EXHIBIT 10.6
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN
EXECUTIVE AGREEMENT
THIS AGREEMENT is made and entered into this 25th day of September, 2001,
by and between North Georgia National Bank, a bank organized and existing under
the laws of the State of Georgia (hereinafter referred to as the "Bank"), and
▇▇▇▇▇ ▇. ▇▇▇▇▇, an Executive of the Bank (hereinafter referred to the
"Executive").
WHEREAS, the Executive is no in the employ of the Bank and has for many
years faithfully served the Bank. It is the consensus of the Board of Directors
(hereinafter referred to as the "Board") that the Executive's services have been
of exceptional merit, in excess of the compensation paid and an invaluable
contribution to the future profits and position of the Bank in its filed of
activity. The Board further believes that the Executive's experience, knowledge
of corporate affairs, reputation and industry contacts are of such value, and
the Executive's continued services so essential to the Bank's future growth and
profits, that it would suffer server financial loss should the Executive
terminate his services;
ACCORDINGLY, the Board has adopted the North Georgia National Bank
Executive Supplemental Retirement Plan (hereinafter referred to as the
"Executive Plan") and it is the desire of the Bank and the Executive to enter
into this Agreement under which the Bank will agree to make certain payments to
the Executive upon the Executive's retirement or to the executive's
beneficiary(ies) in the event of the Executive's death pursuant to the Executive
Plan;
FURTHERMORE, it is the intent of the parties hereto that this Executive
Plan be considered an unfunded arrangement maintained primarily to provide
supplemental retirement benefits for the Executive, and be considered a
non-qualified benefit plan for purposes of the Employee Retirement Security Act
of 1974, as amended ("ERISA"). The Executive is fully advised of the Bank's
financial status and has had substantial input in the design and operation of
this benefit plan; and
NOW THEREFORE, in consideration of services the Executive has performed in
the past and those to be performed in the future, and based upon the mutual
promises and covenants herein contained, the Bank and the Executive agree as
follows:
I. DEFINITIONS
A. Effective Date:
--------------
The effective Date of the Executive Plan shall be September 25, 2001
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B. Plan Year:
---------
Any reference to the "Plan Year" shall mean a calendar year from
January 1st to December 31st. In the year of implementation, the term
"Plan Year" shall mean the period from the Effective Date to December
31st of the year of the Effective Date.
C. Retirement Date:
----------------
Retirement Date shall mean retirement from service with the Bank that
becomes effective on the first day of the calendar month following the
month in which the Executive reaches age sixty-two (62) or such later
date as the Executive may actually retire.
D. Termination of Service:
------------------------
Termination of Service shall mean the Executive's voluntary
resignation of service by the Executive, with or without good reason
as defined in the Executive's Employment Agreement with the Bank in
effect at the time of said resignation, or the Bank's discharge of the
Executive without cause, prior to the Normal Retirement Age
(Subparagraph I [J]).
E. Pre-Retirement Account:
-----------------------
A Pre-Retirement Account shall be established as a liability reserve
account on the books of the Bank for the benefit of the Executive.
Prior to the Executive's Retirement Date (Subparagraph I [C]), such
liability reserve account shall be increased or decreased each Plan
Year, until the aforestated event occurs, by the Index Retirement
Benefit (Subparagraph I [F]).
F. Index Retirement Benefit:
--------------------------
The Index Retirement Benefit for each Executive in the Executive Plan
for each Plan Year shall be equal to the excess (if' any) of the Index
(Subparagraph I [G]) for that Plan Year over the Opportunity Cost
(Subparagraph I [G]) for that Plan Year over the Opportunity cost
(Subparagraph I [H]) for that Plan Year. Any break-even language shall
be inserted here.
G. Index:
-----
The Index for any Plan Year shall be the aggregate annual after-tax
income from the life insurance contract(s) described hereafter as
defined by FASB Technical Bulletin 85-4. This Index shall be applied
as if such insurance contract(s) were purchased on the Effective Date
of the Executive Plan.
