Exhibit 10.4.4.
FIRST SOUTH BANK SALARY CONTINUATION AGREEMENT
THIS SALARY CONTINUATION AGREEMENT (the "Agreement") is made this 19th
day of November, 1999, by and between FIRST SOUTH BANK, a state bank with a
principal office in Spartanburg, South Carolina (the "Company") and XXXXX X.
SLIDER (the "Executive").
INTRODUCTION
To encourage the Executive to remain an employee of the Company, the
Company is willing to provide salary continuation benefits to the Executive.
The Company will pay the benefits from its general assets.
AGREEMENT
Now, therefore, in consideration of the mutual covenants and agreements
herein, the Executive and the Company agree as follows:
Article 1
Definitions
1.1 Definitions. Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:
1.1.1 "Accrual Balance "means the amount of death benefits
payable to the Executive pursuant to Section 3.1 of this Agreement and
set forth in the attached Schedule A.
1.1.2 "Board "or "Board of Directors "means the Board of
Directors of the Company.
1.1.3 "Change of Control "means
(i) the acquisition by any person, group of persons or
entities of the beneficial ownership or power to vote
more than twenty (20%) percent of the Company's
outstanding stock, or
(ii) during any period of two (2) consecutive years, a
change in the majority of the Board unless the election
of each new director was approved by at least
two-thirds of the directors then still in office who
were directors at the beginning of such two (2) year
period, or
(iii) a reorganization, merger, exchange of shares,
combination or consolidation of the Company with one or
more other corporations or other legal entities in
which the Company is not surviving the corporation, or
a transfer of all or substantially all of the assets of
the Company to another person or entity.
(iv) Notwithstanding any other provision in this Agreement,
"Change of Control" shall not be construed to mean the
formation of a bank holding company or other entity
approved in advance by the Board or any changes in
ownership of the Company's assets or stock as the
result of the formation of such an entity.
1.1.4 "Code" means the Internal Revenue Code of 1986, as
amended. References to a Code section shall be deemed to be that
section as it now exists and to any successor provision.
1.1.5 "Disability" means, if the Executive is covered by a
Company sponsored disability policy, total disability as defined in
such policy without regard to any waiting period. If the Executive is
not covered by such a policy, Disability means the Executive suffering
a sickness, accident or injury that, in the judgment of a physician
appointed and paid by the Company, prevents the Executive from
performing substantially all of the Executive's normal duties for the
Company. As a condition to any benefits, the Company may require the
Executive to submit to such physical or mental evaluations and tests as
the Company's Board of Directors deems appropriate.
1.1.6 "Early Termination" means the Termination of Employment
before Normal Retirement Age for reasons other than death, Disability,
Termination for Cause or following a Change of Control.
1.1.7 "Early Termination Date" means the month, day and year
in which Early Termination occurs.
1.1.8 "Effective Date" means January 1, 1999.
1.1.9 "Normal Retirement Age" means the Executive's
sixty-fifth (65lh) birthday.
1.1.10 "Normal Retirement Date" means the later of the Normal
Retirement Age or Termination of Employment.
1.1.11 "Plan Year" means a twelve-month period commencing on
January 1st and ending on December 31st of each year. The first Plan
Year shall commence on the Effective Date of this Agreement.
1.1.12 'Termination for Cause" shall have the meaning set
forth in Section 5.2.
1.13 'Termination of Employment " means that the Executive
ceases to be employed by the Company for any reason whatsoever other
than by reason of a leave of absence that is approved by the Company.
For purposes of this Agreement, if there is a dispute over the 1.1.12
employment status of the Executive or the date of the Executive's
Termination of Employment, the Board shall have the sole and absolute
right to decide the dispute.
Article 2
Lifetime
Benefits
2.1 Normal Retirement Benefit. Upon Termination of Employment on or after
the Normal Retirement Age for reasons other than the Executive's death, the
Company shall pay to the Executive the benefit described in this Section 2.1 in
lieu of any other benefit under this Agreement.
2.1.1 Amount of Benefit. The annual benefit under this Section
2.1 for the first Plan Year is forty-five thousand two hundred thirty
($45,230) dollars as stated on the attached Schedule A. The annual
benefit will be increased two (2.0%) percent each Plan Year thereafter,
until Termination of Employment. The Board, in its sole discretion, may
increase the annual benefit under this Section 2.1.1 beyond the annual
two (2.0%) percent increase; however, any such increase shall require
the restatement of Schedule A.
2.1.2 Payment of Benefit. The Company shall pay the annual
benefit to the Executive in equal and consecutive monthly installments
payable on the first day of each month commencing with the month
following the Executive's Normal Retirement Date and continuing for two
hundred fifteen (215) additional months, for a total of two hundred
sixteen (216) monthly payments.
