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Mahoning National Bancorp, Inc.
Form 10-Q
Item 6 (a)
Exhibit 10 (l)
Supplemental Executive Retirement
Plan Between Mahoning National
Bank and Xxxxxxx X. Xxxxxx; dated
December 11, 1995. Originally
incorporated by reference in the
December 31, 1995, Form 10K Annual
Report is refiled in XXXXX format
and incorporated by reference in
this Form 10-Q
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SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
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THE AGREEMENT, made and entered into this 11th day of December, 1995 by
and between The Mahoning National Bank of Youngstown, an association organized
under the laws of the United States of America (hereinafter called "Bank"), and
Xxxxxxx X. Xxxxxx (hereinafter called the "Executive").
WITNESSETH:
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WHEREAS, the Executive has been and continues to be a valued Executive
of the Bank, and is now serving the Bank as its President and Chief Executive
Officer; and,
WHEREAS, it is the consensus of the Board of Directors that the
Executive's services to the Bank in the past have been of exceptional merit and
have constituted an invaluable contribution to the general welfare of the Bank
and in bringing it to its present status of operating efficiency, and its
present position in its field of activity; and,
WHEREAS, the experience of the Executive, his knowledge of the affairs
of the Bank, his reputation and contacts in the industry are so valuable that
assurance of his continued services is essential for the future growth and
profits of the Bank and it is in the best interests of the Bank to arrange terms
of continued employment for the Executive so as to reasonably assure his
remaining in the Bank's employment during his lifetime or until the age of
retirement; and,
WHEREAS, it is the desire of the Bank that his services be retained as
herein provided; and,
WHEREAS, the Bank maintains a qualified retirement plan known as The
Employees' Retirement Plan of the Mahoning National Bank of Youngstown (the
"Qualified Plan") which includes nondiscrimination limitations as imposed under
Section 401(k) and Section 401(m) of the Internal Revenue Code as well as a
maximum benefit limitation imposed by Section 402(g), Section 415, and Section
401(a)(17) of the Internal Revenue Code; and
WHEREAS, the Company adopts this Supplemental Executive Retirement
Plan, in part for the purpose of providing additional retirement benefits to
Executive in order to compensate Executive for the loss of retirement benefits
from the Qualified Plan due to the statutory limitations herein noted; and
WHEREAS, the Executive is willing to continue in the employ of the Bank
provided the Bank agrees to pay to him or his beneficiaries certain benefits in
accordance with the terms and conditions hereinafter set forth:
ACCORDINGLY, it is the desire of the Bank and the Executive to enter
into this agreement under which the Bank will agree to make certain payments to
the Executive at retirement or his beneficiary in the event of his premature
death while employed by the Bank; and,
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FURTHERMORE, it is the intent of the parties hereto that this agreement
be considered an unfunded arrangement maintained primarily to provide
supplemental benefits for the Executive, as a member of a select group of
management or highly compensated employees of the Bank for the purposes of the
Employee Retirement Income Security Act of 1974, (E.R.I.S.A.):
NOW, THEREFORE, in consideration of services performed in the past and
to be performed in the future as well as of the mutual promises and covenants
herein contained, it is agreed as follows:
I. EMPLOYMENT
The Bank agrees to employ the Executive in such capacity as the Bank
may from time to time determine. The Executive will continue in the
employ of the Bank in such capacity and with such duties and
responsibilities as may be assigned to him, and with such compensation
as may be determined from time to time by the Board of Directors of the
Bank. Active employment shall include temporary disability not to
exceed six months and other "leave of absences" specifically granted by
the Board of Directors.
II. FRINGE BENEFITS
The salary continuation benefits provided by this agreement are granted
by the Bank as a fringe benefit to the Executive and are not part of
any salary reduction plan or an arrangement deferring a bonus or a
salary increase. The Executive has no option to take any current
payment or bonus in lieu of these salary continuation benefits except
as set forth hereinafter.
III. RETIREMENT DATE
If Executive remains in the continuous employ of the Bank, he shall
retire from active employment with the Bank on his sixty-fifth (65th)
birthday, (hereinafter "Normal Retirement Date") unless by action of
the Board of Directors his period of active employment shall be
shortened or extended.