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Insurance Company:
Policy Form:
Policy Name:
Insured's Age and Sex:
Riders:
Ratings:
Option:
Face Amount:
Premiums Paid:
Number of Premium Payments:
Assumed Purchase Date:
If such contracts of life insurance are actually purchased by the
Bank, then the actual policies as of the dates they were actually
purchased shall be used in calculations under this Executive Plan. If
such contracts of life insurance are not purchased or are subsequently
surrendered or lapsed, then the Bank shall receive annual policy
illustrations that assume the above-described policies were purchased
or had not subsequently surrendered or lapsed. Said illustration shall
be received from the respective insurance companies and will indicate
the increase in policy values for purposes of calculating the amount
of the Index.
In either case, references to the life insurance contracts are merely
for purposes of calculating a benefit. The Bank has no obligation to
purchase such life insurance and, if purchased, the Executive and the
Executive's beneficiary(ies) shall have no ownership interest in such
policy and shall always have no greater interest in the benefits under
this Executive Plan than that of an unsecured creditor of the Bank.
H. Opportunity Cost:
-----------------
The Opportunity Cost for any Plan Year shall be, calculated by taking
the sum of the amount of premiums for the life insurance policies
described in the definition of "Index" plus the amount of any
after-tax benefits paid to the Executive pursuant to the Executive
Plan (Paragraph II hereinafter) plus the amount of all previous years'
after-tax Opportunity Cost, and multiplying that sum by the average
after-tax yield of a one year Treasury ▇▇▇▇.
I. Change of Control:
-------------------
Change of Control means the cumulative transfer of more than fifty
percent (50%) of the voting stock of the Bank from the Effective Date
of this Executive Plan. For the purposes of this Executive Plan,
transfers on account of deaths or gifts, transfers between family
members of transfers to a qualified retirement plan maintained by the
Bank shall not be considered in determining whether there has been a
Change of Control.
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J. Normal Retirement Age:
-----------------------
Normal Retirement Age shall mean the date on which the Executive
attains age sixty-two (62).
II. INDEX BENEFITS
A. Retirement Benefits:
--------------------
Subject to Subparagraph II(D) and Subparagraph II(A)(i) hereinafter,
an Executive who remains in the employ of the Bank until the Normal
Retirement Age (Subparagraph I[J]) shall be entitled to receive the
balance in the Pre-Retirement Account in fifteen (15) equal annual
installments commencing thirty (30) days following the Executive's
retirement. In addition to these payments and commencing in
conjunction therewith, the Index Retirement Benefit (Subparagraph I
[F]) for each Plan Year subsequent to the Executive's retirement, and
including the remaining portion of the Plan year following said
retirement, shall be paid to the Executive until the Executive's
death.
(i) The minimum Pre-Retirement Account and Index Retirement benefit
combined for the first fifteen (15) years of benefit payments
shall he seventy-two thousand two hundred and ten dollars and
no/100ths ($72,210.00).
B. Termination of Service:
------------------------
Subject to Subparagraph II(D), should an Executive suffer a
Termination of Service the Executive shall be entitled to receive the
balance in the Pre-Retirement Account payable to the Executive in
fifteen (15) equal annual installments commencing thirty (30) days
following the Executive's Normal Retirement Age (Subparagraph I[J]).
In addition to these payments and commencing in conjunction therewith,
the Index Retirement Benefit for each Plan Year subsequent to the year
in which the Executive attains Normal Retirement Age, and including
the remaining portion of the Play Year in which the Executive attains
Normal Retirement Age, shall be paid to the Executive until the
Executive's death.
C. Death:
-----
Should the Executive die while there is a balance in the Executive's
Retirement Account (Subparagraph I [E]), said unpaid balance of the
Executive's Pre-Retirement Account shall be paid in a lump sum to the
individual or individuals the Executive may have designated in writing
and filed with the Bank. In the absence of any effective beneficiary
designation, the unpaid balance shall be paid as set forth herein to
the duly qualified executor or administrator of the Executive's
estate. Said payment due hereunder shall be made the first day of the
second month following the decease of the Executive.
