EXECUTIVE SALARY CONTINUATION AGREEMENT
Exhibit
99.2
THIS
AGREEMENT,
made
and entered into this _______ day of September, 2007, by and between Cornerstone
Bank, a bank organized and existing under the laws of the State of North
Carolina (hereinafter referred to as the “Bank”), and Xxxxxx Xxxxxx, an
Executive of the Bank (hereinafter referred to as the “Executive”).
WHEREAS,
the
Executive has been and continues to be a valued Executive of the Bank, and
is
now serving the Bank;
WHEREAS,
it is
the consensus of the Board of Directors (hereinafter referred to as the “Board”)
that the Executive’s employment with the Bank in the past has been of
exceptional merit and has constituted an invaluable contribution to the general
welfare of the Bank in bringing the Bank to its present status of operating
efficiency and present position in its field of activity;
WHEREAS,
the
Executive’s experience, knowledge of the affairs of the Bank, reputation, and
contacts in the industry are so valuable that assurance of the Executive’s
continued employment is essential for the future growth and profits of the
Bank
and it is in the best interest of the Bank to arrange terms of continued
employment for the Executive so as to reasonably assure the Executive remains
in
the Bank’s employ during the Executive’s lifetime or until the age of
retirement;
WHEREAS,
it is
the desire of the Bank that the Executive’s employment be retained as herein
provided;
WHEREAS,
the
Executive is willing to continue in the employ of the Bank provided the Bank
agrees to pay the Executive or the Executive’s beneficiary(ies), certain
benefits in accordance with the terms and conditions hereinafter set
forth;
WHEREAS,
the
Bank
and the Executive desire to enter into this Executive Salary Continuation
Agreement (“Agreement”) to provide for the payment of certain benefits and
further desire that the Agreement comply with Internal Revenue Code §409A
enacted on October 22, 2004, including guidance and regulations issued
thereunder (“Section 409A”).
ACCORDINGLY,
it is
the desire of the Bank and the Executive to enter into this Agreement under
which the Bank will agree to make certain payments to the Executive at
retirement or the Executive’s beneficiary(ies) in the event of the Executive’s
death pursuant to this Agreement;
1
FURTHERMORE,
it is
the intent of the parties hereto that this Agreement, which is adopted as part
of a nonqualified executive plan comprised of substantially similar agreements
with other executives (the “Executive Plan”) be considered an unfunded
arrangement maintained primarily to provide supplemental retirement benefits
for
the Executive (who is a member of a select group of management or highly
compensated employees within the meaning of Section 2520.104-23 of the
regulations promulgated under the Employee Retirement Income Security Act of
1974, as amended (“ERISA”)), and be considered a non-qualified benefit plan for
purposes of 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.
NOW, THEREFORE,
in
consideration of past employment performance and employment to be performed
in
the future as well as the mutual promises and covenants herein contained it
is
agreed as follows:
|
I.
|
EFFECTIVE
DATE
|
The
Effective Date of this Agreement shall be September 1, 2007.
| II. |
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.
| III. |
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.
| IV. |
DEFINITIONS
|
|
A.
|
Retirement
Date:
|
If
the
Executive remains in the continuous employ of the Bank, the Executive shall
be
entitled to retire from active employment with the Bank on or after the
Executive’s sixty-fifth (65th) birthday and obtain the retirement benefits
provided hereunder so long as he has incurred a separation from service within
the meaning of Section 409A. “Retirement Date” shall mean the date the Executive
separates from service on or after his sixty-fifth birthday.
2
|
B.
|
Normal
Retirement Age:
|
“Normal
Retirement Age” shall mean the date on which the Executive attains age
sixty-five (65).
| C. |
Plan
Year:
|
Any
reference to “Plan Year” shall mean a calendar year from January 1st
to
December 31st.
