Exhibit 10.1
AGREEMENT FOR SUPPLEMENTAL
RETIREMENT BENEFITS FOR XXXXXXX XXXXX
This Agreement made and entered into as of this 30th day of December, 1996,
by and between City National Bank and Trust Company of Gloversville, a New
York corporation (the "Corporation"), and Xxxxxxx Xxxxx, an individual
currently residing in the State of New York, (the "Executive").
WITNESSETH THAT:
WHEREAS, the Executive is employed by the Corporation as President and Chief
Executive Officer; and
WHEREAS, the Corporation recognizes the value of the services performed by
the Executive and wishes to encourage his continued employment; and
WHEREAS, the Corporation desires to provide the Executive with supplemental
deferred compensation to supplement the benefits under the Corporation's
qualified plans which will be limited because of the compensation limitation
under Section 401(a)(17) of the Code; and
WHEREAS, the parties hereto wish to provide the terms and conditions upon
which the Corporation shall pay such deferred compensation to the Executive
upon his retirement or other termination of employment with the Corporation;
and
WHEREAS, the parties hereto intend that this Agreement be considered an
unfunded arrangement, maintained primarily to provide deferred compensation
benefits for the Executive, a member of a select group of management or
highly compensated employees of the Corporation, for purposes of the Employee
Retirement Income Security Act of 1974, as amended;
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NOW, THEREFORE, in consideration of the above, the parties hereby agree as
follows:
ARTICLE I
DEFINITIONS
Except as otherwise specified herein, the following terms shall have the
following meanings unless a different meaning is plainly required by the
context.
1.1 "Actuarial Equivalent" means equality in value of the aggregate
amounts expected to be received under different forms of payment,
based on the GAM 83 Mortality Table with 7% interest. The applicable
PBGC interest rates for the month preceding the date of the
distribution shall be used to make an Actuarial Equivalent
determination.
1.2 "Beneficiary" means any person or persons designated by the
Executive to receive amounts payable hereunder, after the death of
the Executive. In the event that the Executive fails to designate a
Beneficiary or if no such designated Beneficiary is living upon the
death of the Executive or if for any reason such designation shall
be legally ineffective, then the amount shall be paid to the estate
of the Executive.
1.3 "Cause" means the Executive's having committed an act of fraud,
embezzlement, or theft constituting a felony, or an act
intentionally against the Corporation which causes the Corporation
material injury, or a final determination by a court that the
Executive has committed a material breach of his duties and
responsibilities in connection with rendering services to the
Corporation.
1.4 "Change in Control" means any of the following events for CNB
Bancorp, Inc. or the Corporation: (a) any individual, corporation
(other than the Corporation), partnership, trust, association, pool,
syndicate, or any other entity or any group of persons acting in
concert becomes the beneficial owner, as that concept is defined in
Rule 13d-3 promulgated by the Securities and Exchange Commission
under the Securities
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Exchange Act of 1934, of securities of the
Corporation possessing twenty-five percent (25%) or more of the
voting power for the election of directors of the Corporation; (b)
any consolidation, merger or other business combination involving
the Corporation or the securities of the Corporation in which
holders of voting securities of the Corporation immediately prior to
such event own, as a group, immediately after such event, voting
securities of the Corporation (or, if the Corporation does not
survive such transaction, voting securities of the corporation
surviving such transaction) having less than fifty percent (50%) of
the total voting power in an election of directors of the
Corporation (or such other surviving corporation); (c) during any
period of two consecutive years, individuals who at the beginning of
such period constitute the directors of the Corporation cease for
any reason to constitute at least a majority thereof unless the
election, or the nomination for election by the Corporation's
shareholders, of each new director of the Corporation was approved
by a vote of a least two-thirds of the directors of the Corporation
then still in office who were directors of the Corporation at the
beginning of any such period; (d) removal by the stockholders of all
or any or the incumbent directors of the Corporation other than a
removal for Cause; or (e) any sale, lease, exchange or other
transfer of all, or substantially all, of the assets of the
Corporation to a party which is not controlled by or under common
control with the Corporation.
1.5 "Code" means the Internal Revenue Code of 1986, as amended.
1.6 "Committee" means the committee appointed by the Board of Directors
of the Corporation to interpret and administer this Agreement.
1.7 "Compensation" means the Executive's W-2 earnings during the twelve
month period ending on each Valuation Date.
1.8 "Normal Retirement Date" means the first day of the month following
the month in which the Executive attains age 64 1/2.
