EXECUTIVE SALARY CONTINUATION AGREEMENT THAT SUPERSEDES AND REPLACES THE EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN EXECUTIVE AGREEMENT DATED SEPTEMBER 26, 2002
EXECUTIVE
SALARY CONTINUATION AGREEMENT THAT
SUPERSEDES
AND REPLACES THE EXECUTIVE
SUPPLEMENTAL
RETIREMENT PLAN EXECUTIVE
AGREEMENT
DATED SEPTEMBER 26, 2002
THIS
AGREEMENT,
made
and entered into this _______ day of ____________, 2006, by and between
Peachtree Bank, a bank organized and existing under the laws of the State of
Alabama (hereinafter referred to as the “Bank”), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, an
Executive of the Bank (hereinafter referred to as the “Executive”).
WHEREAS,
the
Bank is a wholly owned subsidiary of Maplesville Bancorp, an Alabama corporation
(hereinafter referred to as “Bancorp”);
WHEREAS,
the
Bank
and the Executive are parties to an Executive Supplemental Retirement Plan
Executive Agreement dated the 26th day of September, 2002, between Peachtree
Bank and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ that provides for the payment of certain benefits.
This
Executive Salary Continuation Agreement that supersedes and replaces the
Executive Supplemental Retirement Plan Executive Agreement dated September
26,
2002, shall bring the Executive Supplemental Retirement Plan Executive Agreement
dated September 26, 2002, into compliance with Internal Revenue Code §409A
enacted on October 22, 2004. The benefits provided hereunder shall supersede
and
replace the existing Executive Supplemental Retirement Plan Executive Agreement
and the benefits provided thereby;
WHEREAS,
the
Executive has been and continues to be a valued Executive of the Bank, and
is
now employed with the Bank;
WHEREAS,
it is
the consensus of the Board of Directors (hereinafter referred to as the “Board”)
that the Executive’s employment with the Bank in the past has been of
exceptional merit and has constituted an invaluable contribution to the general
welfare of the Bank in bringing the Bank to its present status of operating
efficiency and present position in its field of activity;
WHEREAS,
the
Executive’s experience, knowledge of the affairs of the Bank, reputation, and
contacts in the industry are so valuable that assurance of the Executive’s
continued employment is essential for the future growth and profits of the
Bank
and it is in the best interest of the Bank to arrange terms of continued
employment for the Executive so as to reasonably assure the Executive remains
in
the Bank’s employ during the Executive’s lifetime or until the age of
retirement;
WHEREAS,
it is
the desire of the Bank that the Executive’s employment be retained as herein
provided;
WHEREAS,
the
Executive is willing to continue in the employ of the Bank provided the Bank
agrees to pay the Executive or the Executive’s beneficiary(ies), certain
benefits in accordance with the terms and conditions hereinafter set
forth;
ACCORDINGLY,
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 at
retirement or the Executive’s beneficiary(ies) in the event of the Executive’s
death pursuant to this Agreement;
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 Income 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
THEREFORE,
in
consideration of past employment performance and employment to be performed
in
the future as well as the mutual promises and covenants herein contained it
is
agreed as follows:
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I.
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EFFECTIVE
DATE
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The
Effective Date of this Agreement shall be January 1, 2006.
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II.
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EMPLOYMENT
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The
Bank
agrees to employ the Executive in such capacity as the Bank may from time to
time determine. The Executive will continue in the employ of the Bank in such
capacity and with such duties and responsibilities as may be assigned to him,
and with such compensation as may be determined from time to time by the Board
of Directors of the Bank.
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III.
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FRINGE
BENEFITS
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The
salary continuation benefits provided by this Agreement are granted by the
Bank
as a fringe benefit to the Executive and are not part of any salary reduction
plan or an arrangement deferring a bonus or a salary increase. The Executive
has
no option to take any current payment or bonus in lieu of these salary
continuation benefits except as set forth hereinafter.
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IV.
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DEFINITIONS
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A.
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Retirement
Date:
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If
the
Executive remains in the continuous employ of the Bank, the Executive shall
retire from active employment with the Bank on the Executive’s sixty-second
(62nd) birthday or such later date as the Executive may actually
retire.
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B.
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Normal
Retirement Age:
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Normal
Retirement Age shall mean the date on which the Executive attains age sixty-two
(62).
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C.
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Plan
Year:
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Any
reference to “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.
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D.
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Termination
of Employment:
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Termination
of Employment shall mean voluntary resignation of employment by the Executive
or
the Bank’s discharge of the Executive without cause (Subparagraph IV [E]), prior
to the Normal Retirement Age (Subparagraph IV [B]).
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E.
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Discharge
for Cause:
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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 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 (as long as
such
duties are consistent with his duties as of the date of the Agreement, with
such
changes as the Executive may agree to); 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.
