TierOne Corporation AMENDED AND RESTATED 2003 RECOGNITION AND RETENTION PLAN AND TRUST AGREEMENT
Exhibit 10.14
ARTICLE I
ESTABLISHMENT OF THE PLAN AND TRUST
ESTABLISHMENT OF THE PLAN AND TRUST
1.01 TierOne Corporation (the “Corporation”) hereby amends and restates its 2003 Recognition
and Retention Plan (as amended and restated, the “Plan”) and Trust (the “Trust”) upon the terms and
conditions hereinafter stated in this amended and restated 2003 Recognition and Retention Plan and
Trust Agreement (the “Agreement”), with the amendment and restatement effective as of July 27,
2006.
1.02 The Trustee hereby accepts this Trust and agrees 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
PURPOSE OF THE PLAN
The purpose of the Plan is to retain personnel of experience and ability in key positions by
providing Employees and Non-Employee Directors with a proprietary interest in the Corporation and
its Subsidiary Companies as compensation for their contributions to the Corporation and the
Subsidiary Companies and as an incentive to make such contributions in the future. Each Recipient
of a Plan Share Award hereunder is advised to consult with his or her personal tax advisor with
respect to the tax consequences under federal, state, local and other tax laws of the receipt of a
Plan Share Award hereunder.
ARTICLE III
DEFINITIONS
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 TierOne Bank, the wholly owned subsidiary of the Corporation.
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.
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3.03 “Board” means the Board of Directors of the Corporation.
3.04 “Change in Control of the Corporation” 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 as
provided under Section 409A of the Code and the regulations thereunder.
3.05 “Code” means the Internal Revenue Code of 1986, as amended.
3.06 “Committee” means the committee appointed by the Board pursuant to Article IV hereof.
3.07 “Common Stock” means shares of the common stock, $0.01 par value per share, of the
Corporation.
3.08 “Director” means a member of the Board of Directors of the Corporation or a Subsidiary
Corporation or any successors thereto, including Non-Employee Directors as well as Officer and
Employees serving as Directors.
3.09 “Director Emeritus” and “Advisory Director” means a person appointed to serve in such
capacity by the Board of either the Corporation or the Bank or the successors thereto.
3.10 “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).
3.11 “Effective Date” means the day upon which the Board originally adopted this Plan, which
was February 28, 2003.
3.12 “Employee” means any person who is employed by the Corporation or a Subsidiary Company or
is an Officer of the Corporation or a Subsidiary Company, but not including directors who are not
also Officers of or otherwise employed by the Corporation or a Subsidiary Company.
3.13 “Employer Group” means the Corporation and any Subsidiary Company which, with the consent
of the Board, agrees to participate in the Plan.
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3.14 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
3.15 “Non-Employee Director” means a member of the Board (including advisory boards, if any)
of the Corporation or any Subsidiary Company or any successor thereto, including an Advisory
Director or a Director Emeritus of the Board of the Corporation and/or any Subsidiary Company or a
former Officer or Employee of the Corporation and/or any Subsidiary Company serving as a Director,
Advisory Director or Director Emeritus, who is not an Officer or Employee of the Corporation or any
Subsidiary Company.
3.16 “Offering” means the offering of Common Stock to the public during 2002 in connection
with the conversion of the Bank from the mutual to the stock form of organization and the issuance
of the capital stock of the Bank to the Corporation.
3.17 “Officer” means an Employee whose position in the Corporation or a Subsidiary Company is
that of a corporate officer, as determined by the Board.
3.18 “Performance Share Award” means a Plan Share Award granted to a Recipient pursuant to
Section 7.05 of the Plan.