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1.9 "Projected Compensation" means the Executive's estimated annual
Compensation for a future Determination Year and is equal to
Compensation, including bonuses, for the year ending on the
Valuation Date increased by the assumed future cost of living
increases for such year.
1.10 "Supplemental Pension Plan Account" means the bookkeeping account
maintained by the Corporation which reflects the Executive's benefit
under the Agreement as calculated under Article II herein.
1.11 "Supplemental Profit Sharing Account" means the bookkeeping account
maintained by the Corporation which reflects the Executive's benefit
under this Agreement as calculated under Article III herein.
1.12 "Supplemental Pension Benefit" means the benefit calculated in
accordance with Article II of this Agreement.
1.13 "Supplemental Profit Sharing Benefit" means the benefit calculated
in accordance with Article III of this Agreement.
1.14 "Total Pension Benefit" means, the total pension benefit payable
under the Corporation's qualified Pension Plan as follows:
(a) 1.75% of the Executive's Final Average Compensation times
Years of Service as of the Determination Date, up to a
maximum of 35 years, less
(b) 0.49% of the Executive's Covered Compensation multiplied by
Years of Service up to a maximum of 35 years, plus
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(c) 1.25% of the Executive's Final Average Compensation
multiplied by Years of Service between 35 and 40 Years,
less
(d) the amount of the Executive's Accrued Benefit under the
Corporation's qualified Pension Plan, less
(e) the amount of Supplemental Pension Benefit previously
distributed to the Executive.
1.15 "Total and Permanent Disability" means a physical or mental
condition of the Executive resulting from bodily injury, disease, or
mental disorder that renders him incapable of continuing in his
usual or customary employment with the Corporation. The Executive
shall be considered totally and permanently disabled if he is
eligible for benefits under the Social Security Act and under any
long-term disability income plan sponsored by the Corporation.
1.16 "Valuation Date" means December 31 of each year.
1.17 "Years of Service" means the Executive's creditable service, as
calculated under the Corporation's qualified Pension Plan, but in no
case less than forty (40) years.
ARTICLE II
PENSION BENEFITS
2.1 Supplemental Benefit. Upon the attainment of his Normal Retirement
Date, the Executive shall be entitled to a Supplemental Pension
Benefit in an amount equal to the difference between the Executive's
Total Pension Benefit payable under the Corporation's qualified
Pension Plan and the Executive's Total Pension Benefit payable under
the Corporation's qualified Pension Plan calculated without regard
to the compensation limitation under Section 401(a)(17) of the Code
and considering the
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Years of Service defined in Paragraph 1.17. The
Supplemental Pension Benefit shall be payable at such time and in
such manner as provided herein.
2.2 Supplemental Pension Benefit. The Executive's Supplemental Pension
Benefit, at any Valuation Date, is equal to the lump sum Actuarial
Equivalent of the amount determined under Section 2.1 above.
2.3 Death and Disability Benefit. Upon the Executive's death or upon
becoming disabled prior to his Normal Retirement Date, the Executive
or his Beneficiary shall be fully vested in the amount of his
Supplemental Pension Benefit.
2.4 Post-Retirement Benefits. If the Executive remains in the employment
of the Corporation beyond his Normal Retirement Date, his
Supplemental Pension Account Benefit shall be actuarially increased
as of each Valuation Date subsequent to his Normal Retirement Date.
ARTICLE III
PROFIT SHARING BENEFITS
3.1 Supplemental Profit Sharing Benefit. For the 1996 plan year and for
each subsequent year, the Corporation shall credit the Executive's
Supplemental Profit Sharing Account with a Supplemental Profit
Sharing Plan Benefit in the amount equal to the difference between
the Executive's actual contribution under the Corporation's
qualified Profit Sharing Plan and the contribution the Executive
would have received calculated without regard to the compensation
limitation under Section 401(a)(17) of the Code. Upon the attainment
of his Normal Retirement Date, the Executive shall be entitled to
Supplemental Profit Sharing Benefit payable at such time and in such
manner as provided herein.
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3.2 Supplemental Profit Sharing Account. The Executive's Supplemental
Profit Sharing Account as of any Valuation Date will consist of all
Supplemental Profit Sharing contributions made by the Corporation on
his behalf including the income, if any, earned on the Supplemental
Profit Sharing contributions.
The amount of such Supplemental Profit Sharing contributions
credited to the Executive's account will be determined annually by
the Committee.
