AMENDED & RESTATED EXECUTIVE EMPLOYEE SALARY CONTINUATION AGREEMENT FOR James Bomberg
EXHIBIT
10.8
AMENDED
& RESTATED
FOR
Xxxxx
Xxxxxxx
THIS
AMENDED AND RESTATED AGREEMENT is made this 29th day of June, 2007 between
Merchants & Manufacturers Bancorporation, a Wisconsin corporation (the
“Company”) and Xxxxx Xxxxxxx (the “Participant”).
WHEREAS,
the Participant is an executive employee of the Company and as such has
materially contributed to the Company’s position,
WHEREAS,
the Company established this Agreement for purposes of promoting in the
Participant the strongest interest in the successful operation of the Company
and increased efficiency in his work and to provide the Participant benefits
upon retirement, death, disability or other Separation From Service, in
consideration of services to be performed after the date of this Agreement
but
prior to his retirement; and
WHEREAS,
Employer and Participant now wish to amend and restate this Agreement to comply
with the requirements of Internal Revenue Code Section 409A.
NOW,
THEREFORE, in consideration of the premises, the parties hereto agree as
follows:
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1.
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Definitions.
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A. Administrative
Committee - “Administrative Committee” shall mean the committee appointed
pursuant to Section 4 of this Agreement.
B. Age
- “Age” shall mean the age of the person as of his last birthday.
C. Change
in Control - “Change in Control” shall mean the first to occur of any of the
following events: (a) any person or entity becomes, subsequent to the
date of this Agreement, the beneficiary owner, directly or indirectly of 51%
or
more of the then issued and outstanding voting stock of the Company (and, for
the purposes hereof, a person will be considered to be a beneficial owner of
such stock if such person, directly or indirectly, through any contract,
arrangement, understanding, relationship, or otherwise has or shares voting
power, which includes the power to vote or to direct the voting of such stock,
or investment power, which includes the power to dispose or to direct the
disposition of such stock), (b) the Company merges or consolidates with or
reorganizes with or into any other corporation or corporations other than its
affiliates or engages in any other similar business combination or
reorganization, or (c) the Company sells, assigns or transfers all or
substantially all of its business and assets, in one or a series of related
transactions, except any such sales to affiliates.
D. Disability
- “Disability” shall mean, if the Participant is insured under a life insurance
policy the premiums for which are paid by the Company, and which policy contains
a “waiver of premium” benefit, the definition of total disability contained in
the insurance policy. If the Participant is not insured under such a
life insurance policy, the Company shall, in its complete and sole discretion,
determine whether the Participant is disabled for the purposes of this
Agreement.
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E. Discharge
for Cause - “Discharge for Cause” shall mean the Participant’s Separation
From Service because of (a) the Participant’s willful and continued failure to
substantially perform his duties (other than any such failure resulting from
his
incapacity due to physical or mental illness), after a demand for substantial
performance is delivered to him by the Company which specifically identifies
the
manner in which the Company believes he has not substantially performed his
duties; (b) any willful act of misconduct by the Participant which is materially
injurious to the Company, monetarily or otherwise; (c) a criminal conviction
of
the Participant for any act involving the business and affairs of the Company;
(d) a criminal conviction of the Participant for commission of a felony; or
(e)
the removal of the Participant by a regulatory agency. For purposes
of this definition, no act or failure to act on the Participant’s part will be
considered “willful” unless done or omitted by him not in good faith and without
reasonable belief that his act or omission was in the best interest of the
Company.
F. Early
Retirement Date - “Early Retirement Date” shall mean the first day of the
month following the month in which a Participant reaches age 60.
G. Normal
Retirement Date - “Normal Retirement Date” shall mean the first day of the
month following the month in which a Participant reaches age 65.
H. Separation
From Service - “Separation From Service” means the termination of the
Participant’s employment with the Employer for reasons other than
death. Whether a Separation From Service takes place is determined in
accordance with the requirements of Internal Revenue Code Section 409A based
on
the facts and circumstances surrounding the termination of the Participant’s
employment and whether the Employer and the Participant intended for the
Participant to provide significant services for the Employer following such
termination.
