Chattahoochee National Bank Executive Supplemental Retirement Plan Agreement

Contract Categories: Human Resources › Retirement Agreements
Summary

This agreement is between Chattahoochee National Bank and a designated executive. It sets out the terms for providing supplemental retirement benefits to the executive upon retirement, and to their beneficiaries in the event of death. The plan is a non-qualified, unfunded arrangement, meaning it is not subject to standard retirement plan regulations and is intended to offer additional retirement income beyond regular benefits. The agreement details how benefits are calculated, when they are paid, and under what conditions the executive or their beneficiaries are eligible to receive them.

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EX-10.10 4 g86362exv10w10.txt EX-10.10 SUPPLEMENTAL RETIREMENT PLAN EXECUTIVE EXHIBIT 10.10 FORM OF EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN EXECUTIVE AGREEMENT THIS AGREEMENT is made and entered into this __ day of ________, by and between Chattahoochee National Bank, a bank organized and existing under the laws of the State of Georgia (hereinafter referred to as the "Bank"), and ___________, an Executive of the Bank (hereinafter referred to as the "Executive"). WHEREAS, the Executive is now in the employ of the Bank and has for many years faithfully served the Bank. It is the consensus of the Board of Directors (hereinafter referred to as the "Board") that the Executive's services have been of exceptional merit, in excess of the compensation paid and an invaluable contribution to the profits and position of the Bank in its field of activity. The Board further believes that the Executive's experience, knowledge of corporate affairs, reputation and industry contacts are of such value, and the Executive's continued services so essential to the Bank's future growth and profits, that it would suffer severe financial loss should the Executive terminate their service; ACCORDINGLY, the Board has adopted the Chattahoochee National Bank Executive Supplemental Retirement Plan (hereinafter referred to as the "Executive Plan") and it is the desire of the Bank and the Executive to enter into this Agreement under which the Bank will agree to make certain payments to the Executive upon the Executive's retirement and to the Executive's beneficiary(ies) in the event of the Executive's death pursuant to the Executive Plan; FURTHERMORE, it is the intent of the parties hereto that this Executive Plan be considered an unfunded arrangement maintained primarily to provide supplemental retirement benefits for the Executive, and be considered a non-qualified benefit plan for purposes of the Employee Retirement Security Act of 1974, as amended ("ERISA"). The Executive is fully advised of the Bank's financial status and has had substantial input in the design and operation of this benefit plan; and NOW THEREFORE, in consideration of services the Executive has performed in the past and those to be performed in the future, and based upon the mutual promises and covenants herein contained, the Bank and the Executive agree as follows: I. DEFINITIONS A. Effective Date The Effective Date of the Executive Plan shall be August 21, 2002. B. Plan Year Any reference to the "Plan Year" shall mean a calendar year from January 1st to December 31st. In the year of implementation, the term "Plan Year" shall mean the period from the Effective Date to December 31st of the year of the Effective Date. C. Retirement Date Retirement Date shall mean retirement from service with the Bank which becomes effective on the first day of the calendar month following the month in which the Executive reaches age sixty-five (65) or such later date as the Executive may actually retire. D. Termination of Service Termination of Service shall mean the Executive's voluntary resignation from service by the Executive or the Bank's discharge of the Executive without cause, prior to the Normal Retirement Age (Subparagraph I [J]). E. Pre-Retirement Account A Pre-Retirement Account shall be established as a liability reserve account on the books of the Bank for the benefit of the Executive. Prior to the Executive's Termination of Service or Retirement Date, whichever shall first occur, such liability reserve account shall be increased each year by an amount equal to 14% of the annual earnings for the year determined by the Index (described in Subparagraph I (G) hereinafter), less the Cost of Funds Expense for that year (described in Subparagraph I (H) hereinafter). F. Index Retirement Benefit The Index Retirement Benefit for each Executive in the Executive Plan for each Plan Year shall be equal to the excess (if any) of the Index (Subparagraph I [G]) for that Plan Year over the Cost of Funds Expense (Subparagraph I [H]) for that Plan Year, divided by a factor equal to 1.08 minus the marginal tax rate. G. Index The Index for any