TROY HILL BANCORP, INC. AMENDED AND RESTATED RECOGNITION AND RETENTION PLAN FOR OFFICERS AND TRUST AGREEMENT
Exhibit
10.12
XXXX
XXXX BANCORP, INC.
AMENDED
AND RESTATED RECOGNITION AND RETENTION
PLAN
FOR OFFICERS AND TRUST AGREEMENT
ARTICLE
I
ESTABLISHMENT
OF THE PLAN AND TRUST
1.01 ESB
Financial Corporation (the “Corporation”) hereby amends and restates the Xxxx
Xxxx Bancorp, Inc. Recognition and
Retention Plan for Officers (the “Plan”) and Trust (the “Trust”) upon the terms
and conditions hereinafter stated in this amended and restated Recognition
and
Retention Plan for Officers and Trust Agreement (the “Agreement”), with this
amendment and restatement effective as of November 20, 2007.
1.02 The
Trustees hereby accept this Trust and agree to hold the Trust assets existing
on
the date of this Agreement and all additions and accretions thereto upon
the
terms and conditions hereinafter stated.
ARTICLE
II
PURPOSE
OF THE PLAN
2.01 The
purpose of the Plan is to retain personnel of experience and ability in key
positions by providing such key employees of the Corporation, as successor
to
Xxxx Xxxx Bancorp, Inc., with a proprietary interest in the Corporation as
compensation for their contributions to the Corporation, the Bank, and other
Subsidiaries and as an incentive to make such contributions in the
future.
ARTICLE
III
DEFINITIONS
The
following words and phrases when used in this Agreement with an initial capital
letter, unless the context clearly indicates otherwise, shall have the meanings
set forth below. Wherever appropriate, the masculine pronouns shall include
the
feminine pronouns and the singular shall include the plural.
3.01 “Bank”
means ESB Bank, as the successor to Xxxx Xxxx Federal Bank.
3.02 “Beneficiary”
means the person or persons designated by a Recipient to receive any benefits
payable under the Plan in the event of such Recipient’s death. Such person or
persons shall be designated in writing on forms provided for this purpose
by the
Committee and may be changed from time to time by similar written notice
to the
Committee. In the absence of a written designation, the Beneficiary shall
be the
Recipient’s surviving spouse, if any, or if none, his estate.
3.03 “Board”
means the Board of Directors of the Corporation.
3.04 “Code”
means the Internal Revenue Code of 1986, as amended.
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3.05 “Committee”
means the committee appointed by the Board pursuant to Article IV
hereof.
3.06 “Common
Stock” means shares of the common stock, $.01 par value per share, of the
Corporation.
3.07 “Disability”
means the Recipient (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 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
12
months, receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering employees of the
Corporation or the Bank (or would have received such benefits for at least
three
months if he had been eligible to participate in such
plan).
3.08 “Effective
Date” means the hour and day upon which Common Stock was initially sold by Xxxx
Xxxx Bancorp, Inc. in the Officering. The amendment and restatement
of this Plan shall be effective as of November 20, 2007.
3.09 “Employee”
means any person who is employed by the Corporation, the Bank, or any
Subsidiary, including officers or other employees who may be directors of
the
Corporation.
3.10 “Exchange
Act” means the Securities Exchange Act of 1934, as amended.
3.11 “Offering”
means the offering of Common Stock to the public pursuant to the Plan of
Conversion of Xxxx Xxxx Federal Savings and Loan Association.
3.12 “Plan
Shares” or “Shares” means shares of Common Stock held in the Trust which may be
distributed to a Recipient pursuant to the Plan.
3.13 “Plan
Share Award” or “Award” means a right granted under this Plan to receive a
distribution of Plan Shares upon completion of the service requirements
described in Article VII.
3.14 “Recipient”
means an Employee who receives a Plan Share Award under the Plan.