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D. Discharge for Cause:
-------------------
Should the Executive be Discharged for Cause at any time, all benefits
under this Executive Plan shall be forfeited. The term "for cause"
shall be defined in the Executive's Employment Agreement in effect at
the time of said Discharge for Cause. If there is a dispute as to said
Discharge for Cause, then said dispute shall be resolved as set for in
said employment Agreement.
E. Death Benefit:
--------------
Except as set forth above, there is no death benefit provided under
this Agreement.
F. Disability:
----------
In the event the Executive becomes disabled prior to any Termination
of Service, and the Executive's employment is terminated because of
such disability, he shall immediately begin receiving the benefits in
Subparagraph II(A) above. Such benefit shall begin without regard to
the Executive's Normal Retirement Age and the Executive shall be one
hundred percent (100%) vested and the entire benefit amount disability
shall be as defined in the Executive's Employment Agreement with the
Bank in effect at said termination due to disability. If there is a
dispute as to disability, then said dispute shall be resolved as set
forth in said Employment Agreement.
III. RESTRICTIONS UPON FUNDING
The bank shall have no obligation to set aside, earmark or entrust any fund
or money with which to pay its obligations under this Executive Plan. The
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 nor right, title or
interest in or to any specific funding investment or to any assets of the
Bank.
If the Bank elects to invest in a life insurance, disability or annuity
policy upon the life of the Executive, then the Executive shall assist the
Bank by freely submitting to a physical exam and supplying such additional
information necessary to obtain such insurance or annuities.
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IV. CHANGE OF CONTROL
Upon a Change of Control (Subparagraph I [I]), if the Executive
subsequently suffers a Termination of Service (Subparagraph I [D]), then
the Executive shall receive the benefits promised in this Executive Plan
upon attaining Normal Retirement Age, as if the Executive had been
continuously employed by the Bank until the Executive's Normal Retirement
Age. The Executive will also remain eligible for all promised death
benefits in this Executive plan. In addition, no sale, merger, or
consolidation of the Bank shall take place unless the new or surviving
entity expressly acknowledges the obligations under this Executive Plan and
agrees to abide by its terms.
V. MISCELLANEOUS
A. Alienability and Assignment Prohibition:
------------------------------------------
Neither the Executive, nor the Executive's surviving spouse, nor any
other beneficiary(ies) under this Executive Plan shall have any power
or right to transfer, assign, anticipate, hypothecate, mortgage,
commute, modify or otherwise encumber in advance any of the benefits
payable hereunder nor shall any of said benefits be subject to seizure
for the payment of any debts, judgments, alimony or separate
maintenance owed b the Executive or the Executive's beneficiary(ies),
nor be transferable by operation of law in the event of bankruptcy,
insolvency or otherwise. In the event the Executive or any beneficiary
attempts assignment, commutation, hypothecation, transfer or disposal
of the benefits hereunder, the Bank's liabilities shall forthwith
cease and terminate.
B. Binding Obligation of the Bank and any Successor in Interest:
---------------------------------------------------------------------
The Bank shall not merge or consolidate into or with another bank or
sell substantially all of its assets to another bank, firm or person
until such bank, fir or person expressly agrees, 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.
C. Amendment or Revocation:
-------------------------
It is agreed by and between the parties hereto that, during the
lifetime of the Executive, this Executive Plan may be amended or
revoked at any time or times, in whole or in part, by the mutual
written consent of the Executive and the Bank.
D. Gender:
------
Whenever in this Executive Plan words are used in the masculine or
neuter gender, they shall be read and construed as in the masculine,
feminine or neuter gender, whenever they should so apply.
