HABERSHAM BANK SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENT
Exhibit
10.2
HABERSHAM
BANK
THIS
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENT (the “Agreement”) is adopted
effective as of this 1st
day of
January, 2008, by and between HABERSHAM BANK, a state-chartered commercial
bank
located in Clarkesville, Georgia (the “Bank”) and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the
“Executive”).
The
purpose of this Agreement is to provide specified benefits to the Executive,
a
member of a select group of management or highly compensated employees who
contribute materially to the continued growth, development, and future business
success of the Bank. This Agreement shall be unfunded for tax
purposes and for purposes of Title I of the Employee Retirement Income Security
Act of 1974 (“ERISA”), as amended from time to time.
Article
1
Definitions
Whenever
used in this Agreement, the following words and phrases shall have the meanings
specified:
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1.1
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“Account
Value”
means the amount which would be accrued by the Bank at any particular
time
assuming the Discount Rate remained constant at the initial Discount
Rate. The parties expressly acknowledge that the Account Value
may be different than the liability that should be accrued by the
Bank,
under Generally Accepted Accounting Principles (“GAAP”), for the Bank’s
obligation to the Executive under this Agreement. The Account
Value on any date other than the end of a Plan Year shall be determined
by
adding the prorated increase attributable for the current Plan
Year to the
Account Value for the previous Plan Year.
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1.2
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“Base
Annual
Salary” means the annual cash compensation relating to services
performed during any calendar year, excluding distributions from
nonqualified deferred compensation plans, bonuses, commissions,
overtime,
fringe benefits, stock options, relocation expenses, incentive
payments,
non-monetary awards, and other fees, and automobile and other allowances
paid to the Executive for employment rendered (whether or not such
allowances are included in the Executive’s gross income). Base
Annual Salary shall be calculated before reduction for compensation
voluntarily deferred or contributed by the Executive pursuant to
all
qualified or non-qualified plans of the Bank and shall be calculated
to
include amounts not otherwise included in the Executive's gross
income
under Code Sections 125, 402(e)(3), 402(h), or 403(b) pursuant
to plans
established by the Bank; provided, however, that all such amounts
will be
included in compensation only to the extent that had there been
no such
plan, the amount would have been payable in cash to the Executive.
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1.3
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“Beneficiary”
means each designated person, or the estate of the deceased Executive,
entitled to benefits, if any, upon the death of the Executive pursuant
to
Article 4.
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1.4
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“Beneficiary
Designation Form” means the form established from time to time by
the Plan Administrator that the Executive completes, signs, and
returns to
the Plan Administrator to designate one or more Beneficiaries.
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1.5
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“Board”
means
the Board of Directors of the Bank as from time to time constituted.
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1.6
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“Change
of
Control” shall mean any one of the following events which may occur
after the Effective Date:
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(a)
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the
acquisition by any individual, entity or “group,” within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange
Act of
1934, as amended, (a “Person”) of beneficial ownership (within the meaning
of Rule 13-d-3 promulgated under the Securities Exchange Act
of 1934) of
voting securities of the Corporation where such acquisition causes
any
such Person to own fifty percent (50%) or more of the combined
voting
power of the then outstanding voting securities entitled to vote
generally
in the election of directors;
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(b)
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within
any twelve-month period, the persons who were directors of the
Corporation
immediately before the beginning of such twelve-month period
(the
“Incumbent Directors”) shall cease to constitute at least a majority of
the Board of Directors of the Corporation; provided that any
director who
was not a director as of the beginning of such twelve-month period
shall
be deemed to be an Incumbent Director if that director were elected
to the
Board of Directors of the Corporation by, or on the recommendation
of or
with the approval of, at least two-thirds of the directors who
then
qualified as Incumbent Directors; and provided further that no
director
whose initial assumption of office is in connection with an actual
or
threatened election contest relating to the election of directors
shall be
deemed to be an Incumbent Director;
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(c)
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a
reorganization, merger or consolidation, with respect to which
persons who
were the stockholders of the Corporation immediately prior to
such
reorganization, merger or consolidation do not, immediately thereafter,
own more than fifty percent (50%) of the combined voting power
entitled to
vote in the election of directors of the reorganized, merged
or
consolidated company’s then outstanding voting securities; or
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(d)
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the
sale, transfer or assignment of all or substantially all of the
assets of
the Corporation to any third party.
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1.7
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“Code”
means
the
Internal Revenue Code of 1986, as amended.
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1.8
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“Corporation”
means Habersham Bancorp.
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2
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1.9
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“Disability”
means Executive: (i) is 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 (ii)
is, 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 employees of the
Bank. Medical determination of Disability may be made by either
the Social Security Administration or by the provider of an accident
or
health plan covering employees of the Bank. Upon the request of
the Plan Administrator, the Executive must submit proof to the
Plan
Administrator of the Social Security Administration’s or the provider’s
determination.
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1.10
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“Discount
Rate”
means the rate used by the Plan Administrator for determining the
Account
Value. The initial Discount Rate is seven percent
(7%). However, the Plan Administrator, in its discretion, may
adjust the Discount Rate to maintain the rate within reasonable
standards
according to GAAP and/or applicable bank regulatory guidance.
