant under the Plan.

“Performance Goals” means the performance goals set forth in Section 3(f).

“Performance Period” means a fiscal year of the Company or such other period as may be designated by the Committee with respect to an Award.

“Performance Targets” means the performance targets related to the Performance Goals, which are established by the Committee for a Performance Period.

“Section 162(m)” means Section 162(m) of the Code, including any regulations promulgated pursuant to Section 162(m) of the Code.

“Section 409A” means Section 409A of the Code, including any regulations promulgated pursuant to Section 409(A) of the Code.

“Subsidiary” means (i) the Company’s wholly owned subsidiary Rockland Trust Company, a Massachusetts trust company chartered in 1907; (ii) any other corporation or other entity with respect to which the Company, directly or indirectly, has the power, whether through the ownership of voting securities, by contract or otherwise, to elect at least a majority of the members of such corporation’s board of directors or analogous governing body or and (iii) any other corporation or other entity in which the Company, directly or indirectly, has an equity or similar interest and which the Committee designates as a Subsidiary for purposes of the Plan.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00270-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00270-of-00352.parquet"}]]