3.15 “Retirement”
means the later of (a) the attainment of age sixty-five (65) or
such earlier age as may be specified in a Recipient’s Plan Share Award, and (b)
the one-year anniversary of the grant of a Plan Share Award.
3.16 “Subsidiary”
means the Bank and any other subsidiaries of the Corporation or the Bank
which,
with the consent of the Board, agree to participate in this Plan.
3.17 “Trustee”
or “Trustees” means those person or persons (which may be members of the
Committee) or firm or entity, nominated by the Committee and approved by
the
Board pursuant to Sections 4.01 and 4.02 to hold legal title to the Plan
assets
for the purposes set forth herein.
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ARTICLE
IV
ADMINISTRATION
OF THE PLAN
4.01 Role
of the Committee. The Plan shall be
administered and interpreted by the Committee, which shall consist of two
or
more members of the Board, none of whom shall be an officer or employee of
the
Corporation and each of whom shall be a “disinterested person” within the
meaning of Rule 16b-3 under the Exchange Act. The Committee shall have all
of
the powers allocated to it in this and other sections of the Plan. The
interpretation and construction by the Committee of any provisions of the
Plan
or of any Plan Share Award granted hereunder shall be final and binding.
The
Committee shall act by vote or written consent of a majority of its members.
Subject to the express provisions and limitations of the Plan, the Committee
may
adopt such rules, regulations and procedures as it deems appropriate for
the
conduct of its affairs. The Committee shall report its actions and decisions
with respect to the Plan to the Board at appropriate times, but in no event
less
than one time per calendar year. The Committee shall recommend to the Board
one
or more persons (which may be from among its members), or a firm or other
entity, to act as Trustees in accordance with the provisions of this Plan
and
Trust and the terms of Article VIII hereof.
4.02 Role of the
Board. The members of the Committee and the
Trustee or Trustees shall be appointed or approved by, and will serve at
the
pleasure of, the Board. The Board may in its discretion from time to time
remove
members from, or add members to, the Committee, and may remove, replace or
add
Trustees, provided that any directors who are selected as members of the
Committee shall not be officers or employees of the Corporation and shall
be
“disinterested persons” within the meaning of Rule 16b-3 promulgated under the
Exchange Act.
4.03 Limitation
on Liability. No member of the Board or the
Committee shall be liable for any determination made in good faith with respect
to the Plan or any Plan Shares or Plan Share Awards granted under the Plan.
If a
member of the Board or the Committee is a party or is threatened to be made
a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of anything
done or not done by him in such capacity under or with respect to the Plan,
the
Corporation shall, subject to the requirements of applicable laws and
regulations, indemnify such member against all liabilities and expenses
(including attorneys’ fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or
proceeding if he acted in good faith and in a manner he reasonably believed
to
be in the best interests of the Corporation and any Subsidiaries and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe
his conduct was unlawful.
4.04 Compliance
with Laws and Regulations. All awards granted
hereunder shall be subject to all applicable federal and state laws, rules
and
regulations and to such approvals by any government or regulatory agency
or
stockholders as may be required.
4.05 No
Deferral of Compensation Under Section 409A of the
Code. All Plan Share Awards granted under the Plan are
designed to not constitute a deferral of compensation for purposes of Section
409A of the Code, in reliance upon the exemption for the transfer of nonvested
restricted property and the short-term deferral exemption in the final
regulations. No Recipient shall be permitted to defer the recognition
of income beyond the date a Plan Share Award shall be deemed earned pursuant
to
Article VII of this Plan.
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ARTICLE
V
CONTRIBUTIONS
5.01 Amount
and Timing of Contributions. The Board shall
determine the amount (or the method of computing the amount) and timing of
any
contributions by the Corporation and any Subsidiaries to the Trust established
under this Plan. Such amounts may be paid in cash or in shares of Common
Stock
and shall be paid to the Trust at the designated time of contribution. No
contributions by Employees shall be permitted.
