Document:

krny-ex1019_115.htm

 

Exhibit 10.19

 

 

KEARNY BANK

AMENDED AND RESTATED 

CHANGE IN CONTROL SEVERANCE PAY PLAN

 

	
A.
	
Purpose.

 

The primary purpose of the Kearny Bank Amended and Restated Change in Control Severance Pay Plan (the “Plan”) is to recruit and foster the continuous employment of key management personnel of Kearny Bank (the “Bank”) and to reinforce and encourage their continued attention and dedication to their duties in the event of any potential or actual Change in Control (as defined below), although no such change is now apparent or contemplated.

 

	
B.
	
Covered Participants.

 

Any Participant, subject to paragraph C below, with at least one year of service as of his or her termination date shall be eligible to receive a Change in Control Severance Benefit (as defined below) if, within the period beginning on the effective date of a Change in Control and ending on the first anniversary of such date, (i) the Participant’s employment with the Bank is involuntarily terminated or (ii) the Participant terminates employment with the Bank voluntarily after being offered continued employment in a position that is not a Comparable Position (as defined below).

 

For purposes of this Plan, a “Participant” shall mean an employee of the Bank who has been named an officer of the Bank with a title of not less than Vice President.

	
C.
	
Limitations on Eligibility for Change in Control Severance Benefits.

 

	
 
	
(1)
	
No Participant shall be eligible for a Change in Control Severance Benefit if (a) his or her employment is terminated for “Cause,” (b) he or she is offered a Comparable Position and declines to accept such position, or (c) the Participant is, at the time of termination of employment, a party to an individual employment agreement or change in control agreement with the Bank and/or Kearny Financial Corp. (the “Company”).

 

	
 
	
(2)
	
For purposes of this Plan, a termination of employment for “Cause” shall include termination because of the Participant’s personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule, or regulation (other than traffic violations or similar offenses) or final cease-and-desist order.

 

 

 

	
 
	
(3)
	
For purposes of this Plan, a “Comparable Position” shall mean a position that would (a) provide the Participant with base compensation and benefits that are comparable in the aggregate to those provided to the Participant prior to the Change in Control; (b) provide the Participant with an opportunity for variable bonus compensation that is comparable to the opportunity provided to the Participant prior to the Change in Control; (c) be in a location that would not require the Participant to increase his or her daily one way commuting distance by more than twenty-five (25) miles as compared to the Participant’s commuting distance immediately prior to the Change in Control; and (d) have job skill requirements and duties that are comparable to the requirements and duties of the position held by the Participant prior to the Change in Control.

 

	
 
	
(4)
	
A Participant shall cease to be a Participant in the Plan when the Participant ceases to be an employee of the Bank, unless such Participant is entitled to benefits under the Plan.  A Participant entitled to benefits under the Plan shall remain a Participant in this Plan until he or she has received full payment of his or her Plan benefits.

 

D.Definitions of Change in Control.

 

For purposes of this Plan, a “Change in Control” means any of the following events:

	
 
	
(1)
	
Merger:  The Company or the Bank merges into or consolidates with another entity, or merges another Bank or corporation into the Bank or the Company, and as a result, less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of the Company or the Bank immediately before the merger or consolidation;

	
 
	
(2)
	
Acquisition of Significant Share Ownership:  A person or persons acting in concert has or have become the beneficial owner of 25% or more of a class of the Company’s or the Bank’s voting securities; provided, however, this clause (2) shall not apply to beneficial ownership of the Company’s or the Bank’s voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities;

	
 
	
(3)
	
Change in Board Composition:  During any period of two consecutive years, individuals who constitute the Company’s or the Bank’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Company’s or the Bank’s Board of Directors; provided, however, that for purposes of this clause (c), each director who is first elected by the board (or first nominated by the board for election by the stockholders or corporators) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period shall be deemed to have also been a director at the beginning of such period; or

	
 
	
(4)
	
Sale of Assets:  The Company or the Bank sells to a third party all or substantially all of its assets.

 

2

 

 

E.Determination of the Change in Control Severance Benefit.