2.2 Early Termination Benefit. Upon Early Termination, the Company
shall pay to the Executive the benefit described in this Section 2.2 in lieu of
any other benefit under this Agreement.
2.2.1 Amount of Benefit. The benefit under this Section 2.2 is
the Early Termination Annual Benefit amount set forth in Schedule A for
the Plan Year ending immediately prior to the Early Termination Date.
2.2.2 Payment of Benefit. The Company shall pay the annual
benefit to the Executive in equal and consecutive monthly installments
payable on the first day of each month commencing with the month
following the Executive's Normal Retirement Age and continuing for two
hundred fifteen (215) additional months, for a total of two hundred
sixteen (216) monthly payments.
2.3 Disability Benefit. If the Executive terminates employment due to
Disability prior to Normal Retirement Age, the Company shall pay to the
Executive the benefit described in this Section 2.3 in lieu of any other benefit
under this Agreement.
2.3.1 Amount of Benefit. The benefit under this Section 2.3 is
the Disability Annual Benefit amount set forth in Schedule A for the
Plan Year ending immediately prior to the date in which the Termination
of Employment occurs. However, any increase in the annual benefit under
Section 2.1.1 would require the recalculation of the Disability benefit
on Schedule A. The Disability Annual Benefit amount is determined by
calculating a fixed annuity which is payable in one hundred
seventy-nine (179) equal monthly installments, crediting interest on
the unpaid balance of the Accrual Balance at an annual rate of seven
and one-half (7.5%) percent, compounded monthly.
2.3.2 Payment of Benefit. The Company shall pay the annual benefit
amount to the Executive in equal and consecutive monthly installments
payable on the first day of each month commencing with the month
following the Termination of Employment and continuing for two hundred
fifteen (215) additional months, for a total of two hundred sixteen
(216) monthly payments. Upon petition by the Executive, the Company, in
its sole discretion, may instead pay the benefit in an amount equal to
the Accrual Balance in a lump sum within sixty (60) days of Termination
of Employment in lieu of any other benefit under this Agreement.
2.4 Change of Control Benefit. Upon Termination of Employment following a
Change of Control, the Company shall pay to the Executive the benefit described
in this Section 2.4 in lieu of any other benefit under this Agreement.
2.4.1 Amount of Benefit. The annual benefit under this Section
2.4 is the Change of Control Annual Benefit amount set forth on
Schedule A for the Plan Year in which Termination of Employment occurs.
2.4.2 Payment of Benefit. The Company shall pay the annual
benefit amount to the Executive in equal and consecutive monthly
installments payable on the first day of each month commencing with the
month following the Normal Retirement Date and continuing for two
hundred fifteen (215) additional months, for a total of two hundred
sixteen (216) monthly payments.
Article 3
Death Benefits
3.1 Death Benefits. If the Executive dies while employed by the Company
and prior to commencement of any benefits due under Article 2, the Company shall
pay to the Executive's beneficiary the benefit described in this Section 3.1.
This benefit shall be paid in lieu of any other benefit under this Agreement.
3.1.1 Amount of Benefit. The benefit under this Section 3.1 is
the Accrual Balance set forth in Schedule A for the Plan Year ending
immediately prior to the Executive's death.
3.1.2 Payment of Benefit. The Company shall pay the benefit to
the Executive's beneficiary in a lump sum within sixty (60) days
following the Executive's death.
Article 4
Beneficiaries
4.1 Beneficiary Designations. The Executive shall designate a primary
and contingent beneficiary by filing a written designation with the Company. The
Executive may revoke or modify the designation at any time by filing a new
designation. However, designations will only be effective if signed by the
Executive and accepted by the Company during the Executive's lifetime. The
Executive's beneficiary designation shall be deemed automatically revoked if the
beneficiary predeceases the Executive, or if the Executive names a spouse as
beneficiary and the marriage is subsequently dissolved. If the Executive dies
without a valid beneficiary designation, all payments shall be made to the
Executive's surviving spouse, if any, and if none, to the Executive's surviving
descendants, per stirpes. and if no surviving spouse and descendants, to the
Executive's estate. If Executive dies and subsequently the beneficiary receiving
benefit payments dies, then any remaining payments shall be paid pursuant to a
written beneficiary designation filed with the Company made by such beneficiary,
or if none to such beneficiary's estate.