5.02 Investment
of Trust Assets; Number of Plan
Shares. Subject to Section 8.02 hereof, the
Trustees shall invest all of the Trust’s assets primarily in Common Stock. The
aggregate number of Plan Shares initially available for distribution pursuant
to
this Plan shall be equal to three percent (3.0%) of the shares of Common
Stock
which are issued by the Corporation in the Offering (rounded down to the
nearest
whole number), which shares shall be purchased by the Trust in such Offering
with funds contributed by the Corporation. Subsequent to consummation of
the
Offering, the Trust may purchase (from the Corporation and/or stockholders
thereof) additional shares of Common Stock for distribution pursuant to this
Plan.
ARTICLE
VI
ELIGIBILITY;
ALLOCATIONS
6.01 Eligibility. Plan
Share Awards may be made to such Employees as may be selected by the Committee.
In selecting those Employees to whom Plan Share Awards may be granted and
the
number of Shares covered by such Awards, the Committee shall consider the
position and responsibilities of the eligible Employees, the value of their
services to the Corporation and any Subsidiaries, and any other factors the
Committee may deem relevant. The Committee may but shall not be required
to
request the written recommendation of the Chief Executive Officer of the
Corporation other than with respect to Plan Share Awards to be granted to
him.
6.02
Form of Allocation. As promptly as
practicable after a determination is made pursuant to Section 6.01 that a
Plan
Share Award is to be issued, the Committee shall notify the Recipient in
writing
of the grant of the Award, the number of Plan Shares covered by the Award,
and
the terms upon which the Plan Shares subject to the Award shall be distributed
to the Employee. Such terms shall be reflected in a written agreement with
the
Employee. The date on which the Committee so notifies the Recipient shall
be
considered the date of grant of the Plan Share Award. The Committee shall
maintain records as to all grants of Plan Share Awards under the
Plan.
6.03 Allocations
Not Required to any Specific
Employee. Notwithstanding anything to the
contrary in Section 6.01 hereof, no Employee shall have any right or entitlement
to receive a Plan Share Award hereunder, such Awards being at the total
discretion of the Committee.
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ARTICLE
VII
EARNING
AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
7.01 Earning
Plan Shares; Forfeitures.
(a) General
Rules. Unless the Committee shall
specifically state to the contrary at the time a Plan Share Award is granted,
and subject to the terms hereof, Plan Shares subject to an Award shall be
earned
by a Recipient at the rate of twenty percent (20%) of the aggregate number
of
Shares covered by the Award as of each annual anniversary of the date of
grant
of the Award. If the employment of a Recipient is terminated prior to the
fifth
(5th) annual anniversary of the date of grant of a Plan Share Award for any
reason (except as specifically provided in subsections (b), (c) and (d) below),
the Recipient shall forfeit the right to any Shares subject to the Award
which
have not theretofore been earned. No fractional shares shall be distributed
pursuant to this Plan.
(b) Exception
for Terminations Due to Death or
Disability. Notwithstanding the general rule
contained in Section 7.01(a), all Plan Shares subject to a Plan Share Award
held
by a Recipient whose employment with the Corporation or any Subsidiary
terminates due to death or Disability shall be deemed earned as of the
Recipient’s last day of employment with the Corporation or any Subsidiary and
shall be distributed as soon as practicable thereafter; provided, however,
that
no Awards shall be distributed prior to six months from the date of grant
of the
Plan Share Award.
(c) Exception
for Change in Control and
Retirement. Notwithstanding the general rule
contained in Section 7.01(a), all Plan Shares subject to a Plan Share Award
held
by a Recipient shall be deemed to be earned in the event of a “change in
control” or the date the Recipient becomes eligible for Retirement. A
“change in control” shall mean a change in the ownership of the Corporation or
the Bank, a change in the effective control of the Corporation or the Bank
or a
change in the ownership of a substantial portion of the assets of the
Corporation or the Bank, in each case as provided under Section 409A of the
Code
and the regulations thereunder.
