EXHIBIT 10(8)
RIVER VALLEY BANCORP
RECOGNITION AND RETENTION PLAN AND TRUST
ARTICLE I
ESTABLISHMENT OF THE PLAN AND TRUST
1.01 River Valley Bancorp hereby establishes the Recognition and Retention
Plan (the "Plan") and Trust (the "Trust") upon the terms and conditions
hereinafter stated in this Recognition and Retention Plan and Trust Agreement
(the "Agreement").
1.02 The Trustee, which initially shall be First Bankers Trust Company,
hereby accepts this Trust and agrees to hold the Trust assets existing on the
date of this Agreement and all additions and accretions thereto upon the terms
and conditions hereinafter stated.
ARTICLE II
PURPOSE OF THE PLAN
2.01 The purpose of the Plan is to retain directors and executive officers
in key positions by providing such persons with a proprietary interest in the
Holding Company (as hereinafter defined) as compensation for their contributions
to the Holding Company and to the Affiliates (as hereinafter defined) and as an
incentive to make such contributions and to promote the Holding Company's and
the Affiliates' growth and profitability in the future.
ARTICLE III
DEFINITIONS
The following words and phrases when used in this Plan with an initial
capital letter, unless the context clearly indicates otherwise, shall have the
meanings set forth below. Wherever appropriate, the masculine pronoun shall
include the feminine pronoun and the singular shall include the plural.
3.01 "Affiliate" means the Thrift and Bank and such other subsidiaries or
affiliates of the Holding Company which, with the consent of the Board, agree to
participate in this Plan.
3.02 "Bank" shall mean Citizens National Bank of Madison.
3.03 "Beneficiary" means the person or persons designated by a Recipient to
receive any benefits payable under the Plan in the event of such Recipient's
death. Such person or persons shall be designated in writing on forms provided
for this purpose by the Committee and may be changed from time to time by
similar written notice to the Committee. In the absence of a written
designation, the Beneficiary shall be the Recipient's surviving spouse, if any,
or, if none, his estate.
3.04 "Board" means the Board of Directors of the Holding Company or of an
Affiliate.
3.05 "Committee" means the Stock Compensation Committee of the Board of
Directors of the Holding Company. At all times during its administration of this
Plan, the Committee shall consist of two or more directors of the Holding
Company, each of whom shall be a "Non-Employee Director" within the meaning of
the definition of that term contained in Regulation 16b-3 ("Rule 16b-3")
promulgated under the Securities Exchange Act of 1934, as amended (the "1934
Act").
3.06 "Common Stock" means shares of the common stock, without par value, of
the Holding Company.
3.07 "Conversion" shall mean the conversion of the Thrift from the mutual
to stock form of organization and the simultaneous acquisition of the Thrift by
the Holding Company.
3.08 "Director" means a member of the Board of Directors of an Affiliate or
the Holding Company.
3.09 "Director Emeritus" shall mean an honorary non-voting member of the
Board of Directors of an Affiliate or the Holding Company.
3.10 "Disability" means any physical or mental impairment which qualifies
an Employee for disability benefits under the applicable long-term disability
plan maintained by an Affiliate.
3.11 "Employee" means any person, including officers, who is currently
employed by the the Holding Company or an Affiliate and shall also include the
Secretary of the Thrift.
3.12 "Holding Company" shall mean River Valley Bancorp.
3.13 "Outside Director" means a member of the Board of Directors of the
Holding Company, who is not also an Employee.
3.14 "Plan Shares" means shares of Common Stock held in the Trust and
issued or issuable to a Recipient pursuant to the Plan.
3.15 "Plan Share Award" or "Award" means a right granted under this Plan to
earn Plan Shares.
3.16 "Plan Share Reserve" means the shares of Common Stock held by the
Trustee pursuant to Sections 5.03 and 5.04.
3.17 "Recipient" means an Employee or Director who receives a Plan Share
Award under the Plan.
3.18 "Retirement" as to an Employee, means a termination of employment
which constitutes a "retirement" under any applicable qualified pension benefit
plan maintained by the Affiliate which employs the Recipient, or, if such plan
is not applicable, which would constitute "retirement" under such plan were the
Recipient covered by such plan and, as to a Director, means a retirement from
service on the Board after attaining age 70.
3.19 "Subsidiary Director" shall mean a non-employee director of an
Affiliate who is not an Outside Director.
