Exhibit 10.4.5.
FIRST SOUTH BANK SPLIT DOLLAR AGREEMENT
THIS AGREEMENT is made and entered into this 19th day of November, 1999,
by and between FIRST SOUTH BANK, a state chartered commercial bank located in
Spartanburg, South Carolina (the "Company"), and ▇▇▇▇▇▇▇ ▇. SLIDER, as Trustee
of the ▇▇▇▇▇ ▇. SLIDER IRREVOCABLE TRUST AGREEMENT dated June 23,1999 (the
"Trust"). This Agreement shall append the Split Dollar Endorsement entered into
on November 19, 1999, by and between the aforementioned parties.
INTRODUCTION
WHEREAS, ▇▇▇▇▇ ▇. SLIDER (the "Executive") has contributed substantially
to the success of the Company. The Company, as a fringe benefit, is willing to
divide the death proceeds of a life insurance policy on the Executive's life.
The Company will pay life insurance premiums from its general assets.
Article 1
General Definitions
The following terms shall have the meanings specified:
1.1 "Insured" means the Executive.
1.2 "Insurer" means Jefferson Pilot Life Insurance Company.
1.3 "Normal Retirement Age" means the Executive's sixty-fifth (65)
birthday.
1.4 "Policy" means insurance policy # JP 5081391 issued by the Insurer.
1.5 "Termination of Employment" means the Executive ceasing to be employed
by the Company for any reason whatsoever, other than by reason of (a) an
approved leave of absence, (b) the Executive's death, (c) a change of control
(as defined in the Salary Continuation Agreement between the Company and the
Executive effective January 1,1999), or (d) the Executive's disability (as
defined in said Salary Continuation Agreement).
1.6 "Trustee " refers to the trustee or trustees of the Trust.
Article 2
Policy Ownership/Interests
2.1 Company Ownership. The Company is the sole owner of the Policy and
shall have the right to exercise all incidents of ownership. The Company shall
be the direct beneficiary of an amount of death proceeds equal to the greater
of: (a) the cash surrender value of the Policy plus the amount from Schedule A.
or (b) the aggregate premiums paid on the Policy by the Company less any
outstanding indebtedness to the Insurer.
2.2 Trust's Interest. The Trust shall be the beneficiary of any remaining
death proceeds of the Policy after payment of the amount due the Company under
Section 2.2. The Trust shall also have the right to elect and change settlement
options that may be permitted. Provided, however, the Executive, the Trust or
its transferee beneficiary shall have no rights or interests in the Policy with
respect to that portion of the death proceeds designated in this Section 2.2
upon the Executive's Termination of Employment prior to Normal Retirement Age.
2.3 Option to Purchase. The Company shall not sell, surrender or transfer
ownership of the Policy while this Agreement is in effect without first giving
the Trust or the Trust's transferee the option to purchase the Policy for a
period of sixty (60) days from written notice of such intention. The purchase
price shall be an amount equal to the cash surrender value of the Policy. This
provision shall not impair the right of the Company to terminate this Agreement.
2.4 Comparable Coverage. Upon Termination of Employment after the
Executive's Normal Retirement Age, the Company shall maintain the Policy in full
force and effect and in no event shall the Company amend, terminate or otherwise
abrogate the Trust's interest in the Policy, unless the Company replaces the
Policy with a comparable insurance policy to cover the benefit provided under
this Agreement. The Policy or any comparable policy shall be subject to the
claims of the Company's creditors.
Article 3
Premiums
3.1 Premium Payment. The Company shall pay any premiums due on the Policy.
3.2 Imputed Income. The Company shall impute income to the Executive in an
amount equal to the current term rate for the Executive's age multiplied by the
aggregate death benefit payable to the Executive's beneficiary. The "current
term rate" is the minimum amount required to be imputed under Revenue Rulings
64-328 and 66-110, or any subsequent applicable authority.
Article 4
Assignment
The Trust may assign without consideration all interests in the Policy
and in this Agreement to any person, entity or other trust other than the
Executive. In the event the Trust shall transfer all of its interest in the
Policy, then all of the Trust's interest in the Policy and in the Agreement
shall be vested in its transferee, who shall be substituted as a party hereunder
and the Trust shall have no further interest in the Policy or in this Agreement.
Article 5
Insurer
The Insurer shall be bound only by the terms of the Policy. Any payments
the Insurer makes or actions it takes in accordance with the Policy shall fully
discharge it from all claims, suits and demands of all entities or persons. The
Insurer shall not be bound by or be deemed to have notice of the provisions of
this Agreement.
