Attached files
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EX-10.1 - EXHIBIT 10.1 - UNITED COMMUNITY FINANCIAL CORP | c16490exv10w1.htm |
8-K - FORM 8-K - UNITED COMMUNITY FINANCIAL CORP | c16490e8vk.htm |
Exhibit 10.2
UNITED COMMUNITY FINANCIAL CORP.
&
THE HOME SAVINGS AND LOAN COMPANY OF YOUNGSTOWN, OHIO
STAY BONUS AND RETENTION PLAN
&
THE HOME SAVINGS AND LOAN COMPANY OF YOUNGSTOWN, OHIO
STAY BONUS AND RETENTION PLAN
1. Purpose. Effective as of April 28, 2011 (the Effective Date), the Boards of
Directors (collectively, the Board) of United Community Financial Corp. (UCFC) and UCFCs
wholly owned subsidiary, The Home Savings and Loan Company of Youngstown, Ohio (Home Savings and
together with UCFC, the Company), hereby adopt this STAY BONUS AND RETENTION PLAN (the Retention
Plan) for the purpose of recruiting and retaining qualified
officers and employees of the Company
by providing additional procedures and guidelines for payments of Cash Awards and Equity Awards to
Participants (all as defined herein). Equity Awards will be granted in the form of Restricted
Shares issued under and pursuant to the terms and conditions of the United Community Financial
Corp. Amended and Restated 2007 Long Term Incentive Plan (the 2007 Plan).
2. Definitions. Capitalized terms used but not defined in this Retention Plan shall
have the meanings given to such terms in the 2007 Plan. To the extent that any term defined herein
conflicts with the definition of such term under the 2007 Plan, the definition in this Retention
Plan shall control, except to the extent such conflict would render any term or provision of the
2007 Plan ineffective or inoperable.
3. Administration.
(a) This Retention Plan shall be administered by the Companys Compensation Committee
(Committee), subject to such terms and conditions as the Committee may prescribe that are not
inconsistent with the Retention Plan.
(b) Subject to the terms and conditions of the Retention Plan and the 2007 Plan, the Committee
shall have the discretion and (subject to subsequent approval by a majority of the independent
members of the Board, as defined under applicable NASDAQ listing rules) exclusive power to:
(i) | Make Cash Awards and Equity Awards to Participants as described herein; | ||
(ii) | Determine the terms and conditions with respect to Cash Awards and/or Equity Awards to the extent not inconsistent with the provisions of the Retention Plan or the 2007 Plan; and | ||
(iii) | Resolve all questions relating to the administration of the Retention Plan and applicable law. |
(c) The interpretation of, and application by, the Committee of any provision of the Retention
Plan shall be final and conclusive. The Committee, in its sole discretion, may establish rules and
guidelines relating to the Retention Plan as it may deem appropriate.
4. Participation.
(a) The Committee shall recommend officers and employees of the Company to be participants in
the Retention Plan at or any time after the Effective Date, including any officers or employees
hired after the Effective Date in accordance with this Section 4(a). The officers and employees
recommended for participation by the Committee shall be approved by at least a majority of the
independent members of the Board (and upon such approval, each such officer and employee shall
become a Participant, and collectively shall be the Participants). Attached hereto as
Exhibit A is a list of Participants of the Plan as of the Effective Date, which may be
amended from time to time by the Board and the Committee in their sole and absolute discretion.
(b) To be eligible for any Cash Award or Equity Award, each Participant must maintain no less
than a consolidated rating of competent performance of such Participants goals and
responsibilities within the Participants current job description and other related/required duties
that may be assigned. In addition, each Participant must be actively employed by UCFC or Home
Savings at the time any Cash Award is paid or an Equity Award is granted.
5. Awards.
(a) For purposes of this Retention Plan,
(i) | Cash Award shall mean any payment of cash by the Company payable to a Participant in accordance with the terms and conditions of this Retention Plan. |
(ii) | Equity Award shall mean any Award of Restricted Shares under the 2007 Plan to a Participant in accordance with the terms and conditions of this Retention Plan, the 2007 Plan and the award agreement provided by the Company. |
(b) Each eligible Participant shall receive a Cash Award of One Thousand and 00/100 Dollars
($1,000.00) on the first regular pay date occurring in January 2012, subject to all applicable
Federal, state and local payroll taxes.
