First United Corporation (NASDAQ:FUNC) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
ITEM 5.02.

(e)  Compensatory Arrangements.

On March 26, 2020, to the recently-adopted Long-Term Incentive Plan (the “LTIP”), the Compensation Committee (the “Committee”) of the Board of Directors of First United Corporation (the “Corporation”) granted restricted stock units (“RSUs”) to the Corporation’s principal executive officer (Carissa L. Rodeheaver), its principal financial officer (Tonya K. Sturm), and its other named executive officers (Robert L. Fisher, II and Jason B. Rush). RSUs contemplate the issuance of shares of common stock of the Corporation if and when the RSUs vest.

The awards granted to each of the foregoing officers consist of (i) a performance-vesting award for a three-year performance period ending December 31, 2021, (ii) a performance-vesting award for a three-year performance period ending December 31, 2022, and (iii) a time-vesting award that will vest ratably over a three-year period beginning on March 26, 2021. Under the performance-vesting RSUs, the officers will receive 50% of the target number of shares if at least one of the threshold performance levels is met, 100% of the target number of shares if at least one of the target performance levels is met, and 150% of the target number of shares if at least one of the maximum performance levels is met. Actual vesting amounts will be pro-rated between threshold and target levels and target and maximum levels to reward incremental improvement. For the performance period ending December 31, 2021, the RSUs’ performance goal is based on earnings per share for the year ending December 31, 2021. For the performance period ending December 31, 2022, the RSUs’ performance goals are based on earnings per share for the year ending December 31, 2022 and growth in tangible book value per share during the performance period. The threshold, target and maximum performance levels for these grants will be disclosed to Item 402 of Regulation S-K following the conclusion of the applicable performance period.

To receive any shares under an RSU, a grantee must be employed by the Corporation or one of its subsidiaries on the applicable vesting date, except that a grantee whose employment terminates prior to such vesting date due to death, disability or retirement will be entitled to a pro-rata portion of the shares subject to the RSUs, assuming that, in the case of performance-vesting RSUs, the performance goals had been met at their “target” levels.

These awards are evidenced by Restricted Stock Unit Award Agreements (Performance-Vesting) and Restricted Stock Unit Award Agreements (Time-Vesting) that contain customary terms and conditions for these types of equity awards, the forms of which are filed with this report as Exhibit 10.1 and Exhibit 10.2, respectively. In addition, these awards are subject in all respects to the LTIP and the First United Corporation 2018 Equity Compensation Plan (the “Equity Plan”). The material terms of the LTIP, a copy of which was filed as Exhibit 10.1 to the Corporation’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on March 16, 2020, were summarized in Item 5.02 of such Current Report under the heading “First United Corporation Long-Term Incentive Program”, which summary is incorporated herein by reference. The material terms of the Equity Plan, a copy of which was filed as Exhibit 10.1 to the Corporation’s Current Report on Form 8-K filed with the SEC on May 21, 2018, were summarized in the Corporation’s definitive proxy statement on Schedule 14A for the 2018 annual meeting of shareholders filed with the SEC on March 20, 2018, under the heading “APPROVAL OF THE EQUITY PLAN (Proposal 2)”, which summary is incorporated herein by reference.