In
the alternative, if the Executive is permitted to resign due to inappropriate
conduct as defined above, the Board of Directors may vote to deny all benefits.
A majority decision by the Board of Directors is required for forfeiture of
the
Executive’s benefits.
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F.
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Change
of Control:
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In
accordance with Internal Revenue Code §409A, the Change of Control shall be
defined as the occurrence of any one of the following:
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a.
|
the
acquisition of more than fifty percent (50%) of the value orvoting
power
of the Bank’s or Bancorp’s stock by a person or
group;
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b.
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the
acquisition in a period of twelve (12) months or less of at least
thirty-five percent (35%) of the Bank’s or Bancorp’s stock by a person or
group;
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c.
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the
replacement of a majority of the Bank’s board in a period of twelve (12)
months or less by Directors who were not endorsed by a majority of
the
current board members; or
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d.
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the
acquisition in a period of twelve (12) months or less of forty percent
(40%) or more of the Bank’s or Bancorp’s assets by an unrelated
entity.
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For
the
purposes of this Agreement, transfers made on account of deaths or gifts,
transfers between family members or transfers to a qualified retirement plan
maintained by the Bank shall not be considered in determining whether there
has
been a Change in Control.
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G.
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Disability:
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An
Executive is considered disabled if he or she is: [1] unable to engage in any
substantial gainful activity by reason of any medically determinable physical
or
mental impairment which can be expected to result in death or can be expected
to
last for a continuous period of not less than twelve (12) months; or [2] by
reason of any medically determinable physical or mental impairment which can
be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months, receiving income replacement benefits
for a
period of not less than three (3) months under an accident and health plan
covering the Executive of the Bank. If there is a dispute regarding whether
the
Executive is disabled, such dispute shall be resolved by a physician mutually
selected by the Bank and the Executive and such resolution shall be binding
upon
all parties to this Agreement.
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V.
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RETIREMENT
BENEFIT AND POST-RETIREMENT DEATH
BENEFIT
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The
Bank,
commencing with the first day of the second month following the Retirement
Date
(Subparagraph IV [A]), shall pay the Executive an annual benefit equal
Ninety-Five Thousand and 00/100th Dollars ($95,000.00). Said benefit shall
be
paid in equal monthly installments (1/12th of the annual benefit) until the
death of the Executive. Upon the death of the Executive, if there is a balance
in the accrued liability retirement account, such balance shall be paid in
one
(1) 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, any such amount becoming due and payable upon the death of the
Executive shall be payable 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.
In
accordance with the Internal Revenue Code §409A, if the Executive is a Key
Employee, and said Bank is publicly traded at the time of retirement, any such
benefit payment shall be withheld for six (6) months following such
retirement.
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VI.
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DEATH
BENEFIT PRIOR TO
RETIREMENT
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In
the
event the Executive should die while actively employed by the Bank at any time
after the date of this Agreement but prior to the Executive attaining the age
of
sixty-two (62) years (or such later date as may be agreed upon), the Bank will
pay the accrued balance on the date of death, of the Executive’s accrued
liability retirement account in one (1) lump sum, the first day of the second
month following the Executive’s death, to such individual or individuals as the
Executive may have designated in writing and filed with the Bank, at which
time
this Agreement shall terminate. In the absence of any effective beneficiary
designation, any such amount becoming due and payable upon the death of the
Executive shall be payable to the duly qualified executor or administrator
of
the Executive’s estate. Said payment due hereunder shall be made by the first
day of the second month following the decease of the Executive.
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VII.
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DISABILITY
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In
the
event the Executive becomes disabled prior to the Executive’s Retirement Date
(Subparagraph IV [A]), and the Executive’s employment is terminated because of
such disability, he shall become one hundred percent (100%) vested in the
balance of the accrued liability retirement account. Said balance shall be
paid
in a lump sum, without regard to the Executive’s Normal Retirement Age
(Subparagraph IV [B]), thirty (30) days following such termination of
employment.
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VIII.
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BENEFIT
ACCOUNTING/ACCRUED LIABILITY RETIREMENT
ACCOUNT
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The
Bank
shall account for this benefit using the regulatory accounting principles of
the
Bank’s primary federal regulator. The Bank shall establish an accrued liability
retirement account for the Executive into which appropriate reserves shall
be
accrued.
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IX.
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VESTING
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The
Executive shall be one hundred percent (100%) vested in the accrued liability
retirement account.
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X.
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TERMINATION
OF EMPLOYMENT
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Subject
to Subparagraph IV (E), in the event that the employment of the Executive
shall terminate prior to Normal Retirement Age, as provided in Subparagraph
IV
(B), by the Executive’s voluntary action, or by the Executive’s discharge by the
Bank without cause, then this Agreement shall terminate upon the date of such
termination of employment and the Bank shall pay to the Executive an amount
of
money equal to balance of the Executive’s accrued liability retirement account
on the date of said termination, multiplied by the Executive’s cumulative vested
percentage (Paragraph IX). This compensation shall be paid in one (1) lump
sum
the first day of the second month following said Termination.