(d) Revocation
for Misconduct. Notwithstanding anything hereinafter to the
contrary, the Board may by resolution immediately revoke, rescind and terminate
any Plan Share Award, or portion thereof, previously awarded under this Plan,
to
the extent Plan Shares have not been distributed hereunder to the Recipient,
whether or not yet earned, in the case of an Employee who is discharged from
the
employ of the Corporation or any Subsidiary for cause (as hereinafter defined).
Termination of employment shall be deemed to be for cause if the Employee
has
been convicted of a felony by a court of competent jurisdiction or has been
adjudged by a court of competent jurisdiction to be liable for gross negligence
or misconduct in the performance of his duties to the Corporation or any
Subsidiary.
7.02 Distribution
of Dividends. Any cash dividends declared in
respect of each Plan Share held by the Trust will be paid by the Trust, as
soon
as practicable after the Trust’s receipt thereof, to the Recipient on whose
behalf such Plan Share is then held by the Trust.
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7.03
Distribution of Plan Shares.
(a) Timing
of Distributions: General Rule. Plan Shares
shall be distributed to the Recipient or his Beneficiary, as the case may
be, as
soon as practicable after they have been earned; provided, however, that
no Plan
Shares shall be distributed to the Recipient or Beneficiary pursuant to a
Plan
Share Award within six months from the date on which that Plan Share Award
was
granted to such person; provided further, however, in the case of a Plan
Share
Award granted prior to the date this Plan is approved by stockholders of
the
Corporation if presented to stockholders in accordance with Section 4.04
hereof,
no Plan Shares shall be distributed to a Recipient or Beneficiary pursuant
to
such Plan Share Award within six months from the date on which such shareholder
approval of the Plan was obtained.
(b) Form
of Distributions. All Plan Shares, together
with any Shares representing stock dividends, shall be distributed in the
form
of Common Stock. One share of Common Stock shall be given for each Plan Share
earned and distributable. Payments representing cash dividends shall be made
in
cash.
(c) Withholding. The
Trustees may withhold from any cash payment or Common Stock distribution
made
under this Plan sufficient amounts to cover any applicable withholding and
employment taxes, and if the amount of a cash payment is insufficient, the
Trustees may require the Recipient or Beneficiary to pay to the Trustees
the
amount required to be withheld as a condition of delivering the Plan Shares.
The
Trustees shall pay over to the Corporation or any Subsidiary which employs
or
employed such Recipient any such amount withheld from or paid by the Recipient
or Beneficiary.
(d)
Restrictions on Selling of Plan
Shares. Plan Share Awards may not be sold,
assigned, pledged or otherwise disposed of prior to the time that they are
earned and distributed pursuant to the terms of this Plan. Following
distribution, the Committee may require the Recipient or his Beneficiary,
as the
case may be, to agree not to sell or otherwise dispose of his distributed
Plan
Shares except in accordance with all then applicable federal and state
securities laws, and the Committee may cause a legend to be placed on the
stock
certificate(s) representing the distributed Plan Shares in order to restrict
the
transfer of the distributed Plan Shares for such period of time or under
such
circumstances as the Committee, upon the advice of counsel, may deem
appropriate.
7.04 Voting
of Plan Shares. After a Plan Share Award has
been made, the Recipient shall be entitled to direct the Trustees as to the
voting of the Plan Shares which are covered by the Plan Share Award and which
have not yet been earned and distributed to him pursuant to Section 7.03,
subject to rules and procedures adopted by the Committee for this purpose.
Provided that the Recipient informs the Trustees how the Recipient voted
Plan
Shares which have been earned and distributed for and against proposals to
stockholders, the Trustees shall vote all Plan Shares which have not yet
been
earned and distributed pursuant to Section 7.03 in the same proportion for
and
against proposals to stockholders as the Recipient actually votes Plan Shares
which have been earned and distributed pursuant to Section 7.03. If the
Recipient does not provide the Trustees with such information, Plan Shares
which
have not yet been earned and distributed pursuant to Section 7.03 shall not
be
voted by the Trustees. In the event a tender offer is made for Plan Shares,
the
Trustees shall tender Plan Shares held by it which have not yet been earned
and
distributed in the same proportion in which the Recipient actually tenders
Plan
Shares which have been earned and distributed.
