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EXHIBIT 10(h)
EXECUTIVE SUPPLEMENTAL BENEFIT AGREEMENT
XXXX X. XXXXXXX
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EXECUTIVE SUPPLEMENTAL BENEFIT AGREEMENT
This AGREEMENT made and entered into effective July l5, l997 by and
between The Strongsville Savings Bank (the "Bank"), a corporation organized and
existing under the laws of the State of Ohio, with its principal office at
l4092 Pearl Road, Strongsville, Ohio, and Xxxx X. Xxxxxxx (the "Executive").
WHEREAS, the Executive is and has been an employee of the Bank and
currently is serving as the Bank's Executive Vice President;
WHEREAS, the Bank wishes to recognize that Executive has rendered
valuable services to the Bank and has made substantial contributions to the
success and growth of the Bank;
WHEREAS, the Bank wishes to have the benefit of Executive's continued
services and to provide an incentive to Executive to continue to provide such
services and contribute to the Bank's future success and growth;
WHEREAS, the Executive is willing to continue in the employ of the
Bank and to continue to perform such duties as assigned by the Board of
Directors of the Bank, if the Bank provides the benefits specified in this
Agreement;
NOW, THEREFORE, in consideration of the mutual promises of the parties
and the mutual benefits to be gained by the performance thereof, the parties
hereto, intending to be legally bound hereby, agree as follows:
SECTION L. DEFINITIONS.
As used in this Agreement, the following terms shall have the meanings
indicated:
(a) "Bank" shall mean, in addition to The Strongsville Savings Bank,
any parent or subsidiary of The Strongsville Savings Bank.
(b) "Retirement Date" shall mean the first day of any calendar month
following the Executive's 65th birthday on which the Executive elects to
retire, or such earlier date as the Board of Directors of the Bank, by
resolution, may agree to grant Executive early retirement.
(c) "Account Balance" shall mean all amounts provided for in this
Agreement, including the Bank's initial contribution as defined in Section
8(a), and any earnings or appreciation thereon. The Account Balance shall be
maintained and invested by the Bank on behalf of the Executive. Although the
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Account Balance shall remain an asset of the Bank until it is distributed, the
Account Balance shall be segregated from the Bank's other assets.
SECTION 2. SUPPLEMENTAL RETIREMENT BENEFITS.
(a) Provided that Executive has remained continuously in the employ of
the Bank (except for normal vacation time and such other leaves of absence as
may be approved by the Board of Directors of the Bank), the Executive shall
vest in the Account Balance provided for in this Agreement each year on a pro
rata basis beginning with the one year anniversary date of the effective date
of this Agreement and continuing with each succeeding annual anniversary date
thereafter until the Executive's attainment of age sixty-five (65). Upon the
Executive's attainment of age sixty-five (65), the Executive shall be fully
vested in the Account Balance. In the event that the Executive dies or becomes
permanently disabled while in the employ of the Bank and prior to age
sixty-five (65), the Account Balance will fully vest upon the death or
permanent disability.
(b) As of the first day of the calendar month following the
Executive's Retirement Date and on each annual anniversary date thereafter, the
Executive's vested Account Balance shall be distributed to the Executive in
annual installments on a pro rata basis each year for a period of twenty (20)
years.
(c) The Executive may petition the Compensation Committee of the Board
of Directors of the Bank, to have the entire vested Account Balance paid in a
single lump sum rather than in annual installments as provided in Paragraph (b)
of this Section.
SECTION 3. EARLY RETIREMENT
In the event the Executive wishes to retire prior to attaining age
sixty-five (65), the Board of Directors of the Bank may agree, by resolution,
to fully vest the Executive in the entire Account Balance. The Board of
Directors of the Bank may also agree, by resolution and with the approval of
the Executive, to begin payment of the Executive's Account Balance prior to the
Executive's attainment of age sixty-five (65). However, in no event may the
amounts paid to the Executive be less than his entire vested Account Balance
and the distributions of such must begin no later than the first day of the
calendar month following the Executive's attainment of age sixty-five (65).
SECTION 4. DISABILITY
(a) For purposes of this Agreement, total disability means the
Executive's inability to engage in his occupation as a result of a bodily
injury or sickness. If this disability lasts for twenty-four (24) consecutive
months, then for the rest of the period of such disability, total disability
means his inability to engage in any gainful occupation for which he is fitted
due to your education, training and experience. Any one of the following events
also constitutes total disability: the total and irrecoverable loss of speech
or hearing; the loss of sight of both eyes; the severance of both hands at or
above the wrist; the severance of both feet at or above the ankles; or the
severance of one entire hand and one entire foot.