year shall be the aggregate annual after-tax income from the life insurance contracts described in Exhibit "A", attached hereto and fully incorporated herein by reference, on the lives of the Participants (described in Subparagraph I [L]), as defined by FASB Technical Bulletin 85-4. This Index shall be applied as if such insurance contracts were purchased on the effective date hereof. If such contracts of life insurance are actually purchased by the Bank then the actual policies as of the effective dates listed for each policy on Exhibit "A" shall be used in calculations under this Agreement. If such contracts of life insurance are not purchased or are subsequently surrendered or lapsed, then the Bank shall receive annual policy illustrations that assume the policies described in Exhibit "A" were purchased from the named insurance company(ies) on the effective dates listed for each policy on Exhibit "A". 2 In either case, references to the life insurance contracts are merely for purposes of calculating a benefit. The Bank has no obligation to purchase such life insurance and, if purchased, the Executive and his beneficiary(ies) shall have no ownership interest in such policy and shall always have no greater interest in the benefits under this Agreement than that of an unsecured general creditor of the Bank. H. Cost of Funds Expense The Cost of Funds Expense for any Plan Year shall be calculated by taking the sum of the amount of premiums for the life insurance policies described in the definition of "Index" plus the amount of any after-tax benefits paid to the Executive pursuant to the Executive Plan (Paragraph II hereinafter) plus the amount of all previous years' after-tax Cost of Funds Expense, and multiplying that sum by the Average After-Tax Cost of Funds (Subparagraph I [K]). I. Change of Control Change of Control means the cumulative transfer of more than fifty percent (50%) of the voting stock of the Bank or Holding Company from the Effective Date of this Executive Plan. For the purposes of this Executive Plan, transfers made on account of deaths or gifts, transfers between family members or transfers made to a qualified retirement plan maintained by the Bank shall not be considered in determining whether there has been a Change of Control. J. Normal Retirement Age Normal Retirement Age shall mean the date on which the Executive attains age sixty-five (65). K. Average After-Tax Cost of Funds Average After-Tax Cost of Funds means, at any particular time, a ratio, the numerator of which is the total annualized interest expense as set forth on Schedule RI-income Statement of the Bank's most recently filed Consolidated Report of Condition and Income (the "Call Report") and the denominator of which is an amount equal to: (i) the amount of deposits in domestic offices (sum of total of columns A and C from Schedule RC-E of the Call Report), plus (ii) the amount of Federal funds purchased and securities sold under agreements to repurchase, as set forth on Schedule RC-Balance Sheet of the Call Report, times the inverse of the Bank's combined marginal income tax rate. L. Number of Participants The Number of Participants for any Plan Year shall be the number of Participants (including those in retirement status) participating in the Plan as of December 31st of the previous year. Participants are those listed on the attached Exhibit B. 3 M. Modification of Exhibits A and B For all purposes of this Agreement, in the event of a new plan participant, death of a participant, termination of service of a participant who is not fully vested in the plan, retirement of a participant, or some other event, said Exhibits A and B may be modified as follows: (i) Exhibit A By substituting the "Premiums Paid" for each participant with the cash surrender value of each participant's policy on the date(s) of the aforestated event(s). (ii) Exhibit B By adding or deleting a new or existing plan participant. II. INDEX BENEFITS A. Retirement Benefits Subject to Subparagraph II(D) hereinafter, an Executive who remains in the employ of the Bank until the Normal Retirement Age (Subparagraph I [J]) shall be entitled to receive the balance in the Pre-Retirement Account in fifteen (15) equal annual installments commencing thirty (30) days following the Executive's retirement. In addition to these payments and commencing in conjunction therewith, the Index Retirement Benefit (as defined in Subparagraph I [F]) for each Plan Year subsequent to the Executive's retirement, and including the remaining portion of the Plan Year following said retirement, shall be paid to the Executive until the Executive's death. B. Termination of Service Subject to Subparagraph II(D), should an Executive suffer a Termination of Service, the Executive shall be entitled to receive the percentage set forth below that corresponds to the number of full years the Executive has been employed by the Bank from the date of