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1.11
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“Early
Termination” means Separation from Service before Normal Retirement
Age for reasons other than death, Disability, Termination for Cause
or
following a Change of Control.
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1.12
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“Effective
Date”
means January 1, 2008.
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1.13
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“Final
Pay”
means the highest Base Annual Salary of the Executive for the period
of
three (3) consecutive and complete years of employment with the
Bank prior
to Separation from Service. If the Executive does not have
three (3) consecutive and complete years of employment with the
Bank prior
to Separation from Service, then Final Pay shall be determined
by
averaging the sum of Base Annual Salary paid for the consecutive
and
complete years of employment with the Bank credited to the Executive
and
the annualized Base Annual Salary for any partial period of employment
ending immediately prior to the Separation from Service.
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1.14
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“Normal
Retirement
Age” means the Executive attaining age sixty-five (65).
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1.15
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“Normal
Retirement
Date” means the later of Normal Retirement Age or Separation from
Service.
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1.16
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“Plan
Administrator” means the plan administrator described in Article 8.
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1.17
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“Plan
Year”
means each twelve (12) month period commencing on January 1st and
ending
on December 31st of each year.
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1.18
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“Projected
Benefit” means forty percent (40%) of Projected Final Pay.
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3
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1.19
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“Projected
Final
Pay” means Final Pay increased five percent (5%) annually, until
Normal Retirement Age.
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1.20
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“Separation
from Service”
means
the
termination of the Executive’s
employment with
the Bank and
all affiliates for reasons other than death. Whether
a Separation from Service takes place is determined in accordance
with the
requirements of Code Section 409A and related Treasury guidance
or
Regulations based on the facts and circumstances surrounding
the
termination of the Executive’s employment and whether the Bank and the
Executive intended for the Executive to provide significant services
for
the Bank following such termination. A Separation from Service
will nothave
occurred if:
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(a)
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the
Executive continues to provide services as an employee of the Bank
at an
annual rate that is twenty percent (20%) or more of the services
rendered,
on average, during the immediately preceding three (3) full calendar
years
of employment (or, if employed less than three (3) years, such
lesser
period) and the annual remuneration for such services is twenty
percent
(20%) or more of the average annual remuneration earned during
the final
three (3) full calendar years of employment (or, if less, such
lesser
period), or
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(b)
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the
Executive continues to provide services to the Bank in a capacity
other
than as an employee of the Bank at an annual rate that is fifty
percent
(50%) or more of the services rendered, on average, during the
immediately
preceding three (3) full calendar years of employment (or if employed
less
than three (3) years, such lesser period) and the annual remuneration
for
such services is fifty percent (50%) or more of the average annual
remuneration earned during the final three (3) full calendar years
of
employment (or if less, such lesser
period).
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The
Executive’s employment relationship will be treated as continuing intact while
the Executive is on military leave, sick leave, or other bona fide leave
of
absence if the period of such leave of absence does not exceed six (6) months,
or if longer, so long as the Executive’s right to reemployment with the Bank is
provided either by statute or by contract. If the period of leave
exceeds six (6) months and there is no right to reemployment, a Separation
from
Service will be deemed to have occurred as of the first date immediately
following such six (6) month period.
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1.21
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“Specified
Employee” means a key employee (as defined in Section
416(i) of the Code without regard to paragraph 5 thereof) of the
Corporation (or an entity which is considered to be single employer
with
the Corporation under Code Section 414(b) or 414(c)) if any stock
of any
such entity is publicly traded on an established securities market
or
otherwise, as determined by the Plan Administrator based on the
twelve
(12) month period ending each December 31 (the “identification
period”). If the Executive is determined to be a Specified
Employee for an identification period, the Executive shall be treated
as a
Specified Employee for purposes of this Agreement during the twelve
(12)
month period that begins on the first day of the fourth month following
the close of the identification period.
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1.22
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“Termination
for
Cause” means Separation from Service for:
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(a)
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Gross
negligence or gross neglect of duties to the Bank; or
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(b)
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Commission
of a felony or of a gross misdemeanor involving moral turpitude
in
connection with the Executive’s employment with the Bank; or
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(c)
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Fraud,
disloyalty, dishonesty or willful violation of any law or significant
Bank
policy committed in connection with the Executive’s employment and
resulting in a material adverse effect on the Bank.
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Article
2
Distributions
During Lifetime
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2.1
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Normal
Retirement
Benefit. Upon the Normal Retirement Date, the Bank shall
distribute to the Executive the benefit described in this Section
2.1 in
lieu of any other benefit under this Article.
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2.1.1
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Amount
of
Benefit. The annual benefit under this Section 2.1 is
forty percent (40%) of Final Pay.
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2.1.2
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Distribution
of
Benefit. The Bank shall pay the annual benefit to the
Executive in twelve (12) equal monthly installments commencing
on the
first day of the month following the Executive’s Normal Retirement
Date. The annual benefit shall be distributed to the Executive
for fifteen (15) years.
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2.2
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Early
Termination
Benefit. Upon the occurrence of an Early Termination,
the Bank shall distribute to the Executive the benefit described
in this
Section 2.2 in lieu of any other benefit under this Article.