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ARTICLE
VIII
TRUST
8.01
Trust. The Trustees shall receive,
hold, administer, invest and make distributions and disbursements from the
Trust
in accordance with the provisions of the Plan and Trust and the applicable
directions, rules, regulations, procedures and policies established by the
Committee pursuant to the Plan.
8.02
Management of
Trust. It is the intent of this Plan and
Trust that the Trustee shall have complete authority and discretion with
respect
to the arrangement, control and investment of the Trust, and that the Trustees
shall invest all assets of the Trust in Common Stock to the fullest extent
practicable, except (i) to the extent that the Trustees determine that the
holding of monies in cash or cash equivalents is necessary to meet the
obligations of the Trust and (ii) contributions to the Trust by the Corporation
prior to the Offering may be temporarily invested in such interest-bearing
account or accounts as the Trustees shall determine to be appropriate. In
performing their duties, the Trustees shall have the power to do all things
and
execute such instruments as may be deemed necessary or proper, including
the
following powers:
(a) To invest up to one hundred percent (100%) of
all Trust assets in Common Stock without regard to any law now or hereafter
in
force limiting investments for trustees or other fiduciaries. The investment
authorized herein may constitute the only investment of the Trust, and in
making
such investment, the Trustees are authorized to purchase Common Stock from
the
Corporation or from any other source, and such Common Stock so purchased
may be
outstanding, newly issued, or treasury shares.
(b) To
invest
any Trust assets not otherwise invested in accordance with (a) above, in
such
deposit accounts, and certificates of deposit, obligations of the United
States
Government or its agencies or such other investments as shall be considered
the
equivalent of cash.
(c) To
sell,
exchange or otherwise dispose of any property at any time held or acquired
by
the Trust.
(d) To
cause
stocks, bonds or other securities to be registered in the name of a nominee,
without the addition of words indicating that such security is an asset of
the
Trust (but accurate records shall be maintained showing that such security
is an
asset of the Trust).
(e) To
hold
cash without interest in such amounts as may in the opinion of the Trustees
be
reasonable for the proper operation of the Plan and Trust.
(f) To employ brokers, agents, custodians,
consultants and accountants.
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(g) To
hire
counsel to render advice with respect to their rights, duties and obligations
hereunder, and such other legal services or representation as they may deem
desirable.
(h) To
hold
funds and securities representing the amounts to be distributed to a Recipient
or his Beneficiary as a consequence of a dispute as to the disposition thereof,
whether in a segregated account or held in common with other assets of the
Trust.
Notwithstanding
anything herein contained to the contrary, the Trustees shall not be required
to
make any inventory, appraisal or settlement or report to any court, or to
secure
any order of court for the exercise of any power herein contained, or give
bond.
8.03 Records
and Accounts. The Trustees shall maintain
accurate and detailed records and accounts of all transactions of the Trust,
which shall be available at all reasonable times for inspection by any legally
entitled person or entity to the extent required by applicable law, or any
other
person determined by the Committee.
8.04 Expenses. All
costs and expenses incurred in the operation and administration of this Plan
shall be borne by the Corporation.
8.05 Indemnification. Subject
to the requirements of applicable laws and regulations, the Corporation shall
indemnify, defend and hold the Trustees harmless against all claims, expenses
and liabilities arising out of or related to the exercise of the Trustees’
powers and the discharge of their duties hereunder, unless the same shall
be due
to their gross negligence or willful misconduct.