IV. RETIREMENT BENEFIT AND POSTRETIREMENT DEATH BENEFIT
Upon Executive's retirement at his Normal Retirement Date, the Bank,
commencing with the first day of the month following the date of such
retirement, shall pay Executive an annual benefit equal to Ninety-Three
Thousand Dollars ($93,000) in equal monthly installments (of l/12 of
the annual benefit) for a period of two hundred forty (240) months,
provided that if less than two hundred forty (240) such monthly
payments have been made prior to the death of the Executive, the Bank
shall continue such monthly payments to whomever the Executive shall
have designated in a written instrument which is on file with the Bank.
until the full number of two hundred forty (240) monthly payments have
been made. In the absence of any effective designation of beneficiary,
any such amounts
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becoming due and payable upon the death of the Executive shall be
payable to the duly qualified executor or administrator of his estate.
V. DEATH BENEFIT PRIOR TO RETIREMENT
In the event the Executive should die while actively employed by the
Bank at any time after the date of this Agreement but prior to his
attaining the age of sixty-five (65) years (or such later date as may
be agreed upon), the Bank will pay an annual benefit equal to
Ninety-Three Thousand Dollars ($93,000) in equal monthly installments
(each equal to 1/12 of the annual benefit) for a period of two hundred
forty (240) months to such individual or individuals as the Executive
may have designated in writing and filed with the Bank. The said
monthly payments shall begin the first day of the third month following
the month of the death of the Executive. In the absence of any
effective designation of beneficiary, any such amounts becoming due and
payable upon the death of the Executive shall be payable to the duly
qualified executor or administrator of his estate. Provided, however,
that anything hereinabove to the contrary notwithstanding, no death
benefit shall be payable hereunder if it is determined that the
Executive's death was caused by suicide on or before December 6, 1997.
VI. BENEFIT ACCOUNTING
The Bank shall account for this benefit using the regulatory accounting
principles of the Bank's primary federal regulator. The Bank shall
establish an accrued liability retirement account for the Executive
into which appropriate reserves shall be accrued.
VII. VESTING
Executive's interest in the benefits that are the subject of this
Agreement shall be fully vested at all times following the date of this
Agreement.
VIII. EARLY TERMINATION OF EMPLOYMENT
Except as otherwise provided for in Paragraphs V and XIV hereof, in the
event that the employment of the Executive shall terminate, whether
voluntary or involuntary, prior to his Normal Retirement Date, then
Executive shall be entitled to receive monthly benefit payments, as
provided by Paragraph IV of this Agreement, equal to the present value
of the benefit in Paragraph IV, calculated using a discount rate of
seven percent (7%) per annum.
IX. PARTICIPATION IN OTHER PLANS
The benefits provided hereunder shall be in addition to Executive's
annual salary as determined by the Board of Directors, and shall not
affect the right of Executive to participate in any current or future
retirement plan, group insurance, bonuses, or in any
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supplemental compensation arrangement which constitutes a part of the
Bank's regular compensation structure.
X. LUMP SUM OPTION
If after the retirement of Executive, the capital of the Bank should
fall below the minimum required by the Bank's regulatory authority
and/or the Bank fails to make a profit in any two (2) successive years,
Executive may, at his option, demand that the Bank pay him the balance
of the benefits due him in a lump sum. The balance due Executive shall
be an amount of money equal to his accrued liability benefit account
balance and shall be paid to him by the Bank within thirty (30) days of
his demand.
XI. ALIENABILITY
It is agreed that neither Executive, nor his spouse, nor any other
designee, shall have any right to commute, sell, assign, transfer or
otherwise convey the right to receive any payments hereunder, which
payments and the right thereto are expressly declared to be
nonassignable and nontransferable; and, in the event of any attempted
assignment or transfer, the Bank shall have no further liability
hereunder.
XII. RESTRICTIONS ON 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 Agreement.
The Bank reserves the absolute right at its sole discretion to either
fund the obligations undertaken by this Agreement or to refrain from
funding the same and determine the extent, nature, and method of such
funding.
XIII. GENERAL ASSETS OF THE BANK
The rights of the Executive under this Agreement and of any beneficiary
of the Executive shall be solely those of an unsecured creditor of the
Bank. If the Bank shall acquire an insurance policy or any other asset
in connection with the liabilities assumed by it hereunder, it is
expressly understood and agreed that neither Executive nor any
beneficiary of Executive shall have any right with respect to, or claim
against, such policy or other asset. Such policy or asset shall not be
deemed to be held under any trust for the benefit of Executive or his
beneficiaries or to be held in any way as collateral security for the
fulfilling of the obligations of the Bank under this Agreement. It shall
be, and remain, a general, unpledged, unrestricted asset of the Bank and
Executive or any of his beneficiaries shall not have a greater claim to
the insurance policy or other assets, or any interest in either of them,
than any other general creditor of the Bank.