4.2 Facility of Payment. If abenefit is payable to a minor, to a person
declared incapacitated, or to a person incapable of handling the disposition of
his or her property, the Company may pay such benefit to the guardian,
conservator, legal representative or person having the care or custody of such
minor, incapacitated person or incapable person. The Company may require proof
of incapacity, minority or guardianship as it may deem appropriate prior to
distribution of the benefit. Such distribution shall completely discharge the
Company from all liability with respect to such benefit.
Article 5
General Limitations
Notwithstanding any provision of this Agreement to the contrary,
Executive shall irrevocably forfeit and the Company shall not pay any benefit
under this Agreement if any of the events described in Sections 5.1 - 5.3 below
occur:
5.1 Excess Parachute Payment. In the event that the benefit payable to
the Executive pursuant to this Agreement should cause a "parachute payment," as
defined in Code section 280G(b)(2) of the Code, then such benefit shall be
reduced One Dollar (Si.00) at a time until the payment will not constitute a
parachute payment. In the event the benefit the Executive receives under this
Agreement should be incorrectly calculated so that such amount constitutes a
parachute payment, then the Executive will promptly refund to Company the excess
amount.. Excess amount shall mean the amount in excess of the Executive's base
amount, as defined in Code Section 280G(b)(3), multiplied by 2.999.
5.2 Termination for Cause. If the Company terminates the Executive's
employment for:
5.2.1 any willful act of misconduct or gross negligence, prior to a
Change of Control, which is materially injurious to the
Company monetarily or otherwise;
5.2.2 a criminal conviction of the Executive for any act involving
the business and affairs of the Company; or
5.2.3 a criminal conviction of the Executive for commission of a
felony, the circumstances of which substantially relate to the
Executive's position with the Company.
5.3 Suicide or Misstatement. If the Executive commits suicide within
two (2) years after the date of this Agreement, or if the Executive has made any
material misstatement of fact on any application for life insurance purchased by
the Company.
5.4 No Duplication of Benefits. Each of the benefits described in
Articles 2 and 3 are intended to be separate benefits and mutually exclusive of
the other so that once benefit payments commence under one Section the Executive
(or his beneficiary, as the case may be) shall not thereafter receive payments
or become entitled to benefits under another Section.
Article 6
Claims and Review Procedures
6.1 Claims Procedure. The Company shall notify any person or entity
that makes a claim pursuant to this Agreement (the "Claimant") in writing,
within ninety (90) days of the Claimant's written application for benefits, of
his or her eligibility or noneligibility for benefits under the Agreement. If
the Company determines that the Claimant is not eligible for benefits or full
benefits, the notice shall set forth (1) the specific reasons for such denial,
(2) a specific reference to the provisions of the Agreement on which the denial
is based, (3) 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 (4) an explanation of the 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) day period.
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 orally 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, 6.1
written in a manner calculated to be understood by the Claimant and the specific
provisions of the 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.
Article 8
Miscellaneous
8.1 Binding Effect. This Agreement shall bind the Executive and the
Company, and their heirs, beneficiaries, survivors, legal representatives,
personal representatives, assigns, successors, administrators and transferees.
8.2 No Guarantee of Employment. This Agreement is not an employment
policy or contract. This Agreement 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 Non-Transfer ability. No amounts payable under this Agreement shall
be transferable by the Executive. Further, the Executive may not sell, assign,
alienate, pledge or otherwise encumber any benefits under this Agreement.
8.4 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
under this Agreement. 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.
8.5 Tax Withholding. The Company shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.
8.6 Applicable Law. The Agreement and all rights hereunder shall be
governed by the laws of the State of South Carolina, except to the extent
preempted by the laws of the United States of America.
8.7 Unfunded Arrangement. The Executive and any beneficiary of the
Executive are general unsecured creditors of the Company for the payment of
benefits under this Agreement. This Agreement shall always be an unfunded
arrangement. The benefits represent the mere promise by the Company to pay such
benefits. The rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors. Any insurance on the Executive's life, if any, is a
general asset of the Company to which the Executive and the Executive's
beneficiary have no preferred or secured claim. Title to and beneficial
ownership of any cash or assets Company may earmark to pay the Executive or his
beneficiary shall at all times remain with Company.
8.8 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.
8.9 Administration. The Company shall have powers which are necessary
to administer this Agreement, including but not limited to:
8.9.1 Interpreting the provisions of the Agreement;
8.9.2 Establishing and revising the method of accounting for
the Agreement;
8.9.3 Maintaining a record of benefit payments; and 8.9.4
Establishing rules and prescribing any forms necessary or desirable to
administer the Agreement.
8.10 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.
8.11 No Trust Created. Nothing contained in this Agreement, and no
action taken pursuant to its provisions by either party hereto, shall create,
nor be construed to create, a trust of any kind or a fiduciary relationship
between the Company and the Executive, his designated beneficiary, any other
beneficiary of the Executive or any other person.