In the
year of implementation, the term “Plan Year” shall mean the period from the
effective date to December 31st
of the
year of the effective date.
| D. |
Termination
of Employment:
|
“Termination
of Employment” shall mean voluntary resignation of employment by the Executive
for any reason other than Good Reason (Subparagraph IV [K])or the Bank’s
discharge of the Executive Without Cause (Subparagraph IV [E]), prior to the
Normal Retirement Age (Subparagraph IV [B]) so long as the Executive has
incurred a separation from service within the meaning of Section
409A.
|
E.
|
Discharge
for Cause:
|
The
term
“Cause” used in connection with “For Cause” or “Without Cause” shall have the
same definition specified in any severance or employment agreement existing
on
the date hereof or entered into or amended hereafter between the Executive
and
the Bank. If the Executive is not a party to a severance or employment agreement
containing a definition of “Cause,” then “Cause” shall mean any of the following
that result in an adverse effect on the Bank: (i) gross negligence or gross
neglect; (ii) the commission of a felony or gross misdemeanor involving fraud
or
dishonesty; (iii) the willful violation of any law, rule, or regulation (other
than a traffic violation or similar offense); (iv) an intentional failure to
perform stated duties; or (v) a breach of fiduciary duty involving personal
profit. If a dispute arises as to discharge For Cause, such dispute shall be
resolved by arbitration as set forth in this Agreement Plan. In the alternative,
if the Executive is permitted to resign due to inappropriate conduct as defined
above, the Board of Directors may vote to deny all benefits. A majority decision
by the Board of Directors is required for forfeiture of the Executive’s
benefits.
|
F.
|
Change
in Control:
|
In
accordance with Section 409A, the Change in Control shall be defined as the
occurrence of any one of the following:
|
a.
|
the
acquisition of more than fifty percent (50%) of the value or voting
power
of the Bank’s stock by a person or
group;
|
|
b.
|
the
acquisition in a period of twelve (12) months or less of at least
thirty
percent (30%) of the Bank’s stock by a person or
group;
|
3
|
c.
|
the
replacement of a majority of the Bank’s board in a period of twelve (12)
months or less by Directors who were not endorsed by a majority of
the
current board members;
|
|
d.
|
the
acquisition in a period of twelve (12) months or less of forty percent
(40%) or more of the Bank’s assets by an unrelated entity;
or
|
|
e.
|
any
other circumstances that constitute a “Change in Control” under Section
409A.
|
For
the
purposes of this Agreement, transfers made on account of deaths or gifts,
transfers between family members or transfers to a qualified retirement plan
maintained by the Bank shall not be considered in determining whether there
has
been a Change in Control.
| G. |
Good
Reason:
|
“Good
Reason” shall mean, in connection with or within two years following a Change in
Control: (i) a material diminution in the Executive’s authority, duties, or
responsibilities; (ii) a material change in the geographic location at which
the
Executive must perform the services; and (iii) any other action or inaction
that
constitutes a material breach by the Employer of this Agreement. Provided,
that
the Executive must provide notice to the Bank of the condition the Executive
contends is Good Reason within 30 days of the initial existence of the
condition, and the Bank must have a period of at least 30 days to remedy the
condition. If the condition is not remedied, the Executive must provide a
written Notice of Termination within 30 days of the end of the Bank’s remedy
period.
| V. |
RETIREMENT
BENEFIT AND POST-RETIREMENT DEATH
BENEFIT
|
The
Bank,
commencing with the first day of the second month following the Retirement
Date
(Subparagraph IV [A]), shall pay the Executive an annual benefit equal to One
Hundred Ten Thousand Two Hundred Thirteen Dollars ($110,213). Said benefit
shall
be paid in equal monthly installments (1/12th
of the
annual benefit) until the death of the Executive. Upon the death of the
Executive, if there is a balance in the accrued liability retirement account,
such balance shall be paid in one (1) lump sum to the individual or individuals
the Executive may have designated in writing and filed with the Bank. In the
absence of any effective beneficiary designation, any such amount becoming
due
and payable upon the death of the Executive shall be payable to the duly
qualified executor or administrator of the Executive’s estate. Said payment due
hereunder shall be made the first day of the second month following the death
of
the Executive.