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XIV. CHANGE IN CONTROL
CHANGE IN CONTROL - "Change in Control" shall result if:
1. Any person or group (as such terms are used in connection with
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the
"beneficial owner" (as defined in Rule 13(d)(3) and 13(d)(5) under
the Exchange Act), directly or indirectly, of securities of Mahoning
National Bancorp, Inc., (hereinafter the "Company") the corporation
which owns 100% of the voting stock of the Bank, representing 30% or
more of the combined voting power of the Company's then outstanding
securities; or
2. The Company is a party to a merger, consolidation, sale of assets or
other reorganization, or a proxy contest, as a consequence of which
members of the Board of Directors in office immediately prior to such
transaction or event constitute less than a majority of the Board of
Directors thereafter; or
3. During any period of 24 consecutive months, individuals who at the
beginning of such period constitute the Board of Directors of the
Company (including for this purpose any new director whose election,
nomination for election, or appointment was approved by a vote of at
least one-half of the directors then still in office who were
directors at the beginning of such period) cease for any reason to
constitute at least a majority of the Board of Directors of the
Company.
Notwithstanding the foregoing, no Trust Department or designated
fiduciary or other trustee of such Trust Department of the Company or a
subsidiary of the Company, or other similar fiduciary capacity of the
Company with direct voting control of the stock shall be included or
considered. Further, no profit-sharing, employee stock ownership,
employee stock purchase and savings, employee pension, or other
employee benefit plan of the Corporation or any of its subsidiaries,
and no Trustee of any such plan in its capacity as such Trustee, shall
be included or considered.
The Bank agrees that if there is a Change in Control of the Company and
Executive's employment is terminated (whether voluntary or involuntary)
at anytime thereafter and prior to his Normal Retirement Date,
Executive shall be entitled to such monthly benefit payments as are
provided by Paragraph VIII hereof, provided however that in the event
such termination of employment of Executive occurs after a Change of
Control of the Company, the benefits provided to Executive shall be no
less than a monthly benefit of Three Thousand Nine Hundred Forty
Dollars ($3,940) for two hundred forty (240) months.
XV. AMENDMENT
This Agreement may only be amended in whole or in part with the mutual
consent of the Executive and the Bank.
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XVI. NOT A CONTRACT OF EMPLOYMENT
This Agreement shall not be deemed to constitute a contract of
employment between the parties hereto, nor shall any provision hereof
restrict the right of the Bank to discharge the Executive, or restrict
the right of the Executive to terminate his employment.
XVII. HEADINGS
Headings and subheadings of this Agreement are inserted for reference
and convenience only and shall not be deemed a part of this agreement.
XIII. APPLICABLE LAW
The validity and interpretation of this Agreement shall be governed by
the laws of the State of Ohio.
XIX. EFFECTIVE DATE
The effective date of this agreement shall be December 6, 1995.
XX. CLAIMS PROCEDURE AND ARBITRATION
In the event that benefits under this Agreement are not paid to the
Executive (or his beneficiary in the case of the Executive's death),
and such person feels entitled to receive them, a claim shall be made
in writing to the Plan Administrator within one hundred eighty (180)
days from the date payments are not made. Such claim shall be reviewed
by the Plan Administrator and the Bank. If the claim is denied, in full
or in part, the Plan Administrator shall provide a written notice
within thirty (30) days setting forth the specific reasons for denial,
specific reference to the provisions of this Agreement upon which the
denial is based, and any additional material or information necessary
to perfect the claim, if any. Also, such written notice shall indicate
the steps to be taken if a review of the denial is desired.
If a claim is denied and a review is desired, the Executive (or his
beneficiary in the case of the Executive's death), shall notify the
Plan Administrator in writing within sixty (60) days [and a claim shall
be deemed denied if the Plan Administrator does not take any action
within the aforesaid thirty (30) day period]. In requesting a review,
the Executive or his beneficiary may review this Agreement or any
documents relating to it and submit any written issues and comments he
or she may feel appropriate. In its sole discretion the Plan
Administrator shall then review the claim and provide a written
decision within thirty (30) days. This decision likewise shall state
the specific provisions of the Agreement on which the decision is
based.