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E. Effect on Other Bank Benefit Plans:
---------------------------------------
Nothing contained in this Executive Plan shall affect the right of the
Executive to participate in or be covered by any qualified or
non-qualified pension, profit-sharing, group, bonus or other
supplemental compensation or fringe benefit plan constituting a part
of the Bank's existing or future compensation structure.
F. Headings:
--------
Headings and subheadings in this Executive Plan are interested for
reference and convenience only and shall not be deemed a part of this
Executive Plan.
G. Applicable Law:
---------------
The validity and interpretation of this Agreement shall be governed by
the laws of the State of Georgia.
H. 12 U.S.C. Sec. 1828(k):
-------------------------
Any payments made to the Executive pursuant to this Executive Plan, or
otherwise, are subject to and conditioned upon their compliance with
12 U.S.C. Sec. 1828(k) or any regulations promulgated thereunder.
I. Partial Invalidity:
-------------------
If any term, provision, covenant, or condition of this Executive Plan
is determined by an arbitrator or a court, as the case may be, to be
invalid, void, or unenforceable, such determination shall not render
any other term, provision, covenant, or condition invalid, void, or
unenforceable, and the Executive Plan shall remain in full force and
effect notwithstanding such partial validity.
J. Employment:
----------
No provision of this Executive Plan shall be deemed to restrict or
limit any existing employment agreement by and between the Bank and
the Executive, nor shall any conditions herein create specific
employment rights to the Executive nor limit the right of the Employer
to discharge the Executive with or without cause. In a similar
fashion, no provision shall limit the Executive's rights to
voluntarily sever the Executive's employment at any time.
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VI ERISA PROVISION
A. Named Fiduciary and Plan Administrator:
------------------------------------------
The "Named Fiduciary and Plan Administrator" of this Executive Plan
shall be North Georgia National Bank until its resignation or removal
by the Board. As Named Fiduciary and Plan Administrator, the Bank
shall be responsible for the management, control and administration of
the Executive Plan. The Named Fiduciary may delegate to others certain
aspects of the management and operation responsibilities of the
Executive Plan including the employment of advisors and the delegation
of ministerial duties to qualified individuals.
B. Claims Procedure and Arbitration:
-----------------------------------
In the event a dispute arises over benefits under this Executive Plan
and benefits are not paid to the Executive (or to the Executive's
beneficiary(ies) in the case of the Executive's death) and such
claimants feel they are entitled to receive such benefits, then a
written claim must be made to the Named Fiduciary and Plan
Administrator named above within sixty (60) days from the date
payments are refused. The Named Fiduciary and Plan Administrator shall
review the written claim and if the claim is denied, in whole of in
part, they shall provide in writing within sixty (60) days of receipt
of such claim the specific reasons for such denials, reference to the
provisions of this Executive Plan upon which the denial is based and
any additional material or information necessary to perfect the claim.
Such written notice shall further indicate the additional steps to be
taken by claimants if a further review of the claim denial is desired.
A claim shall be deemed denied if the Named Fiduciary and Plan
Administrator fail to take any action within the aforesaid sixty-day
period.
If claimants desire a second review they shall notify the Named
Fiduciary and Plan Administrator in writing within sixty (60) days of
the first claim denial. Claimants may review this Executive Plan or
any documents relating thereto and submit any written issues and
comments it may feel appropriate. In their sole discretion, the Named
Fiduciary and Plan Administrator shall then review the second claim
and provide a written decision within sixty (60) days of receipt of
such claim. This decision shall likewise state the specific reasons
for the decision and shall include reference to specific provisions of
the Plan Agreement upon which the decision is based.
If claimants continue to dispute the benefit denial based upon
completed performance of this Executive Plan or the meaning and effect
of the terms and conditions thereof, then claimants may submit the
dispute to an arbitrator for final 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.