 

	
 
	
(1)
	
The Change in Control Severance Benefit payable to an eligible Participant under this Plan shall be determined under the following schedule:

 

	
 
	
(a)
	
An eligible Participant shall receive a Change in Control Severance Benefit equal to the product of (i) the Participant’s years of credited service from his or her hire date (including partial years) through the termination date and (ii) an amount equal to three weeks of the Participant’s Base Compensation (as defined below).  A “year of credited service” shall mean each twelve (12)-month period of service following a Participant’s hire date determined without regard the number of hours worked during such period(s), provided, however, that upon the written resolution of the Compensation Committee (which may take into consideration recommendations by the President and Chief Executive Officer of the Company or the Bank), an eligible Participant may be credited with additional years of credited service hereunder in order to increase the Severance Benefit payable to such person.  The minimum payment to an eligible Participant under this paragraph shall be an amount equal to four (4) months of Base Compensation and the maximum payment to an eligible Participant shall be an amount equal to nine (9) months of Base Compensation.

 

	
 
	
(b)
	
The Change in Control Severance Benefit shall be paid in a lump sum not later than five (5) business days after the date of the Participant’s termination of employment.

 

	
 
	
(2)
	
For purpose of determinations under this paragraph E, “Base Compensation” shall mean: 

 

	
 
	
(a)
	
For salaried Participants, the Participant’s annual base salary at the rate in effect on his or her termination date or, if greater, the rate in effect on the date immediately preceding the Change in Control.

 

	
 
	
(b)
	
For Participants whose compensation is determined in whole or in part on the basis of commission income, the Participant’s base salary at termination (or, if greater, the Participant’s base salary on the date immediately preceding the effective date of the Change in Control), if any, plus the commissions earned by the Participant in the twelve (12) full calendar months preceding his or her termination date (or, if greater, the commissions earned in the twelve (12) full calendar months immediately preceding the effective date of the Change in Control).

 

	
 
	
(c)
	
For Participants who are compensated on an hourly basis, the Participant’s total hourly wages for the twelve (12) full calendar months preceding his or her termination date or, if greater, the twelve (12) full calendar months preceding the effective date of the Change in Control.

 

	
 
	
(3)
	
Notwithstanding the foregoing, in the event the party that enters into the merger or change in control transaction with the Bank or the Company (the “Acquiror”) sponsors a severance pay plan, then the eligible Participant will receive the greater of the benefit described above or the severance benefits of the Acquiror, whichever is greater.

 

F.Withholding.

 

All payments will be subject to customary withholding for federal, state and local tax purposes.

 

3

 

 

G.Parachute Payment.

 

Notwithstanding anything in this Plan to the contrary, if a Change in Control Severance Benefit to a Participant who is a “Disqualified Individual” shall be in an amount which includes an “Excess Parachute Payment,” taking into account payments under this Plan and otherwise, the benefit payable under this Plan shall be reduced to the maximum amount which does not include an Excess Parachute Payment.  The terms “Disqualified Individual” and “Excess Parachute Payment” shall have the same meanings as under Section 280G of the Internal Revenue Code of 1986, as amended, or any successor provision thereto.

 

H.Administration.

 

The Plan is administered by the Compensation Committee, which shall have the discretion to interpret the terms of the Plan and to make all determinations about eligibility and payment of benefits.  Notwithstanding anything in the Plan to the contrary, the Board of Directors of the Bank may, in its discretion, take any action and exercise any power, privilege or discretion conferred on the Compensation Committee under the Plan with the same force and effect under the Plan as if done or exercised by the Committee.  All decisions of the Compensation Committee, any action taken by the Compensation Committee with respect to the Plan and within the powers granted to the Compensation Committee under the Plan, and any interpretation by the Compensation Committee of any term or condition of the Plan, are conclusive and binding on all persons, and will be given the maximum possible deference allowed by law.  The Compensation Committee may delegate and reallocate any authority and responsibility with respect to the Plan.

 

I.Source of Payments.

 

Unless otherwise determined by the Compensation Committee, all payments and benefits provided under this Agreement shall be paid solely by the Bank or its successors.  Notwithstanding anything in this Agreement to the contrary, no provision of this Agreement shall be construed so as to result in the duplication of any payment or benefit.  

 

J.Inalienability.

 

In no event may any Participant sell, transfer, anticipate, assign or otherwise dispose of any right or interest under the Plan.  At no time will any such right or interest be subject to the claims of creditors, nor liable to attachment, execution or other legal process.

 

K.Governing Law.

 

The provisions of the Plan will be construed, administered and enforced in accordance with the laws of the State of New Jersey, except to the extent that federal law applies.

 

L.Severability.

 

If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will be construed and enforced as if such provision had not been included.

 

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M.No Employment Rights.

