Document:

dxlg-ex101_15.htm

Exhibit 10.1

DESTINATION XL GROUP, INC. 

FIFTH AMENDED AND RESTATED

NON-EMPLOYEE DIRECTOR COMPENSATION PLAN 

 

Section 1.  Establishment and Purpose

 

Destination XL Group, Inc. (the “Company”) hereby amends and restates the Destination XL Group, Inc. Fourth Amended and Restated Non-Employee Director Compensation Plan (as amended, the “Plan”), for the purpose of supporting the Company’s ongoing efforts to attract and retain exceptional directors to provide strategic guidance to the Company.  The Plan also provides a convenient method by which non-employee directors of the Company may acquire shares of Common Stock of the Company (“Shares”) at fair market value by voluntarily electing to receive Shares in lieu of fees otherwise payable to them in cash for service as a director or member of a committee of the Board of Directors of the Company (the “Board”). Any Shares acquired by a Participant pursuant to this Plan shall come out of the pool of Shares reserved for issuance under Section 4 of this Plan, subject to adjustment as the Board may from time to time determine.  The Participants are encouraged, but are not required, to select Shares for at least 50% of his/her compensation.   The Plan shall be effective as of November 6, 2020.  Elections for fiscal 2021 and thereafter must be submitted to the Company in accordance with Section 3(c) no later than December 31 of the year preceding the fiscal year for which the election is to be effective.

 

Section 2.  Definitions

 

When used herein, the following capitalized terms shall have the meanings assigned to them, unless the context clearly indicates otherwise.  Capitalized terms used herein and not defined shall have the meanings assigned to them in the Incentive Compensation Plan.

	
(a)
	
“Board Chair/Lead Director” means an independent director whose responsibilities, if the Board Chair, shall be as set forth for the Chairman of the Board in the Company’s By-laws, and, if the Lead Director, shall include the following and any other responsibilities determined by the Board: (i) presiding at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors; (ii) serving as liaison between the Chairman and the independent directors; (iii) reviewing and approving materials to be sent to the Board; (iv) approving the meeting agendas for the Board; (v) approving meeting schedules to assure that there is sufficient time for discussion of all agenda items; (vi) having the authority to call meetings of the independent directors; and (vii) if requested by major shareholders, ensuring that he or she is available for consultation and direct communication. 

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(b)
	
“Cash” means U.S. dollars.

 

	
(c)
	
“Commission” means the United States Securities and Exchange Commission or any successor agency.

 

	
(d)
	
“Common Stock” means the common stock of the Company, par value $.01 per share.

 

	
(e)
	
“Compensation” means an award under the Plan that is payable in the form of Cash and/or Shares pursuant to the terms and conditions set forth in this Plan.

 

	
(f)
	
“Compensation Payment Choice” means the form of payment of Compensation that a Participant selects in accordance with the terms hereof.

 

	
(g)
	
Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

 

	
(h)
	
“Grant Date” means the following: each quarterly retainer, Board Chair/Lead Director and committee chairperson fees payable pursuant to Sections 3(a)(i)-(iv) hereof shall be paid on, and the Grant Dates shall be, the first business day of each quarter in each fiscal year. 

 

	
(i)
	
“Incentive Compensation Plan” means the Company’s 2016 Incentive Compensation Plan, as amended from time to time, or any shareholder-approved successor plan to the Company’s 2016 Incentive Compensation Plan. 

 

	
(j)
	
“Irrevocable Election Agreement” means the written agreement, substantially in the form of Exhibit A, between the Company and a Participant, which, together with the Plan, governs the Participant’s rights to payment of Compensation under the Plan.

 

	
(k)
	
“NASDAQ” means The NASDAQ Stock Market, Inc., or other quotation system or exchange on which the Common Stock may be traded. 

 

	
(l)
	
“Non-Employee Director” means a Director who satisfies the requirements set forth in Rule 16b-3(b)(3)(i) under the Exchange Act.

 

	
(m)
	
“Participant” means a Non-Employee Director of the Company.

 

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(n)
	
“Plan” means this Destination XL Group, Inc. Fifth Amended and Restated Non-Employee Director Compensation Plan, as amended from time to time.