8.12 Date of Birth. The Executive hereby represents to the Company that
his date of birth is November 17, 1952.
IN WITNESS WHEREOF, the Executive and a duly authorized Company officer
have executed and sealed this Agreement as of the date first above written.
Witnesses: Company:
FIRST SOUTH BANK
s/ Xxxx X. Xxxxxxx By: s/ V. Xxxxx Xxxxxx
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s/ Xxxxxxx X. Xxxxxxxxxxx Its: Executive Vice President
--------------------------- ------------------------
s/ Xxxxxxx X. Xxxxx EXECUTIVE:
---------------------------
s/ Xxxxx X. Slider
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Xxxxx X. Slider
BENEFICIARY DESIGNATION
FIRST SOUTH BANK SALARY
CONTINUATION AGREEMENT
XXXXX X. SLIDER
I designate the following as beneficiary of any death benefits under this
Salary Continuation Agreement:
Primary: Xxxxxxx X. Slider
Contingent: The trustee under mv will dated June 3. 1999. as amended from time
to time
Note: To name a trust as beneficiary, please provide the name of the
trustee(s) and the exact name and date of the trust agreement.
I understand that I may change these beneficiary designations by filing a new
written designation with the Company, I further understand that the
designations will be automatically revoked if the beneficiary predeceases me,
or, if I have named my spouse as beneficiary and our marriage is subsequently
dissolved.
Signature s/ Xxxxx X. Slider
-------------------
Date 11/19/99
Accepted by the Company this 19th day of November 1999
By s/ V. Xxxxx Xxxxxx
---------------------
Title Executive Vice President
First South Bank
Xxxxx X. Slider
Salary Continuation Plan - Schedule A
Early Term. Early Termination Change of Control Disability
Plan Benefit Accrual Vesting Vested Annual Benefit Annual Benefit Annual Benefit
Year Level Balance Schedule Benefit Payable at 65 Payable at 65 Payable Immediately
---- ----- ------- -------- ------- ------------- ------------- -------------------
1 45,230 11,030 100% 45,230 45,230 45,230 1,118
2 46,135 23,161 100% 46,135 46,135 46,135 2,348
3 47,057 36,509 100% 47,057 47,057 47,057 3,702
4 47,998 51,205 100% 47,998 47,998 47,998 5,192
5 48,958 67,397 100% 48,958 48,958 48,958 6,834
6 49,938 85,252 100% 49,938 49,938 49,938 8,644
7 50,936 104,958 100% 50,936 50,936 50,936 10,642
8 51,955 126,731 100% 51,955 51,955 51,955 12,850
9 52,994 150,818 100% 52,994 52,994 52,994 15,292
10 54,054 177,504 100% 54,054 54,054 54,054 17,998
11 55,135 207,125 100% 55,135 55,135 55,135 21,002
12 56,238 240,076 100% 56,238 56,238 56,238 24,343
13 57,363 276,838 100% 57,363 57,363 57,363 28,070
1-1 58,510 318,005 100% 58,510 58,510 58,510 32,245
15 59,680 364,344 100% 59,680 59,680 59,680 36,943
16 60,874 416,902 100% 60,874 60,874 60,874 42,273
17 62,091 477,248 100% 62,091 62,091 62,091 48,391
18 63,333 548,173 100% 63,333 63,333 63,333 55,583
19 64,600 637,097 100% 64,600 64,600 64,600 64,600
FIRST AMENDMENT TO
FIRST SOUTH BANK SALARY CONTINUATION AGREEMENT
THIS AMENDMENT is made this 27 day of April, 2000, by and between the
First South Bank, a state bank located in Spartanburg, South Carolina (the
"Company"), and XXXXX X. SLIDER (the "Executive).
WITNESSETH:
WHEREAS, the Executive and the Company entered into a Salary
Continuation Agreement (the "Agreement") dated November 19, 1999; and
WHEREAS, the Executive and the Company are desirous of amending the
language to the Agreement.
NOW, THEREFORE, in consideration of the premises, the Executive and the
Company agree to amend the "Agreement" as follows: Paragraph 1.1.8 is amended to
read as follows: 1.1.8 "EffectiveDate" weans November 1, 1999. Except as amended
herein, the Agreement remains in full force and effect.
IN WITNESS WHEREOF, the parties hereto have entered into this Amendment
on the date and year first above written.