3.20 "Thrift" shall mean Xxxxxxx First Federal Savings and Loan
Association.
3.21 "Trustee" means that person(s) or entity nominated by the Committee
and approved by the Board pursuant to Sections 4.01 and 4.02 to hold legal title
to the Plan assets for the purposes set forth herein.
ARTICLE IV
ADMINISTRATION OF THE PLAN
4.01 Role of the Committee. The Plan shall be administered and interpreted
by the Committee, which shall have all of the powers allocated to it in this and
other Sections of the Plan. The interpretation and construction by the Committee
of any provisions of the Plan or of any Plan Share Award granted hereunder shall
be final and binding. The Committee shall act by vote or written consent of a
majority of its members. Subject to the express provisions and limitations of
the Plan, the Committee may adopt such rules, regulations and procedures as it
deems appropriate for the conduct of its affairs. If permitted by applicable
law, the Committee, with the consent of Recipients may change the vesting
schedule for Awards after the date of grant thereof. The Committee shall
recommend to the Board one or more persons or entities to act as Trustee in
accordance with the provisions of this Plan and Trust and the terms of Article
VIII hereof.
4.02 Role of the Board. The members of the Committee and the Trustee shall
be appointed or approved by, and will serve at the pleasure of, the Board of
Directors of the Holding Company. The Board of Directors of the Holding Company
may in its discretion from time to time remove members from, or add members to,
the Committee, and may remove, replace or add Trustees.
4.03 Limitation on Liability. Neither a Director nor the Committee nor the
Trustee shall be liable for any determination made in good faith with respect to
the Plan or any Plan Shares or Plan Share Awards granted under it. If a Director
or the Committee or any Trustee is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of anything done or
not done by him in such capacity under or with respect to the Plan, the Holding
Company shall indemnify such person against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in the best interests
of the Holding Company and its Affiliates and, with respect to any criminal
action or proceeding, if he had no reasonable cause to believe his conduct was
unlawful. The indemnification of officers and directors of the Thrift pursuant
to this Section 4.03 shall be subject to 12 C.F.R ss. 545.121.
ARTICLE V
CONTRIBUTION; PLAN SHARE RESERVE
5.01 Amount and Timing of Contributions. The Affiliates shall be permitted
to contribute to the Trust an amount sufficient to purchase up to 4% of the
shares of Common Stock issued by the Holding Company in connection with the
Conversion. Such amounts shall be paid to the Trustee no later than the date
required to purchase shares of Common Stock for Awards made under this Plan. No
contributions by Employees or Directors shall be permitted.
5.02 Initial Investment. Any amounts held by the Trust until such amounts
are invested in accordance with Section 5.03, shall be invested by the Trustee
in such interest-bearing account or accounts at the Affiliates as the Trustee
shall determine to be appropriate.
5.03 Investment of Trust Assets; Creation of Plan Share Reserve. As soon as
practicable following the first shareholder meeting of the Holding Company
following the Conversion, which shall be held no earlier than six (6) months
following the Conversion ("First Shareholder Meeting Date"), the Trustee shall
invest all of the Trust's assets exclusively in the number of shares of Common
Stock designated by the Holding Company and the Affilitates as subject to Awards
made under this Plan, which may be purchased directly from the Holding Company,
on the open market, or from any other source; provided, however, that the Trust
shall not invest in an amount of Common Stock greater than 4.0% of the shares of
the Common Stock sold in the Conversion, which shall constitute the "Plan Share
Reserve" and provided, further that if the Trustee is required to purchase such
shares on the open market or from the Holding Company for an amount per share
greater than the price per share at which shares were trading on the date the
contributions therefor were made to the Trust, the Holding Company shall have
the discretion to reduce the number of shares to be awarded and purchased. The
Trust may hold cash in interest-bearing accounts pending investment in Common
Stock for periods of not more than one year after deposit. The Trustee, in
accordance with applicable rules and regulations and Section 5.01 hereof, shall
purchase shares of Common Stock in the open market and/or shall purchase
authorized but unissued shares of the Common Stock from the Holding Company
sufficient to acquire the requisite percentage of shares. Any earnings received
or distributions paid with respect to Common Stock held in the Plan Share
Reserve shall be held in an interest-bearing account. Any earnings received or
distributions paid with respect to Common Stock subject to a Plan Share Award
shall be held in an interest-bearing account on behalf of the individual
Recipient.