I. Specified
Employee– “Specified Employee” shall have the same meaning as under
Internal Revenue Code Section 409A and the regulations thereunder.
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2.
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Eligibility.
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The
Participant is eligible for the benefits provided herein in accordance with
the
terms of this Agreement upon the execution hereof.
A
Participant shall cease to be a Participant at Separation From
Service. However, the employment of a Participant shall not be deemed
to be terminated by reason of an approved leave of absence granted in accordance
with uniform rules applied in a non-discriminatory manner.
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3. Payment
of Benefits.
3.1 Benefits
Upon Normal Retirement.
Upon
a
Participant’s Separation From Service on the Normal Retirement Date, the Company
shall pay to the Participant, as compensation for services rendered prior to
such date, the sum of $60,700.00 per year, payable subject to the
restriction in Section 3.8 below, in monthly installments of $5,058.33
each, commencing on the first day of the month coincident with or next following
the date of Separation From Service and continuing on the first day of each
month thereafter for a period of fifteen years, but in any event until a minimum
of 180 total monthly payments are made to the Participant or the Participant’s
beneficiary per Section 3.6(b).
3.2 Benefits
Upon Early Retirement.
Upon
a
Participant’s Separation From Service on or after reaching the Early Retirement
Date but prior to the Normal Retirement Date, the Company shall pay to the
Participant, as compensation for services rendered prior to such date, monthly
payments equal to the benefit described in Schedule A,
attached. Subject to the restriction in Section 3.8 below, such
payments shall commence on the first day of the month coincident with or next
following the date of Separation From Service and shall continue on the first
day of each month thereafter for a period of fifteen years but in any event
until a minimum of 180 payments are made to the Participant or to the
Participant’s beneficiary per Section 3.6(b).
3.3 Benefits
Upon Late Retirement.
Upon
a
Participant’s Separation From Service after the Normal Retirement Date, the
Company shall pay to the Participant as compensation for services rendered
prior
to such date, the normal retirement benefit described in Section 3.1 above,
increased by .05 per year or .00416 for each month that the Participant’s
Separation From Service is deferred beyond the Normal Retirement Date, in equal
monthly installments, subject to the restriction in Section 3.8 below,
commencing on the first day of the month coincident with or next following
the
date of Separation From Service and continuing on the first day of each month
thereafter for the periods specified in Section 3.1.
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3.4 Benefits
Upon Disability.
Upon
a
Participant’s Separation From Service prior to the Normal Retirement Date due to
Disability, no separate provision is made for a disability benefit under this
Agreement. However, any such Participant shall be considered,
notwithstanding such Separation From Service, to continue to be a Participant
in
this Agreement, and in the event of such Participant’s death while disabled and
for so long as the disability continues prior to reaching the Early Retirement
Date, such Participant’s beneficiary shall receive the survivor’s benefits
described in Section 3.6(a). In the event the Participant lives to
the Early Retirement Date, the Participant shall be entitled to receive the
early retirement benefit described in Section 3.2, such payments commencing
on
the first day of the month coincident with or next following the Early
Retirement Date.
3.5 Other
Terminations of Employment.
a) Voluntary
Separation From Service Prior to the Early Retirement Date or Discharge for
Cause at any Time. Upon a Participant’s voluntary Separation From
Service prior to reaching the Early Retirement Date, for reasons other than
death or Disability, or upon the Participant’s Discharge for Cause at any time,
the Company shall not be obligated to pay any benefit to the Participant
pursuant to this Agreement, and the Participant shall have no further right
to
receive any benefit hereunder.
b) Involuntary
Separation From Service Prior to the Early Retirement Date Other Than Because
of
Death, Disability or Discharge for Cause. Upon a Participant’s
involuntary Separation From Service prior to reaching the Early Retirement
Date,
for reasons other than death, disability, or Discharge for Cause, the Company
shall pay to the Participant as compensation for services rendered prior to
such
Separation From Service, a sum to be negotiated between the Participant and
the
Company at the time of termination. Such negotiated amount shall be
paid in a manner such that it qualifies as either (i) a short-term deferral
under Section 1.409A-1(b)(4) of the Treasury Regulations or (ii) separation
pay
that is not a deferral of compensation under Section 1.409A-1(b)(9)(iii) of
the
Treasury Regulations.