EXECUTIVE: COMPANY:
FIRST SOUTH BANK
s/ Xxxxx X. Slider By: s/V. Xxxxx Xxxxxx
--------------------- ----------------------------
Xxxxx X. Slider
COMPANY: Title: Executive Vice President
SECOND AMENDMENT TO
FIRST SOUTH BANK SALARY CONTINUATION AGREEMENT
THIS SECOND AMENDMENT executed on this 19th day of June, 2001, by and
between FIRST SOUTH BANK, located in Spartanburg, South Carolina (the "Company")
and XXXXX X. SLIDER (the "Executive").
WITNESSETH:
WHEREAS, the Executive and the Company entered into the FIRST SOUTH BANK
SALARY CONTINUATION AGREEMENT on November 19, 1999, and on April 27, 2000 the
Company and the Executive executed a FIRST AMENDMENT TO THE FIRST SOUTH BANK
SALARY CONTINUATION AGREEMENT (the "Agreement").
WHEREAS, the Executive and the Company are desirous of amending the
language to the Agreement.
NOW, THEREFORE, in consideration of the premises, the Executive and the
Company agree to amend the "Agreement" as follows:
Paragraph 1.1.11 is amended to read as follows:
1.1.11 "Plan Year" means a twelve-month period commencing on
November 1 and ending on October 31 of each year. The first Plan Year
shall commence on the Effective Date of this Agreement.
Paragraph 2.3.1 is amended to read as follows;
2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the
Disability Annual Benefit amount set forth in Schedule A for the Plan Year
ending immediately prior to the date in which the Termination of Employment
occurs.
Except as amended herein, the Agreement remains in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have entered into this Second
Amendment on the date and year first above written.
EXECUTIVE COMPANY:
FIRST SOUTH BANK
s/ Xxxxx X. Slider By V. Xxxxx Xxxxxx
------------------ ---------------
Xxxxx X. Slider Title EVP & CFO
---------
THIRD AMENDMENT
TO THE
FIRST SOUTH BANK SALARY CONTINUATION AGREEMENT
DATED NOVEMBER 19,1999 AND AMENDED
APRIL 27,2000 AND JUNE 19, 2001
FOR XXXXX X.
SLIDER
THIS THIRD AMENDMENT is adopted this 20th day of March , 2007,
effective as of January 1, 2005, by and between First South Bank, a state bank
located in Spartanburg, South Carolina (the "Company") and Xxxxx X. Slider (the
"Executive").
The Company and the Executive executed the Salary Continuation
Agreement on November 19, 1999 effective as of November 1, 1999, and executed a
First Amendment on April 27, 2000, and a Second Amendment on June 19, 2001 (the
"Agreement").
The parties intend this Third Amendment to be a material modification
of the Agreement such that all amounts earned and vested prior to December 31,
2004 shall be subject to the provisions of Code Section 409A.
The undersigned hereby amend the Agreement for the purpose of bringing
the Agreement into compliance with Section 409A of the Internal Revenue Code.
Therefore, the following changes shall be made:
Section 1.1.5 of the Agreement shall be deleted in its entirety and
replaced by the following:
1.1.5 "Disability" means the Executive: (i) is unable to engage in any
substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death
or can be expected to last for a continuous period of not less than
twelve (12) months; or (ii) is, by reason of any medically
determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of
not less than twelve (12) months, receiving income replacement
benefits for a period of not less than three (3) months under an
accident and health plan covering employees or directors of the
Company. Medical determination of Disability may be made by either the
Social Security Administration or by the provider of an accident or
health plan covering employees or directors of the Company provided
that the definition of "disability" applied under such insurance
program complies with the requirements of the preceding sentence. Upon
the request of the Plan Administrator, the Executive must submit proof
to the Plan Administrator of the Social Security Administration's or
the provider's determination.
The following Section 1.1.11a shall be added to the Agreement
immediately following Section 1.1.11:
IA.11a. "Specified Employee" means a key employee (as defined in Section 416(i)
of the Code without regard to paragraph 5 thereof) of the Company if
any stock of the Company is publicly traded on an established
securities market or otherwise.
Section 1.1.13 of the Agreement shall be deleted in its entirety and
replaced by the following:
1.1.13 "Termination of Employment" means the termination of the Executive's
employment with the Company for reasons other than death. Whether a
Termination of Employment takes place is determined based on the facts
and circumstances surrounding the termination of the Executive's
employment and whether the Company and the Executive intended for the
Executive to provide significant services for the Company following
such termination. A change in the Executive's employment status will
not be considered a Termination of Employment if:
(a) the Executive continues to provide services as an employee of
the Company at an annual rate that is twenty percent (20%) or
more of the services rendered, on average, during the
immediately preceding three full calendar years of employment
(or, if employed less than three years, such lesser period)
and the annual remuneration for such services is twenty
percent (20%) or more of the average annual remuneration
earned during the final three full calendar years of
employment (or, if less, such lesser period), or
(b) the Executive continues to provide services to the Company in
a capacity other than as an employee of the Company at an
annual rate that is fifty percent (50%) or more of the
services rendered, on average, during the immediately
preceding three full calendar years of employment (or if
employed less than three years, such lesser period) and the
annual remuneration for such services is fifty percent (50%)
or more of the average annual remuneration earned during the
final three full calendar years of employment (or if less,
such lesser period).
