Retirement Plan for the Board of Managers of The Provident Bank

Summary

This agreement establishes a retirement plan for non-employee members of The Provident Bank's Board of Managers. Eligible managers who have served at least ten years and meet certain age requirements receive quarterly retirement payments, with specific amounts based on years of service. Early retirement and death benefits are also addressed. The plan can be amended or terminated by the Board, but accrued benefits cannot be reduced without consent. Payments are suspended if the bank becomes undercapitalized, resuming only when financial requirements are met.

EX-10.7 16 dex107.txt EXHIBIT 10.7 Exhibit 10.7 RETIREMENT PLAN FOR THE BOARD OF MANAGERS OF THE PROVIDENT BANK WHEREAS. The Provident Bank, a New Jersey savings bank (the "Bank") desires to provide retirement benefits for eligible .members of their Board of Managers ("Managers"); NOW. THEREFORE, the Bank hereby adopts the "Retirement Plan For The Board Of Managers Of The Provident Bank" (the "Plan"), effective January 1, 1992 as hereinafter set forth: 1. Eligibility All Managers who are not employees of the Bank are eligible for Participation in the Plan. Even though a Manager participates in the Plan, no benefits shall be paid under this Plan to a Manager unless he or she meets the age requirements outlined in this Plan and unless he or she has been a Manager for at least ten years. 2. Normal Retirement Benefits A Manager who ceases to be a Manager on or after the first Annual Meeting of the Bank after the Manager has attained his or her 70th birthday, and after having been a Manager for at least ten years, shall receive on each subsequent January1, April 1, July 1, and October 1 for the remainder of his or her lifetime (but not to exceed 40 quarterly payments) a payment from the Bank in an amount determined as follows: Full Years Of Service As Quarterly A Manager After 1991 Payment 1 $125.00 2 250.00 3 375.00 4 500.00 -1- Full Years Of Service As Quarterly A Manager After 1991 Payment 5 $ 625.00 6 750.00 7 875.00 8 1,000.00 9 1,125.00 10 or more 1,250.00 3. Early Retirement Benefit A Manager who ceases to be a Manager at or after attaining age 65, but prior to the first Annual Meeting of the Bank after the Manager has attained his or her 70th birthday, and after having been a Manager for at least ten years, shall receive the quarterly payments outlined in Section 2 above commencing on the first day of the calendar quarter immediately following the first Annual Meeting of the Bank after the Manager has attained his or her 70th birthday. Alternatively, such Manager may elect to have quarterly payments commence on the first day of any calendar quarter coincident with or next following the date he ceases to be a Manager, in which case each payment shall be reduced to reflect the fact that the payments commence prior to the first day of the calendar quarter immediately following the first Annual Meeting of the Bank after the Manager would have attained his or her 70th birthday. The reduction shall be 2.5% for each calendar quarter by which the date payments commence precedes the first day of the calendar quarter immediately following the first Annual Meeting of the Bank after the Manager would have attained his or her 70th birthday. The quarterly payments made to a Manager who retires early in accordance with this Section shall be made for the remainder of his or her lifetime (but not to exceed 40 quarterly payments). -2- 4. Lump Sum Death Benefit In the event that a Manager dies before ceasing to be a Manager or before age 65 or before having been a Manager for at least ten years, no benefits will be payable from this Plan to his or her surviving beneficiary. In the event that a Manager who has met the eligibility requirements for benefits outlined in Sections 2 or 3 above dies after he or she has ceased to be a Manager, a lump sum amount shall be paid to his or her beneficiary equal to four times the amount of the quarterly payment which the Manager was receiving (or would have started receiving on the first day of the calendar quarter next following his or her death if payments have not yet commenced), except that if such deceased Manager has received more than 36 quarterly payments, the lump sum amount paid shall equal (a) 40 minus the number of quarterly payments made to the deceased Manager times (b) the amount of the quarterly payment which the Manager was receiving. 5. General Provisions 5.1 Benefits under this Plan shall be paid out of the general assets of the Bank. 5.2 The Board of Managers of the Bank may amend or terminate the Plan at any time and from time to time in such manner as it shall determine. Any amendment may be given retroactive effect, except that no amendment may reduce or eliminate any benefit which accrued to any Manager under the Plan prior to the date of the amendment without the consent of the affected Manager. 5.3 Except as otherwise provided by law, the right of any Manager to any benefit or payment hereunder is expressly made subject -3- to the condition and limitation that it shall not be subject to alienation, assignment, attachment, execution, or other process. 5.4 In the event it becomes necessary or appropriate to interpret the Plan, the Bank hereby delegates the authority to interpret the provisions of the Plan to those persons, who from time to time, have such authority with respect to and under The Provident Bank Pension Plan. 5.5 In the event that any claim for benefits, which must initially be submitted in writing to the Board of Managers of the Bank, is denied (in whole or in part) hereunder, the claimant shall receive from the Bank notice in writing, written in a manner calculated to be understood by the claimant, setting forth the specific reasons for denial, with specific reference to pertinent provisions of this Plan. The interpretations and construction hereof by the Board of Managers shall be binding and conclusive on all persons and for all purposes. Any disagreements about such interpretations and construction shall be submitted to an arbitrator subject to the rules and procedures established by the American Arbitration Association. No member of the Board of Managers shall be liable to any person for any action taken hereunder except those actions undertaken with lack of good faith. 5.6 The Plan shall be interpretated and construed in accordance with the laws of the State of New Jersey. Dated: June 18, 1992 -4- EXCERPT FROM THE MINUTES OF THE BOARD OF MANAGERS MEETING HELD OCTOBER 22, 1992 On motion made and duly seconded the Board of Managers unanimously adopted the following resolution: BE IT RESOLVED that the Board of Managers deem it advisable to amend the Retirement Plan for the Board of Managers for the Provident Bank (the Plan) by providing that in the event that Provident is deemed to be "undercapitalized" as set forth in the applicable FDIC capital regulations or fails to satisfy the minimum capital requirement established from time to time by the New Jersey Department of Banking then Provident's obligations under the Plan shall cease until such time as Provident is deemed to be "well capitalized" under the applicable FDIC capital regulations and satisfies the minimum capital requirements of the Department of Banking at which time the Plan will be resumed. Mary Louise Festa Corporate Secretary