Exhibit 10.4.7
FIRST SOUTH BANK SPLIT DOLLAR
AGREEMENT
THIS AGREEMENT is made and entered into this 19th day of November, 1999,
by and between FIRST SOUTH BANK, a state-chartered commercial bank located in
Spartanburg, South Carolina (the "Company"), and V. XXXXX XXXXXX (the
"Executive"). This Agreement shall append the Split Dollar Endorsement entered
into on November 19, 1999, or as subsequently amended, by and between the
aforementioned parties.
INTRODUCTION
To encourage the Executive to remain an employee of the Company, the
Company is willing to divide the death proceeds of a life insurance policy on
the Executive's life. The Company will pay life insurance premiums from its
general assets.
Article 1 General
Definitions
The following terms shall have the meanings specified:
1.1 "Insured" means the Executive.
1.2 "Insurer " means West Coast Life Insurance Company.
1.3 "Normal Retirement Age " means the Executive's sixty-fifth (65th)
birthday.
1.4 "Policy" means insurance policy no. XXX000000 issued by the
Insurer.
1.5 "Termination of Employment" means the Executive ceasing to be
employed by the Company for any reason whatsoever, other than by reason of (a)
an approved leave of absence, (b) the Executive's death, (c) a change of control
(as defined in the Salary Continuation Agreement between the Company and the
Executive effective January 1,1999), or (d) the Executive's disability (as
defined in said Salary Continuation Agreement).
Article 2 Policy
Ownership/Interests
2.1 Company Ownership. The Company is the sole owner of the Policy and
shall have the right to exercise all incidents of ownership. The Company shall
be the direct beneficiary of an amount of death proceeds equal to the greater
of: (a) the cash surrender value of the Policy plus the amount from Schedule A.
or (b) the aggregate premiums paid on the Policy by the Company less any
outstanding indebtedness to the Insurer.
2.2 Executive's Interest. The Executive shall have the right to
designate the beneficiary of any-remaining death proceeds of the Policy after
payment of the amount due the Company under Section 2,1. The Executive shall
also have the right to elect and change settlement options that may be
permitted. Provided, however, the Executive, the Executive's transferee or the
Executive's beneficiary shall have no rights or interests in the Policy with
respect to that portion of the death proceeds designated in this Section 2.2
upon the Executive's Termination of Employment prior to Normal Retirement Age.
2.3 Option to Purchase. The Company shall not sell, surrender or
transfer ownership of the Policy while this Agreement is in effect without first
giving the Executive or the Executive's transferee the option to purchase the
Policy for a period of sixty (60) days from written notice of such intention.
The purchase price shall be an amount equal to the cash surrender value of the
Policy. This provision shall not impair the right of the Company to terminate
this Agreement.
2.4 Comparable Coverage. Upon Termination of Employment after the
Executive's Normal Retirement Age, the Company shall maintain the Policy in full
force and effect and in no event shall the Company amend, terminate or otherwise
abrogate the Executive's interest in the Policy, unless the Company replaces the
Policy with a comparable insurance policy to cover the benefit provided under
this Agreement. The Policy or any comparable policy shall be subject to the
claims of the Company's creditors.
Article 3
Premiums
3.1 Premium Payment. The Company shall pay any premiums due on the
Policy.
3.2 Imputed Income. The Company shall impute income to the Executive in
an amount equal to the current term rate for the Executive's age multiplied by
the aggregate death benefit payable to the Executive's beneficiary. The "current
term rate" is the minimum amount required to be imputed under Revenue Rulings
64-328 and 66-110, or any subsequent applicable authority.
Article 4
Assignment
The Executive may assign without consideration all interests in the
Policy and in this Agreement to any person, entity or trust. In the event the
Executive transfers all of the Executive's interest in the Policy, then all of
the Executive's interest in the Policy and in the Agreement shall be vested in
the Executive's transferee, who shall be substituted as a party hereunder and
the Executive shall have no further interest in the Policy or in this Agreement.
Article 5
Insurer
The Insurer shall be bound only by the terms of the Policy. Any payments
the Insurer makes or actions it takes in accordance with the Policy shall fully
discharge it from all claims, suits and demands of all entities or persons. The
Insurer shall not be bound by or be deemed to have notice of the provisions of
this Agreement.
