Needham Bank Long-Term Incentive Plan

Exhibit 10.6

Needham Bank 

Long-term Incentive Plan 

Effective January 1, 2020

TABLE OF CONTENTS

Needham Bank 

LONG-TERM INCENTIVE PLAN 

Effective January 1, 2020

I.              Plan Purposes

This executive long-term incentive plan will permit participating executives to realize future financial rewards when their collective performances result in attainment of the Company’s strategic objectives for growth, profitability, and increased enterprise value. This executive long-term incentive plan is implemented and administered to recognize, reward and retain senior leadership and those executives that have substantially contributed to the growth of Needham Bank that have or are expected to have contributed to the growth of Needham Bank.

II.            Compensation Philosophy

Needham Bank (“the Company”) wishes to provide a comprehensive compensation program for those senior executives whose performance and contributions to the business materially enhance and aid the attainment of desired business results. This long-term incentive plan is intended to be an integral part of the total compensation opportunity offered by the Company to these key executives. It is intended as an adjunct, not an offset, to the other forms of compensation already provided by Needham Bank.

The description of this long-term incentive plan for key executives of Needham Bank contains several terms that may be unfamiliar to participants and/or have a specific legal definition when used in the context of this type of executive compensation plan. Plan terms and their definitions are provided in Exhibit 1.

Participation in this Plan is open to any person employed by Needham Bank in a regular ongoing relationship that meets applicable tests in labor regulation for employee status and is a member of a “select group of management or highly compensated employees,” within the meaning of Sections 201, 301 and 401 of ERISA. While all designated executives are eligible for awards, the extent of participation among the selected executives may vary based on level, scope and type of responsibility within the organization, the significance of actual contributions to the development and success of the business, the importance of future contributions to the business, and at the discretion of the Compensation Committee.

Under certain circumstances, Needham Bank’s Compensation Committee may, in their sole and absolute discretion, at any time, change the eligibility criteria for Plan participation by an executive or determine that one or more Plan participants have ceased to be a key executive for purposes of Plan participation. As a result, the Plan Administrator may be directed by the Compensation Committee to suspend vesting of existing grants, suspend or “freeze” further appreciation in a vested but undistributed grant, and/or decline to make additional grants to a participant. The designation of an executive as a Plan participant in any year shall not confer upon such executive any right to continuing employment with the Company or to be designated as a participating executive in any future fiscal year in which the Plan exists.

A list of participant(s) and/or position(s) participating in this Plan is provided in Exhibit 2. This participant list will be reviewed, adjusted as necessary, and authorized by the Compensation Committee annually.

V.            Plan Concept and Operating Guidelines

This Plan is intended to provide participating executives with long-term compensation opportunities based on the increasing value of the business.

VII.              Vesting of Grant Interests and Distribution of Awards

VIII.              Plan Management

Exhibit 1

Needham Bank 

Long-term Incentive Plan 

Definitions of Key Terms

Certain terms that appear in the description of Needham Bank Long-term Incentive Plan are defined, for purposes of the Plan, as follows:

(i)              Conviction by a court of competent jurisdiction of, or entry of a plea of guilty or nolo contendere for, any criminal offense involving dishonesty or breach of trust or any felony or crime of moral turpitude;

(ii)             Commission of an act of fraud upon the Bank;

(iii)            Willful refusal to perform the duties reasonably assigned

(iv)            Willful breach of fiduciary duty or willful misconduct act of moral turpitude that materially and adversely affects the Bank or, in the opinion of the Compensation Committee, has the ability to do so.

IN WITNESS WHEREOF, the Bank executed this Plan on the date set forth below.

Exhibit 2

Needham Bank
Long-term Incentive Plan

List of Positions/Participants Participating in the Plan for 2020

Exhibit 3

Needham Bank 

Long-term Incentive Plan 

Participant Grant Agreement

This Agreement is made the                       day of                                           , 20          , by and between Needham Bank ("the Company") and                                                     ("the participant"), an employee of the Company serving in an executive capacity on this date.