3.19 “Performance Goal” means an objective for the Corporation or any Subsidiary Company or
any unit thereof or any Employee of the foregoing that may be established by the Committee for a
Performance Share Award to become vested, earned or exercisable. The establishment of Performance
Goals are intended to make the applicable Performance Share Awards “performance-based” compensation
within the meaning of Section 162(m) of the Code, and the Performance Goals shall be based on one
or more of the following criteria:
| (i) | net income, as adjusted for non-recurring items; | ||
| (ii) | cash earnings; | ||
| (iii) | earnings per share; | ||
| (iv) | cash earnings per share; | ||
| (v) | return on average equity; | ||
| (vi) | return on average assets; | ||
| (vii) | assets; | ||
| (viii) | stock price; | ||
| (ix) | total stockholder return; | ||
| (x) | capital; | ||
| (xi) | net interest income; | ||
| (xii) | market share; | ||
| (xiii) | cost control or efficiency ratio; and | ||
| (xiv) | asset growth. |
3.20 “Plan Shares” or “Shares” means shares of Common Stock which may be distributed to a
Recipient pursuant to the Plan.
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3.21 “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
hereof, and includes Performance Share Awards.
3.22 “Recipient” means an Employee or Non-Employee Director or former Employee or Non-Employee
Director who receives a Plan Share Award or Performance Share Award under the Plan.
3.23 “Retirement” means:
(a) A termination of employment which constitutes a “retirement” at the “normal retirement
age” or later under the TierOne Bank Savings Plan or such other qualified pension benefit plan
maintained by the Corporation or a Subsidiary Company as may be designated by the Board or the
Committee, or, if no such plan is applicable, which would constitute “retirement” under the TierOne
Bank Savings Plan, if such individual were a participant in that plan, provided, however, that the
provisions of this subsection (a) will not apply as long as a Recipient continues to serve as a
Non-Employee Director; and provided further that no “retirement” shall be deemed to have occurred
prior to the one-year anniversary of the grant of a Plan Share Award.
(b) With respect to Non-Employee Directors, retirement means retirement from service on the
Board of Directors of the Corporation or a Subsidiary Company or any successors thereto (including
service as a Director Emeritus or Advisory Director to the Corporation or any Subsidiary Company)
after reaching age 65 and having served as a member of the Board Directors of the Corporation
and/or the Bank for a period of 10 years or more; provided that no “retirement” shall be deemed to
have occurred prior to the one-year anniversary of the grant of a Plan Share Award.
3.24 “Subsidiary Companies” means those subsidiaries of the Corporation, including the Bank,
which meet the definition of “subsidiary corporations” set forth in Section 424(f) of the Code, at
the time of the granting of the Plan Share Award in question.
3.25 “Trustee” means such firm, entity or persons approved by the Board to hold legal title to
the Plan and the Plan assets for the purposes set forth herein.
ARTICLE IV
ADMINISTRATION OF THE PLAN
ADMINISTRATION OF THE PLAN
4.01 Duties of the Committee. The Plan shall be administered and interpreted by the
Committee, which shall consist of two or more members of the Board, each of whom shall be a
Non-Employee Director, as defined in Rule 16b-3(b)(3)(i) of the Exchange Act. In addition, each
member of the Committee shall be an “outside director” within the meaning of Section 162(m) of the
Code and the regulations thereunder at such times as is required under such regulations. The
Committee shall have all of the powers allocated to it in this and other Sections of the Plan. The
interpretation and construction
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by the Committee of any provisions of the Plan or of any Plan Share Award granted hereunder shall
be final and binding in the absence of action by the Board. 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 once per calendar year.
4.02 Role of the Board. The members of the Committee and the Trustee 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
or replace the Trustee, provided that any directors who are selected as members of the Committee
shall be Non-Employee Directors.