first service with the Bank (to a maximum of 100%), times the balance in the Pre-Retirement Account payable to the Executive in fifteen (15) equal annual installments commencing thirty (30) days following the Executive's Normal Retirement Age (Subparagraph I [J]). In addition to these payments and commencing in conjunction therewith, the percentage set forth hereinafter that corresponds to the number of full years of employment with the Bank from the date of first employment with the Bank (to a maximum of 100%), times the index Retirement Benefit for each Plan Year subsequent to the year in which the Executive attains Normal Retirement Age, and including the remaining portion of the Plan Year in which the Executive attains Normal Retirement Age, shall be paid to the Executive until the Executive's death. 4
Number of Full Years of Vested Percentage Date of Employment Employment (to a maximum of 100%) ------------------ ---------- ---------------------- December 30, 1998 1-13 3.85% per year PLUS 14-18 10% per year
Notwithstanding anything hereinabove to the contrary, the Executive shall be one hundred percent (100%) vested upon attaining age fifty-five (55) while employed by the Bank. C. Death Should the Executive die while there is a balance in the Executive's Pre Retirement Account (Subparagraph I [E]) said unpaid balance shall be paid in a lump sum to the individual or individuals the Executive may have designated in writing and filed with the Bank. In the absence of any effective beneficiary designation, the unpaid balance shall be paid as set forth herein to the duly qualified executor or administrator of the Executive's estate. Said payment due hereunder shall be made the first day of the second month following the decease of the Executive. D. Discharge for Cause Should the Executive be Discharged for Cause at any time, all benefits under this Executive Plan shall be forfeited. The term "for cause" shall mean any of the following that result in an adverse effect on the Bank: (i) gross negligence or gross neglect; (ii) the commission of a felony or gross misdemeanor involving moral turpitude, fraud, or dishonesty; (iii) the willful violation of any law, rule, or regulation (other than a traffic violation or similar offense); (iv) an intentional failure to perform stated duties; or (v) a breach of fiduciary duty involving personal profit. If a dispute arises as to discharge "for cause," such dispute shall be resolved by arbitration as set forth in this Executive Plan. E. Death Benefit Except as set forth above, there is no death benefit provided under this Agreement. F. Disability Benefit In the event the Executive becomes disabled prior to Termination of Service, and the Executive's employment is terminated because of such disability, he shall immediately begin receiving the benefits in Subparagraph II(A) above. Such benefit shall begin without regard to Executive's Normal Retirement Age and the Executive shall be one hundred percent (100%) vested in the entire benefit 5 amount. If there is a dispute regarding whether the Executive is disabled, such dispute shall be resolved by a physician selected by the Bank and such resolution shall be binding upon all parties to this Agreement. III. DEFERRAL BENEFITS A. Deferral Election Any Executive wishing to defer any portion or all of the Executive's compensation may elect to defer up to twenty-five percent (25%) of compensation each year for a maximum of five (5) years. At the end of the five-year period, the Board shall have the option of extending the deferral period for any amount of time it shall deem to be appropriate. The Executive will make the election to defer by filing with the Bank a written statement setting forth the amount of the deferrals and the Executive's election of payment as set forth in Subparagraph III (C) hereinafter. This statement must be filed prior to having earned the deferred income. B. Deferred Compensation Account The Bank shall establish a Deferred Compensation Account in the name of the Executive and credit that account with the deferrals. The Bank shall also credit interest to the Deferred Compensation Account balance on December 31st of each year. The interest rate credited shall be one hundred and fifty percent (150%) of the yield of a one- year Treasury Bill as of the crediting date. C. Retirement, Termination of Service or Death Upon the Director's Retirement Date or Termination of Service [Subparagraphs I[C] and [D] hereinabove), the balance of the Executive's Deferred Compensation Account shall be payable as elected by the Executive one (1) year prior to receiving said benefit payable to the Executive thirty (30) days following said event. If the Executive fails to make said payment election, then the Executive shall be paid in ten (10) equal annual installments as set forth herein. Should the Executive die while there is a balance in the Executive's Deferred Compensation