Exhibit 10.3
COMMUNITY BANCORP. AND
SUBSIDIARY
OFFICER INCENTIVE
PLAN
1. Purposes
The purpose of
the Community Bancorp. and Subsidiary Officer Incentive Plan (the "
Plan ") is to attract, retain and motivate highly-qualified
management employees by providing
appropriate performance-based short-term incentive
awards.
2. Definitions
The following
terms, as used herein, shall have the following
meanings:
“Additional Bonus Pool”
has the meaning set forth in Section
3.02.
“
Bank ” means the Company’s wholly-owned
subsidiary, Community National Bank, a national banking
association, or any successor financial institution.
" Board
" means the Board of Directors of the Company.
" Bonus
" means an annual incentive bonus award granted pursuant to
the Plan, the payment of which shall be contingent upon the
attainment of Performance Goals with respect to the applicable
Calculation Period.
“
Calculation Period ” means (i), with
respect to Participants who are Executive Officers, the twelve
month period ending on September 30; and (ii) with respect to
eligible Participants who are Other Participants, a calendar
year.
" Code "
means the Internal Revenue Code of 1986, as amended from time to
time.
"
Committee " means the Compensation Committee of the
Board.
"
Company " means Community Bancorp., a corporation
organized under the laws of the State of Vermont, or any successor
corporation.
“ESSA” has the meaning set forth in Section
6.07.
“Executive Officer Bonus
Pool” has the
meaning set forth in Section 3.02.
“
Executive Officers ” and “
Executive Officer Participants ” mean those executive
officers of the Company or the Bank who are designated from time to
time by the Board or the Committee as Executive Officer
Participants in this Plan.
“
IDC ” means IDC Financial Publishing, Inc., a banking
industry performance ranking service.
“Other
Participant Bonus Pool” has the meaning set forth in Section
3.02.
“
Other Participants ” means the officers
of the Company or the Bank (other than Executive Officer
Participants) and other salaried employees, who are designated from
time to time by the Board or the Committee as Participants in this
Plan.
"
Participant " means, a management employee of the Company or
the Bank who meets the eligibility requirements in Section 3.01 and
who has been designated by the Board or the Committee to
participate in the Plan with respect to any annual Calculation
Period.
"
Performance Goals " means the criteria and
objectives established pursuant to Section 3, which must be met as
a condition to payment of Bonuses under this Plan.
" Plan "
has the meaning set forth in Section 1.
3. Eligibility; Bonus Pools;
Performance Goals
3.01. Eligibility and Designation for
Participation. Except as the Board may otherwise
determine, only executive officers, other officers and other
salaried employees who have been employed by the Company or the
Bank for at least 12 months on the last day of the applicable
Calculation Period shall be eligible for participation in the Plan
with respect to such Calculation Period. The eligible participants
for each bonus pool shall be designated annually by the Board or
the Committee. Part-time employees who are otherwise
eligible to participate in the Plan shall be eligible for a
one-half Bonus payment from the Other Participant Bonus Pool and
from the Additional Bonus Pool.
3.02. Bonus Pools.
Subject to Section 6.03
and to attainment of specified performance criteria as contemplated
in Sections 3.03 and 3.04, there shall be established each year a
pool for payment of Bonuses to Executive Officers (“
Executive Officer Bonus Pool ”) and a pool for payment
of Bonuses to Other Participants (“ Other Participant
Bonus Pool ”). In its discretion the Board, in
consultation with the Committee, may establish an additional pool
for payment of additional Bonuses to Other Participants (“
Additional Bonus Pool ”), subject to
attainment of supplemental Performance Goals exceeding those
established for payment of Bonuses from the Other Participant Bonus
Pool.
3.03. Minimum Performance
Target. The
Board, in consultation with the Committee, shall establish annually
a minimum performance target below which no Bonuses will be paid
under this Plan. Such minimum performance target may be based on
any factors the Board deems appropriate, including without
limitation, attainment of a specified percentage return on assets
or return on equity.
3.04. Annual Performance Goals and
Available Bonus Funds. Unless otherwise determined by the Board, no
later than 90 days after the commencement of a Calculation
Period, the Board, in consultation with the Committee, shall
establish Performance Goals and formulas for determining available
funds for the payment of Bonuses with respect to such Calculation
Period. Separate Performance Goals and formulas shall be
established for payment of bonuses under the Executive Officer
Bonus Pool, the Other Participant Bonus Pool and the Additional
Bonus Pool. Performance Goals and the formulas for determining
available funds for payment of Bonuses may include such factors and
be based on such financial measures, including, without limitation,
audited or unaudited net income, as the Board deems
appropriate. Without limiting the generality of the
foregoing, Performance Goals and the formula for determination of
available funds for payment of Bonuses to Executive Officer
Participants may include consideration of the Bank’s and/or
the Company’s performance compared to that of peer
institutions, as measured by an independent rating service such as
IDC.
3.05. Individual
Incentives. The Executive Officers are authorized to
establish from time to time individual incentive compensation
arrangements for designated officers, other than Executive
Officers. Any incentive compensation paid to a
Participant pu
