EXHIBIT 10(D)
DEATH BENEFIT ONLY AGREEMENT
THIS DEATH BENEFIT ONLY AGREEMENT (the "Agreement"), made and entered
into as of the ____ day of _____________, 2002, by and between Xxxxxxxx Bank and
Trust (the "Bank") and ____________________(the "Executive").
WHEREAS, the Executive is an officer of the Bank and the Bank wishes to
retain the Executive in its employ;
WHEREAS, as an inducement to continued employment, the Bank wishes to
assist the Executive with additional financial protection in the event of the
Executive's death;
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
BENEFITS
Should the Executive die while this Agreement is in effect, the Bank
shall pay the Executive's beneficiary a death benefit in an amount, if any,
determined in accordance with the following provisions:
(A) If the Executive is actively employed at the time of his
death, the benefit payable upon the Executive's death shall be
equal to the greater of (i) $100,000, or (ii) product of the
Benefit Factor and the Executive's base salary at the annual
rate in effect on his date of death.
(B) On or after the effective date of the Executive's termination
of employment by reason of Retirement, the benefit payable
upon the Executive's death shall be equal to the greater of
(i) $100,000 or (ii) the product of the Benefit Factor and the
Executive's base salary at the annual rate in effect on the
date of his Retirement.
(C) On or after the effective date of Executive's termination of
employment by reason of Early Retirement, the benefit payable
upon the Executive's death shall be a benefit determined under
Paragraph B of this Article I as if the Executive had
terminated employment by reason of Retirement but reduced by
ten (10) percent for each full year by which the Executive's
attained age at Early Retirement is less than 65; provided,
however, that (i) the minimum benefit payable under this
Paragraph C shall not be less than $50,000 for an Employee
whose Early Retirement occurs at 55 and (ii) the minimum
benefit shall be increased by an additional $5,000 for each
year by which the Employee's age at Early Retirement exceeds
55.
62
(D) On or after the effective date of the Executive's termination
of employment by reason of Disability, the benefit payable
upon the Executive's death shall be equal to the greater of
(i) $100,000 or (ii) product of the Benefit Factor and the
Executive's base salary at the annual rate in effect on his
date of termination.
(E) On or after the effective date of the Executive's termination
of employment for any reason (other than for Cause) within
twelve (12) months of the effective date of a Change in
Control, the benefit payable upon the Executive's death shall
be equal to the greater of (i) $100,000 or (ii) product of the
Benefit Factor and the Executive's base salary at the annual
rate in effect on his date of termination.
(F) Except as otherwise provided in this Article I, no benefit
shall be payable under this Agreement (i) on or after the
effective date of the Executive's termination of employment
prior to attaining age 55 or (ii) on or after the effective
date of the Executive's termination of employment for Cause.
A benefit payable under this Article I shall be paid in a single lump
sum to the Executive's beneficiary as soon as practicable after the Bank
receives written notice, in a form and manner acceptable to the Bank, of the
Executive's death. In the event the Executive has not designated a beneficiary,
of if the Executive's designated beneficiary shall have predeceased the
Executive, the benefit under this Agreement shall be paid to the Executive's
estate. The beneficiary shall be designated on a form designated by the Bank for
such purpose. The Executive may at any time and from time to time while this
Agreement is in effect change his beneficiary by executing and delivering to the
Bank a new beneficiary designation form.
ARTICLE II
FUNDING RESTRICTIONS
The Executive, his beneficiary, and any successor in interest to them,
shall be and remain, with respect to the obligations under this Agreement, a
general creditor of the Bank in the same manner as any other general creditor of
the Bank. The Bank, on behalf of itself and each Bank, reserves the absolute
right, in its sole discretion, through the purchase of life insurance on the
life of the Executive or otherwise, to secure to the Bank a source for the
payment of the Bank's obligations hereunder and to determine the extent, nature,
and method thereof from time to time, including the right to discontinue the
same at any time. Should the Bank elect to do so, in whole or in part, through
the purchase of life insurance or any other funding medium, only the Bank shall
have any right or interest in any such life insurance or other funding medium,
and neither the Executive nor his or her beneficiary shall have any right or
interest therein or recourse thereto.
63
ARTICLE III
TERM OF AGREEMENT
This Agreement is effective as of the date first written above, and
shall remain in effect for so long as the Executive remains in the employ of the
Bank. This Agreement shall continue in effect after the Executive's termination
of employment with the Bank only if such termination occurs by reason of the
Executive's Disability, Retirement, Early Retirement, or within twelve (12)
months of a Change in Control. This Agreement shall terminate immediately upon
the Executive's termination of employment for Cause.
ARTICLE IV
ERISA PROVISIONS
To the extent this Agreement is deemed to constitute or comprise a part
of an "employee welfare benefit plan" within the meaning of the Employment
Retirement Income Security Act of 1974, as amended ("ERISA"), the provisions of
this Article IV shall apply.
A. Named Fiduciary and Administrator. The named fiduciary and
administrator of this Agreement shall be the Bank. As named fiduciary and
administrator, the committee shall be responsible for the management, control
and administration of the plan in accordance with the provisions of this
Agreement. The Bank may delegate to others certain responsibilities hereunder,
including the employment of advisors and the delegation of ministerial duties to
qualified individuals.