4
| VI. |
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 the Executive attaining the age
of
sixty-five (65) years (or such later date as may be agreed upon), the Bank
will
pay the balance in the accrued liability retirement account on the date of
death, of the Executive’s accrued liability retirement account in one (1) lump
sum, the first day of the second month following the Executive’s death, to such
individual or individuals as the Executive may have designated in writing and
filed with the Bank, at which time this Agreement shall terminate. In the
absence of any effective beneficiary designation, any such amount becoming
due
and payable upon the death of the Executive shall be payable to the duly
qualified executor or administrator of the Executive’s estate. Said payment due
hereunder shall be made by the first day of the second month following the
death
of the Executive.
| VII. |
BENEFIT
ACCOUNTING/ACCRUED LIABILITY RETIREMENT
ACCOUNT
|
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.
| VIII. |
VESTING
|
The
Executive shall be vested in the accrued liability retirement account in
accordance with the following schedule (from
the date of first employment) to
a
maximum of one hundred percent (100%).
|
0
|
%
|
|||
|
More
than 1 year, but less than 2 years
|
10
|
%
|
||
|
More
than 2 years, but less than 3 years
|
20
|
%
|
||
|
More
than 3 years, but less than 4 years
|
30
|
%
|
||
|
More
than 4 years, but less than 5 years
|
40
|
%
|
||
|
More
than 5 years, but less than 6 years
|
50
|
%
|
||
|
More
than 6 years, but less than 7 years
|
60
|
%
|
||
|
More
than 7 years, but less than 8 years
|
70
|
%
|
||
|
More
than 8 years, but less than 9 years
|
80
|
%
|
||
|
More
than 9 years, but less than 10 years
|
90
|
%
|
||
|
More
than 10 years, or upon a Change in Control, whichever
occurs first
|
100
|
%
|
| IX. |
TERMINATION
OF EMPLOYMENT
|
Except
as
provided in Paragraph X, and subject to Subparagraph IV [E], in the event that
the employment of the Executive shall terminate prior to Normal Retirement
Age,
as provided in Subparagraph IV [B], by the Executive’s voluntary action for any
reason, or by the Executive’s discharge by the Bank Without Cause, then this
Agreement shall terminate upon the date of such Termination of Employment and
the Bank shall pay to the Executive an amount of money equal to balance of
the
Executive’s accrued liability retirement account on the date of said
termination, multiplied by the Executive’s cumulative vested percentage
(Paragraph VIII). This compensation shall be paid in one (1) lump sum the first
day of the second month following said Termination of Employment.
5
In
the
event the Executive’s death should occur after such termination but prior to the
payment provided for in this Paragraph IX, the balance shall be paid, in one
(1)
lump sum to such individual or individuals as the Executive may have designated
in writing and filed with the Bank. In the absence of any effective beneficiary
designation, any such amount shall be payable to the duly qualified executor
or
administrator of the Executive’s estate. Said payment due hereunder shall be
made the first day of the second month following the death of the
Executive.
In
the
event the Executive shall be discharged For Cause at any time in accordance
with
Subparagraph IV [E], this Agreement shall terminate and all benefits provided
herein shall be forfeited.
| X. |
CHANGE
IN CONTROL
|
Upon
a
Change in Control as defined in Subparagraph IV [F), the Executive shall become
fully vested in and entitled to receive a lump sum payment of the greater of
(i)
the balance in the accrued liability retirement account or (ii) One Million
One
Thousand Eight Hundred Forty-five Dollars ($1,001,845) (the “CIC Payment”). The
Executive will also remain eligible for all promised death benefits in this
Agreement. In addition, no sale, merger, consolidation or conversion of the
Bank
shall take place unless the new or surviving entity expressly acknowledges
the
obligations under this Agreement and agrees to abide by its terms. The CIC
Payment will be made as follows:
|
A.
|
Payment
of Benefit in Connection With or Within One Year Following a Change
in
Control:
|
If,
in
connection with or within one year following a Change in Control, the Bank
terminates the Executive’s employment for any reason other than For Cause
(Subparagraph IV [D)), or the Executive terminates his employment with Good
Reason (Subparagraph IV [G]), the Bank will pay to the Executive the CIC Payment
within 30 days of such termination, subject to Subparagraphs XII [J] and XII
[K].
| B. |
Payment
of Benefit in the Second Year Following a Change in
Control.
|
If,
during the second year following a Change in Control, the Bank terminates the
Executive’s employment for any reason other than Cause or the Executive
terminates his employment with Good Reason, the Bank will pay to the Executive
the CIC Payment within 30 days of such termination, subject to Subparagraphs
XII
[J]) and XII [K].
