SIX RIVERS NATIONAL BANK
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
THIS AGREEMENT is entered into as of the 1st day of February,
1999, by and between SIX RIVERS NATIONAL BANK, a national banking association
(the "Bank"), and Xxxxxx X. Xxxx (the "Employee").
INTRODUCTION
A. Employee is a member of a select group of management
or highly compensated employees of the Bank.
B. The Bank desires to retain the services of Employee
and in consideration of future services to be provided by Employee to the Bank
the Bank will pay to Employee certain future payments, subject to the limits and
conditions set forth in this Agreement.
AGREEMENT
Employee and the Bank agree as follows:
ARTICLE 1
DEFINITIONS
1.1 DEFINITIONS. Whenever used in this Agreement, the
following words and phrases shall have the meanings specified:
"ANNUAL RETIREMENT BENEFIT" means the product of
$13,019 multiplied by each full Year of Service, up to a maximum annual
benefit of $78,115.
"BENEFICIARY" means a person determined under Section
5.1 to receive benefit payments under this Agreement following
Employee's death.
"CAUSE" means (i) a material breach by Employee of
any of the terms or provisions of her Employment Agreement with the
Bank, (ii) the repeated neglect by Employee of her duties under the
Employment Agreement or any material act of dishonesty, intentional
misrepresentation or moral turpitude, including the misappropriation or
embezzlement of property of the Bank or a customer of the Bank, the
unauthorized intentional disclosure of confidential information, or a
fraud by Employee in the performance of her duties as an employee of
the Bank, (iii) Employee is convicted of a misdemeanor involving moral
turpitude or a felony, (iv) conduct that would preclude the Bank's
ability to bond Employee, or (v) a written finding, order or directive
from any state or federal banking regulator with jurisdiction over the
Bank that Employee has operated the Bank in an unsafe manner or
ordering the removal of Employee as an executive officer of the Bank.
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"CHANGE OF CONTROL" means (i) the closing of any
merger, consolidation or sale of substantially all of the assets of the
Bank in which the Bank is not the surviving entity; provided, however,
if the Bank's board of directors and officers remain in their positions
for at least twelve months following the transaction with the same
authority and control that existed prior to the transaction then this
provision shall not apply, (ii) a tender offer or exchange offer for
the outstanding shares of the Bank as a result of which the offeror
acquires in excess of 50% of the Bank's outstanding shares, or (iii) a
merger or consolidation of the Bank with another corporation that
results in the former shareholders of the Bank, as they existed
immediately prior to such merger or consolidation, owning in the
aggregate less than 50% of the outstanding voting securities of the
surviving or resulting corporation; provided, however, if the Bank's
board of directors and officers remain in their positions for at least
twelve months following the transaction with the same authority and
control that existed prior to the transaction then this provision shall
not apply, or (iv) any other transaction that, although different in
form, accomplishes substantially the same result as (i), (ii) or (iii).
"CODE" means the Internal Revenue Code of 1986, as
amended.
"EFFECTIVE DATE" means February 1, 1999.
"ELECTION FORM" means the Form attached as Exhibit 1.
"NORMAL RETIREMENT DATE" means the later of
Employee's sixty-fifth birthday or Termination of Employment.
"PLAN ADMINISTRATOR" means the Board of Directors of
Six Rivers National Bank or their appointee.
"TERMINATION OF EMPLOYMENT" means that the Employee
ceases to be employed by the Bank for any reason whatsoever other than
by reason of a leave of absence which is approved by the Bank. For
purposes of this Agreement, if there is a dispute over the employment
status of the Employee or the date of the Employee's Termination of
Employment, the Bank's determination shall be conclusive.
"YEAR OF SERVICE" means each computation period of
twelve consecutive months during which the Employee is employed on a
full-time basis by the Bank, inclusive of any approved leave of
absence. The initial computation period shall begin on the Effective
Date and ends twelve months thereafter.
