Exhibit 10.12
LIFE INSURANCE
ENDORSEMENT METHOD SPLIT DOLLAR PLAN
AGREEMENT
INSURER/POLICY NUMBER: New York Life/00000000
BANK: The Vintage Bank, a state-chartered commercial bank and wholly-owned
subsidiary of North Bay Bancorp (the "Holding Company")
INSURED: Xxx-Xxx Xxxxxx
RELATIONSHIP OF INSURED TO BANK: Executive Officer
DATE: September 21, 2001
The respective rights and duties of the Bank and the Insured in the
above policy(ies) (the "Policy" or "Policies") shall be as follows:
I. DEFINITIONS
1. Refer to the Policy provisions for the definition of all terms in
this Agreement other than those contained herein or set forth below:
2. The term "Affiliate" shall mean a corporation or entity of any type
directly or indirectly controlling or controlled by, or under direct or indirect
common control with, the Bank, within the meaning of Rule 144 under the
Securities Act of 1933, as amended.
II. POLICY TITLE AND OWNERSHIP
Title and ownership shall reside in the Bank for its use and for the
use of the Insured all in accordance with this Agreement. The Bank alone may, to
the extent of its interest, exercise the right to borrow or withdraw the Policy
cash values. Where the Bank and the Insured (or beneficiary[ies] or assignee[s],
with the consent of the Insured) mutually agree to exercise the right to
increase the coverage under the subject split dollar Policy, then, in such
event, the rights, duties and benefits of the parties to such increased coverage
shall continue to be subject to the terms of this Agreement.
III. BENEFICIARY DESIGNATION RIGHTS
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The Insured (or beneficiary[ies] or assignee[s]) shall have the right
and power to designate a beneficiary or beneficiaries to receive his share of
the proceeds payable upon the death of the Insured, and to elect and change a
payment option for such beneficiary, subject to any right or interest the Bank
may have in such proceeds, as provided in this Agreement.
IV. PREMIUM PAYMENT METHOD
The Bank shall pay an amount equal to the planned premiums and any
other premium payments that might become necessary to maintain the Policy in
force.
V. TAXABLE BENEFIT
Annually the Insured will receive a taxable benefit equal to the
assumed cost of insurance as required by the Internal Revenue Service. The Bank
(or its administrator) will report to the Insured the amount of imputed income
received each year on Form W-2 or its equivalent.
VI. DIVISION OF DEATH PROCEEDS
Subject to Paragraph VII herein, the division of the death proceeds of
the Policy is as follows:
1. If death occurs before age seventy one (71), the Insured's
beneficiary(ies) shall be entitled to the lesser of $750,000, or one hundred
percent (100%) of the net at risk insurance proceeds. If death occurs after age
seventy one (71) but on or before age eighty one (81), the Insured's
beneficiaries shall be entitled to the lesser of $525,000, or one hundred
percent (100%) of the net at risk insurance proceeds. If death occurs after age
eighty one (81), the Insured's beneficiaries shall be entitled to the lesser of
$300,000, or one hundred percent (100%) of the net at risk insurance proceeds.
The net at risk insurance portion is the total proceeds less the cash value of
the Policy.
2. The Bank and the Insured (or beneficiary[ies] or assignee[s]) shall
share in any interest due on the death proceeds on a pro rata basis in the ratio
that the proceeds due the Bank and the Insured, respectively, bears to the total
proceeds, excluding any such interest.
3 In the event that the Policy is terminated other than as a result of
(a) a termination of this Agreement pursuant to paragraph X or (b) any
intentional act of the Insured which results in the termination of the Policy,
then the Bank shall pay to the Insider's beneficiary(ies) an amount which will
provide a total after-tax death benefit equal to the benefit that the Insured
would have received if the Policy had not been terminated.
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VII. DIVISION OF CASH SURRENDER VALUE
The Bank shall at all times be entitled to an amount equal to the
Policy's cash value, as that term is defined in the Policy, less any Policy
loans and unpaid interest or cash withdrawals previously incurred by the Bank
and any applicable Policy surrender charges. Such cash value shall be determined
as of the date of surrender of the Policy or death of the Insured as the case
may be.
VIII. PREMIUM WAIVER
If the Policy contains a premium waiver provision, any such waived
amounts shall be considered for all purposes of this Agreement as having been
paid by the Bank.
IX. RIGHTS OF PARTIES WHERE POLICY ENDOWMENT OR ANNUITY ELECTION EXISTS
In the event the Policy involves an endowment or annuity element, the
Bank's right and interest in any endowment proceeds or annuity benefits shall be
determined under the provisions of this Agreement by regarding such endowment
proceeds or the commuted value of such annuity benefits as the Policy's cash
value. Such endowment proceeds or annuity benefits shall be treated like death
proceeds for the purposes of division under this Agreement.
