UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event reported): September 18, 2020 (September 15, 2020)
CORTLAND BANCORP INC
(Exact name of registrant as specified in its charter)
| | Ohio | | 001-38827 | | 34-1451118 | |
| | | | | | | |
| | (State or other jurisdiction | | (Commission | | (I.R.S. Employer | |
| | of incorporation) | | File Number) | | Identification No.) | |
194 West Main Street, Cortland, Ohio 44410
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(Address of principal executive offices, including Zip Code)
Registrant’s telephone number, including area code: (330) 637-8040
________________________________________________________
Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common stock, No Par Value | CLDB | NASDAQ Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02(e) Compensatory Arrangements of Certain Officers
Amendment of short-term cash incentive plan. On September 15, 2020 the Board of Directors adopted an amended short-term cash incentive plan for executives. The Cortland Savings and Banking Company Amended Annual Incentive Plan for Executive Officers (the “Plan”) is a short-term cash incentive plan that rewards employees with additional cash compensation (the “Target Incentive”) if specified annual objectives are achieved, which can include bank-wide performance objectives, business unit goals, and individual performance goals. Up to 50% of the Target Incentive will be based on specific financial performance criteria established by the Committee on an annual basis (the “Specific Financial Performance Criteria”), and up to 50% of the Target Incentive will be based on the Committee's subjective evaluation of the participant’s performance in managing earnings, capital, liquidity, interest rate sensitivity and increased risks presented by economic and other factors. The Specific Financial Performance Criteria in effect for 2020 are loan and deposit growth, net income, return on assets, net interest margin, efficiency ratio, and asset quality. If targeted performance is achieved or exceeded in 2020, a participating officer will receive a cash bonus ranging from 25% to 40% of base salary, depending on the level of goal achievement. Assuming targeted goals for 2020 are achieved, cash distributions under the plan would occur, at the Compensation Committee’s discretion, during the fourth quarter of 2020 or within two and a half months following the end of the Plan Year (i.e., March 15, 2021). CEO James M. Gasior, COO Timothy Carney, Senior Vice President and Chief Lending Officer Stanley P. Feret, and Senior Vice President and Chief Financial Officer David J. Lucido are participants in the Plan. The Plan may be terminated by the Board of Directors at any time. This summary of the plan is qualified in its entirety by reference to the exhibit attached hereto.
Given the unprecedented and unforeseeable impact of the COVID-19 pandemic on the general economy, the banking industry, and the company's operations and financial performance during the first half of fiscal year 2020, the Board of Directors determined it was necessary to enhance the discretion of the Compensation Committee to award incentive compensation to executives under the Plan.
In reliance on SEC rules and guidance, the precise pre-tax income performance goal and the precise goals for each of the individual performance goals are confidential and are therefore withheld from the exhibits attached hereto.
Item 9.01 Exhibits.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Cortland Bancorp Inc | |
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| Date: September 18, 2020 | By: | /s/ James M. Gasior | |
| | James M. Gasior | |
| | President & Chief Executive Officer | |
