Exhibit 10.4
FORM OF
FLAGSTAR BANCORP, INC.
1997 INCENTIVE COMPENSATION PLAN
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Adoption Agreement
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Flagstar Bancorp, Inc. hereby establishes an incentive compensation
plan having the terms and conditions set forth in the Flagstar Bancorp, Inc.
1997 Incentive Compensation Plan Document, as modified by the elections made in
this Adoption Agreement.
I. General Information about the Plan
II. General Information about the Employer
III. Eligibility and Participation
A. For each Plan Year, an individual will participate in the Plan
if he or she is selected as one of or falls within any one of
the following classes on a Participation Determination Date:
1. ____ Key Employees designated by the Committee
("Eligible Key Employees").
2. ____ Other employees designated by the Committee
("Eligible Employees").
B. The following date or dates will constitute Participant
Determination Dates:
1. ____ The first day of the Plan Year.
2. ____ The last day of Plan Year.
3. ____ Service is required on both of the above dates.
IV. Calculation of the Multiplier
A. For each Plan Year, the Multiplier will equal the lesser of 4.0
and the sum of --
1. 75% of the ROA Factor.
2. 75% of the ▇▇▇ Factor.
3. 50% of the Camels Rating Factor.
4. 75% of the Deposit Factor.
5. 75% of the Loan Factor.
B. The ROA Factors will equal the ratio of (i) the Employer's ROA for the
Plan Year, to (ii) the Employer's budgeted ROA for the Plan Year.
C. The ▇▇▇ factor will equal the ratio of (i) the Employer's ▇▇▇ for the
Plan Year, to (ii) the Employer's budgeted ▇▇▇ for the Plan Year.
D. The CAMELS Rating Factor will be determined according to the following
schedule:
1. 1.2 for a CAMELS rating of 1.
2. 1.0 for a CAMELS Rating of 2.
3. -1.0 for a CAMELS Rating below 2.
E. The Deposit Factor will equal the ratio of the Employer's total
deposit growth in the Plan Year to its budgeted deposit growth for
the Plan Year.
F. The Loan Factor will equal the ratio of total loan originations to
budgeted loan originations for the Plan Year.
G. Notwithstanding the foregoing, if a ratio referred to in Items IV.B.
or IV.C. is less than 50% for any Plan Year, the corresponding Factor
shall be zero.
V. Bonuses For each Plan Year, Bonuses will be paid in accordance with
Section 4.01 and the following elections:
1. ___ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ will receive a Bonus equal to 25% of his
Compensation times the Multiplier.
2. ___ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ will receive a Bonus equal to 12% of his
Compensation times the Multiplier.
3. ___ Each Key Employee will receive a Bonus equal to 6% of his or
her Compensation times the Multiplier.
4. ___ Each Eligible Employee will receive a Bonus equal to 4% of
his or her Compensation times the Multiplier.
WHEREFORE, on this ____ day of _________, 1997, the Employer hereby
executes this Adoption Agreement, and thereby establishes the Plan upon the
terms and conditions set forth herein and in the Plan Document.
FLAGSTAR BANCORP, INC.
By:
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It's President
Witness:
[SEAL]
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