2014 Incentive Compensation Plan Agreement between Georgetown Bancorp Inc. and Joseph W. Kennedy
This agreement outlines the 2014 Incentive Compensation Plan for Joseph W. Kennedy, SVP/CFO of Georgetown Bancorp Inc. It specifies his base salary, bonus targets, and performance goals related to return on assets, efficiency ratio, and net interest margin. Eligibility for bonuses depends on meeting certain financial and performance thresholds, as well as continued satisfactory employment. The plan also allows the company to reclaim bonuses if they were paid based on incorrect or restated financial information.
Exhibit 10.3
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| 2014 Incentive Compensation Plan Effective January 1, 2014 |
| Employee Joseph W. Kennedy | 2014 Base Salary | $ | 136,000 |
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| Title SVP/CFO | 2014 Bonus Target | 11 | % | $ | 14,960 |
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Thresholds Maintain CAMELS rating at one of the two highest ratings
Maintain an Asset Quality Rating of “Satisfactory” or better
Goal #1: Achieve Return on Assets
| Annual Payout Target | 60% | = | $ | 8,976 |
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| Payout |
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| Goals |
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| 95% of Budget |
| $ | 2,962 |
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| At Budget |
| $ | 5,924 |
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| 106% of Budget |
| $ | 8,976 |
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| Stretch Goal |
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| Every .03% over 106% of Budget |
| $ | 2,962 |
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Goal #2: Achieve Efficiency Ratio
| Annual Payout Target | 20% | = | $ | 2,992 |
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| Payout |
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| Goals |
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| 102% of Budget |
| $ | 997 |
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| At Budget |
| $ | 1,995 |
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| 97% of Budget |
| $ | 2,992 |
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| Stretch Goal |
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| Every 2% under 97% of Budget |
| $ | 997 |
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Goal #3: Achieve Net Interest Margin Percentage
| Annual Payout Target | 20% | = | $ | 2,992 |
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| Payout |
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| Goals |
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| 98% of Budget |
| $ | 987 |
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| At Budget |
| $ | 1,975 |
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| 102% of Budget |
| $ | 2,992 |
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| Stretch Goal |
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| Every 0.07% over 102% of Budget |
| $ | 987 |
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NOTES:
Bonus targets are based on Georgetown Bancorp Inc. 2014 budget.
All dollar figures are based on estimates of annualized salary. Incentive payments are based on the employee’s actual base compensation for the fiscal year, which includes straight time pay, vacation, holiday, personal, sick and jury duty pay. Overtime and other payments including previous year’s bonus payout will be excluded from the calculation.
To be eligible for the Incentive Compensation, the employee must be actively employed, performing at a level of “satisfactory” or above, and not be on a written warning at the time of the incentive payment.
The Bank shall have the right to rescind and recoup or “clawback” incentive payments paid under this plan if the Compensation Committee concludes that such awards were paid out based on information that is later found to be materially incorrect, including payments that were determined, in whole or in part, on financial statement information that is subsequently restated.
By signing below I confirm receipt of my Incentive Compensation Plan and my understanding of the provisions stated above.
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| Joseph W. Kennedy |
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| Robert E. Balletto, CEO/President |
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