Exhibit 10.7
RETIREMENT PAYMENT AGREEMENT
AGREEMENT ENTERED INTO AS OF THE 1ST DAY OF May, 1991 between Xxxxxxx Savings
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and Loan Association, a domestic Corporation having its principal office in
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Waynesville, North Carolina (hereinafter referred to as the Association) and R.
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Xxxx Xxxxxx of Waynesville, North Carolina (hereinafter referred to as the
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Director).
WITNESSETH:
WHEREAS, the Director is rendering valuable service and it is the desire of the
Association to have the benefit of his continued loyalty and service and also to
assist him in providing for the contingencies of retirement and death; and,
WHEREAS, the Director hereby agrees to waive fees paid to him as a Director in
the amount of $350.00 per month for five years from the date of the execution of
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this agreement;
NOW THEREFORE, in consideration of the premises contained herein, the parties
hereto mutually agree as follows:
1. Retirement Benefit: Should the Director still be in the Directorship
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of the Association upon attainment of his 65th birthday, the Association will
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commence to pay him $1,733 per month for a continuous period of 120 months. In
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the event that the Director should die after becoming entitled to receive said
monthly installments but before any or all of said installments have been paid,
the Association will pay or will continue to pay said installments to such
beneficiary or beneficiaries as the Director has directed by filing with the
Association a notice in writing. In the event of the death of the last named
beneficiary before all the unpaid payments have been made, the balance of any
amount which remains unpaid at said death shall be paid in a single sum to the
executor or administrator of the estate of the last named beneficiary to die.
In the absence of any such beneficiary designation, any amount remaining unpaid
at the Director's death shall be commuted on the basis of eight percent per
annum compound interest and shall be paid in a single sum to the executor or
administrator of the Director's estate.
2. Death Benefit: Should the Director die while in the Directorship of
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the Association and prior to the attainment of his 65th birthday, the
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Association (beginning at a date to be determined by the Association but within
six months from the date of such death) will commence to pay $1,733 per month
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for a continuous period of 120 months to such beneficiary or beneficiaries as
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the Director has directed by filing with the Association a notice in writing.
Irrespective of the above, however, if the Director dies as a result of suicide
within two years of the execution of this agreement, the death benefit shall not
exceed an amount equal to his waived Directors' fees plus interest at the rate
of eight percent per annum compounded annually. In the event of the death of
the last named beneficiary before all the unpaid payments have been made, the
balance of any amount which remains unpaid at said death shall be commuted on
the basis of eight percent per annum compound interest and shall be paid in a
single sum to the executor or administrator of the estate of the last named
beneficiary to die. In the absence of any such beneficiary designation, any
amount remaining
unpaid at the Director's death shall be commuted on the basis of eight percent
per annum compound interest and shall be paid in a single sum to the executor or
administrator of the Director's estate.
3. Termination of Directorship:
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A. If the Director terminates his Directorship, for reasons other than
death or the attainment of his 65th birthday, prior to two years from the
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execution date of the Agreement, the Director's benefits shall be limited
to his waived Director fees plus interest at the rate of eight percent per
annum compounded annually and shall be paid in a single sum as soon as
practical following the termination of his Directorship.
B. If the Director terminates his Directorship, for reasons other than
death or the attainment of his 65th birthday, at the end of two years or
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more from the execution date of this Agreement, he or his beneficiary, as
applicable, shall be entitled upon the attainment of his 65th birthday, or
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his prior death, to a percentage of the retirement benefits stated in
Section 1 of this Agreement as determined by the following table:
FULL NUMBER OF YEARS SERVED PERCENTAGE OF RETIREMENT
AS DIRECTOR FORM DATE OF BENEFITS STATED IN SECTION
EXECUTION OF THIS AGREEMENT 1 OF THIS AGREEMENT TO WHICH
UNTIL TERMINATION OF DIRECTORSHIP THE DIRECTOR IS ENTITLED
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2 40%
3 60%
4 80%
5 100%
4. Forfeiture Provisions:
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A. During the period the retirement benefit is payable to the Director
under Section 1 of this Agreement, the Director shall not engage in
business activities which are in competition with the Association without
first obtaining the written consent of the Association.
B. During the period the retirement payment is payable to the Director
under Section 1 of the Agreement, the Director shall be available to render
consulting services to the Association upon request by an officer of the
Association, but such requests shall not be made more frequently than once
each moth. The Director shall not be considered to have breached this
condition if he is unable to consult because of his mental or physical
disability.
C. Payment of the retirement benefit under this Agreement may be
terminated by the Association, if the Director fails to comply with either
of the conditions set forth in paragraph (A) and (B) of this Section 4.
5. General Provisions:
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A. Except as otherwise provided by the Agreement, it is agreed that
neither the Director, nor his beneficiary shall have any right to commute,
sell, assign, transfer or otherwise convey the right to receive any
payments hereunder, which payments and the right hereto are expressly
declared to be nonassignable and nontransferable.
B. The benefits payable under the Agreement shall be independent of, and
in addition to, any other employment agreements that may exist from time to
time between the parties hereto, concerning any other compensation payable
by the Association to the Director whether as salary, bonus, or otherwise.