5.04 Effect of Allocations, Returns and Forfeitures Upon Plan Share
Reserves. Upon the allocation of Plan Share Awards under Sections 6.02 and 6.03
after acquisition by the Trustee of such shares, or the decision of the
Committee to return Plan Shares to the Holding Company, the Plan Share Reserve
shall be reduced by the number of Plan Shares so allocated or returned. Any
shares subject to an Award which may not be earned because of a forfeiture by
the Recipient pursuant to Section 7.01 shall be returned (added) to the Plan
Share Reserve.
ARTICLE VI
ELIGIBILITY; ALLOCATIONS
6.01 Eligibility. Employees and Subsidiary Directors are eligible to
receive Plan Share Awards provided in Section 6.02. Outside Directors are
eligible to receive Plan Share Awards provided for in Section 6.03.
6.02 Allocations. The Committee may determine which of the Employees and
Subsidiary Directors referenced in Section 6.01 above will be granted Plan Share
Awards and the number of Plan Shares covered by each Award, including grants
effective upon the First Shareholder Meeting Date, provided, however, that the
number of Plan Shares covered by such Awards may not exceed the number of Plan
Shares in the Plan Share Reserve immediately prior to the grant of such Awards,
and provided further, that in no event shall any Awards be made which will
violate the Articles of Incorporation, Articles of Association, Charter, Bylaws
or Plan of Conversion of the Holding Company or the Affiliates or any applicable
federal or state law or regulation and provided further that Awards may not be
granted at any time in which the Affiliates fail to meet their applicable
minimum capital requirements. In the event Plan Shares are forfeited for any
reason and unless the Committee decides to return the Plan Shares to the Holding
Company, the Committee may, from time to time, determine which of the Employees
or Subsidiary Directors referenced in Section 6.01 above will be granted
additional Plan Share Awards to be awarded from forfeited Plan Shares. In
selecting those Employees or Subsidiary Directors to whom Plan Share Awards will
be granted and the number of Plan Shares covered by such Awards, the Committee
shall consider the position and responsibilities of the eligible Employees and
Subsidiary Directors, the length and value of their services to the Affiliates,
the compensation paid to such Employees and Subsidiary Directors, and any other
factors the Committee may deem relevant.
6.03 Allocations - Outside Directors. The following Outside Directors shall
be awarded a Plan Share Award on the First Shareholder Meeting Date, assuming he
or she is still serving as an Outside Director on such date, equal to the number
of whole shares rounded to the nearest whole number constituting the following
percentage of the number of shares of Common Stock issued in the Conversion (the
"Fixed Award"); provided, however, that the Affiliates shall have the discretion
to reduce such percentages if the Trustee is required to purchase shares on the
open market or from the Holding Company for an amount per share greater than the
price per share at which shares are sold in the Conversion:
Percentage of Shares
Outside Director Issued in Conversion
---------------- --------------------
Xxxx X. Xxxxxxx .1923%
Xxxxxxx X. Xxxxxxx .1731%
Xxxxx X. Xxxxxx .1731%
Xxxx X. Xxxxxx .1731%
Xxxxxx X. Xxxxx .11535%
6.04 Form of Allocation. As promptly as practicable after a determination
is made pursuant to Section 6.02 or 6.03 that a Plan Share Award is to be made,
the Committee shall notify the Recipient in writing of the grant of the Award,
the number of Plan Shares covered by the Award, and the terms upon which the
Plan Shares subject to the Award may be earned. The stock certificates for Plan
Share Awards shall be registered in the name of the Recipient until forfeited or
transferred by the Recipient after such Award has been earned. The Committee
shall maintain records as to all grants of Plan Share Awards under the Plan.
6.05 Allocations Not Required. Notwithstanding anything to the contrary in
Sections 6.01 and 6.02, no Employee or Subsidiary Director shall have any right
or entitlement to receive a Plan Share Award hereunder, such Awards being at the
total discretion of the Committee, nor shall the Employees or Subsidiary
Directors as a group have such a right. No Outside Director shall have any right
or entitlement to reserve a Plan Share Award hereunder, except as provided for
in Section 6.03 hereof. The Committee may, with the approval of the Board (or,
if so directed by the Board, shall) return all Common Stock in the Plan Share
Reserve not yet allocated to the Holding Company at any time, and cease issuing
Plan Share Awards.