The following Section 1.1.14 shall be added to the Agreement
immediately following Section 1.1.13:
1.1.14 " Unforeseeable Emergency" means a severe financial hardship to the
Executive resulting from an illness or accident of the Executive, the
Executive's spouse, or the Executive's dependent (as defined in
Section 152(a) of the Code), loss of the Executive's property due to
casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the
Executive.
Section 2.3.2 of the Agreement shall be deleted in its entirety and
replaced by the following:
2.3.2 Payment of Benefit. The Company shall pay the annual benefit amount to
the Executive in equal and consecutive monthly installments payable on
the first day of each month commencing with the month following
Termination of Employment and continuing for two-hundred fifteen (215)
additional months, for a total of two-hundred sixteen (216) monthly
payments.
The following Sections 2.5, 2.6, 2.7 and 2.8 shall be added to the
Agreement immediately following Section 2.4.2:
2.5 Restriction on Timing of Distributions. Notwithstanding any provision
of this Agreement to the contrary, if the Executive is considered a
Specified Employee at Termination of Employment under such procedures
as established by the Company in accordance with Section 409A of the
Code, benefit distributions that are made upon Termination of
Employment may not commence earlier than six (6) months after the date
of such Termination of Employment. Therefore, in the event this
Section 2.5 is applicable to the Executive, any distribution which
would otherwise be paid to the Executive within the first six months
following the Termination of Employment shall be accumulated and paid
to the Executive in a lump sum on the first day of the seventh month
following the Termination of Employment. All subsequent distributions
shall be paid in the manner specified.
2.6 Distributions Upon Income Inclusion Under Section 409A of the Code.
Upon the inclusion of any amount into the Executive's income as a
result of the failure of this non qualified deferred compensation plan
to comply with the requirements of Section 409A of the Code, to the
extent such tax liability can be covered by the entire amount accrued
by the Company with respect to the Company's obligations hereunder, a
distribution shall be made as soon as is administratively practicable
following the discovery of the plan failure.
2.7 Change in Form or Timing of Distributions. All changes in the form or
timing of distributions hereunder must comply with the following
requirements. The changes:
(a) may not accelerate the time or schedule of any
distribution, except as provided in Section 409 A of
the Code and the regulations thereunder;
(b) must, for benefits distributable under Sections 2.1,
2.2, 2.3 and 2.4, delay the commencement of
distributions for a minimum of five (5) years from
the date the first distribution was originally
scheduled to be made; and
(c) must take effect not less than twelve (12) months
after the election is made.
2.8 Hardship Distribution. The Company may make a hardship distribution
under the circumstances described in Section 2.8.1 below. Any such
distribution shall require the adjustment described in Section 2.8.2
to any amounts to be paid under Article 2 or 3.
2.8.1 Application for and Amount of Hardship Distribution. If an
Unforeseeable Emergency occurs, the Executive would then be
entitled to receive a distribution under the Agreement, but
not before January 1, 2008. The Company's Board of Directors
("the Board") shall make such distribution upon application by
the Executive. If applied for by Executive, the Executive
shall receive, within sixty (60) days, a Hardship Distribution
from the Agreement (i) only to the extent deemed necessary by
the Board to remedy the Unforeseeable Emergency, plus an
amount necessary to pay taxes reasonably anticipated as a
result of the distribution; and (ii) after taking into account
the extent to which such Unforeseeable Emergency is or may be
relieved through reimbursement or compensation by insurance or
otherwise or by liquidation of the Executive's assets (to the
extent the liquidation would not itself cause severe financial
hardship). In any event, the maximum amount which may be paid
out pursuant to this Section 2.8 is the amount the Company has
accrued with respect to the Company's obligations hereunder as
of the day that the Executive petitioned the Board to receive
a Hardship Distribution under this Section.
2.8.2 Benefit Adjustment. At the time of any Hardship Distribution,
the amount the Company has accrued with respect to the
Company's obligations hereunder shall be reduced by the amount
of the Hardship Distribution and the benefits to be paid under
Article 2 or Article 3 hereof shall reflect such reduced
amount.