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2.2.1
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Amount
of
Benefit. The benefit under this Section 2.2 is the
vested portion of the Account Value determined based on the most
recent
anniversary of the Effective Date preceding the Early Termination
based on
the schedule set forth below:
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Effective
Date Anniversary
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Vested
Portion
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1st
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20%
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2nd
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40%
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3rd
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60%
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4th
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80%
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5th
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100%
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Interest
shall be credited to the Account Value from Separation from Service until
Normal
Retirement Age in an amount equal to the Discount Rate at the time of Separation
from Service, compounded monthly.
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2.2.2
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Distribution
of
Benefit. The Bank shall pay the benefit to the Executive
in twelve (12) equal monthly installments commencing on the first
day of
the month following the Executive’s Normal Retirement Age. The
benefit shall be distributed to the Executive for fifteen (15)
years.
During the applicable installment period, interest will be applied to
the Account Value at the Discount Rate, compounded monthly.
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2.3
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Disability
Benefit. If Executive experiences a Disability which
results in a Separation from Service prior to Normal Retirement
Age, the
Bank shall distribute to the Executive the benefit described in
this
Section 2.3 in lieu of any other benefit under this Article.
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2.3.1
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Amount
of
Benefit. The benefit under this Section 2.3 is one
hundred percent (100%) of the Account Value determined as of the
end of
the Plan Year preceding Separation from Service. Interest shall
be
credited to the Account Value from Separation from Service until
Normal
Retirement Age in an amount equal to the Discount Rate at the time
of
Separation from Service, compounded monthly.
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2.3.2
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Distribution
of
Benefit. The Bank shall pay the annual benefit to the
Executive in twelve (12) equal monthly installments commencing
on the
first day of the month following the Executive’s Normal Retirement
Age. The benefit shall be distributed to the Executive for
fifteen (15) years. During the applicable installment
period, interest will be applied to the Account Value at the
Discount Rate, compounded monthly.
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2.4
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Change
of Control
Benefit. Upon a Change of Control followed by a
Separation from Service prior to Normal Retirement Age, the Bank
shall
distribute to the Executive the benefit described in this Section
2.4 in
lieu of any other benefit under this Article.
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2.4.1
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Amount
of
Benefit. The annual benefit under this Section 2.4 is
one hundred percent (100%) of the Projected Benefit.
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2.4.2
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Distribution
of
Benefit.
The Bank shall
pay the annual benefit to the Executive in twelve (12) equal monthly
installments commencing on the first day of the month following
Normal
Retirement Age. The annual benefit shall be distributed to the
Executive for fifteen (15) years.
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2.5
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Restriction
on Timing
of Distribution. Notwithstanding any provision of this
Agreement to the contrary, if the Executive is considered a Specified
Employee at Separation from Service under such procedures as established
by the Bank in accordance with Section 409A of the Code, benefit
distributions that are otherwise payable upon Separation from Service
may
not commence earlier than six (6) months after the date of
such Separation from Service. Therefore, in the event
this Section 2.5 is applicable to the Executive, any distribution
which
would otherwise be paid to the Executive within the first six months
following the Separation from Service shall be accumulated and
paid to the
Executive in a lump sum on the first day of the seventh month following
the Separation from Service. All subsequent distributions shall
be paid in the manner specified.
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6
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2.6
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Distributions
Upon
Income Inclusion Under Section 409A of the Code. If any
amount is required to be included in income by the Executive prior
to
receipt due to a failure of this Agreement to meet the requirements
of
Code Section 409A and related Treasury guidance or Regulations,
the Plan
Administrator shall distribute that portion of the amount the Bank
has
accrued with respect to the Bank’s obligations hereunder that is required
to be included in the Executive’s income. The Bank shall
distribute to the Executive such amount in immediately available
funds in
an amount equal to the portion of the amount the Bank has accrued
with
respect to the Bank’s obligations hereunder required to be included in
income as a result of the failure of this Agreement to meet the
requirements of Code Section 409A and related Treasury guidance
or
Regulations, which amount shall not exceed the Executive's unpaid
amount
the Bank has accrued with respect to the Bank’s obligations
hereunder. Such distribution shall be made within ninety (90)
days of the date the Plan Administrator determines that the income
inclusion described in this Section 2.6 is required. Such a
distribution shall affect and reduce the Executive’s benefits to be paid
under this Agreement.
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2.7
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Change
in Form or
Timing of Distributions. For distribution of benefits under
this Article 2, the Executive and the Bank may, subject to the
terms of
Section 7.1, amend the Agreement to delay the timing or change
the form of
distributions. Any such amendment:
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(a)
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may
not accelerate the time or schedule of any distribution, except
as
provided in Section 409A of the Code and the regulations thereunder;
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(b)
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must,
for benefits distributable under Section 2.2, 2.3 and 2.4 be made
at least
twelve (12) months prior to the first scheduled distribution;
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(c)
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must,
for benefits distributable under Article 2 delay the commencement
of
distributions for a minimum of five (5) years from the date the
first
distribution was originally scheduled to be made; and
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(d)
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must
take effect not
less than twelve (12) months after the amendment is made.
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Article
3
Distribution
at Death
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3.1
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Death
During
Service. If the Executive dies prior to a Separation
from Service, the Bank shall distribute to the Beneficiary the
benefit
described in this Section 3.1. This benefit shall be distributed
in lieu
of the benefits under Article 2.