 

Neither the establishment nor the terms of this Plan shall be held or construed to confer upon any Participant the right to a continuation of employment by the Bank, nor constitute a contract of employment, express or implied.  The Bank reserves the right to dismiss or otherwise deal with any Participant to the same extent and on the same basis as though this Plan had not been adopted.  Nothing in this Plan is intended to alter the at-will status of the Bank’s employees, it being understood that, except to the extent otherwise expressly set forth to the contrary in an individual employment-related agreement, the employment of any employee may be terminated at any time by either the Bank or the employee with or without cause.

 

N.Amendment and Termination.

 

The Plan may be terminated or amended in any respect by resolution adopted by a majority of the Board of Directors, unless a Change in Control has previously occurred.  If a Change in Control occurs, the Plan no longer shall be subject to amendment, change, substitution, deletion, revocation or termination in any respect whatsoever.  The form of any proper amendment or termination of the Plan shall be a written instrument signed by a duly authorized officer or officers of the Bank, certifying that the amendment or termination has been approved by the Board of Directors.  A proper amendment of the Plan automatically shall effect a corresponding amendment to each Participant’s rights hereunder.  A proper termination of the Plan automatically shall effect a termination of all Participants’ rights and benefits hereunder.  This Plan supersedes in its entirely the Kearny Bank Officer Change in Control Severance Pay Plan that was adopted effective as of May 18, 2015.

 

O.Required Provisions.

 

	
 
	
(1)
	
In the event any of the provisions of this paragraph O are in conflict with the terms of this Plan, this paragraph O shall prevail.

 

	
 
	
(2)
	
Any payments made to Participants pursuant to this Plan, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

 

	
 
	
(3)
	
Notwithstanding anything else in this Plan to the contrary, a Participant’s employment shall not be deemed to have been terminated unless and until the Participant has a Separation from Service within the meaning of Code Section 409A.  For purposes of this Agreement, a “Separation from Service” shall have occurred if the Bank and the Participant reasonably anticipate that either no further services will be performed by the Participant after the date of termination (whether as an employee or as an independent contractor) or the level of further services performed is less than fifty (50) percent of the average level of bona fide services in the thirty-six (36) months immediately preceding the termination.  For all purposes hereunder, the definition of Separation from Service shall be interpreted consistent with Treasury Regulation Section 1.409A-1(h)(ii).  

 

	
 
	
(4)
	
Notwithstanding the foregoing, if a Participant is a “specified employee” (i.e., a “key employee” of a publicly traded company within the meaning of Section 409A of the Code and the final regulations issued thereunder) and any payment under this Plan is triggered due to the Participant’s Separation from Service, then solely to the extent necessary to avoid penalties under Section 409A of the Code, no payment shall be made during the first six (6) months following the Participant’s Separation from Service.  Rather, any payment which would otherwise be paid to the Participant during such period shall be accumulated and paid to the Participant in a lump sum on the first day of the seventh month following such Separation from Service.  All subsequent payments shall be paid in the manner specified in this Plan.

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P.Claims Procedures and Arbitration.

 

	
 
	
(1)
	
In the event that benefits under this Plan are not paid to the Participant and such Participant (or former Participant) feels entitled to receive such benefits, then a written claim must be made to the Compensation Committee within sixty (60) days from the date payments are refused. The Compensation Committee shall review the written claim and, if the claim is denied, in whole or in part, they shall provide in writing, within thirty (30) days of receipt of such claim, their specific reasons for such denial, reference to the provisions of this Plan upon which the denial is based, and any additional material or information necessary to perfect the claim. Such writing by the Compensation Committee shall further indicate the additional steps which must be undertaken by the Participant or former Participant if an additional review of the claim denial is desired.

 

	
 
	
(2)
	
If the Participant or former Participant desires a second review, he or she shall notify the Compensation Committee in writing within thirty (30) days of the first claim denial. The Participant or former Participant may review this Plan or any documents relating thereto and submit any issues and comments, in writing, they may feel appropriate. In its sole discretion, the Compensation Committee shall then review the second claim and provide a written decision within thirty (30) days of receipt of such claim. This decision shall state the specific reasons for the decision and shall include reference to specific provisions of this Plan upon which the decision is based.

 

	
 
	
(3)
	
If claimants continue to dispute the benefit denial based upon completed performance of this Plan or the meaning and effect of the terms and conditions thereof, it shall be settled by arbitration administered by the AAA under its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.

 

 

Q.Successors.

 

The provisions of this Plan shall bind and inure to the benefit of the Bank and its successors and assigns.  The term “successors” as used herein shall include any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise acquire all or substantially all of the business and assets of the Bank, and successors of any such corporation or other business entity.

