Albert Sun

About Albert Sun

Albert Sun, age 70, is Executive Vice President and Chief Credit Officer (CCO) of Cathay Bank (a subsidiary of Cathay General Bancorp) since January 1, 2024; he joined Cathay in September 2023 as EVP, Special Advisor to the Office of the President . He has 40+ years of banking experience across credit and operational risk management, loan operations, and loan origination, and currently leads the Credit Administration function at Cathay Bank . Sun’s pay is tied to company performance via an annual cash bonus program based on EPS, ROA, and individual performance, and long‑term performance RSUs tied to three‑year EPS, relative TSR, and relative ROA goals (payouts 0–150%), indicating explicit pay‑for‑performance alignment . There are no related‑party transactions disclosed for Sun under Item 404(a) .

Past Roles

Fixed Compensation

Performance Compensation

Annual Cash Bonus (Short‑Term Incentive)

• Program metrics: EPS, ROA, and individual/departmental performance with formulaic payouts; NEO bonuses for 2024 were 77%–89% of target reflecting below‑target EPS/ROA .
• 2024 target and actual for Sun: | Metric | Threshold ($) | Target ($) | Maximum ($) | Actual Paid ($) | Payout vs Target (%) | |---|---:|---:|---:|---:|---:| | Annual Cash Bonus | 131,250 | 262,500 | 393,750 | 234,300 | 89.2% (calc from cited values) |

Notes:

• Bonus mechanics include interpolated payouts for EPS/ROA between threshold/target/maximum and stepped payouts for performance ratings; example weights show 50%/20%/30% for EPS/ROA/individual rating (illustrative) .
• Clawback applies to incentive compensation (adopted September 2023) .

Long‑Term Incentives (Performance RSUs granted June 28, 2024)

• LTI mix/metrics: 50% three‑year EPS, 25% relative TSR (scaled 0% at <30th percentile; 100% at 50th; 150% at ≥70th), 25% relative ROA vs KBW Regional Bank Index peers (0% at <30th percentile; scaled to 150% at ≥70th) .
• Sun’s June 28, 2024 grants (fair value at grant shown): | Grant Date | Instrument | Threshold (#) | Target (#) | Maximum (#) | Grant Date Fair Value ($) | |---|---|---:|---:|---:|---:| | 06/28/2024 | Performance RSUs (Set 1) | 1,092 | 2,183 | 3,275 | 82,998 | | 06/28/2024 | Performance RSUs (Set 2) | 1,100 | 2,200 | 3,300 | 82,984 | | 06/28/2024 | Performance RSUs (Set 3) | 2,200 | 4,400 | 6,600 | 165,968 | | Total | | | Target RSUs: 8,783 | | 331,950 |

Vesting and payout:

• Three‑year performance period ending December 31, 2026; RSUs vest/settle within 90 days after period end, subject to continued employment; special provisions for death, disability, retirement; clawback applies .
• No RSU vestings for Sun in 2024 (no shares vested) .

Equity Ownership & Alignment

• Beneficial ownership: 0 shares as of March 20, 2025; percentage of outstanding common stock: 0% (below one percent) .
• Outstanding and unvested equity at 12/31/2024: | Type | Shares/Units (#) | Market Value ($) | Vesting Schedule | |---|---:|---:|---| | Time‑based RSUs | 1,417 | 67,463 | Vest on September 25, 2026 (or earlier on death, disability, retirement, change in control) | | Performance RSUs (Tranche A) | 2,256 | 107,408 | Scheduled to vest 12/31/2026, 0%–150% of target based on performance | | Performance RSUs (Tranche B) | 2,274 | 108,265 | Scheduled to vest 12/31/2026, 0%–150% of target based on performance | | Performance RSUs (Tranche C) | 4,548 | 216,530 | Scheduled to vest 12/31/2026, 0%–150% of target based on performance |
• Ownership guidelines: Only the CEO has a stock ownership requirement (3x salary); no minimum ownership requirement for other officers (including Sun) .
• Hedging/Pledging: Board policy prohibits hedging and pledging by directors and executive officers without prior Board approval; no approvals granted .
• Options: Company does not currently grant stock options; no option awards reported for Sun .
• Section 16 compliance: Company reports NEOs complied with Section 16(a) in 2024, except for late filings by other individuals noted; no issues disclosed for Sun .

Employment Terms

Change‑in‑Control (CIC) and termination economics:

• Double‑trigger structure: No automatic acceleration upon a CIC if awards are assumed by a public company; if not assumed/continued, awards may accelerate; otherwise severance is payable upon qualifying termination following a CIC .
• Severance multiple for Sun upon qualifying termination after CIC: 1.5x (salary + Applicable Annual Bonus); based on salary $375,000 and applicable bonus $262,500, the base salary and bonus component equals $956,250 .
• Additional CIC benefits illustrated at 12/31/2024 scenario: | Component | Voluntary (Good Reason) / Involuntary (Other Than For Cause) | Death/Disability | |---|---:|---:| | Base Salary + Bonus (multiple) | $956,250 (1.5x of $375,000 + $262,500) | $0 | | Accrued Obligations (includes pro‑rata bonus) | $262,500 | $262,500 | | 401(k) Matching (continuation) | $4,327 | $0 | | Group Life Insurance | $688 | $0 | | Health Insurance | $21,559 | $0 | | Long‑Term Disability Insurance | $896 | $0 | | Outplacement Services (max) | $50,000 | $0 | | Excise Tax Gross‑Up | $0 (no gross‑up) | $0 | | Total (illustrative) | $1,296,220 | $262,500 |
• Accelerated vesting value upon CIC (if awards not continued/assumed and acceleration occurs): $485,622 for Sun at 12/31/2024 price, assuming target performance .
• Clawback: Company‑wide clawback policy (amended 2023) applies to incentive compensation; plan documents incorporate clawback and arbitration provisions .

Additional Governance, Policies, and Related Matters

• Incentive plan administration and limits: 2005 Incentive Plan being amended/restated; at 12/31/2024, 1,240,607 shares remained available; non‑employee director award limits and one‑year minimum vesting (with limited exceptions); dividends/deferred payout restrictions; updated clawback alignment .
• No defined benefit pension; NEOs receive 401(k) plan access; company reports no deferred compensation program (aside from arrangements with the Executive Chairman) .
• No related‑party transactions disclosed for Sun under Item 404(a) .

Investment Implications

• Alignment and retention: Sun holds no currently‑owned common shares, but has meaningful unvested equity (time‑based and performance RSUs) with three‑year performance periods ending 12/31/2026 tied to EPS, relative TSR, and relative ROA, aligning outcomes with shareholders and promoting retention through 2026; no hedging/pledging permitted absent Board approval .
• Selling pressure: No stock vested in 2024 for Sun; the next vesting events are concentrated in late 2026, suggesting low near‑term insider selling pressure absent discretionary sales .
• Pay‑for‑performance: 2024 bonus paid below target (89% of target) consistent with below‑target EPS/ROA, indicating responsiveness of cash incentives to performance; LTI awards are fully performance‑contingent with capped payouts .
• CIC economics: Moderate CIC protection (1.5x) and no excise gross‑up limit change‑in‑control cost; acceleration requires awards not be assumed/continued; overall design is shareholder‑friendly relative to peers with higher multiples .
• Governance: CEO‑only ownership guideline and robust clawback/anti‑hedging/anti‑pledging policies indicate governance controls; no Item 404(a) related‑party issues for Sun .