EXHIBIT 10.10.1
LIFE INSURANCE
ENDORSEMENT METHOD SPLIT DOLLAR PLAN
AGREEMENT
Insurer: Northwestern Mutual Life Insurance
Company
Policy Number:
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Bank: Chattahoochee National Bank
Insured:
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Relationship of Insured to Bank: Executive
The respective rights and duties of the Bank and the Insured in the
above-referenced policy shall be pursuant to the terms set forth below:
I. DEFINITIONS
Refer to the policy contract for the definition of any terms in this
Agreement that are not defined herein. If a definition of a term in the
policy is inconsistent with the definition of a term in this Agreement,
then the definition of the term as set forth in this Agreement shall
supersede and replace the definition of the terms as set forth in the
policy.
II. POLICY TITLE AND OWNERSHIP
Title and ownership shall reside in the Bank for its use and for the use
of the Insured all in accordance with this Agreement. The Bank may, to
the extent of its interest, exercise the right to borrow or withdraw on
the policy cash values. Where the Bank and the Insured (or assignee,
with the consent of the Insured) mutually agree to exercise the right to
increase the coverage under the subject Split Dollar policy, then, in
such event, the rights, duties and benefits of the parties to such
increased coverage shall continue to be subject to the terms of this
Agreement.
III. BENEFICIARY DESIGNATION RIGHTS
The Insured (or assignee) shall have the right and power to designate a
beneficiary or beneficiaries to receive the Insured's share of the
proceeds payable upon the death of the Insured, and to elect and change
a payment option for such beneficiary, subject to any
right or interest the Trustee at the direction of the Bank or the Trust
may have in such proceeds, as provided in this Agreement.
IV. PREMIUM PAYMENT METHOD
The Bank shall pay an amount equal to the planned premiums and any other
premium payments that might become necessary to keep the policy in
force.
V. TAXABLE BENEFIT
Annually the Insured will receive a taxable benefit equal to the assumed
cost of insurance as required by the Internal Revenue Service. The Bank
will report to the Insured the amount of imputed income each year on
Form W-2 or its equivalent.
VI. DIVISION OF DEATH PROCEEDS
Subject to Paragraphs VII and IX herein, the division of the death
proceeds of the policy is as follows:
A. Should the Insured be employed by the Bank at the time of death, the
Insured's beneficiary(ies), designated in accordance with Paragraph
III, shall be entitled to an amount equal to the percentage set
forth hereinbelow of the net-at-risk insurance portion of the
proceeds that corresponds to plan year of death. The net-at-risk
insurance portion is the total proceeds less the cash value of the
policy.
Percentage of
Plan Year Net-at-risk to the
Of Death Insured's Beneficiary(ies)
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1 20%
2 30%
3 40%
4 50%
5 60%
6 70%
7 80%
8 or more 90%
B. Should the Insured not be employed by the Bank at the time of his or
her death, the Insured's beneficiary(ies), designated in accordance
with Paragraph III, shall be entitled to the percentage as set forth
hereinbelow of the proceeds described in Subparagraph VI (A) above
that corresponds to the number of full years the Insured has been
employed by the Bank since the date of first employment.
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Number of
Full Years of Vested Percentage
Date of Employment Employment (To a Maximum of 100%)
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1-9 5.56% per year
PLUS
10-14 10% per year
Notwithstanding anything hereinabove to the contrary, the Executive
shall be one hundred percent (100%) vested upon attaining age fifty-five
(55) while employed by the Bank.
C. The Bank shall be entitled to the remainder of such proceeds.
D. The Bank and the Insured (or assignees) shall share in any interest
due on the death proceeds on a pro rata basis as the proceeds due
each respectively bears to the total proceeds, excluding any such
interest.
VII. DIVISION OF THE CASH SURRENDER VALUE OF THE POLICY
The Bank shall at all times be entitled to an amount equal to the
policy's cash value, as that term is defined in the policy contract,
less any policy loans and unpaid interest or cash withdrawals previously
incurred by the Bank and any applicable surrender charges. Such cash
value shall be determined as of the date of surrender or death as the
case may be.
VIII. RIGHTS OF PARTIES WHERE POLICY ENDOWMENT OR ANNUITY ELECTION EXISTS
In the event the policy involves an endowment or annuity element, the
Bank's right and interest in any endowment proceeds or annuity benefits,
on expiration of the deferment period, shall be determined under the
provisions of this Agreement by regarding such endowment proceeds or the
commuted value of such annuity benefits as the policy's cash value. Such
endowment proceeds or annuity benefits shall be considered to be like
death proceeds for the purposes of division under this Agreement.
IX. TERMINATION OF AGREEMENT
This Agreement shall terminate upon the occurrence of any one of the
following:
A. The Insured shall be discharged from employment with the Bank for
cause. The term "for cause" shall mean any of the following that
result in an adverse effect on the Bank: (i) gross negligence or
gross neglect; (ii) the commission of a felony or gross misdemeanor
involving moral turpitude, fraud, or dishonesty; (iii) the willful
violation of any law, rule, or regulation (other than a traffic
violation or
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similar offense); (iv) an intentional failure to perform stated
duties; or (v) a breach of fiduciary duty involving personal profit;
or
B. Surrender, lapse, or other termination of the Policy by the Bank.
Upon such termination, the Insured (or assignee) shall have a
fifteen (15) day option to receive from the Bank an absolute
assignment of the policy in consideration of a cash payment to the
Bank, whereupon this Agreement shall terminate. Such cash payment
referred to hereinabove shall be the greater of:
A. The Bank's share of the cash value of the policy on the date
of such assignment, as defined in this Agreement; or
B. The amount of the premiums which have been paid by the Bank
prior to the date of such assignment.
