CHFC 2018 Proxy Statement

In addition, our offer letter with Mr. Rathbun provides for certain severance payments upon termination of his employment, and contemplates that we will provide certain severance payments following a qualifying termination after a change in control, pursuant to the terms of a separate change in control agreement. We entered into this change in control agreement with Mr. Rathbun on February 27, 2018. Employment Agreements with Mr. Provost and Mr. Torgow The following is a description of the severance benefits under our employment agreements with Mr. Provost and Mr. Torgow. Termination Without Cause by the Corporation or for Good Reason by the Executive Under the employment agreements, if Mr. Provost’s or Mr. Torgow’s employment is terminated without cause by us or for good reason by the executive, each are entitled to receive severance in the amount of two times the executive’s then base salary plus two times the average of executive’s bonus under our annual cash incentive plan for each of the three most recently completed fiscal years (including complete calendar years with Talmer Bank and Trust), with each bonus calculated as the higher of the actual bonus, or $1.5 million (the "Severance Payment"). Termination Following a Change in Control Under the employment agreements, if Mr. Provost’s or Mr. Torgow’s employment is terminated without cause by us within two years following the date of a change in control (as defined in the employment agreement), the Severance Payment will be paid but contributed directly to the Community Foundation of Southeastern Michigan, a tax-exempt public charity, in a lump sum cash payment. At the same time, and in the spirit of voluntary generosity to the community and not as compensation to either executive, we have agreed to make a matching contribution to the Community Foundation of Southeastern Michigan, a tax-exempt public charity. Employment Agreements with Mr. Klaeser and Mr. Shafer The following is a description of the severance benefits under our employment agreements with Mr. Klaeser and Mr. Provost. Termination Without Cause by the Corporation or for Good Reason by the Executive Under the employment agreements, if Mr. Klaeser’s or Mr. Shafer’s employment is terminated without cause by us or for good reason by the executive, each are entitled to receive severance in the amount of two times the executive’s then base salary plus the average of the executive’s cash bonuses under our annual cash incentive plan for each of the three most recently completed calendar years (or such lesser number of completed calendar years that executive has been employed by us), payable in equal installments over 104 weeks. We will also pay each executive a lump sum equal to 24 times our monthly contribution towards executive’s then current employee and dependent health, prescription drug and dental coverage elections. With respect to Mr. Klaeser, at the effective time of his termination, all unvested stock options, restricted stock, restricted stock units and any other stock-based awards previously issued to the executive shall immediately vest.With respect toMr. Shafer, all unvested stock options and outstanding TRSUs will immediately vest, and all PRSUs will remain outstanding subject to their original performance goals, and the restrictions under each such grant shall not lapse until the Compensation Committee has determined that the applicable performance goals have been attained, at which time the restrictions will lapse on the number of units corresponding to the level of the attained performance, as if Mr. Shafer had remained employed by us through the last day of the applicable performance period, and any other equity-based awards shall vest in accordance with the terms of the applicable equity-based plan or grant agreement. We will also provide each executive outplacement services for a period not to exceed 12 months. Termination Six Months Before or Following a Change in Control Under the employment agreements, if Mr. Klaeser’s or Mr. Shafer’s employment is terminated without cause by us or by the executive for good reason, within two years following a change in control or within six months before the date of a change in control, we will pay each executive a lump sum cash payment in the amount of two times the executive’s then base salary plus the average of the executive’s cash bonuses under our annual cash incentive plan for each of the most recent three complete calendar years (or such lesser number of completed calendar years that executive has been employed by us). With respect to Mr. Klaeser, at the effective time of his termination, all unvested stock options, restricted stock, restricted stock units and any other stock-based awards previously issued to the executive shall immediately vest. With respect to Mr. Shafer, all unvested stock options and outstanding TRSUs will immediately vest, and all PRSUs will remain outstanding subject to their original performance goals, and the restrictions under each such grant shall not lapse until the Compensation Committee has determined that the applicable performance goals have been attained, at which time the restrictions will lapse on the number of units corresponding to the level of the attained performance, as if Mr. Shafer had remained employed by us through the last day of the applicable performance 53