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 Association to discharge the Director or restrict the right of
the Director to terminate his Directorship.
C. The rights of the Director under this Agreement and of any beneficiary
of the Director shall be solely those of an unsecured creditor of the
Association. Any asset acquired by the Association in connection with the
liabilities assumed by it hereunder, shall not be deemed to be held under
any trust for the benefit of the Director or his beneficiaries or to be
considered security for the performance of the obligations of the
Association but shall be, and remain, a general, unpledged, unrestricted
asset of the Association.
D. The Association hereby reserves the right to accelerate the payments
specified in Sections 1, 2 and 3 above without the consent of the Director,
his estate, beneficiaries, or any other person claiming through or under
him.
E. The Association agrees that it will not merge or consolidate with any
other Association or organization, or permit its business activities to be
taken over by any other organization unless and until the succeeding or
continuing Association or other organization shall expressly assume the
rights and obligations of the Association herein set forth. The
Association further agrees that it will not cease its business activities
or terminate its existence, other than as set forth in this Section,
without having made adequate provision for the fulfilling of its
obligations hereunder.
F. This Agreement may be revoked or amended in whole or in part by a
writing signed by both of the parties hereto.
G. This Agreement shall be subject to and construed under the laws of the
State of North Carolina.
IN WITNESS THEREOF, the said Association has caused this Agreement to be
signed in its Corporate name by its duly authorized officer, and impressed with
the Corporate seal, attached by its Secretary, and the said Director has
hereunto set his hand and seal, all on the date and year first above written.
ATTEST: XXXXXXX SAVINGS AND LOAN ASSOCIATION, INC. (Association)
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BY: /s/ Xxxxx X. Xxxxxx (Seal)
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President
/s/ R. Xxxx Xxxxxx (Seal)
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The Director
WITNESS: _______________________________________________
BENEFICIARY DESIGNATION FORM
As Beneficiary to receive any death benefits payable on my behalf from Xxxxxxx
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Savings and Loan Association incorporated in Waynesville, North Carolina, I
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designate the following:
NAME DATE OF BIRTH ADDRESS RELATIONSHIP
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PRIMARY
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000 Xxxxx Xxxxx Xxxxx
Xxxxxxx X. Xxxxxx 4/5/41 Xxxxxxxxxxx, X.X. 00000 wife
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CONTINGENT, If Any:
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000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxxxxxx Xxxxxx 00-00-00 Xxxxxxxxxxx, X.X. 00000 Daughter
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(Note: If more than one primary beneficiary is named, the benefit will be paid
in equal shares to those living. Should the contingent beneficiaries be
eligible to receive the benefits, such benefits will be paid in equal shares to
such living contingent beneficiaries. If none of the designated beneficiaries
are living at such time as the death benefit is payable, such benefit will be
paid to the Executor or Administrator of your Estate).
Name of Spouse if not given above: Given above
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/s/ R. Xxxx Xxxxxx
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Witness Signature of Director
June 24, 1991
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Date
Note: The original should be retained by the Association, one copy by the
Director, and one copy forwarded to Xxxxx/Xxxxxxxxxx, Inc.
XXXXXXX SAVINGS BANK, INC., SSB
RETIREMENT PAYMENT AGREEMENT
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1998 Amendment
to Agreement dated April 1, 1991
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WHEREAS, Xxxxxxx Savings Bank, Inc., SSB (the "Bank") entered into a
Retirement Payment Agreement (the "RPA") dated April 1, 1991, with
_____________________ (the "Director"); and
WHEREAS, the Bank's Board of Directors and the Director have determined
that it is in their respective best interests to amend the RPA in the manner set
forth herein.
NOW, THEREFORE, the RPA shall be amended as follows, pursuant to
Section 5.F thereof:
1. Section 5 of the RPA shall be amended by adding the following new
paragraph H at the end thereof:
H. Notwithstanding the provisions of paragraphs 2, 3, and 4 hereof,
any benefits that are or become payable after the closing date of a
Change in Control (as defined in the Bank's Retirement Plan for Non-
Employee Directors) shall be paid in the manner selected by the
Director in a duly executed election in the form (the "Election Form")
attached hereto as Exhibit "A"; provided that such an election will be
honored and given effect only if it is properly made and delivered to
the Bank more than 90 days before said closing date. Present value
determinations, as well as interest accruals on present value sums
that are paid in installments over a fixed period of years, shall be
calculated at a rate equal to 120% of the applicable federal rate,
compounded semiannually, as determined under Section 1274(d) of the
Internal Revenue Code of 1986, as amended, and the regulations
thereunder.
The Director may specify on the Election Form, the manner of
payment to his beneficiary, and may at any time or from time to time
change the identity or manner of payment to his beneficiary.
2. Nothing contained herein shall be held to alter, vary, or affect any
of the terms, provisions, or conditions of the RPA other than stated above.
Retirement Payment Amendment
1998 Amendment
Page 2
WHEREFORE, the undersigned hereby approve this 1998 Amendment to the RPA.
Date of Execution: ____________________________, 1998
ATTEST: XXXXXXX SAVINGS BANK, INC., SSB
_____________________________ By_______________________________
Its____________________________
WITNESS: DIRECTOR
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