8-K

 

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): February 27, 2009

Bancinsurance Corporation
__________________________________________
(Exact name of registrant as specified in its charter)

Ohio	0-8738	31-0790882
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
250 East Broad Street, 7th Floor, Columbus, Ohio		43215
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 614-220-5200

Not Applicable
______________________________________________
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:

[  ]  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))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 27, 2009, the Compensation Committee of the Board of Directors of Bancinsurance Corporation (the "Company") approved the Company’s 2009 Fiscal Year Executive Officer Bonus Plan (the "Plan"). The Plan sets forth the cash performance-based incentive compensation that each executive officer is eligible to receive with respect to the 2009 fiscal year.

Under the Plan, each executive officer is eligible to receive a cash performance bonus with respect to the 2009 fiscal year up to a specified percentage of his base salary. The amount of the cash performance bonus available under the Plan will be based upon the Company’s achievement of specified levels of return on beginning equity (excluding (1) the after-tax effect of expenses incurred for fiscal year 2009 relating to the Company’s ongoing SEC investigation and (2) the after-tax effect of any net realized gains (losses) on investments during the 2009 fiscal year) ("ROE") and, in the case of certain executive officers, also based upon the achievement of specified individual performance goals.

The Company's named executive officers are John S. Sokol, Chairman of the Board, Chief Executive Officer and President, Matthew C. Nolan, Vice President, Chief Financial Officer, Treasurer and Secretary, and Daniel J. Stephan, President of OIC Lender Services, a division of the Company's wholly-owned subsidiary, Ohio Indemnity Company. For fiscal year 2009, the target bonus and the weighting of the Company goal and individual goal components for each named executive officer are as follows:

John S. Sokol (1)
Target Bonus as a % of Base Salary: 60%
Company Goal/Individual Goal Weighted Component: 100%/0%

Matthew C. Nolan (1)
Target Bonus as a % of Base Salary: 25%
Company Goal/Individual Goal Weighted Component: 100%/0%

Daniel J. Stephan (1)
Target Bonus as a % of Base Salary: 50%
Company Goal/Individual Goal Weighted Component: 50%/50%

(1) For fiscal year 2009, the base salaries for Messrs. Sokol, Nolan and Stephan are $349,650, $210,000 and $180,810, respectively.

The foregoing description of the Plan does not purport to be complete and is qualified in its entirety by reference to the full text of the Plan which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

10.1 Bancinsurance Corporation 2009 Fiscal Year Executive Officer Bonus Plan.

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.

	Bancinsurance Corporation
March 5, 2009	By:	/s/ Matthew C. Nolan
		Name: Matthew C. Nolan
		Title: Vice President, Chief Financial Officer, Treasurer and Secretary

Exhibit Index

Exhibit No.	Description
10.1	Bancinsurance Corporation 2009 Fiscal Year Executive Officer Bonus Plan.

EX-10.1

2009 Fiscal Year Executive Officer Bonus Plan

The purpose of the Bancinsurance Corporation (the “Company”) 2009 Fiscal Year Executive Officer Bonus Plan (the “Plan”) is to attract, retain and motivate high quality executives and reward executives for Company profitability. Under the Plan, each executive officer is eligible to receive a cash bonus equal to a specified percentage of his base salary based upon the achievement of pre-established Company and individual performance goals (with each component being weighted differently based on the executive officer’s position with the Company). For fiscal year 2009, the target bonus and the weighting of the Company goal and individual goal components for each executive officer are as follows:

John S. Sokol, Chairman, Chief Executive Officer and President
Target Bonus as a % of Base Salary: 60%
Company Goal/Individual Goal Weighted Component: 100%/0%

Matthew C. Nolan, Vice President, Chief Financial Officer, Treasurer and Secretary
Target Bonus as a % of Base Salary: 25%
Company Goal/Individual Goal Weighted Component: 100%/0%

Daniel J. Stephan, President of OIC Lender Services, a division of Ohio
Indemnity Company
Target Bonus as a % of Base Salary: 50%
Company Goal/Individual Goal Weighted Component: 50%/50%