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(b) If any dispute arises as to whether the Executive is or was
physically or mentally unable to perform his duties pursuant to this Agreement,
or whether his disability has ceased and he is able to resume his duties, the
parties shall submit such questions to a licensed physician agreed upon by the
parties, or, if the parties are unable to agree, to a licensed physician
appointed by the President of the Academy of Medicine of Cleveland, Cleveland,
Ohio, at the request of either party. The Executive shall submit to such
examinations and provide information as such physician may request and the
determination of such physical as to Executive's physical or mental condition
shall be binding and conclusive on the parties. The Bank agrees to pay the cost
of any such physician and examinations.
SECTION 5. DEATH BENEFITS.
(a) In the event that Executive dies while in the employ of the Bank
and prior to the Retirement Date, Executive's designated beneficiary shall
succeed to the rights of Executive to receive the distributions from the
Account Balance under Section 2(b) hereof, and the date of Executive's death
shall be deemed to be the Retirement Date hereunder. It is hereby expressly
acknowledged that the Executive's designated beneficiary shall also have the
right under Section 2(c) hereof to petition the Compensation Committee of the
Board of Directors to have the Account Balance paid as a lump sum. If no
beneficiary has been designated by Executive, such amounts shall be paid to
Executive's estate in annual installments, it being expressly acknowledged that
Executive's estate has the right to petition that the Account Balance be
distributed in a lump sum as provided in Section 2(c) hereof.
(b) In the event that the Executive dies while receiving distributions
from the Account Balance during retirement, the Executive's designated
beneficiary shall succeed to the rights of the Executive to receive the
distributions under Section 2(b) or Section 2(c) hereof. If no beneficiary has
been designated by the Executive, such amounts shall be paid to the Executive's
estate in annual installments, it being expressly acknowledged that the
Executive's estate has the right to petition that the Account Balance be
distributed in a lump sum as provided in Section 2(c) hereof.
SECTION 6. CHANGE IN CONTROL OF THE BANK.
(a) This Agreement shall be binding upon and inure to the benefit of
all successors and assigns of the Bank and Executive. In the event of a change
in control of the Bank, the entire Account Balance provided for hereof shall
become vested and be immediately paid in full to the Executive.
(b) For purposes of this Agreement, a change in control shall mean:
(i) The acquisition by a person or persons acting in concert
of the power to vote twenty-five percent (25%) or more of a class
of the voting securities of Emerald Financial Corp.
("Corporation"), or the acquisition by a person of the power to
direct the Corporation's management or policies, if the Board of
Directors or the Office of Thrift Supervision or successor
regulatory agency has made a determination that such acquisition
constitutes or will constitute an acquisition of control of the
Corporation for the purposes
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of the Savings and Loan Holding Company Act or the Change in Bank
Control Act and the regulations thereunder;
(ii) during any period of two (2) consecutive years during
the term of this Agreement, individuals who at the beginning of
such period constitute the Board of Directors of the Bank or
Corporation cease for any reason to constitute at least a
majority thereof, unless the election of each director who was
not a director at the beginning of such period has been approved
in advance by directors representing at least two thirds (2/3) of
the directors then in office who were directors in office at the
beginning of the period:
(iii) the Corporation shall have merged into or consolidated
with another corporation, or merged another corporation into the
Corporation, on a basis whereby less than fifty percent (50%) of
the total voting power of the surviving corporation is
represented by shares held by former shareholders of the
Corporation prior to such merger or consolidation: or
(iv) the Corporation shall have sold substantially all of
its assets to another person. The term "person" refers to an
individual, corporation, partnership, trust, association, joint
venture, pool, syndicate, sole proprietorship, unincorporated
organization or other entity.
SECTION 7. TERMINATION FOR CAUSE OR AS A RESULT OF CERTAIN REGULATORY
ACTIONS.
(a) In the event of the termination of Executive for Cause, the Bank
shall have no further obligations under this Agreement other than payment to
the Executive at the Retirement Date of any vested portion of the Account
Balance.
(b) For purposes of the Agreement, Cause shall be defined as
termination as a result of Executive's personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any law,
rule or regulation (other than traffic violations or similar offenses) or final
cease-and-desist order, or material breach of any provision of this Agreement.
(c) If any of the events specified in Section 563.39(b)(2) through (5)
of the OTS regulations (or any successor provision thereto) shall occur,
Executive's rights under this Agreement shall be determined in accordance with
the provisions of such Sections.
SECTION 8. FUNDING OF BENEFITS.
(a) An initial amount of $307,827.00 shall represent the Bank's
initial contribution under this Agreement. Although this amount will remain as
an asset of the Bank, it shall be segregated from the Bank's other assets and
maintained in an account on behalf of the Executive. The entire Account Balance
shall be invested and the earnings and appreciation thereon shall accrue to the
Executive's Account Balance.