ARTICLE 2
RETIREMENT BENEFITS
2.1 RETIREMENT BENEFITS. Provided Employee meets the
requirements for retirement benefits under this Agreement, the Bank will pay to
Employee the Annual Retirement Benefit for each of the fifteen years following
Employee's Normal Retirement Date. Retirement benefits payable under this
Agreement shall commence on the first day of the calendar month following
Employee's Normal Retirement Date and shall be payable in equal monthly
installments.
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2.2 VESTING UPON CHANGE OF CONTROL. In the event of a
Change of Control Employee shall be entitled to the maximum Annual Retirement
Benefit without regard to Employee's Years of Service.
ARTICLE 3
DEATH BENEFIT ELECTION
3.1 If Employee dies before receiving the full amount of
retirement benefits to which Employee is entitled under Section 2.1, the Bank
shall pay the remaining amount of retirement benefits to the Beneficiary.
Employee may elect to have the Beneficiary receive a lump sum payment equal to
the present value of the future retirement benefits determined as of the date of
Employee's death, which payment shall be paid within 30 days after the Bank
receives notice of Employee's death. For this purpose, the "present value of the
future retirement benefits" shall be determined by using a discount rate equal
to 120 percent of the applicable Federal rate (determined under Section 1274(d)
of the Code) in effect as of Employee's date of death, compounded semiannually.
The election available under this Article 3 must be made at the time this
Agreement is signed, by signing and delivering the Election Form to the Bank. If
Employee does not make the election, the unpaid retirement benefits to which
Employee is entitled as of her death shall be paid to the Beneficiary at the
times and in the amounts such payments would have been paid to Employee.
3.2 PRE-RETIREMENT DEATH BENEFIT. If the participant dies
prior to reaching age 65 no benefits of any kind will be payable under the terms
of this Agreement.
3.3 TERMINATION OF EMPLOYMENT PRIOR TO RETIREMENT OTHER
THAN FOR DEATH OR TERMINATION FOR CAUSE, BUT INCLUDING DISABILITY. If
termination of employment occurs other than for death or for cause, the
participant shall be entitled to a termination benefit, due and payable at her
otherwise Normal Retirement Date. The amount of the benefit shall be $13,019
multiplied by each full Year of Service up to a maximum annual benefit of
$78,115.
ARTICLE 4
FORFEITURE UPON TERMINATION FOR CAUSE
Notwithstanding any provision of this Agreement to the
contrary, Employee shall forfeit her entire benefit if her employment with the
Bank is terminated for Cause.
ARTICLE 5
BENEFICIARIES
5.1 BENEFICIARY DESIGNATIONS. The Employee shall
designate a beneficiary by filing a written designation with the Bank. The
Employee may revoke or modify the designation at any time by filing a new
designation. However, designations will only be effective if signed by the
Employee and accepted by the Bank during the Employee's lifetime and the
designation of any person other than Employee's spouse must be accompanied by
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the written consent of Employee's spouse. The Employee's beneficiary designation
shall be deemed automatically revoked if the beneficiary predeceases the
Employee or if the Employee names a spouse as beneficiary and the marriage is
subsequently dissolved. If the Employee dies without a valid beneficiary
designation, all payments shall be made to Employee's estate.
5.2 FACILITY OF PAYMENT. If a benefit is payable to a
minor, to a person declared incompetent, or to a person incapable of handling
the disposition of his or her property, the Bank may pay such benefit to the
guardian, legal representative or person having the care or custody of such
minor, incompetent person or incapable person. The Bank may require proof of
incompetence, minority or guardianship as it may deem appropriate prior to
distribution of the benefit. Such distribution shall completely discharge the
Bank from all liability with respect to such benefit.
5.3 LUMP SUM BENEFIT OPTION. In lieu of receiving
installment and or delayed payments under any of the above numbered paragraphs,
the Executive (or the Executive's beneficiary in the event of the death of said
Executive) may petition the PLAN ADMINISTRATOR to receive a lump sum benefit.