ARTICLE
IX
MISCELLANEOUS
9.01 Adjustments
for Capital Changes. The aggregate number of
Plan Shares available for distribution pursuant to the Plan Share Awards
and the
number of Shares to which any Plan Share Award relates shall be proportionately
adjusted for any increase or decrease in the total number of outstanding
shares
of Common Stock issued subsequent to the effective date of the Plan resulting
from any split, subdivision or consolidation of shares or other capital
adjustment, or other increase or decrease in such shares effected without
receipt or payment of consideration by the Corporation.
9.02 Amendment
and Termination of Plan. The Board may, by
resolution, at any time amend or terminate the Plan, subject to any required
stockholder approval or any stockholder approval which the Board may deem
to be
advisable for any reason, such as for the purpose of obtaining or retaining
any
statutory or regulatory benefits under tax, securities or other laws or
satisfying any applicable stock exchange listing requirements. The Board
may
not, without the consent of the Recipient, alter or impair his Plan Share
Award
except as specifically authorized herein. Notwithstanding anything contained
in
this Plan to the contrary, the provisions of Articles VI and VII of this
Plan
shall not be amended more than once every six months, other than to comport
with
changes in the Code, the Employee Retirement Income Security Act of 1974,
as
amended, or the rules and regulations promulgated under such
statutes.
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9.03 Nontransferable. Plan
Share Awards and rights to Plan Shares shall not be transferable by a Recipient,
and during the lifetime of the Recipient, Plan Shares may only be earned
by and
paid to a Recipient who was notified in writing of an Award by the Committee
pursuant to Section 6.02. No Recipient or Beneficiary shall have any right
in or
claim to any assets of the Plan or Trust, nor shall the Corporation or any
Subsidiary be subject to any claim for benefits hereunder.
9.04 Employment
Rights. Neither the Plan nor any grant of a
Plan Share Award or Plan Shares hereunder nor any action taken by the Trustees,
the Committee or the Board in connection with the Plan shall create any right
on
the part of any Employee to continue in the employ of the Corporation or
any
Subsidiary.
9.05 Voting
and Dividend Rights. No Recipient shall have
any voting or dividend rights or other rights of a stockholder in respect
of any
Plan Shares covered by a Plan Share Award, except as expressly provided in
Sections 7.02 and 7.04 above, prior to the time said Plan Shares are actually
earned and distributed to him.
9.06 Governing
Law. The Plan and Trust shall be governed by
the laws of the Commonwealth of Pennsylvania.
9.07 Effective
Date. This Plan as originally adopted was
effective as of the Effective Date, and Awards may be granted hereunder as
of or
after the Effective Date and as long as the Plan remains in
effect. The amendment and restatement of this Plan shall be effective
as of November 20, 2007.
9.08 Term
of Plan. This Plan shall remain in effect
until the earlier of (1) ten (10) years from the Effective Date, (2) termination
by the Board, or (3) the distribution to Recipients and Beneficiaries of
all
assets of the Trust.
9.09 Tax
Status of Trust. It is intended that the
trust established hereby be treated as a Grantor Trust of the Corporation
under
the provisions of Section 671 etseq. of the Code, as the same may
be amended from time to time.
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IN
WITNESS WHEREOF, the Corporation has caused this Agreement to be
executed by its duly authorized officers and the corporate seal to be affixed
and duly attested, and the Trustees of the Trust have duly and validly executed
this Agreement, all on this 20th day of November 2007.
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ESB FINANCIAL CORPORATION | |
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By:
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/s/ Xxxxxxxxx X. Xxxxxxxx |
| Xxxxxxxxx X. Xxxxxxxx | ||
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President and Chief Executive Officer | |
| ATTEST: | ||||
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/s/
Xxxxx X. Xxxxx
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||||
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Xxxxx
X. Xxxxx
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||||
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Group
Senior Vice President of Operations
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||||
| and Secretary | ||||
| TRUSTEES: | |
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/s/
Xxxxxxx X. Xxxxxxxxx
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/s/
Xxxxx X. Xxxxxx
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/s/
Xxxxx X. Xxxxx
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