(c) Each eligible Participant also shall receive a Cash Award and be granted an Equity Award
upon receipt by the Board of Home Savings of official notice that the Order to Cease and Desist,
Order No. FDIC -08-175b, as may be amended from time to time (the Order), has been terminated.
For purposes of this Retention Plan, the words terminated or termination used in connection
with the Order shall mean a termination by the Federal Deposit Insurance Corporation (the FDIC)
and the Ohio Division of Financial Institutions (ODFI), or either of such regulatory authoritys
successors or assigns, of the Order, which Order is not replaced, amended or modified in such a
manner as to be considered terminated but replaced with a new order or agreement.
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(d) The combined award described above shall be based upon a specified percentage of each
Participants base salary in effect at the time the Order has been terminated, which percentage
shall be determined by the Board and set forth in Exhibit A attached hereto,
and as may be amended from time to time by the Board and the Committee in their sole and
absolute discretion.
(i) | The Cash Award shall equal fifty percent (50%) of the combined award and will be paid in a single lump sum payment following receipt of the notice of termination of the Order, in accordance with the Companys regular pay practices, but in no event more than thirty (30) days following receipt of such notice. Payment of the Cash Award shall be subject to all applicable Federal, state and local payroll taxes. |
(ii) | The Equity Award shall consist of a number of Restricted Shares equal to fifty percent (50%) of the combined award divided by the Fair Market Value of a Common Share on the Grant Date (defined below), rounded down to the nearest whole Common Share. Fractional Common Shares shall not be issued, so any portion of the Equity Award that is not converted to Restricted Shares on a Grant Date shall be paid to the Participant in cash as part of the Cash Award. |
(e) For purposes of this Retention Plan, the Grant Date of the Equity Award shall be the
date upon which the Compensation Committee and a majority of the independent members of the Board
meet and formally approve the issuance of Restricted Shares pursuant to the Retention Plan. The
Compensation Committee and the Board shall use their best efforts to hold a meeting on the date
notice of termination of the Order is received by the Board or as soon thereafter as practicable.
(f) Restricted Shares awarded pursuant to the Retention Plan shall be evidenced by an award
agreement containing such terms and conditions as the Committee may prescribe and that are not
inconsistent with the terms of the 2007 Plan or the Retention Plan; provided, however, that no
Restricted Shares may vest prior to the first anniversary of the Grant Date except as specifically
set forth in the 2007 Plan or as provided herein. For purposes of applying Section 13.3 of the
2007 Plan to any Equity Award, a Participants Retirement shall mean the Participants Separation
from Service as provided under 2.1(bb) of the 2007 Plan.
(g) Restricted Shares that vest shall be settled by the Company as soon as reasonably
practicable. In accordance with the terms and conditions of the 2007 Plan, in the case of Equity
Awards paid in Restricted Shares, the Company may withhold Common Shares otherwise issuable upon
exercise or settlement of such Equity Award in order to satisfy withholding obligations, unless
otherwise instructed by the Participant or unless the Committee determines otherwise at the time of
Grant.
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(h) In the event that the Company terminates a Participants employment for cause prior to the
date upon which a Cash Award is actually paid to a Participant or a Participants Equity Award has
vested, the Participant shall forfeit all his or her rights, title or interest in any such Cash or
Equity award, and the Participant shall not be entitled to receive all or any part of the Cash or
Equity Award. When used in this Retention Plan, cause means (A) the Participants continued
intentional failure or refusal to perform substantially the Participants
assigned duties (other than as a result of total or partial incapacity due to physical or
mental illness) for a period of ten days following written notice by the Company to the Executive
of such failure; (B) the Participants engagement in willful misconduct, including without
limitation, fraud, embezzlement, theft or dishonesty in the course of Participants employment with
the Company; (C) the Participants conviction of, or plea of guilty or nolo contendere to a felony
or a crime other than a felony, which felony or crime involves moral turpitude or a breach of trust
or fiduciary duty owed to the Company or any of its affiliates; (D) the Participants disclosure of
trade secrets or material, non-public confidential information of the Company or any of its
affiliates in violation of the Companys or its affiliates policies that applies to the Executive
or any agreement with the Company or any of its Affiliates in respect of confidentiality,
nondisclosure, non-competition or otherwise; or (E) with respect to any Participant not otherwise
employed by the Company pursuant to an executed employment agreement, any other termination for
cause pursuant to the Companys policies, procedures or employment practices, where such
termination is not otherwise prohibited by applicable law or regulation.