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c) Separation
From Service At or After A Change in Ownership of Control. If a
Participant incurs a voluntary or involuntary Separation From Service prior
to
reaching the Early Retirement Date, for reasons other than death, disability,
or
discharge for cause, but on or after the occurrence of a Change in Control,
and
in connection with such change, the Participant’s title, duties,
responsibilities, or compensation is significantly lessened or his situs of
employment is changed, without his consent, the Company shall pay to the
Participant, as compensation for services rendered prior to such Separation
From
Service, monthly payments equal to the benefit described in Schedule A,
attached. In the event the Separation From Service occurs within the
two-year period following the date of a Change of Control, and Participant
is
entitled to benefits under this Section 3.5(c), the Company shall pay the
Participant a lump sum payment equal to the present value of the benefits
described in Schedule A, calculated as if the payments would begin on the date
of the Participant’s Separation From Service and using a discount rate equal to
120% of the long-term applicable federal rate published by the IRS for the
month
in which the Change of Control occurs. Subject to the restriction in
Section 3.8 below, the lump sum payment shall be made to the Participant within
thirty (30) days after the Participant’s Separation From Service. In
the event the Separation From Service occurs later than the two-year period
following the date of a Change of Control and Participant is entitled tobenefits
under this Section 3.5(c), the Company shall pay the Participant the monthly
benefit in Schedule A, commencing on the first day of the month coincident
with
or next following the date of the Separation From Service and shall continue
on
the first day of the month thereafter for a period of fifteen years but in
any
event until a minimum of 180 payments are made to the Participant or the
Participant’s beneficiary per Section 3.6(b).
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3.6 Survivorship
Benefits.
a) Prior
to Commencement of Normal or Early Retirement Benefits. If a
Participant dies while in the service of the Company or after a Separation
From
Service due to Disability and while Disabled or after a Separation From Service
on or after the Early Retirement Date, but prior to commencement of any benefit
payments under this Agreement, the Company shall pay to the Participant’s
beneficiary a survivor’s benefit of 180 equal monthly installments of $5,058.33
commencing on the first day of the month after the Participant’s death and
continuing on the first day of each month thereafter until all such payments
are
completed. In the event a beneficiary dies before receiving all the
survivor’s benefit payments, the remaining payments shall be paid to the legal
representatives of the beneficiary’s estate. Payment of the
survivor’s benefit shall relieve the Company of the obligation to pay any other
benefit which the Participant would have otherwise received, under the terms
of
this Agreement.
b) After
Commencement of Benefits. If a Participant dies after any benefit
payments have commenced, but prior to receiving all of the scheduled minimum
number of monthly payments, the Company shall pay the remaining monthly payments
to the Participant’s beneficiary. In the event a beneficiary dies
before receiving all the remaining payments, the then-remaining payments shall
be paid to the legal representatives of the beneficiary’s estate.
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3.7 Recipients
of Payments: Designation of Beneficiary.
All
payments to be made by the Company shall be made to the Participant, if
living. In the event of a Participant’s death prior to the receipt of
all benefit payments, all subsequent payments to be made under this Agreement
shall be to the beneficiary or beneficiaries of the Participant. The
Participant shall designate a beneficiary by filing a written notice of such
designation with the Company in such form as the Company may
prescribe. The Participant may revoke or modify said designation at
any time by a further written designation. The participant’s
beneficiary designation shall be deemed automatically revoked in the event
of
the death of the beneficiary or, if the beneficiary is the Participant’s spouse,
in the event of dissolution of marriage. If no designation shall be
in effect at the time any benefits payable under this Agreement shall become
due, the beneficiary shall be the spouse of the Participant, or if no spouse
is
then living, the legal representatives of the Participant’s estate.
3.8 Restriction
on Timing of Distribution.
Notwithstanding
any provision of this Agreement to the contrary, if the Participant is
considered a Specified Employee at the time of his or her Separation From
Service, under such procedures as established by the Employer, in accordance
with Section 409A of the Code, benefit distributions that are made upon such
Separation From Service may not commence earlier than six (6) months after
the
date of such Separation From Service. Therefore, in the event this
Section 3.8 is applicable to the Participant, any distributions which would
otherwise be paid to the Participant within the first six months following
the
date of the Participant’s Separation From Service shall be accumulated and paid
to the Participant in a lump sum on the first day of the seventh month following
the Separation From Service. All subsequent distributions shall be
paid in the manner specified.