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3.1.1
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Amount
of
Benefit. The benefit under this Section 3.1 is the
present value of the Projected Benefit payable for fifteen (15)
years
discounted back using the Discount Rate in effect at the time of
death.
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3.1.2
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Distribution
of
Benefit. The Bank shall distribute the benefit to the
Beneficiary in a lump sum within sixty (60) days following the
date of the
Executive’s death.
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3.2
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Death
During
Distribution of a Benefit. If the Executive dies after
any benefit distributions have commenced under this Agreement but
before
receiving all such distributions, the Bank shall distribute to
the
Beneficiary the remaining benefits at the same time and in the
same
amounts that would have been distributed to the Executive had the
Executive survived.
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3.3
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Death
After Separation
from Service But Before Benefit Distributions Commence. If
the
Executive is entitled to any benefit payments under Article 2 of
this
Agreement, but dies after Separation from Service but prior to
the
commencement of said benefit payments, the Bank shall pay a lump
sum
benefit to the Beneficiary equal to the Executive’s Account Value at the
time of death. The Bank shall distribute the benefit to the Beneficiary
within sixty (60) days following the date of the Executive’s death.
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Article
4
Beneficiaries
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4.1
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Beneficiary. The
Executive shall have the right, at any time, to designate a Beneficiary
to
receive any benefit distributions under this Agreement upon the
death of
the Executive. The Beneficiary designated under this Agreement
may be the same as or different from the beneficiary designated
under any
other plan of the Bank in which the Executive participates.
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4.2
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Beneficiary
Designation: Change. The Executive shall designate a
Beneficiary by completing and signing the Beneficiary Designation
Form,
and delivering it to the Plan Administrator or its designated
agent. The Executive's beneficiary designation shall be deemed
automatically revoked if the Beneficiary predeceases the Executive
or if
the Executive names a spouse as Beneficiary and the marriage is
subsequently dissolved. The Executive shall have the right to
change a Beneficiary by completing, signing and otherwise complying
with
the terms of the Beneficiary Designation Form and the Plan Administrator’s
rules and procedures, as in effect from time to time. Upon the
acceptance by the Plan Administrator of a new Beneficiary Designation
Form, all Beneficiary designations previously filed shall be
cancelled. The Plan Administrator shall be entitled to rely on
the last Beneficiary Designation Form filed by the Executive and
accepted
by the Plan Administrator prior to the Executive’s death.
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4.3
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Acknowledgment. No
designation or change in designation of a Beneficiary shall be
effective
until received, accepted and acknowledged in writing by the Plan
Administrator or its designated agent.
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4.4
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No
Beneficiary
Designation. If the Executive dies without a valid
beneficiary designation, or if all designated Beneficiaries predecease
the
Executive, then the Executive’s spouse shall be the designated
Beneficiary. If the Executive has no surviving spouse, the
benefits shall be made to the Executive's estate.
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4.5
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Facility
of
Distribution. If the Plan Administrator determines in
its discretion that a benefit is to be distributed to a minor,
to a person
declared incompetent, or to a person incapable of handling the
disposition
of that person’s property, the Plan Administrator may direct distribution
of such benefit to the guardian, legal representative or person
having the
care or custody of such minor, incompetent person or incapable
person. The Plan Administrator may require proof of
incompetence, minority or guardianship as it may deem appropriate
prior to
distribution of the benefit. Any distribution of a benefit
shall be a distribution for the account of the Executive and the
Executive’s Beneficiary, as the case may be, and shall be a complete
discharge of any liability under the Agreement for such distribution
amount.
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Article
5
General
Limitations
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5.1
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Termination
for
Cause. Notwithstanding any provision of this Agreement
to the contrary, the Bank shall not distribute any benefit under
this
Agreement if the Executive’s employment with the Bank is terminated due to
a Termination for Cause.
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5.2
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Suicide
or
Misstatement. No benefits shall be distributed if the
Executive commits suicide within two (2) years after the Effective
Date of
this Agreement, or if an insurance company which issued a life
insurance
policy covering the Executive and owned by the Bank denies coverage
(i)
for material misstatements of fact made by the Executive on an
application
for such life insurance, or (ii) for any other reason.
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5.3
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Forfeiture
Provision. The Bank shall not pay any benefit under this
Agreement if the Executive, without the prior written consent of
the Bank,
during active service and within one (1) year from the Executive’s
Separation from Service for any reason whatsoever he will not (except
on
behalf of or with the prior written consent of the Bank either
directly or
indirectly, on his own behalf or in the service of or on behalf
of others,
as an executive employee or in any other capacity which involves
duties
and responsibilities similar to those undertaken for the Bank engage
in
any business which is the same as or essentially the same as the
business
of the Bank in accepting deposits or making loans (whether presently
existing or subsequently established) and which has an office located
within a radius of fifty (50) miles of any office of the Bank;
provided,
however, that the foregoing shall not preclude any ownership by
the Executive of an amount not to exceed five percent (5%) of the
equity
securities of any entity which is subject to the periodic reporting
requirements of the Securities Exchange act of 1934 and the shares
of Bank
and Corporation common stock owned by the Executive at the time
of Separation from Service. This section shall not apply following a
Change of Control.