6.06. Distribution Election Before Plan Shares Are Earned. Notwithstanding
anything contained in the Plan to the contrary, an Employee or a Director who
has received an allocation of Plan Shares in accordance with Article VI may
request in writing that the Committee authorize the distribution to him or her
of all or a portion of the Plan Shares awarded before the date on which the Plan
Shares become earned in accordance with Article VII. The decision as to whether
to distribute to any Employee or Director who requests distribution shall be
made by the Committee, in its sole discretion. In addition, the distribution
shall be subject to the following parameters:
(a) The Committee shall be required to make a separate
determination for each request received by an Employee or Director for
distribution.
(b) Any Plan Shares awarded shall be required to have a legend
on the Plan Shares confirming that the Plan Shares are subject to
restriction and transfer in accordance with the terms set forth in the
Plan. This legend may not be removed until the date that the Plan
Shares become earned in accordance with Article VII.
(c) The Plan Shares distributed shall be voted by the Trustee
in accordance with Section 7.04 until the date that the Plan Shares are
earned.
(d) Any cash dividends or other cash distributions paid with
respect to the Plan Shares before the date that the Plan Shares are
earned shall be paid to the Trustee to be held for the Employee or
Director, whichever is applicable, until the date that the Plan Shares
are earned.
(e) At the date on which the Plan Shares are earned, the
Trustee may withhold from any cash dividends or other cash
distributions held on behalf of such Employee or Director the amount
needed to cover any applicable withholding and employment taxes arising
at the time that the Plan Shares are earned. If the amount of such cash
dividends or distributions is insufficient, the Trustee may require the
Employee or Director to pay to the Trustee the amount required to be
withheld as a condition of removing the legend on the Plan Shares.
ARTICLE VII
EARNING AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
7.01 Earning Plan Shares; Forfeitures.
(a) General Rules. Plan Shares subject to an Award shall be earned by a
Recipient at the rate of twenty percent (20%) of the aggregate number
of Shares covered by the Award at the end of each full twelve months
of consecutive service with the Holding Company or the Affiliate after
the date of grant of the Award. If the term of service of a Recipient
terminates as an Employee, as a Director, and as a Director Emeritus
prior to the fifth anniversary (or such later date as the Committee
shall determine) of the date of grant of an Award for any reason
(except as specifically provided in Subsection (b) below or in Section
4.01 hereof), the Recipient shall forfeit the right to earn any Shares
subject to the Award which have not theretofore been earned. In
determining the number of Plan Shares which are earned, fractional
shares shall be rounded down to the nearest whole number, provided
that such fractional shares shall be aggregated and earned, on the
fifth anniversary of the date of grant.
(b) Exception for Terminations due to Death and Disability.
Notwithstanding the general rule contained in Section 7.01(a) above,
all Plan Shares subject to a Plan Share Award held by a Recipient
whose term of service as an Employee and as a Director or Director
Emeritus with the Holding Company and the Affiliates terminates due to
death or Disability shall be deemed earned as of the Recipient's last
day of service with the Holding Company and the Affiliates as a result
of such death or Disability. If the recipient's service as an Employee
and as a Director or Director Emeritus terminates due to Disability
within one year of the effective date of the Conversion, the Shares
earned by the Receipent may not be disposed of by the Recipient during
the one-year period following the Conversion, and stock certificate
legends to that effect may be placed on the stock certificates for any
such shares.
(c) Revocation for Misconduct. Notwithstanding anything hereinafter to the
contrary, the Board may by resolution immediately revoke, rescind and
terminate any Plan Share Award, or portion thereof, previously awarded
under this Plan, to the extent Plan Shares have not been delivered
thereunder to the Recipient, whether or not yet earned, in the case of
an Employee who is discharged from the employ of the Holding Company
or an Affiliate for cause (as hereinafter defined), or who is
discovered after termination of employment to have engaged in conduct
that would have justified termination for cause or, in the case of an
Outside Director, Director Emeritus, or Subsidiary Director, who is
removed from the Board of Directors of the Holding Company or an
Affiliate for cause (as hereinafter defined), or who is discovered
after termination of service as an Outside Director, Director
Emeritus, or Subsidiary Director to have engaged in conduct which
would have justified removal for cause. "Cause" is defined as personal
dishonesty, willful misconduct, any breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, or the
willful violation of any law, rule, regulation (other than traffic
violations or similar offenses) or order which results in a loss to
the Holding Company or any Affiliate or in a final cease and desist
order.