B. Claims Procedure.
If benefits under this Agreement are not paid to the Executive's
beneficiary and such claimants feel they are entitled to receive such benefits,
then a written claim must be made to the administrator named above within sixty
(60) days from the date payment is refused. The administrator shall review the
written claim and if the claim is denied, in whole or in part, shall provide in
writing within 90 days of receipt of such claim the specific reasons for such
denial, reference to the provisions of this Agreement upon which the denial is
based, and any additional material or information necessary to perfect the
claim. Such written notice shall further indicate the additional steps to be
taken by claimants if a further review of the claim denial is desired. A claim
shall be deemed denied if the administrator fails to take any action within the
aforesaid ninety (90) day period.
If the claimants desire a second review, they shall notify the named
fiduciary in writing within sixty (60) days of receipt of such claim. This
decision shall likewise state the specific reasons for the decision and shall
include reference to specific provisions of the Agreement upon which the
decision is based.
The parties hereto agree that they and their heirs, personal
representatives, successors, and assigns shall be bound by the decision of the
named fiduciary with respect to any claim properly submitted to it for
determination.
64
ARTICLE V
MISCELLANEOUS
A. Alienability and Assignment Prohibition. Neither the Executive, his
spouse, nor any other beneficiary hereunder shall have any power or right to
transfer assign, anticipate, hypothecate, mortgage, commute, modify, or
otherwise encumber in advance any of the benefits payable hereunder, nor shall
any of said benefits be subject to seizure for the payment of any debts,
judgments, alimony, or separate maintenance owed by the Executive or his
beneficiary, nor be transferable by operation of law in the event of bankruptcy
or insolvency or otherwise. In the event the Executive or any beneficiary
attempts assignment, commutation, hypothecation, transfer, or disposal of the
benefits hereunder, the Bank's liabilities hereunder shall forthwith cease and
terminate.
B. Gender and Headings. 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. Headings
and subheadings in this Agreement are inserted for reference and convenience
only and shall not be deemed a part of the Agreement.
C. Effect on Other Bank Benefit Agreements. Nothing contained in this
Agreement shall affect the right of the Executive to participate in or be
covered under any qualified or nonqualified pension, profit sharing, group life
insurance, bonus, or other supplemental compensation or fringe benefit plan or
arrangement constituting a part of the Bank's existing or future compensation
and benefits structure. The Executive acknowledges that this Agreement replaces
and supersedes any prior agreement relating to the provision of death benefits
to the Executive, including the Executive's Executive Death Benefit Agreement in
the form of a split dollar agreement relating to certain life insurance policies
issued by Security Life of Denver and owned by the Bank, but excluding any
supplemental retirement or similar arrangement which provides the Executive with
a death benefit.
D. Amendment and Termination. This Agreement may be amended or
terminated at any time or times, in whole or in part, by the mutual written
consent of the Executive and the Bank. The Bank may amend this Agreement
unilaterally at any time or times, so long as no such unilateral amendment has
the effect of revoking or decreasing the amount of the death benefit payable
hereunder.
E. Applicable Law. The validity and interpretation of this Agreement
shall be governed by the laws of the State of Michigan.
F. Definitions. The following definitions shall apply for purposes of
this Agreement:
"Benefit Factor" shall mean 3.
"Cause" shall mean termination of the Executive's employment
because of the Executive's personal dishonesty, willful
misconduct, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, or a
willful
65
violation of any law, rule or regulation (other than traffic
violations or similar offenses).
"Change in Control" shall mean an event occurring:
(i) at such time as any "person" (as the term is used in
Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended ("Exchange Act")) is or
becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or
indirectly, of voting securities of the Corporation
representing 25% or more of the outstanding voting
securities of IBT Bancorp, Inc. (the "Corporation")
or the right to acquire such securities, except for
any voting securities purchased by any employee
benefit plan of the Corporation or its subsidiaries;
(ii) at such time as individuals who constitute the Board
of Directors of the Corporation on the date hereof
(the "Incumbent Board") cease for any reason to
constitute at least a majority thereof, provided that
any person becoming a director subsequent to the date
hereof whose election was approved by a vote of at
least three-quarters of the directors constituting
the Incumbent Board (or members who were nominated
for election by the Corporation's stockholders was
approved by a nominating committee solely composed of
members which are Incumbent Board members (or members
nominated by the Incumbent Board), shall be, for
purposes of this clause (b), considered as though he
or she were a member of the Incumbent Board;
(iii) at such time as a reorganization, merger,
consolidation, or similar transaction occurs or is
effectuated as a result of which 60% of shares of the
common stock of the resulting entity are owned by
persons who were not stockholders of the Corporation
immediately prior to the consummation of the
transaction; or
(iv) at such time as substantially all of the assets of
the Corporation are sold or otherwise transferred to
another corporation or other entity that is not
controlled by the Corporation.
"Disability" shall mean any mental or physical condition, with
respect to which an individual qualifies for and receives
benefits under a long-term disability plan or coverage under
such a plan, "Disability" shall mean a physical or mental
condition which, in the sole discretion of the Bank, is
reasonably expected to be of indefinite duration and to
substantially prevent the individual from fulfilling his
duties or responsibilities to the Bank.
"Early Retirement" shall mean the Executive's termination of
employment (other than for Cause) at or after attaining age 55
but prior to attaining age 65.
66
"Retirement" shall mean the Executive's termination of
employment (other than for Cause) at or after attaining age
65.
IN WITNESS WHEREOF, the Executive and Bank, by their signatures below,
hereby acknowledge their agreement to the terms and provisions contained herein,
all effective as of the date first written above.
XXXXXXXX BANK AND TRUST
By:
---------------------------
---------------------------
Executive
IBT Bancorp
Form 10-K
67