 

[Signature page follows]

 

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This plan has been approved and adopted by the Board of Directors of the Bank and is effective as of June 19, 2019.

 

 

		
	
KEARNY BANK

	
 

	
 

	
By:
	
/s/ Craig L. Montanaro

	
 
	
Craig L. Montanaro

	
 
	
President and Chief Executive Officer

 

7krny-ex1020_759.htm

 

Exhibit 10.20

 

 

Executive Management Incentive Compensation Program 

 

This document outlines the Kearny Bank Executive Management Incentive Compensation Program (the “Program”) by and between Kearny Financial Corp. (“Kearny”), its subsidiary Kearny Bank (the “Bank”), and the Executive (the “Participant”).

	
 
	
1.
	
Purpose
	
 

The Program is designed to recognize and reward executives for their contribution to the Bank’s performance. The Program is designed to reward predefined performance goals that are critical to the Bank’s profitability, growth and prudent management of business risk. The Program is further intended to assist Kearny in its ability to motivate, attract and retain qualified executives. 

	
 
	
2.
	
Effective Date

The Program is in effect July 1, 2016 through June 30, 2017, and will continue to renew for successive one-year periods (each year being a “Program Year”) unless otherwise terminated or modified in accordance with the Program and specifically approved by the Compensation Committee (the “Committee”) of the Kearny Board of Directors (the “Board”).  

	
 
	
3.
	
Eligibility

Participation is limited to those executives recommended by the Chief Executive Officer and approved by the Committee during the first 90 days of each Program Year. The Committee shall retain the discretion to include as a Participant any otherwise-eligible executive hired or promoted after the commencement of a Program Year.

 

	
 
	
4.
	
Basis of Incentive Compensation Award

The Participant’s incentive compensation award under the Program is based on an incentive target that is approved at the beginning of the Program Year by the Committee (or its delegee) in its discretion. The incentive award is expressed as a percentage of the Participant’s base salary, and may be awarded if either or both the Kearny corporate goals (the “Corporate Goals”) and the Participant’s individual goals (the “Individual Goals”) are achieved, along with a “performance gate”.  In no event shall a Participant receive payment under the Program that exceeds 200% of the Participant’s base salary for the Program Year.

	
 
	
5.
	
 Program Details

The amount of incentive compensation that the Participant is entitled to receive under the Program is determined based on the Participant’s award target and weighting and achievement of the approved performance goals. The performance period for achievement of any performance goal(s) is the Program Year. 

	
 
	
a.
	
 Award Targets and Weightings

Each Participant shall be assigned an incentive award target, calculated as a percentage of the Participant’s base salary, which may be awarded if Kearny and the Participant achieve targeted performance goals.

Target awards shall be weighted between Corporate Goals and Individual Goals. The weightings for the two goal categories shall be recommended by the Chief Executive Officer and presented to the Committee for review and approval. Threshold, target and superior achievement levels for each Corporate Goal and Individual Goal will be recommended by the Chief Executive Officer and presented to the Committee for review and approval. The payout for 

1

 

 

the threshold achievement level will be not less than 0% of the target payout, and the payout for the superior achievement level will be not more than 200% of the target payout.

	
 
	
b.
	
 Program Funding

A funding trigger is in place for the program. The Program is funded at the superior level if the Company has positive operating earnings for the Program Year.  The incentive awards paid are then determined by the Committee using the performance measures selected for the Program Year.  In other words, the funded amount is adjusted downwards to reflect actual performance.

	
 
	
c.
	
Performance Gate

The Bank must achieve at minimum 50% of the budgeted net income (“Threshold Net Income”) for the Program Year for any incentive compensation to be paid.  Corporate and/or Individual Goals are capped at target if a Threshold Net Income is less than 75% of Program Year budgeted net income.

The program may be adjusted for extraordinary items at the discretion of the Compensation Committee with Board approval.

	
 
	
d.
	
Corporate Goals

The Corporate Goals for the Program Year will be recommended by the Chief Executive Officer and approved in writing by the Committee within the first 90 days of the Program Year.

	
 
	
e.
	
 Individual Goals

Individual Goals for the Program Year will be established for each Participant in conjunction with his or her direct supervisor and will be presented to the Committee for review and approval.

	
 
	
f.
	