Section 5.1 of the Agreement shall be deleted in its entirety.
Article 7 of the Agreement shall be deleted in its entirety and
replaced by the following:
Article 7
Amendments and Termination
7.1 Amendments. This Agreement may be amended only by a written agreement
signed by the Company and the Executive. However, the Company may
unilaterally amend this Agreement to conform with written directives to
the Company from its auditors or banking regulators or to comply with
legislative changes or tax law, including without limitation Section
409A of the Code and any and all Treasury regulations and guidance
promulgated thereunder.
7.2 Plan Termination Generally. This Agreement may be terminated only by a
written agreement signed by the Company and the Executive. The benefit
hereunder shall be the amount the Company has accrued with respect to
the obligations hereunder as of the date the Agreement is terminated.
Except as provided in Section 7.3, the termination of this Agreement
shall not cause a distribution of benefits under this Agreement.
Rather, after such termination benefit distributions will be made at
the earliest distribution event permitted under Article 2 or Article 3.
7.3 Plan Terminations Under Section 409A, Notwithstanding anything to the
contrary in Section 7.2, if this Agreement terminates in the following
circumstances:
(a) Within thirty (30) days before, or twelve (12) months after a
change in the ownership or effective control of the Company,
or in the ownership of a substantial portion of the assets of
the Company as described in Section 409A(a)(2)(A)(v) of the
Code, provided that all distributions are made no later than
twelve (12) months following such termination of the Agreement
and further provided that all the Company's arrangements which
are substantially similar to the Agreement are terminated so
the Executive and all participants in the similar arrangements
are required to receive all amounts of compensation deferred
under the terminated arrangements within twelve (12) months of
the termination of the arrangements;
(b) Upon the Company's dissolution or with the approval of a
bankruptcy court provided that the amounts deferred under the
Agreement are included in the Executive's gross income in the
latest of (i) the calendar year in which the Agreement
terminates; (ii) the calendar year in which the amount is no
longer subject to a substantial risk of forfeiture; or (iii)
the first calendar year in which the distribution is
administratively practical; or
(c) Upon the Company's termination of this and all other
non-account balance plans (as referenced in Section 409A of
the Code or the regulations thereunder), provided that all
distributions are made no earlier than twelve (12) months and
no later than twenty-four (24) months following such
termination, and the Company does not adopt any new
non-account balance plans for a minimum of five (5) years
following the date of such termination;
the Company may distribute the entire amount accrued by the Company
with respect to the Company's obligations hereunder, determined as of
the date of the termination of the Agreement, to the Executive in a
lump sum subject to the above terms.
The following Section 8.13 shall be added to the Agreement immediately
following Section 8.12:
8.13 Compliance with Section 409A. This Agreement shall at all times be
administered and the provisions of this Agreement shall be interpreted
consistent with the requirements of Section 409A of the Code and any
and all regulations thereunder, including such regulations as may be
promulgated after the Effective Date of this Agreement.
IN WITNESS OF THE ABOVE, the Company and the Executive hereby consent
to this Third Amendment.
Executive: First South Bank
s/ Xxxxx X. Slider By Xxxxxxx X. Xxxxxxx
------------------ ------------------
Xxxxx X. Slider Title HR and Training Director
------------------------
FOURTH AMENDMENT
TO THE
FIRST SOUTH BANK SALARY CONTINUATION AGREEMENT
DATED NOVEMBER 19,1999
AND AMENDED APRIL 27,2000 AND JUNE 19,2001
AND MARCH 20,2007
FOR XXXXX X.
SLIDER
THIS FOURTH AMENDMENT is adopted this 28th day of September 2007, by
and between First South Bank, a state bank located in Spartanburg, South
Carolina (the "Company") and Xxxxx X. Slider (the "Executive").
The Company and the Executive executed the Salary Continuation
Agreement on November 19, 1999 effective as of November 1, 1999, and executed a
First Amendment on April 27, 2000, and a Second Amendment on June 19, 2001 and
a Third Amendment on March 20, 2007 (the "Agreement").
The parties intend this Fourth Amendment to be a material modification
of the Agreement such that all amounts earned and vested prior to December 31,
2004 shall be subject to the provisions of Code Section 409A.
The undersigned hereby amend the Agreement to reflect the final 409A
Treasury Regulations. Therefore, the following changes shall be made:
Section 1.13 of the Agreement shall be deleted in its entirety and
replaced by the following:
1.13 "Termination of Employment means termination of the Executive's
employment with the Company for reasons other than death or
Disability. Whether a termination of employment has occurred is
determined based on whether the facts and circumstances indicate that
the Company and the Executive reasonably anticipated that no further
services would be performed after a certain date or that the level of
bona fide services the Executive would perform after such date
(whether as an employee or as an independent contractor) would
permanently decrease to no more than twenty percent (20%) of the
average level of bona fide services performed (whether as an employee
or an independent contractor) over the immediately preceding
thirty-six (36) month period (or the full period of services to the
Company if the Executive has been providing services to the Company
less than thirty-six (36) months).