The value of the lump sum benefit shall be the present value of the remaining
installment payments as determined by using a discount rate and methodology as
defined in Article 3.1 of this Agreement; it being understood that the PLAN
ADMINISTRATOR shall have the final authority to either grant or reject said
request.
ARTICLE 6
EXCESS PARACHUTE PAYMENT
Notwithstanding any other provision of this Agreement, if any
payment to be made or benefit to be provided to Employee pursuant to this
Agreement, after taking into account all other payments or benefits provided by
the Bank to Employee, would constitute a "parachute payment" as defined in
Section 280G of the Code, then the payments to be made or benefits to be
provided to Employee shall be reduced so that the aggregate present value of all
parachute payments does not exceed 299% of Employee's "annualized includible
compensation for the base period" (as such term is defined in Section 280G(d)(1)
of the Code). The determination of any reduction in the payments or benefits to
be provided to Employee shall be made by the Bank and the Bank's determination
shall be conclusive and binding on Employee.
ARTICLE 7
CLAIMS AND REVIEW PROCEDURES
7.1 CLAIMS PROCEDURE. The Bank shall notify any person or
entity that makes a claim under this Agreement (the "Claimant") in writing,
within ninety (90) days of Claimant's written application for benefits, of his
or her eligibility or non-eligibility for benefits under the Agreement. If the
Bank 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
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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 Bank determines that there are special
circumstances requiring additional time to make a decision, the Bank 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) days.
7.2 REVIEW PROCEDURE. If the Claimant is determined by
the Bank 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 Bank by filing a petition for
review with the Bank within sixty (60) days after receipt of the notice issued
by the Bank. 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 Bank of the petition, the Bank shall
afford the Claimant (and counsel, if any) all opportunity to present his or her
position to the Bank verbally or in writing, and the Claimant (or counsel) shall
have the right to review the pertinent documents. The Bank shall notify the
Claimant of its decision in writing within the sixty-day period, stating
specifically the basis of its decision, 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-day
period is not sufficient, the decision may be deferred for up to another sixty
(60) days at the election of the Bank, but notice of this deferral shall be
given to the Claimant.
ARTICLE 8
AMENDMENTS AND TERMINATION
This Agreement may be amended or terminated only be a written
agreement signed by the Bank and the Employee.
ARTICLE 9
MISCELLANEOUS
9.1 BINDING EFFECT. This Agreement shall bind the
Employee and the Bank, and their beneficiaries, survivors, executors,
administrators and transferees.
9.2 NO EMPLOYMENT CONTRACT. Nothing contained in this
Agreement shall be construed to create any express or implied employment
contract between Employee and the Bank nor to confer upon Employee the right to
continue to be employed by the Bank in any capacity. In addition, nothing
contained herein, nor any action taken by either party pursuant to the terms
hereof, shall be construed to create any trust or fiduciary relationship between
the Bank and Employee.
9.3 NON-TRANSFERABILITY. Except as may otherwise be
required by law, no amount payable at any time under this Agreement shall be
subject in any manner to alienation by anticipation, sale, transfer, assignment,
bankruptcy, pledge, attachment, charge or encumbrance of any kind or in any
manner be subject to the debts or liabilities of any persons and any attempt to
so alienate or subject any such amount, whether payable currently or at a later
date, shall be void.
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9.4 TAX WITHHOLDING. The Bank shall withhold any tax
which is required to be withheld from the benefits provided under this
Agreement, including but not limited to FICA, Medicare and FUTA contributions
and income tax withholding on benefit payments.
9.5 APPLICABLE LAW. This Agreement and all rights
hereunder shall be governed by the laws of the State of California, except to
the extent preempted by the laws of the United States of America.