Article 6 Claims
Procedure
6.1 Claims Procedure. The Company shall notify the Executive, the
Executive's transferee or beneficiary, or any other party who claims a right to
an interest under this Agreement (the "Claimant') in writing, within ninety (90)
days of the Claimant's written application for benefits, of his or her
eligibility or ineligibility for benefits under this Agreement. If the Company
determines that the Claimant is not eligible for benefits or full benefits, the
notice shall set forth (a) the specific reasons for such denial, (b) a specific
reference to the provisions of this Agreement on which the denial is based, (c)
a description of any additional information or material necessary for the
Claimant to perfect his or her claim, and a description of why it is needed, and
(d) an explanation of this Agreement's claims review procedure and other
appropriate information as to the steps to be taken if the Claimant wishes to
have the claim reviewed. If the Company determines that there are special
circumstances requiring additional time to make a decision, the Company shall
notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an additional
ninety (90) days.
6.2 Review Procedure. If the Claimant is determined by the Company not
to be eligible for benefits, or if the Claimant believes that he or she is
entitled to greater or different benefits, the Claimant shall have the
opportunity to have such claim reviewed by the Company by filing a petition for
review with the Company within sixty (60) days after receipt of the notice
issued by the Company. Said petition shall state the specific reasons which the
Claimant believes entitle him or her to benefits or to greater or different
benefits. Within sixty (60) days after receipt by the Company of the petition,
the Company shall afford the Claimant (and counsel, if any) an opportunity to
present his or her position to the Company verbally or in writing, and the
Claimant (or counsel) shall have the right to review the pertinent documents.
The Company shall notify the Claimant of its decision in writing within the
sixty (60) day period, stating specifically the basis of its decision, written
in a manner to be understood by the Claimant and the specific provisions of this
Agreement on which the decision is based. If, because of the need for a hearing,
the sixty (60) day period is not sufficient, the decision may be deferred for up
to another sixty (60) day period at the election of the Company, but notice of
this deferral shall be given to the Claimant.
Article 7
Amendments and Termination
This Agreement may be amended or terminated only by a written agreement
signed by the Company and the Executive. However, unless otherwise agreed to by
the Company and the Executive, this Agreement will automatically terminate upon
the Executive's Termination of Employment prior to Normal Retirement Age.
Article 8
Miscellaneous
8.1 Binding Effect. This Agreement shall bind the Executive and the
Company, their beneficiaries, survivors, personal representatives,
administrators and transferees, and any Policy beneficiary.
8.2 No Guarantee of Employment. This Agreement is not an employment
policy or contract. It does not give the Executive the right to remain an
employee of the Company, nor does it interfere with the Company's right to
discharge the Executive. This Agreement also does not require the Executive to
remain an employee nor interfere with the Executive's right to terminate
employment at any time. Nothing in this Agreement shall be construed as an
employment agreement, either express or implied.
8.3 Reorganization. The Company shall not merge or consolidate into or
with another company, or reorganize, or sell substantially all of its assets to
another company, firm or person unless such succeeding or continuing company,
firm or person agrees to assume and discharge the obligations of the Company.
Upon the occurrence of such event, the term "Company" as used in this Agreement
shall be deemed to refer to the successor or survivor company.
8.4 Applicable Law. The Agreement and all rights hereunder shall be
governed by and construed according to the laws of the State of South Carolina,
except to the extent preempted by the laws of the United States of America.
8.5 Notice. Any notice, consent or demand required or permitted to be
given under the provisions of this Split Dollar Agreement by one party to
another shall be in writing, shall be signed by the party giving or making the
same, and may be given either by delivering the same to such other party
personally, or by mailing the same, by United States certified mail, postage
prepaid, to such party, addressed to his or her last known address as shown on
the records of the Company. The date of such mailing shall be deemed the date of
such mailed notice, consent or demand.
8.6 Entire Agreement. This Agreement constitutes the entire agreement
between the Company and the Executive as to the subject matter hereof. No rights
are granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.
8.7 Administration. The Company shall have powers which are necessary to
administer this Agreement, including but not limited to:
(a) Interpreting the provisions of the Agreement;
(b) Establishing and revising the method of accounting for the
Agreement;
(c) Maintaining a record of benefit payments; and
(d) Establishing rules and prescribing any forms necessary or
desirable to administer the Agreement.