3.3 Death and Disability Benefit. Upon the Executive's death or upon his
Total and Permanent Disability, the Executive or his Beneficiary
shall be vested in his Supplemental Profit Sharing Benefit Account
under the same terms and conditions as under the Corporation's
qualified Profit Sharing Plan.
3.4 Post-Retirement Profit Sharing Benefit. If the Executive remains in
the employment of the Corporation beyond his Normal Retirement Date,
his Supplemental Profit Sharing Account Balance shall be credited
with additional contributions in accordance with Section 3.1.
ARTICLE IV
PAYMENT OF BENEFITS
4.1 Except as otherwise provided in Sections 4.2 and 7.1, if the
Executive's employment with the Corporation is voluntarily
terminated by the Executive or is terminated by the Corporation for
Cause as described in Paragraph 1.3, the Executive shall forfeit all
benefits under this Agreement.
4.2 If the Executive's employment with the Corporation is terminated (a)
after the attainment of his Normal Retirement Date, (b) by Total and
Permanent Disability, or (c) by death, the Executive or his
Beneficiary shall be entitled to his Supplemental
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Pension Benefit and Supplemental Profit Sharing Benefit determined
at the next Valuation Date.
4.3 The Supplemental Pension and Profit Sharing Benefits shall be
payable to the Executive or his Beneficiary in the same manner, and
at the same time as benefit payments to such Participant or his
Beneficiary are made under the applicable terms of the Corporation's
qualified Pension Plan and the Corporation's qualified Profit
Sharing Plan.
ARTICLE V
ADMINISTRATION
5.1 The Agreement shall be administered by the Committee thereof
appointed by the Board. The Committee shall have the authority to
administer and interpret the Agreement including the establishment
of a claims procedure.
ARTICLE VI
MISCELLANEOUS
6.1 This Agreement shall not be construed as giving the Executive any
right to be retained in the employ of the Corporation.
6.2 Nothing contained in this Agreement and no action taken pursuant to
the provisions of this Agreement shall create or be construed to
create a trust of any kind, or a fiduciary relationship between the
Corporation and the Executive, his Beneficiary or any other person.
To the extent that the Executive, his Beneficiary or any person
acquires the right to receive payment from the Corporation under
this Agreement, such right shall be no greater than the right of any
unsecured general creditor of the Corporation.
6.3 No benefit payable at any time under this Agreement shall be subject
in any manner to alienation, sale, transfer, assignment, pledge,
attachment or encumbrance of any kind.
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6.4 This Agreement shall be binding upon and inure to the benefit of the
Corporation, its successors and assigns and the Executive and his
heirs, executor, administrator and legal representatives.
6.5 All rights hereunder shall be governed by and construed according to
the laws of the State of New York, except to the extent such laws
are preempted by the laws of the United States of America. In the
event any provision of this Agreement is held invalid, void or
unenforceable, the same shall not affect, in any respect whatsoever,
the validity of any other provision of this Agreement.
6.6 No modification of this Agreement shall be binding upon the parties
hereto, or either of them, unless such modification is in writing
and signed by the Corporation and the Executive.
ARTICLE VII
CHANGE IN CONTROL
7.1 If the Executive's employment with the Corporation and all of its
subsidiaries is terminated within four (4) years after a Change in
Control, the Executive will be entitled to a single lump sum payment
equal to the Actuarial Equivalent of his Supplemental Pension
Benefit and a single lump sum payment equal to his Supplemental
Profit Sharing Benefit payable as of the next Valuation Date.
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ARTICLE VIII
CONVENANTS NOT TO COMPETE
8.1 The Executive shall forfeit all rights to benefits under this
Agreement if he serves as an officer, director or employee of, or
acts as a consultant for, any corporation or other entity whose
business is competitive with the Corporation and is situated in any
of the following counties of New York: Fulton, Franklin, Herkimer,
Hamilton, Montgomery, Saratoga, Schenectady, or Schoharie. The
forfeiture provided in this Article VIII will be deemed inapplicable
to any relationship that:
(a) exists and was disclosed to the Committee prior to the
effective date of this Agreement; or
(b) is determined by a majority of the Committee not to be
contrary to the interests of the Corporation.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement this
30th day of December, 1996.
CITY NATIONAL BANK AND TRUST COMPANY
OF GLOVERSVILLE
By: /s/ Xxxxxxxx X. Xxxx Xx.
____________________________________
Chairman, Compensation Committee
By: /s/ Xxxxxxx X. Xxxxx
____________________________________
Xxxxxxx Xxxxx, "Executive"
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