7.02 Accrual of Dividends. Whenever Plan Shares are paid to a Recipient or
Beneficiary under Section 7.03, such Recipient or Beneficiary shall also be
entitled to receive, with respect to each Plan Share paid, an amount equal to
any cash dividends or cash distributions and a number of shares of Common Stock
equal to any stock dividends, and any other asset distributions declared and
paid with respect to a share of Common Stock between the date the Plan Shares
are being distributed and the date the Plan Shares were granted. There shall
also be distributed an appropriate amount of net earnings, if any, of the Trust
with respect to any cash dividends or cash distributions so paid out. Until the
Plan Shares are vested and distributed to any such Recipient or Beneficiary,
such dividends, distributions and net earnings thereon, if any, shall be
retained by the Trust.
7.03 Distribution of Plan Shares.
(a) Timing of Distributions: General Rule. Except as provided in
Subsection (b) below, Plan Shares shall be distributed to the
Recipient or his Beneficiary, as the case may be, as soon as
practicable after they have been earned.
(b) Timing: Exception for 10% Stockholders. Notwithstanding Subsection (a)
above, no Plan Shares may be distributed prior to the date which is
five (5) years from the effective date of the Conversion to the extent
the Recipient or Beneficiary, as the case may be, would after receipt
of such shares own in excess of ten (10) percent of the issued and
outstanding shares of Common Stock. Any Plan Shares remaining unpaid
solely by reason of the operation of this Subsection (b) shall be paid
to the Recipient or his Beneficiary on the date which is five (5)
years from the effective date of the Conversion.
(c) Form of Distribution. All Plan Shares, together with any shares
representing stock dividends, shall be distributed in the form of
Common Stock. One share of Common Stock shall be given for each Plan
Share earned and payable. Payments representing accumulated cash
dividends and cash or other distributions (and earnings thereon) shall
be made in cash or in the form of such non-cash distributions.
(d) Withholding. The Trustee may withhold from any payment or distribution
made under this Plan sufficient amounts of cash or shares of Common
Stock to cover any applicable withholding and employment taxes, and if
the amount of such payment is insufficient, the Trustee may require
the Recipient or Beneficiary to pay to the Trustee the amount required
to be withheld as a condition of delivering the Plan Shares.
Alternatively, a Recipient may pay to the Trustee that amount of cash
necessary to be withheld in taxes in lieu of any withholding of
payments or distribution under the Plan. The Trustee shall pay over to
the Holding Company, or the Affiliate which employs or employed such
Recipient any such amount withheld from or paid by the Recipient or
Beneficiary.
(e) Cessation of Payment. The Trustee shall cease payment of benefits to
Recipients or, if applicable, their Beneficiaries in the event of the
Bank's or Thrift's insolvency. The Bank or Thrift shall be considered
insolvent for purposes of this RRP if the Bank or Thrift is unable to
pay its debts as they become due or if a receiver is appointed for the
Bank or Thrift under applicable law. If payments cease by reason of
this subsection, payments will be resumed, with appropriate make-up
payments, once the Bank or Thrift ceases to be insolvent but only to
the extent the payments were not made directly by the Bank, the Thrift
or their Affiliates.
7.04 Voting of Plan Shares. All shares of Common Stock held by the Trust
shall be voted by the Trustee, taking into account the best interests of the
Plan Share Award recipients.
ARTICLE VIII
TRUST
8.01 Trust. The Trustee shall receive, hold, administer, invest and make
distributions and disbursements from the Trust in accordance with the provisions
of the Plan and Trust and the applicable directions, rules, regulations,
procedures and policies established by the Committee pursuant to the Plan.
8.02 Management of Trust. It is the intent of this Plan and Trust that,
subject to the provisions of this Plan, the Trustee shall have complete
authority and discretion with respect to the management, control and investment
of the Trust, and that the Trustee shall invest all assets of the Trust, except
those attributable to cash dividends paid with respect to Plan Shares, in Common
Stock to the fullest extent practicable, and except to the extent that the
Trustee determines that the holding of monies in cash or cash equivalents is
necessary to meet the obligation of the Trust. Neither the Holding Company nor
any Affiliate shall exercise any direct or indirect control or influence over
the time when, or the prices at which, the Trustee may purchase such shares, the
number of shares to be purchased, the manner in which the shares are to be
purchased, or the broker (if any) through whom the purchases may be executed. In
performing its duties, the Trustee shall have the power to do all things and
execute such instruments as may be deemed necessary or proper, including the
following powers:
(a) To invest up to one hundred percent (100%) of all Trust assets
in Common Stock without regard to any law now or hereafter in
force limiting investments for Trustees or other fiduciaries.