6
| XI. |
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 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 Agreement 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 Agreement, in whole or in part, through the purchase of
life
insurance, mutual funds, disability policies or annuities, the Bank reserves
the
absolute right, in its sole discretion, to terminate such funding at any time,
in whole or in part. At no time shall any Executive be deemed to have any lien,
right, title or interest in any specific funding investment or assets of the
Bank.
If
the
Bank elects to invest in a life insurance, disability or annuity policy on
the
life of the Executive, then the Executive shall assist the Bank by freely
submitting to a physical exam and supplying such additional information
necessary to obtain such insurance or annuities.
| XII. |
MISCELLANEOUS
|
|
A.
|
Alienability
and Assignment Prohibition:
|
Neither
the Executive, nor the Executive’s surviving spouse, nor any other
beneficiary(ies) under this Agreement shall have any power or right to transfer,
assign, anticipate, hypothecate, mortgage, commute, modify or otherwise encumber
in advance any of the benefits payable hereunder nor shall any of said benefits
be subject to seizure for the payment of any debts, judgments, alimony or
separate maintenance owed by the Executive or the Executive’s beneficiary(ies),
nor be transferable by operation of law in the event of bankruptcy, insolvency
or otherwise. In the event the Executive or any beneficiary attempts assignment,
commutation, hypothecation, transfer or disposal of the benefits hereunder,
the
Bank’s liabilities shall forthwith cease and terminate.
|
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, firm or
person expressly agree, in writing, to assume and discharge the duties and
obligations of the Bank under this Agreement. This Agreement shall be binding
upon the parties hereto, their successors, beneficiaries, heirs and personal
representatives.
7
| C. |
Amendment
or Revocation:
|
Subject
to Paragraph XIV, it is agreed by and between the parties hereto that, during
the lifetime of the Executive, this Agreement 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. Provided, however, that no amendment or revocation
will
be adopted unless it complies with Section 409A to the extent Section 409A
applies to such matters.
|
D.
|
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.
|
E.
|
Effect
on Other Bank Benefit Plans:
|
Nothing
contained in this Agreement 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 Agreement are inserted for reference and convenience
only and shall not be deemed a part of this Agreement.
|
G.
|
Applicable
Law:
|
The
laws
of the State of North Carolina shall govern the validity and interpretation
of
this Agreement.
|
H.
|
Partial
Invalidity:
|
If
any
term, provision, covenant, or condition of this Agreement 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 Agreement shall
remain in full force and effect notwithstanding such partial
invalidity.
8
|
I.
|
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
employment.
|
J.
|
Compliance
with Section 409A:
|
It
is
intended that this Agreement shall comply with Section 409A. Accordingly, in
interpreting, construing and/or applying any provisions of the Agreement, the
same shall be construed in such manner as shall meet and comply with Section
409A, and in the event of any inconsistency with Section 409A, the same shall
be
reformed so as to meet the requirements of Section 409A.
| K. |
Certain
Payments Delayed for a Specified Employee.
|
If
the
Executive is a “specified employee” as defined in Section 409A, then any
payment(s) under this Agreement on account of a “separation from service” as
defined in Section 409A shall be withheld for six (6) months following such
retirement. The aggregate amount of the first seven (7) months of installments
shall be paid at the beginning of the seventh (7th)
month
following the separation from service.
| XIII. |
ADMINISTRATIVE
AND CLAIMS PROVISION
|
|
A.
|
Plan
Administrator:
|
The
“Plan
Administrator” of this Executive Plan shall be the Bank. As Plan Administrator,
the Bank shall be responsible for the management, control and administration
of
the Executive Plan. The Plan Administrator may delegate to others certain
aspects of the management and operation responsibilities of the Executive Plan
including the employment of advisors and the delegation of ministerial duties
to
qualified individuals.
| B. |
Claims
Procedure:
|
| a. |
Filing
a Claim for Benefits:
|
Any
insured, beneficiary, or other individual, (“Claimant”) entitled to benefits
under this Executive Plan will file a claim request with the Plan Administrator.