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VII. DEFERRAL BENEFITS
A. Deferral Election:
------------------
Any Executive wishing to defer any portion or all of the Executive's
salary may elect to defer up to one hundred percent (100%) each year
for a maximum of five (5) years. At the end of the five-year period,
the Board shall have the option of extending the deferral period for
any amount of time it shall deem to be appropriate. The Executive will
make the election to defer by filing with the Bank a written statement
setting forth the amount of the deferrals and the Executive's election
of payment as set forth in Subparagraph VIII(C) hereinafter. This
statement must be filed prior to having earned the deferred income.
B. Deferred Compensation Account:
-------------------------------
The Bank shall establish a Deferred Compensation Account in the name
of the Executive and credit that account with the deferrals. The Bank
shall also credit interest to the Deferred Compensation Account
balance on December 31st of each year. The interest rate credited
shall be the Bank's average prime lending rate of each Plan Year.
C. Retirement, Termination of Service or Death:
------------------------------------------------
Upon the Executive's Retirement Date or Termination of Service
(Subparagraphs I[C] and [D] hereinabove), the balance of the
Executive's Deferred Compensation Account shall be payable as elected
by the Executive one (1) year prior to receiving said benefit payable
to the Executive thirty (30) days following said event. If the
Executive fails to make said payment election, then the Executive
shall be paid in ten (10) equal annual installments as set forth
herein. Should the Executive die while there is a balance in the
Executive's Deferred Compensation Account, such balance shall be paid
pursuant to Subparagraph II(C) hereinabove.
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IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully
red this Agreement and executed the original thereof on the first day set forth
hereinabove, and that, upon execution, each has received a conforming copy.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
_________________________________ _________________________________
Witness Witness Title
_________________________________ _________________________________
Witness ▇▇▇▇▇ ▇. ▇▇▇▇▇
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BENEFICIARY DESIGNATION FORM
FOR THE EXECUTIVE SUPPLEMENTAL
RETIREMENT PLAN AGREEMENT
PRIMARY DESIGNATION:
Name Address Relationship
---- ------- ------------
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SECONDARY (CONTINGENT) DESIGNATION:
--------------------------------------------------------------------------------
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All sums payable under the Supplemental Retirement Plan Executive Agreement by
reason of my death shall be paid to the Primary Beneficiary, if he or she
survives me, and if no Primary Beneficiary shall survive me, then to the
Secondary (Contingent) Beneficiary.
-------------------------------- -----------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇ Date
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DEFERRAL DECLARATION
I. AUTHORIZATION AND AMOUNT OF DEFERRAL
The undersigned ▇▇▇▇▇ ▇. ▇▇▇▇▇, a Executive of the Board of____________
Bank hereby elects to defer _______________ ($ or percent) of the
Executive's income for the year __________ and all subsequent years
thereafter pursuant to the Executive Supplemental Retirement Plan Executive
Agreement effective the day of _________ , 200__ unless modified by the
Executive accordingly. The undersigned is a party to the above referenced
agreement.
II. DISTRIBUTION ELECTION
Pursuant to the Provisions of my Executive Supplemental Retirement Plan
Executive Agreement with North Georgia National Bank, I hereby elect to
have any distribution of the balance of my Deferral Account paid to me in
installments as designated below:
_____ Lump sum.
_____ Five (5) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ Ten (10) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ Fifteen (15) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ The aforesaid length of time for payments in monthly installments.
Date: Executive:
-------------------------- ------------------------------
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LIFE INSURANCE
ENDORSEMENT METHOD SPLIT DOLLAR PLAN
AGREEMENT
Insurer:
Policy Number:
Bank: North Georgia National Bank
Insured: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Relationship of Insured to Bank: Executive
The respective rights and duties of the Bank and the Insured in the
above-referenced policy shall be pursuant to the terms set forth below:
I. DEFINITIONS
Refer to the policy contract for the definition of all terms of this
Agreement.