 Determination of Incentive Compensation Award

The Committee will review performance against the Corporate Goals and any Individual Goals established for the Participant once the audited financial results are confirmed, certify in writing that the applicable performance goals were satisfied, and determine the amount of the incentive compensation award, if any, to be paid to each Participant under the Program. Notwithstanding any provision of the Program to the contrary, in making this determination, the Committee may, in its discretion, in light of such considerations as it may deem relevant, increase or decrease any payments to which a Participant would otherwise be entitled by such amount or percentage as the Committee deems appropriate. 

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6.
	
Administrative Matters

 

	
 
	

	

	
 
	
a.
	
 Administration of the Program

Responsibility for the administration of the Program, as described herein, rests with the Committee. The Chief Executive Officer shall monitor for accuracy the performance reporting of the Participant and make recommendations to the Committee concerning the amount of the Participant’s awards under the Program. In addition, the Committee, and ultimately the Board, is responsible for the overall oversight, supervision and existence of the Program. The Committee has been delegated the sole discretion to interpret the terms of the Program, to determine eligibility for benefits, and to calculate and render final incentive compensation awards under the Program. The Committee shall also be empowered to make any and all of the determinations not herein specifically authorized which may be necessary or desirable for the effective administration of the Program.

Unless the Committee deems otherwise, awards will not be earned or paid, regardless of Corporate or 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 the Program or 2) after a review of the Company’s credit quality measures the Committee considers it imprudent to provide awards under the Program.

The Committee may withhold or adjust any incentive compensation award in its sole discretion as it deems appropriate and will notify the Participant of its decision to withhold or adjust an incentive compensation award. 

Any decision or interpretation of any provision of the Program adopted by the Committee shall be final and conclusive.

	
 
	
b.
	
 Active Participation Required

 

	
 
	
i.
	
New Hires, Promotions, and Transfers

 

Participants who are not employed by the Bank at the beginning of the Program Year will receive a pro-rata incentive award based on their length of employment during a given year.

 

A Participant whose work schedule changes during the year will be eligible for pro-rated treatment that reflects his/her time in the different schedules.

 

If a Participant changes his/her role or is promoted during the Program Year, he/she will be eligible for the new role’s target incentive award on a pro rata basis (i.e. the award will be prorated based on the number of months employed in the respective positions.)

 

	
 
	
ii.
	
Termination of Employment – General

 

Unless otherwise specified in this Program, and as the Program is designed to encourage employees to remain in the employment of the Bank or its affiliates, a Participant must be an active employee of the Bank at the time the award is paid.

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iii.
	
Termination of Employment without Cause

 

Unless otherwise noted in the Program, if a Participant is involuntarily terminated by the Bank or the Company without “cause” (as defined below), the Participant’s potential incentive award may, in the sole discretion of the Compensation Committee, be prorated.  The Compensation Committee will consider the following factors in its pro-ration process: (i) reason for termination of employment, (ii) level of achievement of the Participant’s goals as of the Participant’s date of termination, and (iii) other factors the Committee deems relevant to the specific situation.

 

For purposes of this Program, a termination for “cause” shall mean termination because of a Participant’s personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform his or her job functions, willful violation of any law, rule, regulations (other than a traffic violation or similar offenses) or the Participant’s breach of any cease and desist order issued by the Office of the Comptroller of the Currency (or any successor agency) or the U.S. Securities and Exchange Commission.

 

	
 
	
iv.
	
Voluntary Resignation of Employment or Termination for Cause

 

If a Participant voluntarily resigns or is terminated by the Bank for cause, no incentive award will be paid to the Participant.

 

	
 
	
v.
	
Voluntary Resignation for Good Reason  

 

If a Participant maintains an employment or change in control agreement with the Bank or the Company and terminates his or her employment with the Bank for Good Reason (as defined in the applicable employment or change in control agreement), the Participant will receive a pro-rated incentive award.  The Compensation Committee will prorate the award based on the Participant’s base salary earned as of his or her termination date or other factors the Compensation Committee deems relevant to the proration process.

 

	
 
	
vi.
	
Disability, Death and Retirement

 

A Participant that is receiving long-term disability benefits will not be considered “actively employed” for the purposes of the Program and therefore will not be eligible to receive incentive awards during the period in which the Participant is on long-term disability, but may earn a pro-rata portion based on their period of active service.   A Participant that is receiving short-term disability benefits may be eligible to participate in the Program during the period the Participant is on short-term disability, at the discretion of the Compensation Committee.

 

In the event of death, the Bank will pay to the Participant’s estate the pro-rata portion of the award that had been earned by the Participant as of his or her date of death.  The Compensation Committee will determine what portion of the award had been earned based on: (i) the base salary earned by the Participant as of his or her date of death and (ii) such other factors as the Committee deems relevant.  