4.03 Revocation for Misconduct. Notwithstanding anything to the contrary herein, the
Board or the Committee may by resolution immediately revoke, rescind and terminate any Plan Share
Award, or portion thereof, to the extent not yet vested, previously granted or awarded under this
Plan to an Employee who is discharged from the employ of the Corporation or a Subsidiary Company
for cause, which, for purposes hereof, shall mean termination because of the Employee’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. Unvested Plan
Share Awards to a Non-Employee Director who is removed for cause pursuant to the Corporation’s
Articles of Incorporation or Bylaws or the Bank’s Charter and Bylaws or the constituent documents
of such other Subsidiary Company on whose board he serves shall terminate as of the effective date
of such removal.
4.04 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 it. 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 Subsidiary Companies and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful.
4.05 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 shareholders as may be required. The Corporation shall not
be required to issue or deliver any certificates for shares of
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Common Stock prior to the completion of any registration or qualification of or obtaining of
consents or approvals with respect to such shares under any Federal or state law or any rule or
regulation of any government body, which the Corporation shall, in its sole discretion, determine
to be necessary or advisable.
4.06 Restrictions on Transfer. The Corporation may place a legend upon any
certificate representing shares issued pursuant to a Plan Share Award noting that such shares may
be restricted by applicable laws and regulations.
ARTICLE V
CONTRIBUTIONS
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
Subsidiary Companies 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 or Non-Employee Directors shall be permitted.
5.02 Investment of Trust Assets; Number of Plan Shares. Subject to Section 8.02
hereof, the Trustee shall invest all of the Trust’s assets primarily in Common Stock. The
aggregate number of Plan Shares available for distribution pursuant to this Plan shall be 903,003
shares of Common Stock, subject to adjustment as provided in Section 10.01 hereof, which shares
shall be purchased (from the Corporation and/or, if permitted by applicable regulations, from
shareholders thereof) by the Trust with funds contributed by the Corporation. During the time this
Plan remains in effect, Awards to each Employee and each Non-Employee Director shall not exceed 25%
and 5% of the shares of Common Stock available under the Plan, respectively. Plan Share Awards to
Non-Employee Directors in the aggregate shall not exceed 30% of the number of shares available
under this Plan.
ARTICLE VI
ELIGIBILITY; ALLOCATIONS
ELIGIBILITY; ALLOCATIONS
6.01 Awards. Plan Share Awards and Performance Share Awards may be made to such
Employees and Non-Employee Directors as may be selected by the Board or the Committee. In
selecting those Employees to whom Plan Share Awards and/or Performance Share Awards may be granted
and the number of Shares covered by such Awards, the Board or the Committee shall consider the
duties, responsibilities and performance of each respective Employee and Non-Employee Director, his
present and potential contributions to the growth and success of the Corporation, his salary or
other compensation and such other factors as deemed relevant to accomplishing the purposes of the
Plan. The Board or 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 and/or Performance Share Awards to be granted to him.
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6.02 Form of Allocation. As promptly as practicable after an allocation pursuant to
Section 6.01 that a Plan Share Award or a Performance Share Award is to be issued, the Board or 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 Recipient. The Board or the Committee shall maintain records as to all grants
of Plan Share Awards or Performance Share Awards under the Plan.
6.03 Allocations Not Required to any Specific Employee or Non-Employee Director. No
Employee or Non-Employee Director shall have any right or entitlement to receive a Plan Share Award
hereunder, such Awards being at the total discretion of the Board or the Committee.
ARTICLE VII
EARNING AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
EARNING AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS
7.01 Earning Plan Shares; Forfeitures.
(a) General Rules. Subject to the terms hereof, Plan Share Awards granted 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
an Employee or service as a Non-Employee Director (including for purposes hereof service as a
Director Emeritus or Advisory Director) 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) and (c) below), the Recipient shall forfeit the right to any Shares subject to the
Award which have not theretofore been earned. In the event of a forfeiture of the right to any
Shares subject to an Award, such forfeited Shares shall become available for allocation pursuant to
Section 6.01 hereof as if no Award had been previously granted with respect to such Shares. No
fractional shares shall be distributed pursuant to this Plan.
(b) Exception for Terminations Due to Death, Disability or Change in Control.