In
accordance with Internal Revenue Code §409A, if the Executive is a Key Employee,
and said Bank is publicly traded at the time of termination of employment,
any
such benefit payment shall be withheld for six (6) months following such
termination of employment.
In
the
event the Executive’s death should occur after such termination but prior to the
payment provided for in this Paragraph X, the balance shall be paid, in one
(1)
lump sum to such individual or individuals as the Executive may have designated
in writing and filed with the Bank. In the absence of any effective beneficiary
designation, any such amount shall be payable 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.
In
the
event the Executive shall be discharged for cause at any time in accordance
with
Subparagraph IV (E), this Agreement shall terminate and all benefits provided
herein shall be forfeited.
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XI.
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CHANGE
OF CONTROL
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If
the
Executive subsequently suffers a Termination of Employment (voluntarily or
involuntarily), except for cause, anytime subsequent to a Change of Control
as
defined in Subparagraph IV (F), then the Executive shall receive the benefits
in
Paragraph V herein upon attaining Normal Retirement Age (Subparagraph IV [B]),
as if the Executive had been continuously employed by the Bank until the
Executive’s Normal Retirement Age. Said payment shall be made in accordance with
Internal Revenue Code §409A. The Executive will also remain eligible for all
promised death benefits in this Agreement. In addition, no sale, merger,
consolidation or conversion of the Bank or Bancorp shall take place unless
the
new or surviving entity expressly acknowledges the obligations under this
Agreement and agrees to abide by its terms.
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XII.
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RESTRICTIONS
ON FUNDING
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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 Executive, 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 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, right, title or interest in any specific funding
investment or assets of the Bank.
If
the
Bank elects to invest in a life insurance, disability or annuity policy on
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.
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XIII.
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MISCELLANEOUS
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A.
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Alienability
and Assignment Prohibition:
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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.
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B.
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Binding
Obligation of the Bank and any Successor in
Interest:
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Neither
the Bank nor Bancorp shall merge or consolidate into or with another bank or
company or sell substantially all of either 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.
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C.
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Amendment
or Revocation:
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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.
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D.
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Gender:
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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.
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E.
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Effect
on Other Bank Benefit Plans:
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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.
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F.
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Headings:
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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.
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G.
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Applicable
Law:
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The
laws
of the State of Alabama shall govern the validity and interpretation of this
Agreement.
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H.
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Partial
Invalidity:
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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.
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I.
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Not
a Contract of Employment:
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This
Agreement shall not be deemed to constitute a contract of employment between
the
parties hereto, nor shall any provision hereof restrict the right of the Bank
to
discharge the Executive, or restrict the right of the Executive to terminate
employment.
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J.
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Supersede
and Replace Entire Agreement:
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This
Agreement shall supersede the Executive Supplemental Retirement Plan Executive
Agreement dated the 26th day of September, 2002, and shall replace the entire
agreement of the parties pertaining to this particular Executive Salary
Continuation Agreement.
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XIV.
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ADMINISTRATIVE
AND CLAIMS PROVISION
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A.
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Plan
Administrator:
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The
“Plan
Administrator” of this Executive Plan shall be Peachtree Bank. As Plan
Administrator, the Bank shall be responsible for the management, control and
administration of the Executive Plan. The Plan Administrator 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.
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B.
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Claims
Procedure:
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a.
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Filing
a Claim for Benefits:
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Any
insured, beneficiary, or other individual, (“Claimant”) entitled to benefits
under this Executive Plan will file a claim request with the Plan Administrator.
The Plan Administrator will, upon written request of a Claimant, make available
copies of all forms and instructions necessary to file a claim for benefits
or
advise the Claimant where such forms and instructions may be obtained. If the
claim relates to disability benefits, then the Plan Administrator shall
designate a sub-committee to conduct the initial review of the claim (and
applicable references below to the Plan Administrator shall mean such
sub-committee).
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b.
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Denial
of Claim:
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A
claim
for benefits under this Executive Plan will be denied if the Bank determines
that the Claimant is not entitled to receive benefits under the Executive Plan.
Notice of a denial shall be furnished the Claimant within a reasonable period
of
time after receipt of the claim for benefits by the Plan Administrator. This
time period shall not exceed more than ninety (90) days after the receipt of
the
properly submitted claim. In the event that the claim for benefits pertains
to
disability, the Plan Administrator shall provide written notice within
forty-five (45) days. However, if the Plan Administrator determines, in its
discretion, that an extension of time for processing the claim is required,
such
extension shall not exceed an additional ninety (90) days. In the case of a
claim for disability benefits, the forty-five (45) day review period may be
extended for up to thirty (30) days if necessary due to circumstances beyond
the
Plan Administrator’s control, and for an additional thirty (30) days, if
necessary. Any extension notice shall indicate the special circumstances
requiring an extension of time and the date by which the Plan Administrator
expects to render the determination on review.
