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FORM OF LETTER AGREEMENT REGARDING
STANDARDS FOR INCENTIVE COMPENSATION
TO EXECUTIVE OFFICERS UNDER THE TARP CAPITAL PURCHASE
PROGRAM
[ADDRESS]
__________________
Popular,
Inc. (the “ Company ”) intends to enter into
a Securities Purchase Agreement, (the “ Participation
Agreement ”), with the United States Department of
Treasury (“ Treasury ”) that provides for the
Company’s participation in the Treasury’s TARP Capital
Purchase Program (the “ CPP ”).
For the Company to
participate in the CPP and as a condition to the closing of the
investment contemplated by the Participation Agreement, the Company
is required to establish specified standards for incentive
compensation to its senior executive officers and to make changes
to its compensation arrangements. To comply with these
requirements, and in consideration of the benefits that you will
receive as a result of the Company’s participation in the
CPP, you agree as follows:
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(1)
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No Golden Parachute
Payments .
The Company is prohibiting any golden parachute payment to you
during any “CPP Covered Period”. A “ CPP
Covered Period ” is any period during which (A) you
are a senior executive officer and (B) Treasury holds an
equity or debt position acquired from the Company in the
CPP.
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(1)
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Recovery of Bonus and Incentive
Compensation. Any bonus and incentive
compensation paid to you during a CPP Covered Period is subject to
recovery or “clawback” by the Company if the payments
were based on materially inaccurate financial statements or any
other materially inaccurate performance metric criteria.
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(2)
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Compensation Program
Amendments. Each of the Company’s
compensation, bonus, incentive and other benefit plans,
arrangements and agreements (including golden parachute, severance
and employment agreements) (collectively, “ Benefit
Plans ”) with respect to you is hereby amended to the
extent necessary to give effect to provisions (1) and
(2).
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In
addition, the Company is required to review its Benefit Plans to
ensure that they do not encourage senior executive officers to take
unnecessary and excessive risks that threaten the value of the
Company. To the extent any such
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review requires revisions to any
Benefit Plan with respect to you, you and the Company agree to
execute such additional documents as the Company deems necessary to
effect such revisions .
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(3)
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Definitions and
Interpretation . This letter shall be interpreted
as follows:
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•
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“Senior executive
officer” means the Company’s “senior executive
officers” as defined in subsection 111(b)(3) of
EESA.
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