 

	
(o)
	
“Separation from Service” means the earliest date on which a Participant has incurred a separation from service, within the meaning of Section 409A(a)(2) of the Code, with the Service Recipient.

 

	
(p)
	
“Service Recipient” means the Company and all persons with whom the Company would be considered a single employer under Section 414(b) of the Code (employees of a controlled group of corporations), and all persons with whom such person would be considered a single employer under Section 414(c) of the Code (employees of partnerships, proprietorships, or other entities under company control).

 

	
(q)
	
“Treasury Regulations” means the regulations promulgated by the United States Treasury Department with respect to the Code, as amended from time to time.

 

Section 3.  Compensation; Irrevocable Election; Holding Requirement; Valuation. 

 

	
(a)
	
The Compensation paid to the Participants shall be as follows:

 

	
 
	
i.
	
a retainer equal to $30,000 per fiscal quarter;

	
 
	
ii.
	
to the Board Chair/Lead Director, a fee equal to $5,000 per fiscal quarter;

	
 
	
iii.
	
to the chairperson of the Company’s audit committee, a fee equal to $2,500 per fiscal quarter;

	
 
	
iv.
	
to the chairperson of any of the Company’s other committees, a fee equal to $1,250 per fiscal quarter.

 

The annual retainer, Board Chair/Lead Director and respective chairperson fees described above in Sections 3 (a)(i)-(iv), shall be earned on a quarterly basis based on the Company’s fiscal year and shall be payable by the Company on the first business day in each quarter in each fiscal year. In the event that, following the Grant Date, a Participant is initially elected or appointed to the Board on any date other than the first business day in each fiscal quarter (the Participant’s “Start Date)”, such Participant shall receive, on or as soon as practicable following such Start Date, a prorated portion of the retainer, Board Chair/Lead Director and chairperson fees, if applicable, otherwise payable to such Participant, with such prorated portion determined by multiplying the retainer, Board Chair/Lead Director and any applicable chairperson fees by a fraction, the numerator of which is the number of days remaining from the Start 

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Date until the end of the applicable fiscal quarter and the denominator of which is the number of days in the applicable fiscal quarter.  If a Participant notifies the Company that he/she will not stand for re-election at the Company’s Annual Meeting of Stockholders (the “Annual Meeting”), but will serve as a Participant up until the date of the Annual Meeting, Participant will receive a pro-rated portion of his/her next quarterly retainer, Board Chair/Lead Director and chairperson fees, as applicable, calculated from the first day of the quarter in which the Annual Meeting occurs until the date of the Annual Meeting, payable in cash.  

 

	
(b)
	
Participants will have the right to elect payments of the values set forth above in any combination of Cash or Shares. Subject to the terms hereof, Compensation shall be paid on the applicable Grant Date Compensation paid in the form of Shares shall be made pursuant to this Plan, and can only be made in such form if there is a sufficient number of shares of Common Stock available under this Plan.  Under Section 4 of this Plan, there is a maximum number of 250,000 Shares that may be granted each quarter. In the event that the Company does not have a sufficient number of shares of Common Stock due to this limit or if there is insufficient Shares remaining under this Plan to satisfy elections to receive Shares, the payments will be made in Cash to the extent of such insufficiency (Participants making similar elections will be allocated the remaining equity ratably in proportion to the respective equity amounts which would otherwise be payable to them absent such insufficiency).    

 

	
(c)
	
The elections by the Participants must be made in writing substantially in the form of Exhibit A attached hereto and submitted to the General Counsel of the Company (or such other person as the Committee shall designate) no later than December 31st of the year preceding the fiscal year for which the election is to be effective.  All elections once submitted, are irrevocable for that fiscal year.  In the event a timely election is not made or a person does not become a Participant until after the deadline for the election to be made or who becomes a Participant during a fiscal year, the payments will be made in cash until such election is made the following year.

 

	
(d)
	
Requirement to Hold Equity.  Each Participant is required to hold any form of equity paid to the Participant pursuant to this Plan until a Participant’s Separation from Service, unless the Board, in its sole discretion, permits a sale of equity prior to a Participant’s Separation from Service.