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9
Article
6
Claims
and Review Procedures
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6.1
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Claims
Procedure. An Executive or Beneficiary (“claimant”) who
has not received benefits under the Agreement that he or she believes
should be distributed shall make a claim for such benefits as follows:
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6.1.1
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Initiation
–
Written
Claim. The claimant initiates a claim by submitting to
the Plan Administrator a written claim for the benefits. If
such a claim relates to the contents of a notice received by the
claimant,
the claim must be made within sixty (60) days after such notice was
received by the claimant. All other claims must be made within
one hundred eighty (180) days of the date on which the event that
caused the claim to arise occurred. The claim must state with
particularity the determination desired by the claimant.
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6.1.2
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Timing
of Plan
Administrator Response. The
Plan
Administrator shall respond to such claimant within ninety (90)
days after
receiving the claim (forty-five (45) days with respect to a denial
of any
claim for benefits due to the Executive’s Disability). If the
Plan Administrator determines that special circumstances require
additional time for processing the claim, the Plan Administrator
can
extend the response period by an additional ninety (90) days (thirty
(30)
days with respect to a claim for benefits due to the Executive’s
Disability) by notifying the claimant in writing, prior to the
end of such
initial period, that an additional period is required. With
respect to a claim for benefits due to the Executive’s Disability, an
additional extension of up to thirty (30) days beyond the initial
30-day
extension period may be required for processing the claim. In
such event, written notice of the extension shall be furnished
to the
claimant within the initial 30-day extension period. The notice
of extension must set forth the special circumstances and the date
by
which the Plan Administrator expects to render its decision.
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6.1.3
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Notice
of
Decision. If the Plan Administrator denies part or all
of the claim, the Plan Administrator shall notify the claimant
in writing
of such denial. The Plan Administrator shall write the
notification in a manner calculated to be understood by the
claimant. The notification shall set forth:
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(a)
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The
specific reasons for the denial;
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(b)
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A
reference to the specific provisions of the Agreement on which
the denial
is based;
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(c)
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A
description of any additional information or material necessary
for the
claimant to perfect the claim and an explanation of why it is needed;
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(d)
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An
explanation of the Agreement’s review procedures and the time limits
applicable to such procedures;
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(e)
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A
statement of the claimant’s right to bring a civil action under ERISA
Section 502(a) following an adverse benefit determination on review;
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10
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(f)
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In
the case of a claim for benefits due to the
Executive’s Disability, if an internal rule, guideline,
protocol or other similar criterion is relied upon in making the
adverse
determination, either the specific rule, guideline, protocol or
other
similar criterion; or a statement that such rule, guideline, protocol
or
other similar criterion was relied upon in making the decision
and that a
copy of such rule, guideline, protocol or other similar criterion
will be
provided free of charge upon request; and
|
|
|
(g)
|
In
the case of a claim for benefits due to the Executive’s Disability, if a
denial of the claim is based on a medical necessity or experimental
treatment or similar exclusion or limit, an explanation of the
scientific
or clinical judgment for the denial, an explanation applying the
terms of
the Agreement to the claimant’s medical circumstances or a statement that
such explanation will be provided free of charge upon request.
|
|
6.2
|
Review
Procedure. If the Plan Administrator denies part or all
of the claim, the claimant shall have the opportunity for a full
and fair
review by the Plan Administrator or, if applicable, the Appeals
Fiduciary
of the denial, as follows:
|
|
6.2.1
|
Initiation
–
Written
Request. To initiate the review, the claimant, within
sixty (60) days (one hundred eighty (180) days with respect to
a denial of
a claim for benefits due to the Executive’s Disability) after receiving
the Plan Administrator’s notice of denial, must file with the Plan
Administrator or, if applicable, Appeals Fiduciary a written request
for
review. For purposes of this Article 6, the term “Appeals
Fiduciary” means an individual or group of individuals appointed to review
appeals of claims for benefits payable due to the Executive’s Disability.
With respect to any denial of a claim for benefits due to Disability,
in
deciding an appeal of any denial based in whole or in part on a
medical
judgment (including determinations with regard to whether a particular
treatment, drug, or other item is experimental, investigational,
or not
medically necessary or appropriate), the Appeals Fiduciary shall:
|
|
|
(a)
|
consult
with a health care professional who has appropriate training and
experience in the field of medicine involved in the medical judgment;
and
|
|
|
(b)
|
identify
the medical and vocational experts whose advice was obtained in
connection
with the denial without regard to whether the advice was relied
upon in
making the determination to deny the claim.
|
Notwithstanding
the foregoing, the health care professional consulted pursuant to this Section
6.2.1 shall be an individual who was not consulted with respect to the initial
denial of the claim that is the subject of the appeal or a subordinate of
such
individual.