The Plan Administrator will, upon written request of a Claimant, make available
copies of all forms and instructions necessary to file a claim for benefits
or
advise the Claimant where such forms and instructions may be obtained. If the
claim relates to disability benefits, then the Plan Administrator shall
designate a sub-committee to conduct the initial review of the claim (and
applicable references below to the Plan Administrator shall mean such
sub-committee).
9
| b. |
Denial
of Claim:
|
A
claim
for benefits under this Executive Plan will be denied if the Bank determines
that the Claimant is not entitled to receive benefits under the Executive Plan.
Notice of a denial shall be furnished the Claimant within a reasonable period
of
time after receipt of the claim for benefits by the Plan Administrator. This
time period shall not exceed more than ninety (90) days after the receipt of
the
properly submitted claim. In the event that the claim for benefits pertains
to
disability, the Plan Administrator shall provide written notice within
forty-five (45) days. However, if the Plan Administrator determines, in its
discretion, that an
extension of time for processing the claim is required, such extension shall
not
exceed an additional ninety (90) days. In the case of a claim for disability
benefits, the forty-five (45) day review period may be extended for up to thirty
(30) days if necessary due to circumstances beyond the Plan Administrator’s
control, and for an additional thirty (30) days, if necessary. Any
extension notice shall indicate the special circumstances requiring an extension
of time and the date by which the Plan Administrator expects to render the
determination on review.
| c. |
Content
of Notice:
|
The
Plan
Administrator shall provide written notice to every Claimant who is denied
a
claim for benefits which notice shall set forth the following:
| (i.) |
The
specific reason or reasons for the
denial;
|
|
(ii.)
|
Specific
reference to pertinent Executive Plan provisions on which the denial
is
based;
|
|
(iii.)
|
A
description of any additional material or information necessary for
the
Claimant to perfect the claim, and any explanation of why such material
or
information is necessary; and
|
|
(iv.)
|
Any
other information required by applicable regulations, including with
respect to disability benefits.
|
10
| d. |
Review
Procedure:
|
The
purpose of the Review Procedure is to provide a method by which a Claimant
may
have a reasonable opportunity to appeal a denial of a claim to the Plan
Administrator for a full and fair review. The Claimant, or his duly authorized
representative, may:
|
(i.)
|
Request
a review upon written application to the Plan Administrator. Application
for review must be made within sixty (60) days of receipt of written
notice of denial of claim. If the denial of claim pertains to disability,
application for review must be made within one hundred eighty (180)
days
of receipt of written notice of the denial of
claim;
|
|
(ii.)
|
Review
and copy (free of charge) pertinent Executive Plan documents, records
and
other information relevant to the Claimant’s claim for
benefits;
|
|
(iii.)
|
Submit
issues and concerns in writing, as well as documents, records, and
other
information relating to the claim.
|
| e. |
Decision
on Review:
|
A
decision on review of a denied claim shall be made in the following
manner:
|
(i.)
|
The
Plan Administrator may, in its sole discretion, hold a hearing on
the
denied claim. If the Claimant’s initial claim is for disability benefits,
any review of a denied claim shall be made by members of the Plan
Administrator other than the original decision maker(s) and such
person(s)
shall not be a subordinate of the original decision maker(s). The
decision
on review shall be made promptly, but generally not later than sixty
(60)
days after receipt of the application for review. In the event that
the
denied claim pertains to disability, such decision shall not be made
later
than forty-five (45) days after receipt of the application for review.