II. POLICY TITLE AND OWNERSHIP
Title and ownership shall reside in the Bank for its use and for the use of
the Insured all in accordance with this Agreement. The Bank alone may, to
the extent of its interest, exercise the right to borrow or withdraw on the
policy cash values. Where the Bank and the Insured (or assignee, with the
consent of the Insured) mutually agree to exercise the right to increase
the coverage under the subject Split Dollar policy, then, in such event,
the rights, duties and benefits of the parties to such increased coverage
shall continue to be subject to the terms of this Agreement.
III. BENEFICIARY DESIGNATION RIGHTS
The Insured (or assignee) shall have the right and power to designate a
beneficiary or beneficiaries to receive the Insured's share of the proceeds
payable upon the death of the Insured, and to elect and change a payment
option for such beneficiary, subject to any right or interest the Bank may
have in such proceeds, as provided in this Agreement.
IV. PREMIUM PAYMENT METHOD
The Bank shall pay an amount equal to the planned premiums and any other
premium payments that might become necessary to keep the policy in force.
29
V. TAXABLE BENEFIT
Annually the Insured will receive a taxable benefit equal to the assumed
cost of insurance as required by the Internal Revenue Service. The Bank (or
its administrator) will report to the Insured the amount of imputed income
each year on Form W-2 or its equivalent.
VI. DIVISION OF DEATH PROCEEDS
Subject to Paragraphs VII and IX herein, the division of the death proceeds
of the policy is as follows:
A. Upon the death of the insured, the Insured's beneficiary(ies),
designated in accordance with Paragraph III, shall be entitled to an
amount equal to the amount or the percentage of the net-at-risk
insurance portion of the proceeds set forth hereinbelow that
corresponds to the Plan Year in which death occurs. The net-at-risk
insurance portion is the total proceeds less the cash value of the
policy.
Plan Year* Amount of Percentage
---------- --------------------
1 $500,000 or 100% of the net-at-risk,
whichever is less
2 35% of the net-at-risk
3 45% of the net-at-risk
4 55% of the net-at-risk
5 65% of the net-at-risk
6 and thereafter 75% of the net-at-risk
B. The Bank shall be entitled to the remainder of such proceeds.
C. The Bank and the Insured (or assignees) shall share in any interest
due on the death proceeds on a pro rata basis as the proceeds due each
respectively bears to the total proceeds, excluding any such interest.
*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.
VII. DIVISION OF THE CASH SURRENDER VALUE OF THE POLICY
The Bank shall at all times be entitled to an amount equal to the policy's
cash value, as that term is defined in the policy contract, less any policy
loans and unpaid interest or cash withdrawals previously incurred by the
Bank and any applicable surrender charges. Such cash value shall be
determined as of the date of surrender or death as the case may be.
VIII. RIGHTS OF PARTIES WHERE POLICY ENDOWMENT OR ANNUITY ELECTION EXISTS
In the event the policy involves an endowment or annuity element, the
Bank's right and interest in any endowment proceeds or annuity benefits, or
expiration of the deferment period, shall be determined under the
30
provisions of this Agreement by regarding such endowment proceeds or the
commuted value of such annuity benefits as the policy's cash value. Such
endowment proceeds or annuity benefits shall be considered to be like death
proceeds for the purposes of division under this Agreement.
IX. TERMINATION OF AGREEMENT
This Agreement shall terminate upon the occurrence of any one of the
following:
A. The Insured shall be discharged from employment with the Bank for
cause. The term "for cause" shall be as defined in the Executive's
Employment Agreement in effect at the time of said Discharge for
Cause. If there is a dispute as to said Discharge or Cause, then said
dispute shall be resolved as set forth in said Employment Agreement.
B. Surrender, lapse, or other termination of the Policy by the Bank.
Upon such termination, the Insured (or assignee) shall have a sixty (60)
days option to receive from the Bank an absolute assignment of the Policy
in consideration of cash payment to the Bank, whereupon this Agreement
shall terminate. Such cash payment referred to hereinabove shall be the
greater of:
A. The Bank's share of the cash value of the policy on the date of such
assignment, as defined in this Agreement; or
B. The amount of the premiums that have been paid by the Bank prior to
the date of such assignment.