9.6 UNFUNDED ARRANGEMENT. The rights of Employee, any
designated Beneficiary, or any other person claiming through the Employee or her
designated Beneficiaries under this Agreement, shall be solely those of an
unsecured general creditor of the Bank, and the Bank's obligation shall be an
unfunded and unsecured promise to pay. Neither Employee nor her Beneficiaries or
other persons shall have any rights, interests or prior claims whatsoever in any
of the Bank's assets. The Bank's obligations under this Agreement shall be
satisfied from the general assets of the Bank, and any asset which may be used
or acquired by the Bank in connection with the liabilities it has assumed under
this Agreement shall not be deemed to be held under any trust or escrow for the
benefit of Employee or her Beneficiaries, nor shall it be considered security
for the performance of the obligations of the Bank.
9.7 NOTICES. Any notice required or permitted under this
Agreement shall be in writing and shall be deemed to have been duly given if
delivered personally or if deposited in the United States mail, registered or
certified mail, postage prepaid and return receipt requested, to the most recent
address of the party set forth in the records of the Bank or to such other
address as may be designated by notice in writing pursuant to the terms of this
Section 9.7 to the other party to this Agreement.
9.8 ADMINISTRATION. No officer or employee of the Bank or
any member of its Board of Directors shall be personally liable by reason of
this Agreement or any other instrument executed in connection with this
Agreement by such person or on his or her behalf or in his or her capacity as an
employee or member of the Board of Directors nor for any mistake of judgment
made in good faith, and the Bank shall indemnify and hold harmless each such
officer, employee, or Director of the Bank to whom any duty or power relating to
the administration or interpretation of this Agreement has been delegated,
against any cost or expense (including attorneys' fees) or liability (including
any sum paid in settlement of a claim with the approval of the Board of
Directors) arising out of any act or omission to act in connection with this
Agreement unless arising out of such person's own fraud or bad faith.
9.9 PROTECTIVE PROVISIONS. Employee shall cooperate with
the Bank by furnishing any and all information requested by the Bank in order to
facilitate the payment of benefits, taking physical examinations as the Bank may
deem necessary and taking other relevant action as may be requested by the Bank.
If Employee commits suicide during the first two years following the Effective
Date, or if Employee makes any material misstatement of information or
nondisclosure of medical history, then no benefits will be payable to Employee
or her Beneficiary, provided that, in the Bank's sole discretion, benefits may
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be payable in an amount reduced to compensate the Bank for any loss, cost,
damage or expense suffered or incurred by the Bank as a result in any way of
misstatement or nondisclosure.
9.10 ENTIRE AGREEMENT. This Agreement constitutes the
entire agreement between the Bank and the Employee as to the subject matter
hereof. No rights are granted to the Employee by virtue of this Agreement other
than those specifically set forth herein.
IN WITNESS WHEREOF, the Employee and a duly authorized Bank
officer have signed this Agreement.
EMPLOYEE: COMPANY:
SIX RIVERS NATIONAL BANK
/s/ XXXXXX X. XXXX BY /s/ XXXXXXX X. XXXXXXXX
------------------------------- -----------------------
Xxxxxx X. Xxxx XXXXXXX X. XXXXXXXX
TITLE President and Chief Executive Officer
Initials of XXXXXXX X. XXX
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EXHIBIT 1
TO
SIX RIVERS NATIONAL BANK
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
LUMP SUM PAYMENT ELECTION
In the event of my death, I elect to have the present value of any unpaid
benefits paid to my Beneficiary in a lump sum payment in accordance with Article
3 of the Agreement.
Signature ______________________
Date ___________________________
Accepted by the Bank this _____ day of __________________, 19__.
By _____________________________
Title __________________________
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EXHIBIT 2
TO
SIX RIVERS NATIONAL BANK
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
BENEFICIARY DESIGNATION
I designate the following as beneficiary of benefits under the Supplemental
Executive Retirement Agreement payable following my death:
Primary: _______________________________________________________________________
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Contingent: ____________________________________________________________________
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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 Bank. 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 ______________________
Date ___________________________
Accepted by the Bank this _____ day of __________________, 19__.
By _____________________________
Title __________________________
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