 

	
(e)
	
Valuation of Shares.  For the purposes of determining the number of Shares to be issued to a Participant on a Grant Date, each Share shall be assigned a value equal to the closing sale price of a share of Common 

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Stock as reported by NASDAQ, or other quotation system or exchange on which the Common Stock may be traded, on the effective Grant Date.  Any Shares granted pursuant to this Plan shall be fully vested on the Grant Date.  Payouts of Shares under the Plan will be in the form of whole Shares only; the de minimis balance of any foregone fees not payable in whole Shares will not be paid.

 

Section 4. Number of Shares Under the Plan.  Subject to adjustment as the Board may from time to time determine, the total number of Shares reserved and available under the Plan with respect to elections to receive Shares in lieu of fees was initially 500,000, and shall be increased to 1,500,000, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Common Stock.  Further, beginning with the first quarter payment for fiscal 2021, the maximum number of Shares that can be granted each quarter is 250,000 Shares. As discussed above, if the aggregate number of Shares needed for the payment of Compensation to all Participants in a given quarter exceeds 250,000 Shares, the provision of Section 3(b) shall apply. 

 

Section 5. Additional Compensation. In the event of the creation of a special Board committee tasked with working on a significant corporate event (a “Special Committee”), the Board shall determine the amount, timing and form of payment of any additional compensation which it determines should be paid to the Participants serving on the Special Committee.

 

Section 6.  Amendment and Termination. 

 

This Plan may be amended or terminated in any respect at any time by the Board; provided, however, that no amendment or termination of the Plan shall be effective to reduce any benefits that accrue and are vested before the adoption of such amendment or termination.  If and to the extent permitted without violating the requirements of Section 409A of the Code, the Committee may require that the Compensation of all Participants be paid in cash as soon as practicable after such termination, notwithstanding any elections by Participants with regard to the timing or form in which their benefits are to be paid.  If and to the extent that the Committee does not accelerate the timing of payments on account of the termination of the Plan pursuant to the preceding sentence, payment of any remaining benefits under the Plan shall be made at the same times and in the same manner as such payments would have been made based upon the most recent elections made by Participants, and the terms of the Plan, as in effect at the time the Plan is terminated. 

 

 

 

Section 7.  Unfunded Obligation. 

 

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The obligations of the Company to pay any Compensation under the Plan shall be unfunded and unsecured, and any payments under the Plan shall be made from the general assets of the Company.  Participants’ rights under the Plan are not assignable or transferable except to the extent that such assignment or transfer is permitted under the terms of the Incentive Compensation Plan (regardless of the fact that payment hereunder is not being made under the Incentive Compensation Plan).

 

Section 8.  Withholding. 

 

The Participants and personal representatives shall bear any and all federal, state, local or other taxes imposed on benefits under the Plan.  The Company may deduct from any payments under the Plan the amount of any taxes required to be withheld from such payments by any federal, state or local government, and may deduct from any Compensation or other amounts payable to the Participant the amount of any taxes required to be withheld with respect to any other amounts under the Plan by any federal, state or local government.

 

Section 9.  Applicable Law. 

 

This Plan shall be construed and enforced in accordance with the laws of the State of Delaware, except to the extent superseded by federal law.

 

Section 10.  Administration and Interpretation. 

 

The Plan will be administered by the Committee.  The Committee shall not make any substantive changes to the Compensation set forth in this Plan without the approval of the Board.  The Committee will have broad authority to adopt rules and regulations relating to the Plan and make decisions and interpretations regarding the provisions of the Plan.  Benefits due and owing to a Participant under the Plan shall be paid when due without any requirement that a claim for benefits be filed.  However, any Participant who has not received the benefits to which Participant believes himself or herself entitled may file a written claim with the Committee, which shall act on the claim within thirty days.  Any decisions or interpretations by the Committee relating to benefits under the Plan shall be binding and conclusive on all affected parties.

 

Section 11.  Code Section 409A. 

 

It is intended that the Compensation granted pursuant to this Plan be exempt from Section 409A of the Code (“Section 409A”) because it is believed the Compensation payable in cash and Shares should qualify for the short-term deferral exception contained in Treasury Regulation §1.409A-1(b)(4). The provisions of the Plan shall be interpreted in a manner consistent with the foregoing intentions.  