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4.
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Administration
and Interpretation of this
Agreement.
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The
Board
of Directors shall appoint an Administrative Committee consisting of three
(3)
or more persons to administer and interpret this
Agreement. Interpretation by the Administrative Committee shall be
final and binding upon a Participant. The Administrative Committee
may adopt rules and regulations relating to this Agreement as it may deem
necessary or advisable for the administration thereof.
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5.
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Claims
Procedure.
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If
the
Participant or the Participant’s beneficiary (hereinafter referred to as a
“Claimant”) is denied all or a portion of an expected benefit under this Plan
for any reason, he or she may file a claim with the Administrative
Committee. The Administrative Committee shall notify the Claimant
within 60 days of allowance or denial of the claim, unless the Claimant receives
written notice from the Administrative committee prior to the end of the sixty
(60) day period stating that special circumstances require an extension of
the
time for decision. The notice of the Administrative Committee’s
decision shall be in writing, sent by mail to Claimant’s last known address,
and, if a denial of the claim, must contain the following
information:
a) the
specific reasons for the denial;
b) specific
reference to pertinent provisions of the Plan on which the denial is based;
and
c) if
applicable, a description of any additional information or material necessary
to
perfect the claim, an explanation of why such information or material is
necessary, and an explanation of the claims review procedure.
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6.
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Review
Procedure.
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a) A
Claimant is entitled to request a review of any denial of his claim by the
Administrative Committee. The request for review must be submitted in
writing within 60 days of mailing a notice of the denial. Absent a
request for review within the 60-day period, the claim will be deemed to be
conclusively denied. The Claimant or his representative shall be
entitled to review all pertinent documents, and to submit issues and comments
orally and in writing.
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b) If
the request for review by a Claimant concerns the interpretation and application
of the provisions of the Agreement and the Company’s obligations, then the
review shall be conducted by a separate committee consisting of three persons
designated or appointed by the Administrative Committee. The separate
committee shall afford the Claimant a hearing and the opportunity to review
all
pertinent documents and submit issues and comments orally and in writing and
shall render a review decision in writing, all within sixty (60) days after
receipt of a request for a review, provided that, in special circumstances
(such
as the necessity of holding a hearing) the committee may extend the time for
decision by not more than sixty (60) days upon written notice to the
Claimant. The Claimant shall receive written notice of the separate
committee’s review decision, together with specific reasons for the decision and
reference to the pertinent provisions of this Agreement.
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7.
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Life
Insurance and Funding.
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The
Company in its discretion may apply for and procure as owner and for its own
benefit, insurance on the life of the Participant, in such amounts and in such
forms as the Company may choose. The Participant shall have no
interest whatsoever in any such policy or policies, but at the request of the
Company he shall submit to medical examinations and supply such information
and
execute such documents as may be required by the insurance company or companies
to whom the Company has applied for insurance.
The
rights of the Participant, or his beneficiary, or estate, to benefits under
the
Plan shall be solely those of an unsecured creditor of the
Company. Any insurance policy or other assets acquired by or held by
the Company in connection with the liabilities assumed by it pursuant to the
Plan shall not be deemed to be held under any trust for the benefit of the
Participant, his beneficiary, or his estate, or to be security for the
performance of the obligations of the Company but shall be, and remain, a
general, unpledged, and unrestricted asset of the Company.
If
this
Agreement is funded through insurance on the life of the Participant, then
in
the event of such Participant’s death during the first two (2) years after the
effective date of this Agreement, and if such Participant’s death was a result
of suicide or if such Participant made any material misstatement or failed
to
make a material disclosure of information in any documentation which the
Participant is requested to complete in connection with this Agreement, then
no
death benefits under the terms of this Agreement will be payable, unless and
to
the extent that the Board of Directors of Company, in their absolute discretion,
may otherwise determine.
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8.
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Assignment
of Benefits.