Sections 2.3, 2.3.1 and 2.3.2 of the Agreement shall be deleted in
their entirety and replaced by the following:
2.3 Disability Benefit. If the Executive experiences a Disability prior to
Normal Retirement Age, the Company shall pay to the Executive the
benefit described in this Section 2.3 in lieu of any other benefit
under this Agreement.
2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the Disability
Annual Benefit amount set forth on Schedule A for the Plan Year ending
immediately prior to such Disability.
2.3.2 Payment of Benefit. The Company shall pay the annual benefit amount to
the Executive in equal and consecutive monthly installments payable on
the first day of each month commencing with the month following such
Disability and continuing for two-hundred fifteen (215) additional
months, for a total of two-hundred sixteen (216) monthly payments.
Section 2.4.2 of the Agreement shall be deleted in their entirety and
replaced by the following:
2.4.2 Payment of Benefit. The Company shall pay the annual benefit amount to
the Executive in equal and consecutive monthly installments payable on
the first day of each month commencing with the month following Normal
Retirement Age and continuing for two hundred fifteen (215) additional
months, for a total of two hundred sixteen (216) monthly payments.
Section 2.7 of the Agreement shall be deleted in its entirety and
replaced by the following:
2.7 Change in Form or Timing of Distributions. All changes in the form or
timing of distributions hereunder must comply with the following
requirements. The changes:
(a) may not accelerate the time or schedule of any
distribution, except as provided in Section 409 A of
the Code and the regulations thereunder;
(b) must, for benefits distributable under Sections 2.2
and 2.4, be made at least twelve (12) months prior to
the first scheduled distribution;
(c) must, for benefits distributable under Sections 2.1,
2.2 and 2.4, delay the commencement of distributions
for a minimum of five (5) years from the date the
first distribution was originally scheduled to be
made; and
(d) must take effect not less than twelve (12) months
after the election is made.
Section 7.3 of the Agreement shall be deleted in its entirety and
replaced by the following:
7.3 Plan Terminations Under Section 409A. Notwithstanding anything to the
contrary in Section 7.2, if this Agreement terminates in the following
circumstances:
(a) Within thirty (30) days before, or twelve (12) months after a
change in the ownership or effective control of the Company, or in the
ownership of a substantial portion of the assets of the Company as
described in Section 409A(a)(2)(A)(v) of the Code, provided that all
distributions are made no later than twelve (12) months following such
termination of the Agreement and further provided that all the
Company's arrangements which are substantially similar to the Agreement
are terminated so the Executive and all participants in the similar
arrangements are required to receive all amounts of compensation
deferred under the terminated arrangements within twelve (12) months of
the termination of the arrangements;
(b) Upon the Company's dissolution or with the approval of a bankruptcy
court provided that the amounts deferred under the Agreement are
included in the Executive's gross income in the latest of (i) the
calendar year in which the Agreement terminates; (ii) the calendar year
in which the amount is no longer subject to a substantial risk of
forfeiture; or (iii) the first calendar year in which the distribution
is administratively practical; or
(c) Upon the Company's termination of this and all other arrangements
that would be aggregated with this Agreement pursuant to Treasury
Regulations Section 1.409A-l(c) if the Executive participated in such
arrangements ("Similar Arrangements"), provided that (i) the
termination and liquidation does not occur proximate to a downturn in
the financial health of the Company, (ii) all termination distributions
are made no earlier than twelve (12) months and no later than
twenty-four (24) months following such termination, and (iii) the
Company does not adopt any new arrangement that would be a Similar
Arrangement for a minimum of three (3) years following the date the
Company takes all necessary action to irrevocably terminate and
liquidate the Agreement; the Company may distribute the amount the
Company has accrued with respect to the Company's obligations
hereunder, determined as of the date of the termination of the
Agreement, to the Executive in a lump sum subject to the above terms.
(d) Schedule A shall be deleted in its entirety and replaced with the
following Schedule A.
IN WITNESS OF THE ABOVE, the Company and the Executive hereby consent to this
Fourth Amendment.
Executive First South Bank
s/ Xxxxx X. Slider By s/ V. Xxxxx Xxxxxx
--------------------------- ------------------
Xxxxx X. Slider Title EVP/CFO