11
|
6.2.2
|
Additional
Submissions
– Information Access. The claimant shall then have the
opportunity to submit written comments, documents, records and
other
information relating to the claim. The Plan Administrator shall
also provide the claimant, upon request and free of charge, reasonable
access to, and copies of, all documents, records and other information
relevant (as defined in applicable ERISA regulations) to the claimant’s
claim for benefits.
|
|
6.2.3
|
Considerations
on
Review. In considering the review, the Plan
Administrator shall take into account all materials and information
the
claimant submits relating to the claim, without regard to whether
such
information was submitted or considered in the initial benefit
determination.
|
|
6.2.4
|
Timing
of Plan
Administrator Response. The Plan Administrator shall
respond in writing to such claimant within sixty (60) days (forty-five
(45) days with respect to a claim for benefits due to the Executive’s
Disability) after receiving the request for review. If the Plan
Administrator (or Appeals Fiduciary) determines that special circumstances
require additional time for processing the claim, the Plan Administrator
(or Appeals Fiduciary) can extend the response period by an additional
sixty (60) days (forty-five (45) days with respect to a claim for
benefits
due to the Executive’s Disability) by notifying the claimant in writing,
prior to the end of such day period that an additional period is
required. The notice of extension must set forth the special
circumstances and the date by which the Plan Administrator (or
Appeals
Fiduciary) expects to render its decision.
|
|
6.2.5
|
Notice
of
Decision. The Plan Administrator (or Appeals Fiduciary)
shall notify the claimant in writing of its decision on
review. The Plan Administrator (or Appeals Fiduciary) shall
write the notification in a manner calculated to be understood
by the
claimant. The notification shall set forth:
|
|
|
(a)
|
The
specific reasons for the denial;
|
|
|
(b)
|
A
reference to the specific provisions of the Agreement on which
the denial
is based;
|
|
|
(c)
|
A
statement that the claimant is entitled to receive, upon request
and free
of charge, reasonable access to, and copies of, all documents,
records and
other information relevant (as defined in applicable ERISA regulations)
to
the claimant’s claim for benefits;
|
|
|
(d)
|
A
statement of the claimant’s right to bring a civil action under ERISA
Section 502(a);
|
|
|
(e)
|
In
the case of a claim for benefits due to the Executive’s Disability,
if an internal rule, guideline, protocol or other similar
criterion is relied upon in making the adverse determination, either
the
specific rule, guideline, protocol or other similar criterion;
or a
statement that such rule, guideline, protocol or other similar
criterion
was relied upon in making the decision and that a copy of such
rule,
guideline, protocol or other similar criterion will be provided
free of
charge upon request;
|
12
|
|
(f)
|
In
the case of a claim for benefits due to the Executive’s Disability, if a
denial of the claim is based on a medical necessity or experimental
treatment or similar exclusion or limit, an explanation of the
scientific
or clinical judgment for the denial, an explanation applying the
terms of
the Agreement to the claimant’s medical circumstances or a statement that
such explanation will be provided free of charge upon request;
and
|
|
|
(g)
|
In
the case of a claim for benefits due to the Executive’s Disability, a
statement regarding the availability of other voluntary alternative
dispute resolution options.
|
Article
7
Amendments
and Termination
|
7.1
|
Amendments. This
Agreement may be amended only by a written agreement signed by
the Bank
and the Executive. However, the Bank may unilaterally amend
this Agreement to conform to written directives to the Bank from
its
auditors or banking regulators or to comply with legislative or
tax law,
including without limitation Section 409A of the Code and any and
all
regulations and guidance promulgated thereunder.
|
|
7.2
|
Plan
Termination
Generally. The Bank may unilaterally terminate this
Agreement at any time. The benefit shall be the Account Value
as of the date the Agreement is terminated. Except as provided
in Section 7.3, the termination of this Agreement shall not cause
a
distribution of benefits under this Agreement. Rather, upon
such termination benefit distributions will be made at the earliest
distribution event permitted under Article 2 or Article 3.
|
|
7.3
|
Plan
Terminations
Under Section 409A. Notwithstanding anything to the
contrary in Section 7.2, if the Bank terminates this Agreement
in the
following circumstances:
|
|
|
(a)
|
Within
thirty (30) days before, or twelve (12) months after a Change of
Control,
provided that all distributions are made no later than twelve (12)
months
following such termination of the Agreement and further provided
that
all the Bank's arrangements which are substantially similar to
the Agreement are terminated so the Executive and all
participants in the similar arrangements are required to receive all
amounts of compensation deferred under the terminated arrangements
within
twelve (12) months of the termination of the arrangements;
|
|
|
(b)
|
Upon
the Bank’s dissolution or with the approval of a bankruptcy court provided
that the amounts deferred under the Agreement are included in the
Executive's gross income in the latest of (i) the calendar year
in which
the Agreement terminates; (ii) the calendar year in which the amount
is no
longer subject to a substantial risk of forfeiture; or (iii) the
first
calendar year in which the distribution is administratively practical;
or
|
|
|
(c)
|
Upon
the Bank’s termination of this and all other non-account balance plans (as
referenced in Section 409A of the Code or the regulations thereunder),
provided that all distributions are made no earlier than twelve
(12)
months and no later than twenty-four (24) months following such
termination, and the Bank does not adopt any new non-account balance
plans
for a minimum of five (5) years following the date of such termination;
|
13
the
Bank
may distribute the Account Value, determined as of the date of the termination
of the Agreement, to the Executive in a lump sum subject to the above
terms.