A. Declaration of Award to Participant

In recognition of the participant's role in Needham Bank and the extent of opportunities for the executive to contribute to the growth and success of the business, the Compensation Committee of the Board of Directors of Needham Bank awards grants to participants.

B. Terms and Conditions of the Grant

C. Notices

Any notice hereunder to the Needham Bank shall be addressed to its offices in                                     to the attention of the Plan Administrator, and any notice to the participant shall be addressed to him or her at the address of record in the Needham Bank's personnel files.

D. Participant Bound by Plan

The participating executive acknowledges receipt of a copy of the Plan and this Agreement and agrees to be bound by all of the terms and provisions therein contained. In accepting this award, the participating executive also agrees to comply with all employment documentation required to be executed by Needham Bank, including but not limited to, the participating executive’s executed Needham Bank non-competition and non-solicitation agreement(s) (“Employment Documentation”). Distribution of the benefit provided by this Plan is contingent on the participating executive’s compliance their executed Employment Documentation. In witness whereof, the Needham Bank has caused this Agreement to be executed on its behalf by the Plan Administrators and the participant on the date indicated.

needham bank

FIRST Amendment TO 

NEEDHAM BANK LONG-TERM INCENTIVE PLAN

WHEREAS, Needham Bank (hereinafter referred to as “Bank”) previously established the Needham Bank Long-term Incentive Plan, effective January 1, 2020 (the “Plan”) to permit participating executives to realize future financial rewards when their collective performances result in the attainment of certain objectives, growth, profitability, and increased enterprise value; and

WHEREAS, the Bank desires to amend the Plan to include certain provisions required under Section 409A of the Internal Revenue Code of 1986, as amended, for public companies; and

WHEREAS, Section VIII.e. provides that the Compensation Committee may amend or modify the Plan in certain respects at any time.

NOW THEREFORE, the Bank does hereby amend the Plan as follows, effective as of June 1, 2023:

“h. Code Section 409A.

1.              Separation from Service. Provided that such term shall be interpreted within the meaning of regulations promulgated under Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), a participant shall incur a Separation from Service with a Service Recipient due to death, retirement or other termination of employment with the Service Recipient unless the employment relationship is treated as continuing intact while the individual is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the individual retains a right to reemployment with the Service Recipient under an applicable statute or by contract. Upon a sale or other disposition of the assets of the Company to an unrelated purchaser, the Company reserves the right, to the extent permitted by Code Section 409A to determine whether participants providing services to the purchaser after and in connection with the purchase transaction have experienced a Separation from Service. For purposes of this provision, the term “Service Recipient” means Needham Bank or person for whom the services are performed and with respect to whom the legally binding right to compensation arises, and all persons with whom such person would be considered a single employer under Code Section 414(b) (employees of controlled group of corporations), and all persons with whom such person would be considered a single employer under Code Section 414(c) (employees of partnerships, proprietorships, etc., under common control).

2.              Specified Employee. Notwithstanding anything in this Plan to the contrary, if a participant is a Specified Employee and a distribution under this Plan is due to the participant’s Separation from Service (other than due to death), then solely to the extent necessary to avoid penalties under Code Section 409A, the distribution (or any part thereof) shall be delayed and paid on the first day of the seventh month following the Separation from Service. For purposes of this Plan, the term “Specified Employee” means an individual who also satisfies the definition of “key employee” as that term is defined in Code Section 416(i) (without regard to paragraph (5) thereof).

3.              Code Section 409A Generally. To the extent applicable, it is intended that the Plan complies with the provisions of Code Section 409A. The Plan shall be administered in a manner consistent with this intent, and any provision that would cause the Plan to fail to satisfy Code Section 409A shall have no force and effect until amended to comply with Code Section 409A.”

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IN WITNESS WHEREOF, Needham Bank has executed this First Amendment to the Needham Bank Long-term Incentive Plan on this 31st day of May, 2023.