 

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The Committee, in its sole discretion, and without the consent of any Participant or Beneficiary, may amend the provisions of this Plan to the extent that the Committee determines that such amendment is necessary or appropriate in order for the Compensation paid pursuant to the Plan to be exempt from the requirements of Section 409A, or if and to that the Committee determines that the Compensation is not so exempt, to amend the Plan  (and any agreements relating to any Compensation) in such manner as the Committee determines shall deem necessary or appropriate to comply with the requirements of Section 409A.  

 

Notwithstanding the foregoing, the Company does not make any representation to any Participant or Beneficiary that the Compensation paid pursuant to this Plan is exempt from, or satisfies, the requirements of Section 409A, and the Company shall have no liability or other obligation to indemnify or hold harmless any Participant or Beneficiary for any tax, additional tax, interest or penalties that the Participant or Beneficiary may incur in the event that any provision of the Plan or any Compensation agreement, or any amendment or any modification thereof, or any other action taken with respect thereto, is deemed to violate any of the requirements of Section 409A.

 

 

 

 

THIS SPACE IS LEFT BLANK INTENTIONALLY

 

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EXHIBIT A

DESTINATION XL GROUP, INC.

FIFTH AMENDED AND RESTATED NON-EMPLOYEE DIRECTOR COMPENSATION PLAN

IRREVOCABLE ELECTION AGREEMENT

 

TO:General Counsel:

 

I, _____________________________, hereby elect to receive my Destination XL Group, Inc. Non-Employee Director Compensation (as defined in the Destination XL Group, Inc. Fifth Amended and Restated Non-Employee Director Compensation Plan (the “Plan”)) as follows:

 

				
	
 

 

 

COMPENSATION
	
 

 

 

Cash
	
 

DXLG 

Shares
	
 

 

 

TOTAL

	
 

 

Retainer*
	
 

 

_______%
	
 

 

______%
	
 

 

100%

	
 

 

Board Chair / 

Lead Director
	
 

 

_______%
	
 

 

______%
	
 

 

100%

	
 

Committee Chair Fee
	
 

 

_______%
	
 

 

______%
	
 

 

100%

 

*Participants are encouraged, but are not required, to select at least 50% of Retainer in the form of DXLG Stock.  

 

NOTE: You have the opportunity to decide the Compensation Payment Choice of Cash and/or DXLG Shares. Your selected choice(s) for any given year must equal 100%.  

 

I understand and acknowledge that as discussed in Section 4 of the Plan, if the aggregate equity to be granted to all Participants in a quarter exceeds the maximum number of Shares permitted, I will receive a pro-rated allocation of that maximum amount, with the shortfall paid in Cash.  

 

I understand and acknowledge that any equity must be held until my Separation from Service, unless the Board, in its sole discretion, permits a sale of equity prior to my Separation from Service.

 

I understand and acknowledge that this election is irrevocable.  I understand and acknowledge that I must be a Non-Employee Director of the Company on the dates each portion of the Compensation is paid in order to qualify for such payment.

 

I understand and acknowledge that if there is any conflict between this form or any part of it and the Plan, the provisions of the Plan shall govern. 

 

I have hereunto set my hand and seal this ____ day of ___________, 20___.

 

 

_________________________________________________________

 (Signature)(Printed name) 

8ex_215091.htm

Exhibit 10.1

 

MERCANTILE BANK CORPORATION/MERCANTILE BANK OF MICHIGAN

 

2020 MERCANTILE EXECUTIVE OFFICER BONUS PLAN

 

 

 

	
			1. 

				
			Purpose of this Plan

			

 

This 2020 Mercantile Executive Officer Bonus Plan (this “Plan”) is designed to reflect that the directors of Mercantile Bank Corporation (the “Company”) and Mercantile Bank of Michigan (the “Bank”) believe that the Company’s shareholders are willing to share financially in operating results that exceed certain specific financial metrics.

