PennFed Financial Services, Inc. Named Executive Officer Salary and Bonus Arrangements for Fiscal 2006

Summary

This agreement outlines the base salaries and bonus arrangements for the named executive officers of PennFed Financial Services, Inc. and Penn Federal Savings Bank. It specifies the annual base salaries for five executives and describes the Fiscal 2006 Incentive Plan, which provides quarterly cash bonuses to certain executives if the company's earnings per share growth meets set thresholds. Bonus payments are not subject to repayment if performance later declines. One executive is eligible for discretionary bonuses. The agreement was approved by the Compensation Committee on July 26, 2005.

EX-10.1 2 ex10-1.txt Exhibit 10.1 Named Executive Officer Salary and Bonus Arrangements ----------------------------------------------------- Base Salaries The current base salaries for the named executive officers (the "named executive officers") of PennFed Financial Services, Inc. (the "Company") and Penn Federal Savings Bank who will be named in the compensation table that will appear in the Company's upcoming annual meeting proxy statement are as follows: Name and Title Base Salary - -------------- ----------- Joseph L. LaMonica $525,250 President and Chief Executive Officer Patrick D. McTernan $243,225 Senior Executive Vice President, General Counsel and Secretary Jeffrey J. Carfora $232,875 Senior Executive Vice President and Chief Operating Officer Claire M. Chadwick $187,000 Executive Vice President and Chief Financial Officer Maria F. Magurno $144,900 Executive Vice President and Residential Lending Group Executive Description of Bonus Plan for Fiscal 2006 On July 26, 2005, the Compensation Committee of the Company's Board of Directors approved the Fiscal 2006 Incentive Plan. The executive officers who may earn bonus payments under the Incentive Plan are Messrs. LaMonica, McTernan and Carfora and Ms. Chadwick. The Company's Fiscal 2006 Incentive Plan provides for cash bonuses, payable quarterly, if the Company's annualized growth in earnings per share (excluding unusual or other non-recurring items) exceeds the specified percentage thresholds for either of two achievement tiers. If the higher tier's threshold is achieved the following total amounts for the year will be paid: Mr. LaMonica - $200,000; Mr. McTernan - $80,000; Mr. Carfora - $80,000; and Ms. Chadwick - $50,000. If subsequent to a quarterly award payment, annualized earnings per share growth falls below the threshold achieved for that payment, the executive is not required to return the payment. If the executive does not receive a bonus payment for a particular quarter or receives the lower tier bonus payment for the quarter, and annualized earnings per share growth increases in a later quarter to either the lower or higher tier threshold, then, in addition to receiving a payment for the later quarter, the executive will receive a payment for the earlier quarter as if the threshold achieved during the later quarter were also achieved during the earlier quarter. Ms. Magurno, along with other senior management personnel, is eligible for cash bonuses to be awarded in the discretion of the Compensation Committee.