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c.
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Content
of Notice:
|
The
Plan
Administrator shall provide written notice to every Claimant who is denied
a
claim for benefits which notice shall set forth the following:
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(i.)
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The
specific reason or reasons for the
denial;
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(ii.)
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Specific
reference to pertinent Executive Plan provisions on which the denial
is
based;
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(iii.)
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A
description of any additional material or information necessary for
the
Claimant to perfect the claim, and any explanation of why such material
or
information is necessary; and
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(iv.)
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Any
other information required by applicable regulations, including with
respect to disability benefits.
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d.
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Review
Procedure:
|
The
purpose of the Review Procedure is to provide a method by which a Claimant
may
have a reasonable opportunity to appeal a denial of a claim to the Plan
Administrator for a full and fair review. The Claimant, or his duly authorized
representative, may:
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(i.)
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Request
a review upon written application to the Plan Administrator. Application
for review must be made within sixty (60) days of receipt of written
notice of denial of claim. If the denial of claim pertains to disability,
application for review must be made within one hundred eighty (180)
days
of receipt of written notice of the denial of
claim;
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(ii.)
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Review
and copy (free of charge) pertinent Executive Plan documents, records
and
other information relevant to the Claimant’s claim for
benefits;
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(iii.)
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Submit
issues and concerns in writing, as well as documents, records,
and other
information relating to the claim.
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e.
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Decision
on Review:
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A
decision on review of a denied claim shall be made in the following
manner:
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(i.)
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The
Plan Administrator may, in its sole discretion, hold a hearing on
the
denied claim. If the Claimant’s initial claim is for disability benefits,
any review of a denied claim shall be made by members of the Plan
Administrator other than the original decision maker(s) and such
person(s)
shall not be a subordinate of the original decision maker(s). The
decision
on review shall be made promptly, but generally not later than sixty
(60)
days after receipt of the application for review. In the event that
the
denied claim pertains to disability, such decision shall not be made
later
than fortyfive (45) days after receipt of the application for review.
If
the Plan Administrator determines that an extension of time for processing
is required, written notice of the extension shall be furnished to
the
Claimant prior to the termination of the initial sixty (60) day period.
In
no event shall the extension exceed a period of sixty (60) days from
the
end of the initial period. In the event the denied claim pertains
to
disability, written notice of such extension shall be furnished to
the
Claimant prior to the termination of the initial forty-five (45)
day
period. In no event shall the extension exceed a period of thirty
(30)
days from the end of the initial period. The extension notice shall
indicate the special circumstances requiring an extension of time
and the
date by which the Plan Administrator expects to render the determination
on review.
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(ii.)
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The
decision on review shall be in writing and shall include specific
reasons
for the decision written in an understandable manner with specific
references to the pertinent Executive Plan provisions upon which
the
decision is based.
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(iii.)
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The
review will take into account all comments, documents, records and
other
information submitted by the Claimant relating to the claim without
regard
to whether such information was submitted or considered in the initial
benefit determination. Additional considerations shall be required
in the
case of a claim for disability benefits. For example, the claim will
be
reviewed without deference to the initial adverse benefits determination
and, if the initial adverse benefit determination was based in whole
or in
part on a medical judgment, the Plan Administrator will consult with
a
health care professional with appropriate training and experience
in the
field of medicine involving the medical judgment. The health care
professional who is consulted on appeal will not be the same individual
who was consulted during the initial determination or the subordinate
of
such individual. If the Plan Administrator obtained the advice of
medical
or vocational experts in making the initial adverse benefits determination
(regardless of whether the advice was relied upon), the Plan Administrator
will identify such experts.
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(iv.)
|
The
decision on review will include a statement that the Claimant is
entitled
to receive, upon request and free of charge, reasonable access to,
and
copies of, all documents, records or other information relevant to
the
Claimant’s claim for benefits.
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f.
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Exhaustion
of Remedies:
|
A
Claimant must follow the claims review procedures under this Executive Plan
and
exhaust his or her administrative remedies before taking any further action
with
respect to a claim for benefits.
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C.
|
Arbitration:
|
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 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 cause,” such
dispute shall likewise be submitted to arbitration as above described and the
parties hereto agree to be bound by the decision thereunder.
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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 hereinabove, and that,
upon execution, each has received a conforming copy.
| PEACHTREE BANK | |||
| Maplesville, AL | |||
|
By:
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| Witness | (Bank Officer other than Insured) Title | ||
|
Witness
|
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | ||
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