 

The purpose of this Plan is to:

 

	 	
			•

				
			Promote the growth, profitability and expense control necessary to accomplish corporate strategic long-term plans;

			

 

	 	
			•

				
			Encourage superior results by providing a meaningful incentive; and

			

 

	 	
			•

				
			Support teamwork among employees.

			

 

	
			2. 

				
			Eligibility

			

 

Robert B. Kaminski, Jr., Charles E. Christmas, Raymond E. Reitsma, Robert T. Worthington and Lonna Wiersma (the “Executive Officers,” and each an “Executive Officer”) are included in this Plan. The following provisions (a) – (d) set forth circumstances where an Executive Officer will, or will not, be eligible for a bonus payout, or where an unpaid bonus award will be cancelled:

 

(a) Except as provided below, an Executive Officer must be an active employee as of December 31, 2020 to be eligible to receive a bonus payout.

 

(b) An Executive Officer that is out on medical leave as of December 31, 2020 will be eligible to receive a bonus award.

 

(c) An Executive Officer that is suspended with or without pay or is on final written warning as of December 31, 2020 will not be eligible to receive a bonus award.

 

(d) If an Executive Officer terminates his or her employment with the Bank during 2020, any unpaid bonus award for the Executive Officer is cancelled.

 

1

 

 

Notwithstanding any of the provisions (a), (b), (c) or (d) above, no such provision shall adversely affect an Executive Officer’s eligibility for, or right to receive, any bonus award, if during 2020, or during the first four months of 2021 pursuant to a notice given in 2020, the employment of the Executive Officer terminates under one or more circumstances set forth in Section 8.5 or 9 of the Employment Agreement dated as of November 29, 2018, and effective as of December 31, 2018, between such Executive Officer, the Company and the Bank, in which case, such Executive Officer is eligible for 100% of his or her bonus payout (a “Special Termination”).

 

	
			3. 

				
			Bonus Pool, Performance Metrics and Bonus Awards

			

 

The maximum amount that will be allocated to the bonus pool under this Plan (the “Executive Bonus Pool”) is $645,765, provided, however, that the maximum amount will be appropriately adjusted if (a) a newly hired employee becomes a named executive officer (as defined in Item 402(a)(3) of SEC Regulations S-K) and becomes eligible to participate in this Plan, (b) an Executive Officer's base salary is adjusted during the year, or (c) an Executive Officer becomes ineligible before December 31, 2020.

 

Payment from the Executive Bonus Pool, if any, is based on the achievement of targets under the following 2020 Executive Bonus Metrics:

 

12.5%     Non-performing assets

12.5%     Commercial loan portfolio composition

12.5%     Net interest margin

12.5%     Non-interest income

12.5%     Efficiency ratio

12.5%     Return on assets

12.5%     Return on equity

12.5%     Wholesale funds

 

The specific targets for each metric will be established by the Compensation Committee of the Company.

 

Each individual target must be met or exceeded in order for the percentage associated with that metric to be credited toward payment from the Executive Bonus Pool. The accumulated percentage for each individual target attained will be applied to the Executive Bonus Pool to determine the total amount of the Executive Bonus Pool to be awarded (the “Award Amount”). For example, if the first four factors are attained and the next four factors are not attained, and if the maximum amount is allocated to the Executive Bonus Pool, the Award Amount under this Plan would be $645,765 x 50% = $322,882.50.

 

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The Award Amount will be paid to each Executive Officer pro rata based on a uniform percentage of the Executive Officer's 2020 salary, not to exceed:

 

	 	
			●

				
			45% of the 2020 salary of the Chief Executive Officer;

			

	 	
			●

				
			35% of the 2020 salary of each of the Chief Financial Officer and the President of the Bank;

			

	 	
			●

				
			27.5% of the 2020 salary of the Chief Operating Officer; and

			

	 	
			●

				
			27.5% of the 2020 salary of the Human Resources Director.

			

 

	
			4. 

				
			Clawback Provision

			

 

Payouts made under this Plan are subject to recovery or clawback, and an Executive Officer receiving a payout will be required to promptly return the monies (or any portion of the monies requested by the Company) in each of the following circumstances:

 

	 	
			●

				
			if it is determined that the Executive Officer was engaging in an activity during 2020 that would have resulted in the employee being suspended without pay, placed on final written warning or terminated on or before December 31, 2020, and no Special Termination of the Executive Officer is involved.