The investment authorized herein and in paragraph (b)
constitutes the only investment of the Trust, and in making
such investment, the Trustee is authorized to purchase Common
Stock from the Holding Company or an Affiliate or from any
other source, and such Common Stock so purchased may be
outstanding, newly issued, or treasury shares.
(b) To invest any Trust assets not otherwise invested in
accordance with (a) above in such deposit accounts, and
certificates of deposit (including those issued by an
Affiliate), securities of any open-end or closed-end
management investment company or investment trust registered
under the Investment Company Act of 1940, whether or not the
Trustee or any affiliate of the Trustee is being compensated
for providing services to the investment company or trust as
investment advisor or otherwise, obligations of the United
States government or its agencies or such other investments as
shall be considered the equivalent of cash.
(c) To sell, exchange or otherwise dispose of any property at any
time held or acquired by the Trust.
(d) To cause stocks, bonds or other securities to be registered in
the name of a nominee, without the addition of words
indicating that such security is an asset of the Trust (but
accurate records shall be maintained showing that such
security is an asset of the Trust).
(e) To hold cash without interest in such amounts as may be in the
opinion of the Trustee reasonable for the proper operation of
the Plan and Trust and to hold cash pending investment.
(f) To employ brokers, agents, custodians, consultants and
accountants.
(g) To hire counsel to render advice with respect to their rights,
duties and obligations hereunder, and such other legal
services or representation as they may deem desirable.
(h) To hold funds and securities representing the amounts to be
distributed to a Recipient or his or her Beneficiary as a
consequence of a dispute as to the disposition thereof,
whether in a segregated account or held in common with other
assets of the Trust.
Notwithstanding anything herein contained to the contrary, the Trustee
shall not be required to make any inventory, appraisal or settlement or report
to any court, or to secure any order of court for the exercise of any power
herein contained, or give bond.
8.03 Records and Accounts. The Trustee shall maintain accurate and detailed
records and accounts of all transactions of the Trust, which shall be available
at all reasonable times for inspection by any legally entitled person or entity
to the extent required by applicable law, or any other person determined by the
Committee.
8.04 Earnings. All earnings, gains and losses with respect to Trust assets
shall be allocated, in accordance with a reasonable procedure adopted by the
Committee, to bookkeeping accounts for Recipients or to the general account of
the Trust, depending on the nature and allocation of the assets generating such
earnings, gains and losses. In particular, any earnings on cash dividends or
distributions received with respect to shares of Common Stock shall be allocated
to accounts for Recipients, if such shares are the subject of outstanding Plan
Share Awards, or otherwise to the Plan Share Reserve. Recipients (or their
Beneficiaries) shall not be entitled to any such allocations until the Plan
Share Awards to which they relate are vested and distributed to those Recipients
(or their Beneficiaries).
8.05 Expenses. All costs and expenses incurred in the operation and
administration of this Plan, including those incurred by the Trustee, shall be
borne by the Affiliates or the Holding Company.
8.06 Indemnification. The Holding Company shall indemnify, defend and hold
the Trustee harmless against all claims, expenses and liabilities arising out of
or related to the exercise of the Trustee's powers and the discharge of its
duties hereunder, unless the same shall be due to its negligence or willful
misconduct.
ARTICLE IX
MISCELLANEOUS
9.01 Adjustments for Capital Changes. The aggregate number of Plan Shares
available for issuance pursuant to the Plan Share Awards (which, as of the
effective date of this Plan, shall not exceed, 4% of the shares of the Holding
Company's Common Stock issued in the Conversion), and the number of shares to
which any Plan Share Award relates shall be proportionately adjusted for any
increase or decrease in the total number of outstanding shares of Common Stock
issued subsequent to the effective date of the Plan resulting from any stock
dividend or split, recapitalization, merger, consolidation, spin-off,
reorganization, combination or exchange of shares, or other similar capital
adjustment, or other increase or decrease in such shares effected without
receipt or payment of consideration, by the Committee.