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(b) The Executive shall be credited with the earnings on the Account
Balance as of the end of each year. In the event that the Executive's Account
Balance is distributed other than at the end of any year, the account shall be
credited with earnings thereon from the end of the immediately preceding year
to the date of the distribution. No earnings shall be credited to the Executive
after the date of the distribution of his balance. Earnings to be credited for
any period shall be at a rate equal to the time weighted return earned during
the corresponding year on the Account Balance held on behalf of the Executive.
(c) The right of the Executive or any successor or assign of the
Executive to receive distributions from the Account Balance under this
Agreement shall be no greater than the rights of an unsecured creditor of the
Bank.
SECTION 9. NOTICES.
All notices or other communications under this Agreement shall be made
in writing as follows:
(a) If to the Bank:
Corporate Secretary
The Strongsville Savings Bank
l4092 Xxxxx Xxxx
Xxxxxxxxxxxx, Xxxx 00x00
(b) If to the Executive:
Xx. Xxxx X. Xxxxxxx
00000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxxxxxxx, Xxxx 00000
SECTION 10. CLAIMS PROCEDURES.
Claims under this Agreement shall be made in writing by Executive or
his duly authorized representative pursuant to Section 9 hereof. All claims
shall be processed within l5 days of receipt by the Bank. If a claim under this
Agreement is wholly or partially denied, the Bank shall provide a written
notice to the Executive within five (5) business days of such denial, setting
forth:
(a) The specific reason or reasons for the denial;
(b) Specific reference to the pertinent provisions of this Agreement
upon which the denial is based; and
(c) A description of any additional material or information necessary
for Executive to perfect the claim and an explanation of why such material or
information is necessary.
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Within 15 days of receipt of such additional material or information
or receipt of Executive's request for a review of the denial of his claim, the
Bank shall provide Executive with its final determination of his claim.
In the event that Executive disputes the Bank's final determination of
his claim, such dispute shall be subject to final and binding arbitration in
the City of Cleveland, County of Cuyahoga, Ohio, pursuant to the rules and
procedures of the American Arbitration Association.
SECTION 11. PAYMENT OF TAXES.
The Bank shall have the right to deduct from all benefits paid
hereunder any Federal, state or local taxes required by law to be withheld with
respect to such benefit payments.
SECTION 12. NO ATTACHMENT.
Neither this Agreement nor any benefit payable under this Agreement
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge or to execution, attachment, levy or
similar process or assignment by operation of law, and any attempt, voluntary
or involuntary, to effect any such action shall be void and of no effect.
SECTION 13. ENTIRE AGREEMENT: NO EMPLOYMENT AGREEMENT.
This Agreement contains the entire understanding between the parties
hereto with respect to the matters covered herein, except that this Agreement
shall not affect or operate to reduce any benefit or compensation inuring to
Executive of a kind elsewhere provided and not expressly provided in this
Agreement. This Agreement shall not be construed as an employment contract, nor
shall it be construed in any manner so as to restrict the Bank's or the
Executive's ability to terminate his/her employment with the Bank.
SECTION 14. AMENDMENT.
This Agreement may not be modified or amended by the parties hereto
except by an instrument in writing signed by all of the parties.
SECTION 15. SEVERABILITY.
If, for any reason, any provision of this Agreement is held invalid,
such invalidity shall not affect any other provision of this Agreement not held
so invalid, and each such other provision shall, to the full extent consistent
with the law, continue in full force and effect. If any provision of this
Agreement shall be held invalid in part, such invalidity shall in no way affect
the rest of such provision not held so invalid,
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and the rest of such provision, together with all other provisions of this
Agreement shall, to the full extent consistent with the law, continue in full
force and effect.
SECTION 16. HEADINGS.
The headings of Sections herein are included solely for convenience of
reference and shall not affect the meaning or interpretation of any provision
of this Agreement.
SECTION 17. GOVERNING LAW.
This Agreement was made and entered into in the State of Ohio and the
laws of said State shall govern the interpretation, construction and legal
effect of this Agreement and the rights and liabilities of the parties hereto.
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed, sealed
and attested on its behalf by its duly authorized officers and the Executive
has hereunto set his/her hand as of the day and year first above written.
ATTEST: THE STRONGSVILLE SAVINGS BANK
\s\ XXXXX X. XXXXX \s\ XXXXXX X. XXXXXXX
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BY: Xxxxxx X. Xxxxxxx
President
[Corporate Seal]
WITNESS:
\s\ XXXXX X. XXXXX \s\ XXXX X. XXXXXXX
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Xxxx X. Xxxxxxx
Executive