If, within said sixty (60) day period, the Insured fails to exercise said
option, fails to procure the entire aforestated cash payment, or dies, then
the option shall terminate and the Insured (or assignee) agrees that all of
the Insured's rights, interest and claims in the policy shall terminate as
of the date of the termination of this Agreement.
The Insured expressly agrees that this Agreement shall constitute
sufficient written notice to the Insured of the Insured's option to receive
an absolute assignment of the policy as set forth herein.
Except as provided above, this Agreement shall terminate upon distribution
of the death benefit proceeds in accordance with Paragraph VI above.
X. INSURED'S OR ASSIGNEE'S ASSIGNMENT RIGHTS
The Insured may not, without the written consent of the Bank, assign to any
individual, trust or other organization, any right, title or interest in
the subject policy nor any rights, options, privileges or duties created
under this Agreement.
XI. AGREEMENT BINDING UPON THE PARTIES
This Agreement shall bind the Insured and the Bank, their heirs,
successors, personal representatives and assigns.
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XII. ERISA PROVISIONS
The following provisions are part of this Agreement and are intended to
meet the requirements of the Employee Retirement Income Security Act of
1974 ("ERISA"):
A. Named Fiduciary and Plan Administrator.
--------------------------------------
The "Named Fiduciary and Plan Administrator" of this Endorsement
Method Split Dollar Agreement shall be North Georgia National Bank
until its resignation or removal by the Board of Directors. As Named
Fiduciary and Plan Administrator, the Bank shall be responsible for
the management, control, and administration of this Split Dollar Plan
as established herein. The Named Fiduciary may delegate to others
certain aspects of the management and operation responsibilities of
the Plan, including the employment of advisors and the delegation of
any ministerial duties to qualified individuals.
B. Funding Policy.
--------------
The funding policy for this Split Dollar Plan shall be to maintain the
subject policy in force by paying, when due, all premiums required.
C. Basis of Payment of Benefits.
----------------------------
Direct payment by the Insurer is the basis of payment of benefits
under this Agreement, with those benefits in turn being based on the
payment of premiums as provided in this Agreement.
D. Claim Procedures.
----------------
Claim forms or claim information as to the subject policy can be
obtained by contacting Benmark, Inc. (800-544-6079). When the Named
Fiduciary has a claim which may be covered under the provisions
described in the insurance policy, they should contact the office
named above, and they will either complete a claim form and forward it
to an authorized representative of the Insurer or advise the named
Fiduciary what further requirements are necessary. The Insurer will
evaluate and make a decision as to payment. If the claim is payable, a
benefit check will be issued in accordance with the terms of this
Agreement.
In the event that a claim is not eligible under the policy, the
Insurer will notify the Named Fiduciary of the denial pursuant to the
requirements under the terms of the policy. If the Named Fiduciary is
dissatisfied with the denial of the claim and wishes to contest such
claim denial, they should contact the office named above and they will
assist in making an inquiry to the Insurer. All objections to the
Insurer's actions should be in writing and submitted to the office
named above for transmittal to the Insurer.
XIII. GENDER
Whenever in this Agreement 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.
XIV. INSURANCE COMPANY NOT A PARTY TO THIS AGREEMENT
The Insurer shall not be deemed a party to this Agreement, but will respect
the rights of the parties as herein developed upon receiving an executed
copy of this Agreement. Payment or other performance in accordance with the
policy provisions shall fully discharge the Insurer from any and all
liability.
XV. CHANGE OF CONTROL
Change of Control shall be deemed to be the cumulative transfer of more
than fifty percent (50%) of the voting stock of the Bank from the date of
this Agreement. For the purposes of this Agreement, transfers on account of
death 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 of Control. Upon a Change of
Control, if the Insured's employment is subsequently terminated, except for
cause, then the Insured shall be one hundred percent (100%) vested in the
benefits promised in this Agreement.