9.02 Amendment and Termination of Plan. The Board may, by resolution, at
any time amend or terminate the Plan. The power to amend or terminate shall
include the power to direct the Trustee to return to the Holding Company all or
any part of the assets of the Trust, including shares of Common Stock held in
the Plan Share Reserve, as well as shares of Common Stock and other assets
subject to Plan Share Awards but not yet earned by the Employees or Outside
Directors or Subsidiary Directors to whom they are allocated. However, the
termination of the Trust shall not affect a Recipient's right to the
distribution of Common Stock relating to Plan Share Awards already earned,
including earnings thereon, in accordance with the terms of this Plan and the
grant by the Committee.
9.03 Nontransferable. Plan Share Awards and rights to Plan Shares shall not
be transferable by a Recipient other than by will or the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined by
the Internal Revenue Code of 1986, as amended, or Title I of the Employee
Retirement Income Security Act, or the rules thereunder, and during the lifetime
of the Recipient, Plan Shares may only be earned by and paid to the Recipient
who was notified in writing of the Award by the Committee pursuant to Section
6.04. The assets of the RRP, prior to the distribution of Plan Shares to a
Recipient or his or her Beneficiary, shall be subject to the claims of creditors
of the Bank and/or the Thrift. Unless Plan Shares are distributed in accordance
with Section 6.06 or 7.03 to a Recipient or his or her Beneficiary, such
Recipient or, if applicable, Beneficiary shall not have any right in or claim to
any specific assets of the RRP or Trust and shall only be an unsecured creditor
of the Bank and/or the Thrift, nor shall any Affiliate be subject to any claim
for benefits hereunder.
9.04 Employment Rights. Neither the Plan nor any grant of a Plan Share
Award or Plan Shares hereunder nor any action taken by the Trustee, the
Committee or the Board in connection with the Plan shall create any right on the
part of any Employee to continue in the employ of, or of any Director to
continue in the service of, the Holding Company or any Affiliate thereof.
9.05 Voting and Dividend Rights. No Recipient shall have any voting or
dividend rights or other rights of a stockholder in respect of any Plan Shares
covered by a Plan Share Award, except as expressly provided in Sections 7.02 and
7.04 above, prior to the time said Plan Shares are actually distributed to him.
9.06 Governing Laws. The Plan and Trust shall be governed by the laws of
the State of Indiana, except to the extent governed by federal law, including
regulations of the Office of Thrift Supervision. In particular, grants of Plan
Share Awards under the Plan shall comply with the requirements of 12 C.F.R.
ss.563b.3(g)(4)(vi) as long as those requirements are in effect. That regulation
currently requires that no individual shall receive more than 25% of the Plan
Share Awards available for grant under the Plan and Outside Directors shall not
receive Plan Share Awards for more than 5% individually, or 30% in the
aggregate, of the Plan Share Awards available for grant under the Plan.
9.07 Effective Date. This Plan shall be effective as of the date of its
approval by the shareholders of the Holding Company.
9.08 Term of Plan. This Plan shall remain in effect until the earlier of
(1) 21 years from its effective date, (2) termination by the Board, or (3) the
distribution of all assets of the Trust. Termination of the Plan shall not
affect any Plan Share Awards previously granted, and such Awards shall remain
valid and in effect until they have been earned and paid, or by their terms
expire or are forfeited.
9.09 Tax Status of Trust. It is intended that the trust established hereby
be treated as a grantor trust of the Holding Company and the Affiliates under
the provisions of Section 671, et seq., of the Internal Revenue Code of 1986, as
amended.
9.10. Compensation. The Trustee shall be entitled to receive fair and
reasonable compensation for its services hereunder, as agreed to by the Trustee
and the Holding Company, and shall also be entitled to be reimbursed for all
reasonable out-of-pocket expenses, including, but not by way of limitation,
legal, actuarial and accounting expenses and all costs and expenses incurred in
prosecuting or defending any action concerning the Plan or the Trust or the
rights or responsibilities of any person hereunder, brought by or against the
Trustee. Such reasonable compensation and expenses shall be paid by the Holding
Company or the Affiliates.
9.11. Resignation of Trustee. The Trustee may resign at any time by giving
sixty (60) calendar days' prior written notice to the Holding Company, and the
Trustee may be removed, with or without cause, by the Holding Company on sixty
(60) calendar days' prior written notice to the Trustee. Such prior written
notice may be waived by the party entitled to receive it. Upon any such
resignation or removal becoming effective, the Trustee shall render to the
Holding Company a written account of its administration of the Plan and the
Trust for the period since the last written accounting and shall do all
necessary acts to transfer the assets of the Trust to the successor Trustee or
Trustees.