 

Individuals who retire during the Program Year will receive a prorated award based on their base salary earned as of their retirement date and other factors the Committee deems relevant.  For the purposes of this Program, retirement is defined as age 55 with a minimum of 5 years of service. 

 

	
 
	
vii.
	
Change in Control

 

Upon the occurrence of a Change in Control (as defined in the Company’s employment agreement with its President and Chief Executive Officer) of the Company or Bank, the Bank will pay a Participant the pro-rata portion of the award that had been earned by the Participant as of the date of the Change in Control, and for purposes of calculating the amount, the Threshold Net Income target shall be deemed to be satisfied.  The Compensation Committee will determine what 

4

 

 

portion of the award had been earned based on: (i) the base salary earned by the Participant as of the date of the Change in Control and (ii) such other factors as the Committee deems relevant.  

 

	
 
	
7.
	
Payment Method

The Compensation Committee, in its sole discretion, may elect to distribute all or a portion of an incentive award in Kearny common stock and/or cash to further align Participants’ interests with those of the Kearny shareholders. Payment of awards, less deferrals and applicable federal, state and local taxes, will be made as soon as practicable following the end of the Program Year (the “Payment Date”), but in no event before certification of the Committee or later than September 30th following the end of the Program Year.

	
 
	
8.
	
Modification and Termination of Program

The Program may be modified or changed at any time by the Committee in its discretion, followed by written notification to the Participant as soon as reasonably practicable. The Program may be terminated at any time by the Committee in its discretion, followed by written notification to the Participant as soon as reasonably practicable. In the event of a Program termination, the Participant shall continue to be eligible for incentive compensation awards for the Program Year prorated through the Program’s termination date, unless the Committee determines in its discretion that no incentive compensation should be paid. Any incentive compensation awards shall be calculated through the date of the Program termination on such basis as the Committee deems appropriate in its discretion and will be payable as soon as practicable after the termination of the Program but in no event later than September 30th following the end of the Program Year.

	
 
	
9.
	
Participant Rights Not Assignable; Program not a Contract

Any awards made pursuant to the Program shall not be subject to assignment, pledge or other disposition.

Nothing contained in the Program shall confer upon any employee any right to continued employment or to receive or continue to receive any rate of pay or other compensation, nor does the Program affect the right of Kearny or the Bank to terminate a Participant’s employment. Participation in the Program does not confer rights to participation in other Kearny or Bank programs or programs, including annual or long-term incentive programs, non-qualified retirement or deferred compensation programs or other executive perquisite programs.

	
 
	
10.
	
Ethical 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 the Program to which the employee would otherwise be entitled will be revoked.

Participants who have willfully engaged in any activity, injurious to the Bank, will upon termination of employment, death, or retirement, forfeit any incentive award earned during the award period in which the termination occurred.

	
 
	
11.
	
Governing Law 

The parties agree that the interpretation and enforcement of the Program shall be governed by the laws of the state of New Jersey. The Participant consents and waives any objection to personal jurisdiction and venue in such court. The Program, and any payments thereunder, shall not be subject to the Employee Retirement Income Security Act.

	
 
	
12.
	
Attorney’s Fees and Costs

The parties agree that in the event of any legal action arising out of or relating to the interpretation or enforcement of the Program, Kearny and the Bank shall be entitled to recover their attorney’s fees and costs in the event that they are (or either of them is) the prevailing party.

5

 

 

	
 
	
13.
	
No Oral or Written Representations

The parties agree that they have relied on no oral or written representation or promises not set forth herein, and that the terms of the Program are set forth solely in the written Program document and it constitutes the complete and entire agreement of the parties relating to the subject matter hereof.

	
 
	
14.
	
Clawback 

Participant, while employed by the Bank and in the conduct of his or her duties as an employee, shall not expose Kearny or the Bank to any unreasonable or unnecessary risk. All incentive compensation awards under the Program are subject to the terms of Kearny’s or the Bank’s recoupment, clawback or similar policy as such may be in effect from time to time, as well as any similar provisions of applicable law, which could in certain circumstances require repayment of an incentive compensation award or portion thereof.

	
 
	
15.
	
Banking Regulatory Provision

All incentive compensation awards under the Program are subject to any condition, limitation or prohibition under any financial institution regulatory policy or rule to which Kearny or the Bank is subject.

 

Approved by the Boards of Directors of Kearny Financial Corp. and Kearny Bank on September 21, 2016.

 

6

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