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 Company or
service as a Non-Employee Director (including for purposes hereof service as a Director Emeritus or
Advisory Director) terminates due to death or Disability shall be deemed earned as of the
Recipient’s last day of employment with or service to the Corporation or any Subsidiary Company
(provided, however, no such accelerated vesting shall occur if a Recipient remains employed by or
continues to serve as a Director (including for purposes hereof service as a Director Emeritus or
Advisory Director) of at least one member of the Employer Group) and shall be distributed as soon
as practicable thereafter. Furthermore, 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 earned
as of the effective date of a Change in Control.
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(c) Exception for 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 on the date a Recipient terminates his employment or service as a Non-Employee Director
(including for purposes hereof service as a Director Emeritus or Advisory Director) with the
Corporation or a Subsidiary Company due to Retirement if, as of the date of such Retirement (i)
such treatment is either authorized or is not prohibited by applicable laws and regulations, or
(ii) an amendment to the Plan providing for such treatment has been approved by shareholders of the
Corporation at a meeting of the shareholders held more than one (1) year after the consummation of
the Offering.
7.02 Distribution of Dividends. Any cash dividends (including special large and
nonrecurring dividends and including any that has the effect of a return of capital to the
Corporation’s shareholders) or stock dividends declared in respect of each unvested Plan Share
Award (excluding any unearned Performance Share Awards) then held by the Trust will be paid out
proportionately by the Trust to the Recipient thereof 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. Any
cash dividends, stock dividends or returns of capital declared in respect of each unvested
Performance Share Award will be held by the Trust for the benefit of the Recipient on whose behalf
such Performance Share Award is then held by the Trust, and such dividends or returns of capital,
including any interest thereon, will be paid out proportionately by the Trust to the Recipient
thereof as soon as practicable after the Performance Share Awards become earned.
7.03 Distribution of Plan Shares.
(a) Timing of Distributions: General Rule. Subject to the provisions of Section
7.05 hereof, 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.
(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 Trustee 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 Trustee may require the
Recipient or Beneficiary to pay to the Trustee the amount required to be withheld as a condition of
delivering the Plan Shares. The Trustee shall pay over to the Corporation or any Subsidiary
Company which employs or employed such Recipient any such amount withheld from or paid by the
Recipient or Beneficiary.
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(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. Upon distribution, the Board or 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 Board or 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 Board or the Committee, upon the
advice of counsel, may deem appropriate.
7.04 Voting of Plan Shares. After a Plan Share Award (other than a Performance Share
Award) has been made, the Recipient shall be entitled to direct the Trustee 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. All shares of Common Stock held by the Trust which have not been
awarded under a Plan Share Award and shares subject to Performance Share Awards which have not yet
vested and shares which have been awarded as to which Recipients have not directed the voting shall
be voted by the Trustee in its discretion.
7.05 Performance Awards
(a) Designation of Performance Share Awards. The Committee may determine to make any
Plan Share Award a Performance Share Award by making such Plan Share Award contingent upon the
achievement of a Performance Goal or any combination of Performance Goals. Each Performance Share
Award shall be evidenced by a written agreement (“Award Agreement”), which shall set forth the
Performance Goals applicable to the Performance Share Award, the maximum amounts payable and such
other terms and conditions as are applicable to the Performance Share Award. Each Performance
Share Award shall be granted and administered to comply with the requirements of Section 162(m) of
the Code, or any successor thereto and with OTS Regulatory Bulletin 27a and Thrift Activities
Handbook Section 310, or any successors thereto.
(b) Timing of Grants. Any Performance Share Award shall be made not later than 90
days after the start of the period for which the Performance Share Award relates and shall be made
prior to the completion of 25% of such period. All determinations regarding the achievement of any
Performance Goals will be made by the Committee. The Committee may not increase during a year the
amount of a Performance Share Award that would otherwise be payable upon achievement of the
Performance Goals but may reduce or eliminate the payments as provided for in the Award Agreement.