8.8 Named Fiduciary. For purposes of the Employee Retirement Income
Security Act of 1974, if applicable, the Company shall be the named fiduciary
and plan administrator under the Agreement. The named fiduciary may delegate to
others certain aspects of the management and operation responsibilities under
this Agreement including the employment of advisors and the delegation of
ministerial duties to qualified individuals.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
EXECUTIVE: COMPANY:
FIRST SOUTH BANK
s/ V. Xxxxx Xxxxxx By: s/ Xxxxx X. Slider
------------------ ------------------
V. Xxxxx Xxxxxx Title: President/CE
SPLIT DOLLAR POLICY ENDORSEMENT FIRST
SOUTH BANK SPLIT DOLLAR AGREEMENT
Policy No. XXX000000 Insured: V. XXXXX XXXXXX
Supplementing and amending the application for insurance to West Coast Life
Insurance Company ("Insurer") on August 12, 1999, the applicant requests and
directs that:
BENEFICIARIES
(1) FIRST SOUTH BANK, a state-chartered commercial bank located in
Spartanburg, South Carolina (the "Company"), shall be the direct beneficiary of
death proceeds equal to the greater of (a) the cash surrender value of the
Policy plus the amount from Schedule A. or (b) the aggregate premiums paid on
the Policy by the Company less any outstanding indebtedness to the Insurer.
(2) The beneficiary of any remaining death proceeds shall be designated by
the Insured or the Insured's transferee, subject to the provisions of paragraph
(5) below.
OWNERSHIP
(3) The Owner of the policy shall be the Company. The Owner shall have all
ownership rights in the Policy except as may be specifically granted to the
Insured or the Insured's transferee in paragraph (4) of this endorsement.
(4) The Insured or the Insured's transferee shall have the right to assign
his or her rights and interests in the Policy with respect to that portion of
the death proceeds designated in paragraph (2) of this endorsement, and to
exercise all settlement options with respect to such death proceeds.
(5) Notwithstanding the provisions of paragraph (4) above, the Insured or
the Insured's transferee shall have no rights or interests in the Policy with
respect to that portion of the death proceeds designated in paragraph (2) of
this endorsement upon the Insured's Termination of Employment prior to Normal
Retirement Age unless otherwise agreed to by the Company and the Executive.
MODIFICATION OF ASSIGNMENT PROVISIONS OF THE POLICY
Upon the death of the Insured, the interest of any collateral assignee of the
Owner of the Policy designated in paragraph (3) above shall be limited to the
portion of the proceeds described in paragraph (1) above.
MISCELLANEOUS
In the event of any conflict between this endorsement and the Split Dollar
Agreement between the parties of even date (the "Agreement"), the Agreement
shall control. All capitalized terms not defined in this endorsement shall have
the meaning assigned them in the Agreement.
OWNERS AUTHORITY
The Insurer is hereby authorized to recognize the Owner's claim to rights
hereunder without investigating the reason for any action taken by the Owner,
including its statement of the amount of premiums it has paid on the Policy. The
signature of the Owner shall be sufficient for the exercise of any rights under
this endorsement and the receipt of the Owner for any sums received by it shall
be a full discharge and release therefore to the Insurer.
Any transferee's rights shall be subject to this endorsement. The Owner accepts
and agrees to this split dollar endorsement.
Signed at Spartanburg, South Carolina, this 19th day of November, 1999.
FIRST SOUTH BANK
By: s/ Xxxxx X. Slider
-------------------
Its: President/CEO
The Insured accepts and agrees to the foregoing and, subject to the rights of
the Owner as stated above, designates Xxxx X. Xxxxxx as primary beneficiary and
Xxxxxxx X. Xxxxxx and Xxxx X. Xxxxxx equally as secondary beneficiary of the
portion of the proceeds described in paragraph (2) above.
Signed at Spartanburg, South Carolina, this 19th day of November, 1999.
THE INSURED:
s/ V. Xxxxx Xxxxxx
------------------
V. XXXXX XXXXXX
First South Bank
V. Xxxxx Xxxxxx
Split Dollar Agreement and Endorsement Schedule A
Policy Year Additional
in Which Death Benefit
Death to the
Occurs Company
------ -------
1 72,130
2 83,283
3 95,591
4 109,212
5 124,345
6 141,258
7 160,337
8 182,255
9 208,752
Thereafter 208,752