X. TERMINATION OF AGREEMENT
This Agreement shall terminate at the option of the Bank following
thirty (30) days written notice to the Insured upon the happening of any one of
the following: (i) the Insured commits fraud, theft or embezzlement against the
Bank, or any subsidiary or Affiliate thereof; (ii) the Insured commits a felony
or a crime involving moral turpitude; (iii) the Insured compromises trade
secrets or other proprietary information of the Bank, or any subsidiary or
Affiliate thereof; (iv) the Insured breaches any non-solicitation agreement with
the Bank, or any subsidiary or Affiliate thereof; (v) the Insured breaches any
of the material terms of any employment agreement entered into with the Bank or
Holding Company and, if given the right in any such employment agreement, fails
to cure said breach in accordance therewith; (vi) the Insured breaches any of
the material terms of this Agreement; (vii) the Insured engages in any grossly
negligent act or willful misconduct that causes, or could be reasonably expected
to cause, harm to the business, operations or reputation of the Bank, or any
subsidiary or Affiliate thereof; or (viii) the Bank, or any subsidiary or
Affiliate thereof, is ordered to terminate any employment agreement by any
governmental regulatory agency with supervisory authority over the Bank, or any
subsidiary or Affiliate thereof.:
Upon such termination, the Insured (or beneficiary[ies] or assignee[s])
shall have a ninety (90) day option to receive from the Bank an absolute
assignment of the Policy in consideration of a
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cash payment to the Bank, whereupon this Agreement shall terminate. Such cash
payment shall be the greater of:
1. The Bank's share of the cash value of the Policy on the date of such
assignment, as defined in this Agreement.
2. The amount of the premiums which have been paid by the Bank prior to
the date of such assignment.
Should the Insured (or beneficiary[ies] or assignee[s]) fail to
exercise this option within the prescribed ninety (90) day period, the Insured
(or beneficiary[ies] or assignee[s]) agrees that all of his rights, interest and
claims in the Policy shall terminate as of the date of the termination of this
Agreement.
Except as provided above, this Agreement shall terminate upon
distribution of the death benefit proceeds in accordance with Paragraph VI
above.
XI. INSURED'S OR ASSIGNEE'S ASSIGNMENT RIGHTS
The Insured may not, without the prior written consent of the Bank,
assign to any individual, trust or other organization, any right, title or
interest in the Policy nor any rights, options, privileges or duties created
under this Agreement.
XII. AGREEMENT BINDING UPON THE PARTIES
This Agreement shall be binding upon the Insured and the Bank, and
their respective heirs, successors, personal representatives and assigns, as
applicable.
XIII. NAMED XXXXXXXXX AND PLAN ADMINISTRATOR
The Holding Company is hereby designated the "Named Fiduciary" until
resignation or removal by its Board of Directors. As Named Fiduciary, the
Holding Company shall be responsible for the management, control, and
administration of this Agreement as established herein. The Named Fiduciary may
allocate to others certain aspects of the management and operations
responsibilities of this Agreement, including the employment of advisors and the
delegation of any ministerial duties to qualified individuals.
XIV. FUNDING POLICY
The funding Policy for this Agreement shall be to maintain the Policy
in force by paying, when due, all premiums required.
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XV. CLAIM PROCEDURES
Claim forms or claim information as to the subject Policy can be
obtained by contacting The Benefit Marketing Group, Inc. (770-952-1529). When
the Named Fiduciary has a claim which may be covered under the provisions
described in the Policy, it should contact the office named above, and they will
either complete a claim form and forward it to an authorized representative of
the Insurer or advise the named Fiduciary what further requirements are
necessary. The Insurer will evaluate and make a decision as to payment. If the
claim is payable, a benefit check will be issued to the Named Fiduciary.
In the event that a claim is not eligible under the Policy, the Insurer
will notify the Named Fiduciary of the denial pursuant to the requirements under
the terms of the Policy. If the Named Fiduciary is dissatisfied with the denial
of the claim and wishes to contest such claim denial, it should contact the
office named above and they will assist in making inquiry to the Insurer. All
objections to the Insurer's actions should be in writing and submitted to the
office named above for transmittal to the Insurer.
XVI. GENDER
Whenever in this Agreement words are used in the masculine or neuter
gender, they shall be read and construed as in the masculine, feminine or neuter
gender, whenever they should so apply.
XVII. INSURANCE COMPANY NOT A PARTY TO THIS AGREEMENT
The Insurer shall not be deemed a party to this Agreement, but will
respect the rights of the parties as set forth herein upon receiving an executed
copy of this Agreement. Payment or other performance in accordance with the
Policy provisions shall fully discharge the Insurer from any and all liability.
IN WITNESS WHEREOF, the Insured and a duly authorized Bank officer have signed
this Agreement as of the above written date.
THE VINTAGE BANK INSURED
By: _____________________________________ By: ________________________________
Xxxxx X. Xxxxxxxx Xxx-Xxx Xxxxxx
President and Chief Executive Officer
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Acceptance of Named Fiduciary Designation:
NORTH BAY BANCORP
By: _____________________________________
Xxxxx X. Xxxxxxxx
President and Chief Executive Officer
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BENEFICIARY DESIGNATION FORM
Primary Designation:
Name Relationship
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Contingent Designation:
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_____________, 2001
Signed: ____________________________
Xxx-Xxx Xxxxxx
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