(c) Restrictions on Grants. Nothing contained in the Plan will be deemed in any way
to limit or restrict the Committee from making any Award or
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payment to any person under any other plan, arrangement or understanding, whether now existing or
hereafter in effect.
(d) Rights of Recipients. Notwithstanding anything to the contrary herein, a
Participant who receives a Performance Share Award payable in Common Stock shall have no rights as
a shareholder until the Common Stock is issued pursuant to the terms of the Award Agreement.
(e) Nontransferable. Plan Share Awards and Performance 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 Company be
subject to any claim for benefits hereunder.
(f) Distribution. No Performance Share Award or portion thereof that is subject to
the attainment or satisfaction of a condition of a Performance Goal shall be distributed or
considered to be earned or vested until the Committee certifies in writing that the conditions or
Performance Goal to which the distribution, earning or vesting of such Award is subject have been
achieved.
ARTICLE VIII
TRUST
TRUST
8.01 Trust. The Trustee 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 Trustee shall invest all assets of the Trust in Common Stock
to the fullest extent practicable, except to the extent that the Trustee determines that the
holding of monies in cash or cash equivalents is necessary to meet the obligations of the Trust.
In performing their duties, the Trustee 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 Trustee is 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.
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(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 Trustee be
reasonable for the proper operation of the Plan and Trust.
(f) To employ brokers, agents, custodians, consultants and accountants.
(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 Trustee 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 Trustee 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 Board or the Committee.
8.04 Expenses. All costs and expenses incurred in the operation and administration of
this Plan shall be borne by the Corporation or, in the discretion of the Corporation, the Trust.
8.05 Indemnification. Subject to the requirements of applicable laws and regulations,
the Corporation shall indemnify, defend and hold the Trustee harmless against all claims, expenses
and liabilities arising out of or related to the exercise of the
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Trustee’s powers and the discharge of their duties hereunder, unless the same shall be due to their
gross negligence or willful misconduct.
ARTICLE IX
DEFERRED PAYMENTS
DEFERRED PAYMENTS
9.01 Deferral of Plan Shares. Notwithstanding any other provision of this Plan, any
Recipient may elect on or before December 31, 2004 to defer the receipt of Plan Shares granted
hereunder in accordance with the Bank’s Amended and Restated Deferred Compensation Plan.
9.02 Timing of Election. The election to defer the delivery of any Plan Shares must
be made no later than the last day of the calendar year preceding the calendar year in which the
Recipient would otherwise have an unrestricted right to receive such Shares. Deferrals of eligible
Plan Shares shall only be allowed for Plan Share Awards for which all applicable restrictions lapse
while the Recipient is in active service with the Corporation or one of the Subsidiary Companies.
Any election to defer the proceeds from an eligible Plan Share Award shall be irrevocable as long
as the Recipient remains an Employee or a Non-Employee Director.
9.03 Share Award Deferral. The deferral of Plan Share Awards may be elected by a
Recipient subject to the rules and regulations established by the Committee. Any shares covered by
such deferred Plan Share Awards may be transferred from this Plan to any trust created by the Bank.
9.04 Accelerated Distributions. The Committee may, at its sole discretion, allow for
the early payment of a Participant’s deferred Plan Share Award account in the event of an
“unforeseeable emergency” or in the event of the death or Disability of the Recipient. An
“unforeseeable emergency” means an unanticipated emergency caused by an event beyond the control of
the Recipient that would result in severe financial hardship if the distribution were not
permitted. Such distributions shall be limited to the amount necessary to sufficiently address the
financial hardship. Any distributions under this provision shall be consistent with the Code and
the regulations promulgated thereunder.
9.05 Assignability. No rights to deferred Recipient accounts may be assigned or
subject to any encumbrance, pledge or charge of any nature except that a Recipient may designate a
beneficiary pursuant to any rules established by the Committee.