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Neither
the Participant nor any other beneficiary under the Plan shall have any right
to
assign the right to receive any benefits hereunder, and in the event of any
attempted assignment or transfer, the Company shall have no further liability
hereunder.
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9.
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Employment
Not Guaranteed by Agreement.
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Neither
this Agreement nor any action taken hereunder shall be construed as giving
a
Participant the right to be retained as an Executive Employee or as an employee
of the Company for any period.
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10.
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Taxes.
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The
Company shall deduct from all payments made hereunder all applicable federal
or
state taxes required by law to be withheld from such payments.
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11.
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Amendment
and Termination.
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The
Board
of Directors may, at any time, amend or terminate this Agreement, provided
that
the Board may not reduce or modify any benefit in pay status to a Participant
or
beneficiary hereunder or any benefit that would become payable hereunder if
the
Participant were to have died or were to have been involuntarily terminated
under Section 3.5(b) hereof on the day prior to such action by the Board,
without the prior written consent of the Participant.
The
Company is entering into this Agreement upon the assumption that certain
existing tax laws will continue in effect in substantially their current
form. In the event of any changes in Federal law relating to and
allowing the tax-free accumulation of earnings within a life insurance policy,
the income tax-free payment of proceeds from life insurance policies or any
other law which would result in a material adverse impact upon the Company’s
ability to perform its obligations under this Agreement, the Company shall
have
an option to terminate or modify this Agreement subject to the protection
afforded Participant in the preceding paragraph above.
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12.
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Construction.
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This
Agreement shall be construed according to the laws of the state of
Wisconsin.
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13.
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Form
of Communication.
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Any
election, application, claim, notice or other communication required or
permitted to be made by a Participant to the Company shall be made in writing
and in such form as the Company shall prescribe. Such communication
shall be effective upon mailing, if sent by first class mail, postage pre-paid,
and addressed to the Company’s office at 0000 Xxxxxxxxx Xxxxx, Xxx
Xxxxxx, XX 00000.
14. Captions.
The
captions at the head of a section or a paragraph of this Agreement are designed
for convenience of reference only and are not to be resorted to for the purpose
of interpreting any provision of this Agreement.
15. Severability.
The
invalidity of any portion of this Agreement shall not invalidate the remainder
thereof, and said remainder shall continue in full force and
effect.
16. Binding
Effect.
This
Agreement shall be binding upon and shall inure to the benefit of the Company
and the Participant, and each of their successors, heirs, personal
representatives and permitted assigns. No sale of substantially all
of the Company’s assets shall be made without the buyer expressly assuming the
obligation of this Agreement. The Company further agrees that it will
not be a party to any merger, consolidation or reorganization unless and until
its obligations hereunder are expressly assumed by the successor or
successors.
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17. 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 WHEREOF, this Agreement has been executed by the parties as of the
date
first set above.
By:
/s/ Xxxxxxx X.
Xxxxx
Chairman
of the Board
/s/
Xxxxx
Xxxxxxx
Participant
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SCHEDULE
A
Xxxxx
Xxxxxxx
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End
of Plan Year
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Age
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Salary
Cont. Liability
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Annual
Benefit For 15 Years
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1
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48
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$9,849
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$1,270
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2
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49
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$20,729
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$2,675
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3
|
50
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$32,748
|
$4,225
|
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4
|
51
|
$46,026
|
$5,935
|
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5
|
52
|
$60,694
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$7,825
|
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6
|
53
|
$76,899
|
$9,915
|
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7
|
54
|
$94,800
|
$12,225
|
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8
|
55
|
$114,575
|
$14,775
|
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9
|
56
|
$136,422
|
$17,590
|
|
10
|
57
|
$160,556
|
$20,700
|
|
11
|
58
|
$187,217
|
$24,140
|
|
12
|
59
|
$216,670
|
$27,940
|
|
13
|
60
|
$249,206
|
$32,135
|
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14
|
61
|
$285,150
|
$36,770
|
|
15
|
62
|
$324,858
|
$41,890
|
|
16
|
63
|
$368,724
|
$47,550
|
|
17
|
64
|
$417,183
|
$53,795
|
|
18
|
65
|
$470,716
|
$60,700
|
14