Account, such balance shall be paid pursuant to Subparagraph II(C) hereinabove. IV. RESTRICTIONS UPON FUNDING The Bank shall have no obligation to set aside, earmark or entrust any fund or money with which to pay its obligations under this Executive Plan. The Executives, their beneficiary(ies), or any successor in interest shall be and remain simply a general creditor of the Bank in the same manner as any other creditor having a general claim for matured and unpaid compensation. The Bank reserves the absolute right, at its sole discretion, to either fund the obligations undertaken by this Executive Plan or to refrain from funding the same and to determine the extent, nature and method of such funding. Should the Bank 6 elect to fund this Executive Plan, in whole or in part, through the purchase of life insurance, mutual funds, disability policies or annuities, the Bank reserves the absolute right, in its sole discretion, to terminate such funding at any time, in whole or in part. At no time shall any Executive be deemed to have any lien nor right, title or interest in or to any specific funding investment or to any assets of the Bank. If the Bank elects to invest in a life insurance, disability or annuity policy upon the life of the Executive, then the Executive shall assist the Bank by freely submitting to a physical exam and supplying such additional information necessary to obtain such insurance or annuities. V. CHANGE OF CONTROL Upon a Change of Control (Subparagraph I [I]) if the Executive subsequently suffers a Termination of Service (Subparagraph I [D]) then the Executive shall receive the benefits promised in this Executive Plan upon attaining Normal Retirement Age, as if the Executive had been continuously employed by the Bank until the Executive's Normal Retirement Age. The Executive will also remain eligible for all promised death benefits in this Executive Plan. In addition, no sale, merger, or consolidation of the Bank shall take place unless the new or surviving entity expressly acknowledges the obligations under this Executive Plan and agrees to abide by its terms. VI. MISCELLANEOUS A. Alienability and Assignment Prohibition Neither the Executive, nor the Executive's surviving spouse, nor any other beneficiary(ies) under this Executive Plan shall have any power or right to transfer, assign, anticipate, hypothecate, mortgage, commute, modify or otherwise encumber in advance any of the benefits payable hereunder nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance owed by the Executive or the Executive's beneficiary(ies), nor be transferable by operation of law in the event of bankruptcy, insolvency or otherwise. In the event the Executive or any beneficiary attempts assignment, commutation, hypothecation, transfer or disposal of the benefits hereunder, the Bank's liabilities shall forthwith cease and terminate. B. Binding Obligation of the Bank and any Successor in Interest The Bank shall not merge or consolidate into or with another bank or sell substantially all of its assets to another bank, firm or person until such bank, firm or person expressly agree, in writing, to assume and discharge the duties and obligations of the Bank under this Executive Plan. This Executive Plan shall be binding upon the parties hereto, their successors, beneficiaries, heirs and personal representatives. 7 C. Amendment or Revocation It is agreed by and between the parties hereto that, during the lifetime of the Executive, this Executive Plan may be amended or revoked at any time or times, in whole or in part, by the mutual written consent of the Executive and the Bank. D. Gender Whenever in this Executive Plan words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply. E. Effect on Other Bank Benefit Plans Nothing contained in this Executive Plan shall affect the right of the Executive to participate in or be covered by any qualified or non-qualified pension, profit-sharing, group, bonus or other supplemental compensation or fringe benefit plan constituting a part of the Bank's existing or future compensation structure. F. Headings Headings and subheadings in this Executive Plan are inserted for reference and convenience only and shall not be deemed a part of this Executive Plan. G. Applicable Law The validity and interpretation of this Agreement shall be governed by the laws of the State of Georgia. H. 12 U.S.C. 1828(k) Any payments made to the Executive pursuant to this Executive Plan, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. Section 1828(k) or any regulations promulgated thereunder. I. Partial Invalidity If any term, provision, covenant, or condition of this Executive Plan is determined by an arbitrator or a court, as the case may be, to be invalid, void, or unenforceable, such determination shall not render any other term, provision, covenant, or condition invalid, void, or unenforceable, and the Executive Plan shall remain in full