Article
8
Administration
of Agreement
|
8.1
|
Plan
Administrator
Duties. This Agreement shall be administered by a Plan
Administrator which shall consist of the Board, or such committee
or
person(s) as the Board shall appoint. The Plan Administrator
shall administer this Agreement according to its express terms
and shall
also have the discretion and authority to (i) make, amend, interpret
and
enforce all appropriate rules and regulations for the administration
of this Agreement and (ii) decide or resolve any and all questions
including interpretations of this Agreement, as may arise in connection
with the Agreement to the extent the exercise of such discretion
and
authority does not conflict with Section 409A of the Code and regulations
thereunder.
|
|
8.2
|
Agents. In
the administration of this Agreement, the Plan Administrator may
employ
agents and delegate to them such administrative duties as it sees
fit,
(including acting through a duly appointed representative), and
may from
time to time consult with counsel who may be counsel to the Bank.
|
|
8.3
|
Binding
Effect of
Decisions. The decision or action of the Plan
Administrator with respect to any question arising out of or in
connection
with the administration, interpretation and application of the
Agreement
and the rules and regulations promulgated hereunder shall be final
and
conclusive and binding upon all persons having any interest in
the
Agreement.
|
|
8.4
|
Indemnity
of Plan
Administrator. The Bank shall indemnify and hold
harmless the members of the Plan Administrator against any and
all claims,
losses, damages, expenses or liabilities arising from any action
or
failure to act with respect to this Agreement, except in the case
of
willful misconduct by the Plan Administrator or any of its members.
|
|
8.5
|
Bank
Information. To enable the Plan Administrator to perform
its functions, the Bank shall supply full and timely information
to the
Plan Administrator on all matters relating to the date and
circumstances of the Disability, death, or Separation from Service of
the Executive, and such other pertinent information as the Plan
Administrator may reasonably require.
|
|
8.6
|
Annual
Statement. The Plan Administrator shall provide to the Executive,
within one hundred twenty (120) days after the end of each Plan
Year, a
statement setting forth the benefits to be distributed under this
Agreement.
|
14
Article
9
Miscellaneous
|
9.1
|
Binding
Effect. This Agreement shall bind the Executive and the
Bank, and their beneficiaries, survivors, executors, administrators
and
transferees.
|
|
9.2
|
No
Guarantee of
Employment. This Agreement is not a contract for
employment. It does not give the Executive the right to remain
as an employee of the Bank, nor does it interfere with the Bank's
right to
discharge the Executive. It also does not require the Executive
to remain an employee nor interfere with the Executive's right
to
terminate employment at any time.
|
|
9.3
|
Non-Transferability. Benefits
under this Agreement cannot be sold, transferred, assigned, pledged,
attached or encumbered in any manner, except pursuant to the Executive’s
will or the laws of dissent and distribution.
|
|
9.4
|
Tax
Withholding and
Reporting. The Executive is responsible for payment of
all taxes applicable to benefits paid or provided to Executive
under this
Agreement, except the employer portion of applicable federal, state
and
local employment tax obligations. The Bank shall withhold any
taxes owed by the Executive that are required to be withheld, including
federal, state and local income and employment tax withholding
obligations, from the benefits provided under this Agreement or
from any
other compensation otherwise payable to the Executive. The
Executive acknowledges that the Bank’s sole liability regarding such
withholding taxes is to forward any amounts withheld to the appropriate
taxing authority(ies). The Executive agrees that appropriate
amounts for withholding may be deducted from the cash salary, bonus
or
other payments due to Executive by the Bank, including payments
due under
this Agreement. If insufficient cash wages are available or if
Executive so desires, Executive may remit payment in cash for the
withholding amounts. In addition, the Bank shall be responsible
for withholding and payment to appropriate taxing authority(ies)
of all
employment tax obligations required to be paid and withheld by
the Bank
pursuant to Code Section 3121(v) and regulations promulgated thereunder
or
any other applicable law on the present value of benefits hereunder
which
are vested but not yet payable. In that regard, payment under
this Agreement may be accelerated to pay the FICA tax imposed under
Code
Sections 3101, 3121(a), and 3121(v)(2), where applicable, on benefits
paid
or provided to Executive under this Agreement (the “FICA Amount”) or to
pay the income tax at source on wages imposed under Code Section
3401 or
the corresponding withholding provisions of applicable state, local,
or
foreign tax laws as a result of the payment of the FICA Amount,
and to pay
the additional income tax at source on wages attributable to the
pyramiding Code Section 3401 wages and taxes; provided that the
total
amount accelerated pursuant to this sentence may not exceed the
aggregate
of the FICA Amount and the income tax withholding related to such
FICA
Amount. Withholding and payment of any taxes under this Section
9.4 shall reduce the amount of the benefits otherwise payable to
the
Executive.
|
15
|
9.5
|
Applicable
Law. The Agreement and all rights hereunder shall be
governed by the laws of the State of Georgia, except to the extent
preempted by the laws of the United States of America.
|
|
9.6
|
Unfunded
Arrangement. The Executive and the Beneficiary are
general unsecured creditors of the Bank for the distribution of
benefits
under this Agreement. The benefits represent the mere promise
by the Bank to distribute such benefits. The rights to benefits
are not subject in any manner to anticipation, alienation, sale,
transfer,
assignment, pledge, encumbrance, attachment, or garnishment by
creditors. Any insurance on the Executive's life or other
informal funding asset is a general asset of the Bank to which
the
Executive and Beneficiary have no preferred or secured claim.