Stephen J. Toth, Vice President of Specialty Products of Ohio Indemnity Company
Target Bonus as a % of Base Salary: 25%
Company Goal/Individual Goal Weighted Component: 50%/50%

Margaret A. Noreen, Vice President of Technology
Target Bonus as a % of Base Salary: 25%
Company Goal/Individual Goal Weighted Component: 50%/50%

Company Performance Goal Component

For fiscal year 2009, the Compensation Committee has established a 10% return on beginning equity (“ROE”) as the target Company performance goal. Under the Plan, ROE is calculated by dividing (1) the Company’s net income for fiscal year 2009 (excluding (1) the after-tax effect of expenses incurred for fiscal year 2009 relating to the Company’s ongoing SEC investigation and (2) the after-tax effect of any net realized gains (losses) on investments during fiscal year 2009) by (2) total shareholders’ equity at the beginning of fiscal year 2009.

The minimum and maximum Company performance goals for fiscal year 2009 were set by the Compensation Committee at a 5% ROE and a 15% ROE, respectively. Under the Plan:

• if ROE for fiscal year 2009 is less than 5%, no bonus will be awarded for the Company goal component;

• if the Company achieves a ROE of 5% for fiscal year 2009, each executive officer will be entitled to receive a bonus equal to the product of (1) 50% of the amount of the executive officer’s target bonus and (2) the percentage of his bonus allocated to the Company goal component;

• if the Company achieves a ROE of 10% for fiscal year 2009, each executive officer will be entitled to receive a bonus equal to the product of (1) 100% of the amount of the executive officer’s target bonus and (2) the percentage of his bonus allocated to the Company goal component; and

• if the Company achieves a ROE of at least 15% for fiscal year 2009, each executive officer will be entitled to receive a bonus equal to the product of (1) 125% of the amount of his target bonus and (2) the percentage of his bonus allocated to the Company goal component.

If ROE for fiscal year 2009 falls between 5% and 10%, a straight-line schedule will be used to determine the percentage of the amount of target bonus (ranging between 50% and 100%) each executive officer will be entitled to receive in respect of the Company goal component.

Individual Performance Goal Component

Under the Plan, the Compensation Committee has established individual performance goals for each applicable executive officer. For fiscal year 2009, the individual performance goals for Mr. Stephan and Mr. Toth consist of financial targets with respect to the product line for which the applicable executive officer has responsibility. For Margaret A. Noreen, the individual performance goals consist primarily of information technology development goals. Following the completion of the 2009 fiscal year, the Compensation Committee will evaluate each applicable executive officer’s performance with respect to his individual performance goals and determine his bonus relating to the individual goal component (equal up to the product of (1) the amount of the executive officer’s target bonus and (2) the percentage of his bonus allocated to the individual goal component).

Total Cash Bonus

Following the completion of the 2009 fiscal year, each executive officer will be entitled to receive a cash bonus equal to the sum of the Company performance goal component achieved and the individual performance goal component achieved. Under the Plan, bonuses for fiscal year 2009 performance will be paid to participants in early 2010.

Miscellaneous

Notwithstanding anything to the contrary set forth in the Plan, the Compensation Committee shall have the right, in its sole discretion and for any reason, to reduce or eliminate the amount of any cash bonus otherwise payable to any executive officer under the Plan.

In the event that, at any time prior to the payment date of a cash bonus under the Plan, (1) a participant incurs a “separation from service” (as such term is defined in the Treasury Regulations promulgated under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), whether voluntary or involuntary, from the Company and all entities with whom the Company would be treated as a single employer for purposes of Sections 414(b) and (c) of the Code, or (2) a “change in control event” (as such term is defined in the Treasury Regulations promulgated under Section 409A of the Code) occurs with respect to the Company, the Compensation Committee shall have the right, in its sole discretion and for any reason, to determine whether, and the extent to which, cash bonuses shall be paid to any executive officer under the Plan.