If
the Plan Administrator determines that an extension of time for processing
is required, written notice of the extension shall be furnished to
the
Claimant prior to the termination of the initial sixty (60) day period.
In
no event shall the extension exceed a period of sixty (60) days from
the
end of the initial period. In the event the denied claim pertains
to
disability, written notice of such extension shall be furnished to
the
Claimant prior to the termination of the initial forty-five (45)
day
period. In no event shall the extension exceed a period of thirty
(30)
days from the end of the initial period. The extension notice shall
indicate the special circumstances requiring an extension of time
and the
date by which the Plan Administrator expects to render the determination
on review.
|
11
|
(ii.)
|
The
decision on review shall be in writing and shall include specific
reasons
for the decision written in an understandable manner with specific
references to the pertinent Executive Plan provisions upon which
the
decision is based.
|
|
(iii.)
|
The
review will take into account all comments, documents, records and
other
information submitted by the Claimant relating to the claim without
regard
to whether such information was submitted or considered in the initial
benefit determination. Additional considerations shall be required
in the
case of a claim for disability benefits. For example, the
claim will be reviewed without deference to the initial adverse benefits
determination and, if the initial adverse benefit determination was
based
in whole or in part on a medical judgment, the Plan Administrator
will
consult with a health care professional with appropriate training
and
experience in the field of medicine involving the medical judgment.
The
health care professional who is consulted on appeal will not be the
same
individual who was consulted during the initial determination or
the
subordinate of such individual. If the Plan Administrator obtained
the
advice of medical or vocational experts in making the initial adverse
benefits determination (regardless of whether the advice was relied
upon),
the Plan Administrator will identify such
experts.
|
|
(iv.)
|
The
decision on review will include a statement that the Claimant is
entitled
to receive, upon request and free of charge, reasonable access to,
and
copies of, all documents, records or other information relevant to
the
Claimant’s claim for benefits.
|
|
f.
|
Exhaustion
of Remedies:
|
A
Claimant must follow the claims review procedures under this Executive Plan
and
exhaust his or her administrative remedies before taking any further action
with
respect to a claim for benefits.
|
C.
|
Arbitration:
|
If
claimants continue to dispute the benefit denial based upon completed
performance of this Executive Plan or the meaning and effect of the terms and
conditions thereof, then claimants may submit the dispute to an Arbitrator
for
final arbitration. The Arbitrator shall be selected by mutual agreement of
the
Bank and the claimants. The Arbitrator shall operate under any generally
recognized set of arbitration rules. The parties hereto agree that they and
their heirs, personal representatives, successors and assigns shall be bound
by
the decision of such Arbitrator with respect to any controversy properly
submitted to it for determination.
12
Where
a
dispute arises as to the Bank’s discharge of the Executive For Cause, such
dispute shall likewise be submitted to arbitration as above described and the
parties hereto agree to be bound by the decision thereunder.
|
XIV.
|
TERMINATION
OR MODIFICATION OF AGREEMENT BY REASON OF CHANGES IN THE LAW, RULES
OR
REGULATIONS
|
The
Bank
is entering into this Agreement upon the assumption that certain existing tax
laws, rules and regulations will continue in effect in their current form.
If
any said assumptions should change and said change has a detrimental effect
on
this Executive Plan, then the Bank reserves the right to terminate or modify
this Agreement accordingly. Provided, however, that no termination or
modification will be adopted unless it complies with Section 409A to the extent
that Section 409A applies to such matters. Upon a Change in Control
(Subparagraph IV [F]), this paragraph shall become null and void effective
immediately upon said Change in Control.
IN
WITNESS WHEREOF,
the
parties hereto acknowledge that each has carefully read this Agreement and
executed the original thereof on the first day set forth hereinabove, and that,
upon execution, each has received a conforming copy.
|
CORNERSTONE
BANK
(Wilson,
North Carolina)
|
|||
| By: | |||
| Witness | (Bank Officer other than Insured) | ||
| Title | |||
| Witness | Xxxxxx Xxxxxx | ||
13