Article 6
Executive
The Executive is not a party to this Agreement or to the corresponding
Endorsement. Except as otherwise provided herein, the Executive shall have no
rights, title or interest hereunder. Specifically, the Executive shall have no
right to cancel, surrender or assign the Policy, change the beneficiary, revoke
any assignment affecting the Policy, pledge the Policy for a loan, or obtain
from the Insurer a loan against the cash surrender value of the Policy.
Article 7
Claims Procedure
7.1 Claims Procedure. The Company shall notify the Trust, the Trust's
transferee or beneficiary, or any other party who claims a right to an interest
under the Agreement (the "Claimant') in writing, within ninety (90) days of his
or her written application for benefits, of his or her eligibility or
ineligibility for benefits under this Agreement. If the Company determines that
the Claimant is not eligible for benefits or full benefits, the notice shall
set forth (a) the specific reasons for such denial, (b) a specific reference to
the provisions of this Agreement on which the denial is based, (c) a
description of any additional information or material necessary for the
Claimant to perfect his or her claim, and a description of why it is needed,
and (d) an explanation of this Agreement's claims review procedure and other
appropriate information as to the steps to be taken if the Claimant wishes to
have the claim reviewed. If the Company determines that there are special
circumstances requiring additional time to make a decision, the Company shall
notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an
additional ninety (90) days.
7.2 Review Procedure, If the Claimant is determined by the Company not
to be eligible for benefits, or if the Claimant believes that he or she is
entitled to greater or different benefits, the Claimant shall have the
opportunity to have such claim reviewed by the Company by filing a petition for
review with the Company within sixty (60) days after receipt of the notice
issued by the Company. Said petition shall state the specific reasons which the
Claimant believes entitle him or her to benefits or to greater or different
benefits. Within sixty (60) days after receipt by the Company of the petition,
the Company shall afford the Claimant (and counsel, if any) an opportunity to
present his or her position to the Company orally or in writing, and the
Claimant (or counsel) shall have the right to review the pertinent documents.
The Company shall notify the Claimant of its decision in writing within the
sixty (60) day period, stating specifically the basis of its decision, written
in a manner calculated to be understood by the Claimant and the specific
provisions of this Agreement on which the decision is based. If, because of the
need for a hearing, the sixty (60) day period is not sufficient, the decision
may be deferred for up to another sixty (60) day period at the election of the
Company, but notice of this deferral shall be given to the Claimant.
Article 8
Amendments and Termination
This Agreement may be amended or terminated only by a written agreement
signed by the Company and the Trustee. However, unless otherwise agreed to by
the Company and the Trust, this Agreement will automatically terminate upon the
Executive's Termination of Employment prior to Normal Retirement Age.
Article 9
Miscellaneous
9.1 Binding Effect. This Agreement shall bind the Trust and the Company,
their beneficiaries, survivors, administrators and transferees, and any Policy
beneficiary.
9.2 No Guarantee of Employment. This Agreement is not an employment policy
or contract. It does not give the Executive the right to remain an employee of
the Company, nor does it interfere with the Company's right to discharge the
Executive. This Agreement also does not require the Executive to remain an
employee nor interfere with the Executive's right to terminate employment at any
time. Nothing in this Agreement shall be construed as an employment agreement,
either express or implied.
9.3 Reorganization. The Company shall not merge or consolidate into or with
another company, or reorganize, or sell substantially all of its assets to
another company, firm or person unless such succeeding or continuing company,
firm or person agrees to assume and discharge the obligations of the Company.
Upon the occurrence of such event, the term "Company" as used in this Agreement
shall be deemed to refer to the successor or survivor company.
9.4 Applicable Law. The Agreement and all rights hereunder shall be
governed by and construed according to the laws of the State of South Carolina,
except to the extent preempted by the laws of the United States of America.
9.5 Notice. Any notice, consent or demand required or permitted to be given
under the provisions of this Split Dollar Agreement by one party to another
shall be in writing, shall be signed by the party giving or making the same, and
may be given either by delivering the same to such other party personally, or by
mailing the same, by United States certified mail, postage prepaid, to such
party, addressed to his or her last known address as shown on the records of the
Company. The date of such mailing shall be deemed the date of such mailed
notice, consent or demand.
9.6 Entire Agreement. This Agreement constitutes the entire agreement
between the Company and the Trust as to the subject matter hereof. No rights are
granted to the Trust by virtue of this Agreement other than those specifically
set forth herein. 9.7 Administration. The Company shall have powers which are
necessary to administer this Agreement, including but not limited to:
(a) Interpreting the provisions of the Agreement;
(b) Establishing and revising the method of accounting for the Agreement;
(c) Maintaining a record of benefit payments; and
(d) Establishing rules and prescribing any forms necessary or desirable to
administer the Agreement.