			

 

	 	
			●

				
			If the payout is based on materially inaccurate financial statements (which includes, but is not limited to statements of earnings, revenues, or gains) or any other materially inaccurate performance metric criteria, including net income.

			

 

	 	
			●

				
			If the payout is required to be returned pursuant to a policy adopted by the Company regarding clawback in order to comply with the Dodd-Frank Wall Street Reform and Consumer Protection Act or any stock exchange or other rule adopted pursuant to that Act.

			

 

In the event that the Company or Bank demands recovery or clawback of any payout (or portion of any payout), and the Executive Officer who received the payout does not promptly return the payout (or demanded portion of the payout) to the Company or the Bank, the Executive Officer shall be required to pay to the Company or the Bank, immediately upon demand, all expenses, including reasonable attorneys’ fees, incurred to recover the payout (or demanded portion of the payout), unless the Executive Officer establishes in an appropriate legal proceeding that he or she had no obligation under this Section of this Plan to return the payout (or demanded portion of the payout). Executive Officers, as a condition to receiving a payout under this Plan, may be required to agree in writing to the terms of this Section.

 

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			5. 

				
			Timing of Bonus Payouts

			

 

Bonus awards that are earned under this Plan will be paid to eligible Executive Officers on or before March 15, 2021.

 

	
			6. 

				
			Plan Administration

			

 

The Board of Directors of the Company and the its Compensation Committee, or if the Board of Directors of the Company so designates, another committee of the Board of Directors of the Company or the Bank (each, an "Administrator"), will each have the authority to administer and interpret this Plan, and approve or determine the amounts to be distributed under this Plan as bonus awards, in its sole discretion. Any interpretation or construction of this Plan or approval or determination of bonus awards by an Administrator will be final and binding on the Company, the Bank and their respective subsidiaries, all employees and past employees of any of them, their heirs, successors and assigns. No member of the Board of Directors of the Bank or the Company, or any of their affiliates, or any committee of the Board of Directors of the Bank, the Company, or any affiliate, will be liable for any action or determination made in good faith regarding this Plan or any bonus award.

 

	
			7. 

				
			No Right to Employment

			

 

This Plan does not give any Executive Officer any right to continued employment, or limit in any way the right of the Bank or any affiliated company to terminate his employment at any time.

 

	
			8. 

				
			Withholding of Taxes

			

 

The Bank and any affiliated company will have the right to deduct from any payment to be made pursuant to this Plan any Federal, state or local taxes required by law to be withheld. It is contemplated that substantially all payments that are made under this Plan will be made by the Bank or one of its subsidiaries, and not by the Company.

 

	
			9.

				
			Amendment of this Plan

			

 

This Plan may be amended from time to time by the Compensation Committee of the Company, without the consent of any Executive Officer or past Executive Officer, (a) to the extent required to comply with applicable law; (b) to make reasonable adjustments for any acquisition or sale of a business or branch, merger, reorganization, or restructuring, change in accounting principles or their application, or special charges or extraordinary items, that materially affect the Company or any of its consolidated subsidiaries; (c) to make any changes that do not materially and adversely affect the bonus award payable to any eligible employee; (d) to expand the Executive Officers or other employees who are eligible to receive a bonus from the amounts available for bonuses under this Plan; or (e) to make any other changes that the Compensation Committee of the Company, in its sole discretion, deems appropriate, even if such changes materially and adversely affect, or eliminate, the bonus award payable to any Executive Officer or past Executive Officer; provided that, after a Special Termination or notice that will result in a Special Termination, no amendment made under provision (d) or (e) of this paragraph above shall adversely affect an Executive Officer’s rights under this Plan.

 

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			10. 

				
			Governing Law

			

 

The validity, construction and interpretation of this Plan will be determined in accordance with the laws of the State of Michigan.

 

	
			11.

				
			Effective Date

			

 

This Plan was approved by the Boards of Directors of the Company and the Bank on November 19, 2020, and is effective as of January 1, 2020.

 

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