Heartland Financial USA, Inc. 2005 Long-Term Incentive Plan Performance Restricted Stock Agreement

THIS PERFORMANCE RESTRICTED STOCK AGREEMENT (this “ Agreement ”), entered into as of the Grant Date (as defined in Section 1(b) ), by and between the Participant and Heartland Financial USA, Inc., a Delaware corporation (the “ Company ”);

WHEREAS, the Company maintains the Heartland Financial USA, Inc. 2005 Long-Term Incentive Plan (the “ Plan ”), which is incorporated into and forms a part of this Agreement, and the Participant has been selected by the committee administering the Plan (the “ Committee ”) to receive a Restricted Stock Award under the Plan;

NOW, THEREFORE, IT IS AGREED, by and between the Company and the Participant, as follows:

Section 1.    Terms of Award . The following terms used in this Agreement shall have the meanings set forth in this Section 1 :

(a)    The “ Participant ” is                           .

(b)    The “ Grant Date ” is                           .

(c)    The number of “Covered Shares” awarded under this Agreement is            shares. “ Covered Shares ” are shares of Stock granted under this Agreement and are subject to the terms and conditions of this Agreement and the Plan.

Except where the context clearly implies to the contrary, any capitalized term in this Agreement shall have the meaning ascribed to that term under Section 9 of this Agreement or the Plan.

Section 2.    Award . The Participant is hereby granted the number of Covered Shares set forth in Section 1(c) , subject to the terms and conditions of this Agreement and the Plan.

Section 3.    Dividends and Voting Rights .

(a)    No dividends shall be payable to or for the benefit of the Participant for Covered Shares with respect to record dates occurring prior to the Vesting Date of such shares.

(b)    The Participant shall be entitled to vote the Covered Shares during the Restricted Period to the same extent as would have been applicable to the Participant if the Participant was then vested in the shares; provided, however, that the Participant shall not be entitled to vote the shares with respect to record dates for such voting rights arising prior to the Grant Date, or with respect to record dates occurring on or after the date, if any, on which the Participant has forfeited those Covered Shares.

Section 4.    Retention of Covered Shares . Each share of Stock issued with respect to the Covered Shares granted under this Agreement shall be registered in the name of the Participant and shall be retained by the Company during the applicable Restricted Period (as defined in Section 5(a) ).

Section 5.    Vesting and Forfeiture of Shares . 

(a)    Covered Shares may not be sold, assigned, transferred, pledged or otherwise encumbered (“ Restrictions ”) until the expiration of the Restricted Period or, if earlier, until the Participant is vested in the shares. Except as otherwise provided in this Section 5 , the Participant shall forfeit the unvested Covered Shares (whether or not earned) as of a Date of Termination (as defined in Section 9(i) ) that occurs during the Restricted Period. All Covered Shares shall be forfeited as of December 31, 2009, to the extent not earned as of such date. A Participant shall earn and later vest in the Covered Shares and then own the shares free and clear of all Restrictions pursuant to this Section 5. With respect to all Covered Shares, the “ Restricted Period ” shall begin on the Grant Date and shall end on the “ Vesting Date ” applicable to such shares (subject to the “Slip-Back” exception provided in paragraph (g)   below).

(b)    Portions of the Covered Shares shall be eligible to be earned upon on the attainment of Performance Measures (provided in Exhibit A ) based on the following allocations:

(c)    As of each December 31 during the Restricted Period (a “ Measurement Date ”), the Company will determine the actual growth in the earnings and the assets at both the Company and Bank level and calculate the number of Covered Shares earned as of such date.

(d)    The “ Earned Shares ” for any Measurement Date shall be the sum of the following products:

(i)    Company Earnings Shares times the Company Earnings Percentage;

(ii)    Company Asset Shares times the Company Asset Percentage;

(iii)    Bank Earnings Shares times the Bank Earnings Percentage; plus

(iv)    Bank Asset Shares times the Bank Asset Percentage.

(e)    Subject to paragraph (g)(iii) , as of each Measurement Date, the excess of the Earned Shares for such Measurement Date over the number of Earned Shares as of the last Measurement Date are “ Newly Earned Shares .”

(f)    Only Earned Shares will be eligible for vesting. Newly Earned Shares will vest, and become “ Vested Shares ” upon the two-year anniversary of the Measurement Date on which they became Newly Earned Shares (such anniversary, the “ Vesting Date ”) if the Participant has remained continually employed through such two-year period; provided, however, if as of the scheduled Vesting Date there is a “Slip-Back” (as defined in Section 9(o) ), then such Earned Shares shall not vest on such date. If there is a Slip-Back, the applicable Vesting Date for such Earned Shares shall be delayed and shall, if ever, occur on the first Measurement Date following the Slip-Back, on which the Performance Measures applicable to such shares are met, at which time the Earned Shares shall become Vested Shares and the Participant shall own the shares free of all Restrictions otherwise imposed by this Agreement; provided, however , that no such Vesting Date may occur, if at all, later than December 31, 2011.

(g)    Not withstanding the foregoing provisions of this Section 5 :

(i)    Upon a Date of Termination, which occurs due to the Participant’s death, Disability (as defined in Section 9(l) ) or due to the termination of the Participant’s employment for reasons other than Cause (as defined in Section 9(h) ), prior to the end of the Restricted Period, the Participant shall become vested in the Earned Shares, become owner of all of such Covered Shares free of all Restrictions otherwise imposed by this Agreement and all unearned Covered Shares shall be immediately forfeited as of such Date of Termination.

(ii)    Upon a Date of Termination, which occurs due to the Participant’s Retirement (as defined in Section 9(m) ), prior to the end of the Restricted Period and after the Participant has at least 10 years of service and has attained the age of 55; (A) all unearned Covered Shares shall continue to be subject to the earning provisions of this Section 5 as if Participant’s employment continued throughout the original Restriction Period and such shares will become Vested Shares if, and when, they become Earned Shares, and (B) all Earned Shares at the time of Retirement shall immediately become Vested Shares; provided, however, that all unearned Covered Shares shall be immediately forfeited if the Participant violates any applicable confidentiality, non-solicitation or non-competition agreement in effect between the Participant and the Company or Subsidiary. If at the time of the Participant’s Retirement, the Participant does not have least 10 years of service with the Company or has not attained the age of 55, then the provisions of (A) in the immediately preceding sentence will not apply and all unearned Covered Shares shall be immediately forfeited as of such Date of Termination.

(iii)    Upon a Change in Control of the Company; (A) all Earned Shares shall immediately become Vested Shares, and (B) all unearned shares shall become Vested Shares if the