9.8 Named Fiduciary. For purposes of the Employee Retirement Income
Security Act of 1974, if applicable, the Company shall be the named fiduciary
and plan administrator under the Agreement. The named fiduciary may delegate to
others certain aspects of the management and operation responsibilities under
this Agreement including the employment of advisors and the delegation of
ministerial duties to qualified individuals.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
TRUST: COMPANY:
▇▇▇▇▇ ▇. SLIDER FIRST SOUTH BANK
IRREVOCABLE TRUST AGREEMENT
DATED JUNE 23, 1999
By: s/ ▇▇▇▇▇▇ ▇. Slider By: s/ V. ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. SLIDER, Trustee
Title: EVP/CFO
SPLIT DOLLAR POLICY ENDORSEMENT FIRST SOUTH BANK SPLIT DOLLAR AGREEMENT
Policy No. JP 5081391 Insured: ▇▇▇▇▇ ▇. SLIDER
Supplementing and amending the application of August 12, 1999, to Jefferson
Pilot Life Insurance Company ("Insurer"), the applicant requests and directs
that:
BENEFICIARIES
(1) FIRST SOUTH BANK, a state chartered commercial bank located in
Spartanburg, South Carolina (the "Company"), shall be the direct beneficiary of
death proceeds equal to the greater of: (a) the cash surrender value of the
Policy plus the amount from Schedule A. or (b) the aggregate premiums paid on
the Policy by the Company less any outstanding indebtedness to the Insurer.
(2) The beneficiary of any remaining death proceeds shall be ▇▇▇▇▇▇▇ ▇.
SLIDER, as TRUSTEE of the ▇▇▇▇▇ ▇. SLIDER IRREVOCABLE TRUST AGREEMENT dated June
23, 1999 (the "Trust") or the Trust's transferee, subject to the provisions of
paragraph (5) below.
OWNERSHIP
(3) The Owner of the policy shall be the Company. The Owner shall have
all ownership rights in the Policy except as may be specifically granted to the
Trust or its transferee in paragraph (4) of this endorsement.
(4) The Trust or its transferee shall have the right to assign all rights
and interests in the Policy with respect to that portion of the death proceeds
designated in paragraph (2) of this endorsement, and to exercise all settlement
options with respect to such death proceeds.
(5) Notwithstanding the provisions of paragraph (4) above, the Trust or its
transferee shall have no rights or interests in the Policy with respect to that
portion of the death proceeds designated in paragraph (2) of this endorsement
upon the Insured's Termination of Employment prior to Normal Retirement Age
unless otherwise agreed to by the Company and the Executive.
MODIFICATION OF ASSIGNMENT PROVISIONS OF THE POLICY
Upon the death of the Insured, the interest of any collateral assignee of the
Owner of the Policy designated in paragraph (3) above shall be limited to the
portion of the proceeds described in paragraph (1) above.
MISCELLANEOUS
In the event of any conflict between this endorsement and the Split Dollar
Agreement between the parties of even date (the "Agreement"), the Agreement
shall control. All capitalized terms not defined in this endorsement shall have
the meaning assigned them in the Agreement.
OWNERS AUTHORITY
The Insurer is hereby authorized to recognize the Owner's claim to rights
hereunder without investigating the reason for any action taken by the Owner,
including its statement of the amount of premiums it has paid on the Policy. The
signature of the Owner shall be sufficient for the exercise of any rights under
this endorsement and the receipt of the Owner for any sums received by it shall
be a full discharge and release therefore to the Insurer.
Any transferee's rights shall be subject to this endorsement. The Owner accepts
and agrees to this split dollar endorsement.
Signed at Spartanburg, South Carolina, this 19th day of November, 1999.
COMPANY:
FIRST SOUTH BANK
By: s/ V. ▇▇▇▇▇ ▇▇▇▇▇▇
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Its: EVP/CFO
The Trust accepts and agrees to the foregoing as direct beneficiary of the
portion of the proceeds described in paragraph (2) above.
Signed at Spartanburg, South Carolina, this 19th day of November, 1999.
TRUST:
▇▇▇▇▇ ▇. SLIDER
IRREVOCABLE TRUST AGREEMENT
DATED JUNE 23, 1999
By: s/ ▇▇▇▇▇▇ ▇. Slider
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▇▇▇▇▇▇▇ ▇. SLIDER, Trustee
First South Bank
▇▇▇▇▇ ▇. Slider
Split Dollar Agreement and Endorsement
Schedule A
Policy Year Additional
In Which Death Benefit
Death to the
Occurs Company
------ -------
1 68,839
2 76,360
3 84,635
4 93,747
5 103,786
6 114,856
7 127,074
8 140,573
9 155,507
10 172,053
11 190,417
12 210,847
13 233,639
14 259,163
15 287,893
16 320,479
17 357,894
18 401,867
19 457,000
Thereafter 457,000
Bank
Compensation
Strategies Group