XVI. AMENDMENT OR REVOCATION
It is agreed by and between the parties hereto that, during the lifetime of
the Insured, this Agreement may be amended or revoked at any time or times,
in whole or in part, by the mutual written consent of the Insured and the
Bank.
XVII. EFFECTIVE DATE
The Effective Date of this Agreement shall be _______________, _____.
XVIII. SEVERABILITY AND INTERPRETATION
If a provision of this Agreement is held to be invalid or unenforceable,
the remaining provisions shall nonetheless be enforceable according to law
and enforced as amended.
XIX. APPLICABLE LAW
The validity and interpretation of this Agreement shall be governed by the
laws of the State of Georgia.
XX. PREMIUM PAYMENT METHOD AND BANK'S DUE DILIGENCE
Subject to the following, the Bank shall pay an amount equal to the planned
premiums and any other premium payments that might become necessary to keep
the policy in force. The Bank shall exercise due diligence in reviewing the
financial stability of the insurance company and the policy that are the
subject of this Agreement. If the Bank believes that the Insurer under the
policy is financially weak or that the policy is not performing well, the
Bank may, at any time, surrender the policy or substitute a different
policy provided that the Bank is under no obligation to invest in such
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replacement policy any more than the proceeds available from the cash
surrender value of the original policy. The Executive will cooperate by
undertaking any necessary medical examination. If the Bank chooses to
surrender the above-referenced policy without replacing it or the policy
otherwise ceases to exist prior to the death of the Insured, the Bank
agrees to pay the Insured's named beneficiary(ies) Five Hundred Thousand
and no/100ths Dollars ($500,000.00) as a death benefit under Paragraph VI
of this Agreement.
Executed at Calhoun, Georgia this _____ day of __________, _____.
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
_________________________________ By:_________________________________
Witness Title
_________________________________ ____________________________________
Witness ▇▇▇▇▇ ▇. ▇▇▇▇▇
BENEFICIARY DESIGNATION FORM
FOR LIFE INSURANCE ENDORSEMENT METHOD
SPLIT DOLLAR PLAN AGREEMENT
PRIMARY DESIGNATION:
Name Address Relationship
---- ------- ------------
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SECONDARY (CONTINGENT) DESIGNATION:
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All sums payable under the Life Insurance Endorsement Method Split Dollar Plan
Agreement by reason of my death shall be paid to the Primary Beneficiary, if he
or she survives me, and if no Primary Beneficiary shall survive me, then to the
Secondary (Contingent) Beneficiary.
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▇▇▇▇▇ ▇. ▇▇▇▇▇ Date
DEFERRAL DECLARATION
I. AUTHORIZATION AND AMOUNT OF DEFERRAL
The undersigned ▇▇▇▇▇ ▇. ▇▇▇▇▇, an Executive of the Board of
_______________ Bank hereby elects to defer _______________ ($ or percent)
of the Executive's income for the year ______ and all subsequent years
thereafter pursuant to the Executive Supplemental Retirement Plan Executive
Agreement effective the _____ day of __________, 200__ unless modified by
the Executive accordingly. The undersigned is a party to the above
referenced agreement.
II. DISTRIBUTION ELECTION
Pursuant to the Provisions of my Executive Supplemental Retirement Plan
Executive Agreement with North Georgia National Bank, I hereby elect to
have any distribution of the balance in my Deferral Account paid to me in
installments as designated below:
_____ Lump sum.
_____ Five (5) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ Ten (10) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ Fifteen (15) annual installments with the amount of each installment
determined as of each installment date by dividing the entire amount
in my Benefit Account by the number of installments then remaining
to be paid, with the final installment to be the entire remaining
balance in the Benefit Account.
_____ The aforesaid length of time for payments in monthly installments.
Date: ____________________________ Executive: ____________________________