6. Plan as Controlling. Except as provided otherwise herein, any Equity Award granted
to a Participant under the Retention Plan shall be subject to the terms and conditions of the 2007
Plan, including such additional terms and conditions as the Committee may impose that are not
inconsistent with the 2007 Plan or the Retention Plan.
7. Amendment and Termination. Subject to any limitations contained in the 2007 Plan,
the Board may, at any time and from time to time, amend, modify or suspend the Retention Plan and
all rules and guidelines hereunder; provided, however, that no such amendment, modification,
suspension or termination shall impair or adversely alter any Cash Award or Equity Award previously
granted under the Retention Plan without the consent of the affected Participant.
8. Term of Retention Plan. The Retention Plan shall terminate on the earlier of the
date of termination of the 2007 Plan or after all Equity Awards issued hereunder have vested and
been settled by the Company, and no Equity Award may be granted pursuant to the Retention Plan
thereafter; provided, however, that neither the termination of the 2007 Plan nor the termination of
the Retention Plan shall affect the vesting of any Equity Award outstanding upon such termination
or the right of a Participant to receive Common Shares upon vesting of an Equity Award.
9. Regulatory Matters. In the event and to the extent the payment of any Cash Award
or grant of any Equity Award is subject to regulatory approval and/or may be nullified or rendered
inoperative or inapplicable by operation of applicable Federal or state law, this Retention Plan
shall be effective only to the extent permissible under such regulatory and/or other legal
requirements, but to the fullest extent as may be permissible thereunder.
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10. Miscellaneous
(a) Except as otherwise specifically provided in the Retention Plan or as set forth in an
award agreement (and to the extent not otherwise inconsistent with the 2007 Plan), during the
vesting period and after the certificates for the Restricted Shares have been issued, the
Participant shall be entitled to all rights of a shareholder of the Company, including the right to
vote and the right to receive dividends, with respect to the Restricted Shares subject to this
Retention Plan. Subject to applicable withholding requirements, if any, dividends on the
Restricted Shares shall be paid to the Participant when earned and payable.
(b) An Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in
exchange for consideration.
(c) Nothing contained herein shall be deemed to restrict or prohibit any employee from making
a Section 83(b) election under the Code.
(d) Except as otherwise explicitly stated herein, the adoption of the Retention Plan by the
Board shall not be construed as amending, modifying or rescinding the 2007 Plan but is intended to
serve as a framework for the Board and the Committee with respect to grants to Participants.
(e) Nothing contained in the Retention Plan or in an award agreement granted hereunder shall
confer upon any Participant any right to continue serving as an employee of the Company or
interfere in any way with the right of UCFC or Home Savings to terminate the Participants service
as an employee at any time.
(f) An award agreement may provide that Common Shares issuable upon settlement of an Equity
Award may be subject to such restrictions, including, without limitation, restrictions as to
transferability as the Committee may determine at the time such Equity Award is granted.
(g) The Retention Plan and all actions taken hereunder shall be governed by and construed in
accordance with the laws of the State of Ohio, except to the extent federal law shall be deemed
applicable. All disputes and matters arising under, in connection with or incident to this
Agreement shall be litigated, if at all, in and before any Federal court sitting within the
Northern District of Ohio or any State court sitting in Mahoning County, Ohio, to the exclusion of
the courts of any other state or county.
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