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If after following the claims procedure set forth above, the parties
are unable to agree as to whether payments are owing under the terms of
this agreement, the parties agree to arbitrate any issue,
misunderstanding, disagreement or dispute in connection with the terms
in effect in this Agreement in accordance with the Rules of the
American Arbitration Association, before one arbitrator mutually
agreeable to the parties hereto. If after two weeks Executive (or his
beneficiary or personal representative in the case of the death of
Executive) determines that Company and Executive have been unable to
agree upon one arbitrator, then Executive may appoint one arbitrator
and require Company to appoint a second arbitrator. Whereupon, the two
appointed arbitrators shall appoint a third arbitrator mutually
agreeable to them. The arbitration shall occur in Youngstown, Ohio, or
such other place as mutually agreed upon. Company and Executive shall
be mutually and equally responsible for the costs and expenses
associated with arbitration.
XXI. NAMED FIDUCIARY AND PLAN ADMINISTRATOR
For purposes of implementing this claims procedure (but not for any
other purpose), The Mahoning National Bank of Youngstown, is hereby
designated as the Named Fiduciary and Plan Administrator of Plan
Agreement. As Named Fiduciary and Plan Administrator, The Mahoning
National Bank of Youngstown shall be responsible for the management,
control, and administration of the agreement as established herein. The
Bank 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.
IN WITNESS WHEREOF, the Bank has caused this Agreement to be signed in
its corporate name by its duly authorized officers and Executive hereunto sets
his hand, all on the day and year first above written.
THE MAHONING NATIONAL BANK OF
YOUNGSTOWN
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. XxXxxxx
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Xxxxxx X. Xxxxxxx Xxxxxx X. XxXxxxx
Witness Its: Executive Vice President
/s/ Xxxxxxx X. XxXxxxxxx, Xx. By: /s/ Xxxxxx X. Xxxxxx, Xx.
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Xxxxxxx X. XxXxxxxxx, Xx. Xxxxxx X. Xxxxxx, Xx.
Witness Its: Senior Vice President and Comptroller
EXECUTIVE
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx
Witness
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Acknowledgment and Guaranty
The undersigned duly authorized officers of Mahoning National Bancorp, Inc., the
sole stockholder of The Mahoning National Bank of Youngstown, hereby execute
this acknowledgment and Guaranty with the intent to obligate the Company to make
the payments provided for in this Agreement if, for any reason, the Bank is
unwilling, unable or prohibited by regulation or regulatory action from making
such payments.
MAHONING NATIONAL BANCORP, INC
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. XxXxxxx
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Xxxxxx X. Xxxxxxx Xxxxxx X. XxXxxxx
Witness Its: Vice President
/s/ Xxxxxxx X. XxXxxxxxx, Xx. By: /s/ Xxxxxx X. Xxxxxx, Xx.
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Xxxxxxx X. XxXxxxxxx, Xx. Xxxxxx X. Xxxxxx, Xx.
Witness Its: Treasurer
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DESIGNATION OF BENEFICIARY
Pursuant to the terms of a Supplemental Executive Retirement Plan,
dated December 11, 1995, between myself and The Mahoning National Bank of
Youngstown, I hereby designate the following beneficiary(ies) to receive
payments which may be due under such Agreement after my death:
Primary Beneficiary: Mahoning National Bank, Trustee under agreement with
Xxxxxxx X. Xxxxxx dated January 22, 1985
00 Xxxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000-0000
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Name Address Relationship
SECONDARY BENEFICIARY(IES):
---------------------- ------------------------------ ----------------
Name Address Relationship
---------------------- ------------------------------ ----------------
Name Address Relationship
The Primary Beneficiary named above shall be the designated beneficiary
referred to in Paragraphs IV and V of said Agreement if he or she is living at
the time a death benefit payment thereunder becomes due and payable, and the
Secondary Beneficiary named above shall be the designated beneficiary referred
to in Paragraphs IV and V of said Agreement only if he or she is living at the
time a death benefit payment becomes payable and the Primary Beneficiary is not
then living.
ATTEST: Dated: December 11, 1995
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/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxxx Xxxxxxx X. Xxxxxx
Witness Executive
Acknowledged by:
/s/ Xxxxxxx X. XxXxxxxxx, Xx. /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. XxXxxxxxx, Xx. Xxxxxxx X. Xxxxxx
Witness Bank Officer (Employee Benefits Officer)