force and effect notwithstanding such partial invalidity. J. Employment No provision of this Executive Plan shall be deemed to restrict or limit any existing employment agreement by and between the Bank and the Executive, nor 8 shall any conditions herein create specific employment rights to the Executive nor limit the right of the Employer to discharge the Executive with or without cause. In a similar fashion, no provision shall limit the Executive's rights to voluntarily sever the Executive's employment at any time. VII. ERISA PROVISION A. Named Fiduciary and Plan Administrator The "Named Fiduciary and Plan Administrator" of this Executive Plan shall be Chattahoochee National Bank until its resignation or removal by the Board. As Named Fiduciary and Plan Administrator, the Bank shall be responsible for the management, control and administration of the Executive Plan. The Named Fiduciary may delegate to others certain aspects of the management and operation responsibilities of the Executive Plan including the employment of advisors and the delegation of ministerial duties to qualified individuals. B. Claims Procedure and Arbitration In the event a dispute arises over benefits under this Executive Plan and benefits are not paid to the Executive (or to the Executive's beneficiary(ies) in the case of the Executive's death) and such claimants feel they are entitled to receive such benefits, then a written claim must be made to the Named Fiduciary and Plan Administrator named above within sixty (60) days from the date payments are refused. The Named Fiduciary and Plan Administrator shall review the written claim and if the claim is denied, in whole or in part, it shall provide in writing within sixty (60) days of receipt of such claim the specific reasons for such denial, reference to the provisions of this Executive Plan upon which the denial is based and any additional material or information necessary to perfect the claim. Such written notice shall further indicate the additional steps to be taken by claimants if a further review of the claim denial is desired. A claim shall be deemed denied if the Named Fiduciary and Plan Administrator fail to take any action within the aforesaid sixty-day period. If claimants desire a second review they shall notify the Named Fiduciary and Plan Administrator in writing within sixty (60) days of the first claim denial. Claimants may review this Executive Plan or any documents relating thereto and submit any written issues and comments it may feel appropriate. In their sole discretion, the Named Fiduciary and Plan Administrator shall then review the second claim and provide a written decision within sixty (60) days of receipt of such claim. This decision shall likewise state the specific reasons for the decision and shall include reference to specific provisions of the Plan Agreement upon which the decision is based. If claimants continue to dispute the benefit denial based upon completed performance of this Executive Plan or the meaning and effect of the terms and conditions thereof, then claimants may submit the dispute to an arbitrator for final 9 arbitration. The arbitrator shall be selected by mutual agreement of the Bank and the claimants. The arbitrator shall operate under any generally recognized set of arbitration rules. The parties hereto agree that they and their heirs, personal representatives, successors and assigns shall be bound by the decision of such arbitrator with respect to any controversy properly submitted to it for determination. Where a dispute arises as to the Bank's discharge of the Executive for "for cause," such dispute shall likewise be submitted to arbitration as above described and the parties hereto agree to be bound by the decision thereunder. VIII. TERMINATION OR MODIFICATION OF AGREEMENT BY REASON OF CHANGES IN THE LAW, RULES OR REGULATIONS The Bank is entering into this Agreement upon the assumption that certain existing tax laws, rules and regulations will continue in effect in their current form. If any said assumptions should change and said change has a detrimental effect on this Executive Plan, then the Bank reserves the right to terminate or modify this Agreement accordingly. Provided, however, that the Executive shall be entitled to receive at least his/her Executive's Deferred Compensation Account including interest earned. Upon a Change of Control (Subparagraph I [I]) this paragraph shall become null and void effective immediately upon said Change of Control. 10 IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Agreement and executed the original thereof on the first day set forth hereinbelow, and that, upon execution, each has received a conforming copy. CHATTAHOOCHEE NATIONAL BANK Alpharetta, Georgia By: - ----------------------------------- ----------------------------------- Witness Title - ----------------------------------- -------------------------------------- Witness 11