9.06 Unfunded Status. No Recipient or other person shall have any interest in any
fund or in any specific asset of the Corporation or any of its Subsidiary Companies by reason of
any amount credited pursuant to the provisions hereof. Any amounts payable pursuant to the
provisions hereof shall be paid from the general assets of the Corporation or one of its Subsidiary
Companies and no Recipient or other person shall have any rights to such assets beyond the rights
afforded general creditors of the Corporation or one of its Subsidiary Companies. However, the
Corporation or one of its Subsidiary Companies shall have the right to establish a reserve or trust
or make any investment for the purpose
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of satisfying the obligations created under this Article IX of the Plan; provided, however, that no
Recipient or other person shall have any interest in such reserve, trust or investment.
ARTICLE X
MISCELLANEOUS
MISCELLANEOUS
10.01 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 unvested
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,
the payment of a stock dividend or other increase or decrease in such shares effected without
receipt or payment of consideration by the Corporation. If, upon a merger, consolidation,
reorganization, liquidation, recapitalization or the like of the Corporation or of another
corporation, the shares of the Corporation’s Common Stock shall be exchanged for other securities
of the Corporation or of another corporation, each Recipient of a Plan Share Award shall
be entitled, subject to the conditions herein stated, to receive such number of shares of Common
Stock or amount of other securities of the Corporation or such other corporation as were
exchangeable for the number of shares of Common Stock of the Corporation which such Recipients
would have been entitled to receive except for such action.
10.02 Amendment and Termination of Plan. The Board may, by resolution, at any time
amend or terminate the Plan, subject to any required shareholder approval or any shareholder
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 any other provision of the Plan, this Plan may not be terminated prior to
such time as all outstanding Plan Share Awards granted to Recipients have been earned or forfeited
in accordance with the Plan.
10.03 Employment or Service Rights. Neither the Plan nor any grant of a Plan Share
Award, Performance Share Award or Plan Shares hereunder nor any action taken by the Trustee, the
Committee or the Board in connection with the Plan shall create any right on the part of any
Employee or Non-Employee Director to continue in such capacity.
10.04 Voting and Dividend Rights. No Recipient shall have any voting or dividend
rights or other rights of a shareholder in respect of any Plan Shares covered by a Plan Share Award
or Performance Share Award, except as expressly provided in Sections 7.02, 7.04 and 7.05 above,
prior to the time said Plan Shares are actually earned and distributed to him.
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10.05 Governing Law. To the extent not governed by federal law, the Plan and Trust
shall be governed by the laws of the State of Nebraska.
10.06 Effective Date. This Plan as originally adopted was effective as of the
Effective Date, and Awards may be granted hereunder no earlier than the date this Plan was approved
by the shareholders of the Corporation and prior to the termination of the Plan. Notwithstanding
the foregoing or anything to the contrary in this Plan, the implementation of this Plan was subject
to the approval of the Corporation’s shareholders, which occurred at a meeting held on April 23,
2003. The amendment and restatement of this Plan shall be effective as of July 27, 2006.
10.07 Term of Plan. This Plan shall remain in effect until the earlier of (i) ten
(10) years from the Effective Date, (ii) termination by the Board, or (iii) the distribution to
Recipients and Beneficiaries of all the assets of the Trust.
10.08 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 et
seq. of the Code, as the same may be amended from time to time.
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 initial
Trustees of the Trust established pursuant hereto have duly and validly executed this Agreement,
all on this 27th day of July 2006.
| TIERONE CORPORATION | TRUSTEES: | |||||||
By: |
/s/ Xxxxxxx X. Xxxxxxxxx | /s/ Xxxxx Person Xxxxxx | ||||||
| Chairman of the Board and | ||||||||
| Chief Executive Officer | ||||||||
| /s/ Xxxxxxxx X. XxXxxxxxx | ||||||||
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