|
|
9.7
|
Reorganization. The
Bank shall
not merge or consolidate into or with another bank, or reorganize,
or sell
substantially all of its assets to another bank, firm, or person
unless
such succeeding or continuing bank, firm, or person agrees to assume
and
discharge the obligations of the Bank under this
Agreement. Upon the occurrence of such event, the term “Bank”
as used in this Agreement shall be deemed to refer to the successor
or
survivor bank.
|
|
9.8
|
Entire
Agreement. This
Agreement
constitutes the entire agreement between the Bank and the Executive
as to
the subject matter hereof. No rights are granted to the
Executive by virtue of this Agreement other than those specifically
set
forth herein.
|
|
9.9
|
Interpretation. Wherever
the fulfillment of the intent and purpose of this Agreement requires,
and
the context will permit, the use of the masculine gender includes
the
feminine and use of the singular includes the plural.
|
|
9.10
|
Alternative
Action. In the event it shall become impossible for the
Bank or the Plan Administrator to perform any act required by this
Agreement, the Bank or Plan Administrator may in its discretion
perform
such alternative act as most nearly carries out the intent and
purpose of
this Agreement and is in the best interests of the Bank, provided
that
such alternative acts do not violate Section 409A of the Code.
|
|
9.11
|
Headings. Article
and section headings are for convenient reference only and shall
not
control or affect the meaning or construction of any of its provisions.
|
|
9.12
|
Validity. In
case any provision of this Agreement shall be illegal or invalid
for any
reason, said illegality or invalidity shall not affect the remaining
parts
hereof, but this Agreement shall be construed and enforced as if
such
illegal and invalid provision has never been inserted herein.
|
|
9.13
|
Notice. Any
notice or filing required or permitted to be given to the Bank
or Plan
Administrator under this Agreement shall be sufficient if in writing
and
hand-delivered, or sent by registered or certified mail, to the
address
below:
|
16
|
Habersham
Bank
|
|
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇
|
|
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
Such
notice shall be deemed given as of the date of delivery or, if delivery is
made
by mail, as of the date shown on the postmark on the receipt for registration
or
certification.
Any
notice or filing required or permitted to be given to the Executive under
this
Agreement shall be sufficient if in writing and hand-delivered, or sent by
mail,
to the last known address of the Executive.
|
9.14
|
Compliance
with
Section 409A. This Agreement shall at all times be
administered and the provisions of this Agreement shall be interpreted
consistent with the requirements of Section 409A of the Code and
any and
all regulations thereunder, including such regulations as may be
promulgated after the Effective Date of this Agreement.
|
|
9.15
|
Deduction
Limitation
on Benefit Payments. If the Bank reasonably anticipates
that the Bank’s deduction with respect to any distribution under this
Agreement would be limited or eliminated by application of Code
Section
162(m), then to the extent deemed necessary by the Bank to ensure
that the
entire amount of any distribution from this Agreement is deductible,
the
Bank may delay payment of any amount that would otherwise be distributed
under this Agreement. The delayed amounts shall be distributed
to the Executive (or the Beneficiary in the event of the Executive's
death) at the earliest date the Bank reasonably anticipates that
the
deduction of the payment of the amount will not be limited or eliminated
by application of Code Section 162(m).
|
IN
WITNESS WHEREOF, the Executive and a duly authorized representative of the
Bank
have signed this Agreement.
|
Executive:
|
Bank:
|
||
|
Habersham
Bank
|
|||
|
/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
|
|
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
|
|||
|
Title:
|
Chief
Executive Officer
|
||
17
|
£
|
New
Designation
|
|
£
|
Change
in Designation
|
I,
▇▇▇▇▇▇
▇.
▇▇▇▇▇▇ , designate the following as Beneficiary under the
Agreement:
|
Primary:
|
||||||
|
%
|
||||||
|
%
|
||||||
|
Contingent:
|
||||||
|
%
|
||||||
|
%
|
||||||
Notes:
|
|
·
|
Please
PRINT CLEARLY or TYPE
the names of the
beneficiaries.
|
|
|
·
|
To
name a trust as Beneficiary,
please provide the name of the trustee(s) and the exactname
and date of the trust
agreement.
|
|
|
·
|
To
name your estate as
Beneficiary, please write “Estate of [your
name]”.
|
|
|
·
|
Be
aware that none of the
contingent beneficiaries will receive anything unless ALL of the
primary
beneficiaries predecease
you.
|
I
understand that I may change these beneficiary designations by delivering
a new
written designation to the Plan Administrator, which shall be effective only
upon receipt and acknowledgment by the Plan Administrator prior to my
death. I further understand that the designations will be
automatically revoked if the Beneficiary predeceases me, or, if I have named
my
spouse as Beneficiary and our marriage is subsequently dissolved.
|
Name:
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
|
||||||
|
Signature:
|
|
|
Date:
|
Received
by the Plan Administrator this ________ day of ___________________,
2___
|
By:
|
|
||
|
Title:
|
|