If, within said fifteen (15) day period, the Insured fails to exercise
said option, fails to procure the entire aforestated cash payment, or
dies, then the option shall terminate and the Insured (or assignee)
agrees that all of the Insured's rights, interest and claims in the
policy shall terminate as of the date of the termination of this
Agreement.
The Insured expressly agrees that this Agreement shall constitute
sufficient written notice to the Insured of the Insured's option to
receive an absolute assignment of the policy as set forth herein.
Except as provided above, this Agreement shall terminate upon
distribution of the death benefit proceeds in accordance with Paragraph
VI above.
X. INSURED'S OR ASSIGNEE'S ASSIGNMENT RIGHTS
The Insured may not, without the written consent of the Bank, assign to any
individual, trust or other organization, any right, title or interest in the
subject policy nor any rights, options, privileges or duties created under
this Agreement.
XI. AGREEMENT BINDING UPON THE PARTIES
This Agreement shall bind the Insured and the Bank, their heirs, successors,
personal representatives and assigns.
XII. ERISA PROVISIONS
The following provisions are part of this Agreement and are intended to meet
the requirements of the Employee Retirement Income Security Act of 1974
("ERISA"):
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A. NAMED FIDUCIARY AND PLAN ADMINISTRATOR.
The "Named Fiduciary and Plan Administrator" of this Endorsement Method
Split Dollar Agreement shall be Chattahoochee National Bank until its
resignation or removal by the Board of Directors. As Named Fiduciary and
Plan Administrator, the Bank shall be responsible for the management,
control, and administration of this Split Dollar Plan as established
herein. The Named Fiduciary may delegate to others certain aspects of
the management and operation responsibilities of the Plan, including the
employment of advisors and the delegation of any ministerial duties to
qualified individuals.
B. FUNDING POLICY.
The funding policy for this Split Dollar Plan shall be to maintain the
subject policy in force by paying, when due, all premiums required.
C. BASIS OF PAYMENT OF BENEFITS.
Direct payment by the Insurer is the basis of payment of benefits under
this Agreement, with those benefits in turn being based on the payment
of premiums as provided in this Agreement.
D. CLAIM PROCEDURES.
Claim forms or claim information as to the subject policy can be
obtained by contacting Benmark, Inc. (800-544-6079). When the Named
Fiduciary has a claim which may be covered under the provisions
described in the insurance policy, they should contact the office named
above, and they will either complete a claim form and forward it to an
authorized representative of the Insurer or advise the named Fiduciary
what further requirements are necessary. The Insurer will evaluate and
make a decision as to payment. If the claim is payable, a benefit check
will be issued in accordance with the terms of this Agreement.
In the event that a claim is not eligible under the policy, the Insurer
will notify the Named Fiduciary of the denial pursuant to the
requirements under the terms of the policy. If the Named Fiduciary is
dissatisfied with the denial of the claim and wishes to contest such
claim denial, they should contact the office named above and they will
assist in making an inquiry to the Insurer. All objections to the
Insurer's actions should be in writing and submitted to the office named
above for transmittal to the Insurer.
XIII. GENDER
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.
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XIV. INSURANCE COMPANY NOT A PARTY TO THIS AGREEMENT
The Insurer shall not be deemed a party to this Agreement, but will
respect the rights of the parties as herein developed upon receiving an
executed copy of this Agreement. Payment or other performance in
accordance with the policy provisions shall fully discharge the Insurer
from any and all liability.
XV. CHANGE OF CONTROL
Change of Control shall be deemed to be the cumulative transfer of more
than fifty percent (50%) of the voting stock of the Bank or the Holding
Company from the date of this Agreement. For the purposes of this
Agreement, transfers on account of death or gifts, transfers between
family members, or transfers to a qualified retirement plan maintained
by the Bank shall not be considered in determining whether there has
been a Change of Control. Upon a Change of Control, if the Insured's
employment is subsequently terminated, except for cause, then the
Insured shall be one hundred percent (100%) vested in the benefits
promised in this Agreement and, therefore, upon the death of the
Insured, the Insured's beneficiary(ies) (designated in accordance with
Paragraph III) shall receive the death benefit provided herein as if the
Insured had died while employed by the Bank (See Subparagraph VI [A]).
XVI. AMENDMENT OR REVOCATION
It is agreed by and between the parties hereto that, during the lifetime
of the Insured, this Agreement may be amended or revoked at any time or
times, in whole or in part, by the mutual written consent of the Insured
and the Bank.
XVII. EFFECTIVE DATE
The Effective Date of this Agreement shall be _________________ .
XVIII. SEVERABILITY AND INTERPRETATION
If a provision of this Agreement is held to be invalid or unenforceable,
the remaining provisions shall nonetheless be enforceable according to
their terms. Further, in the event that any provision is held to be over
broad as written, such provision shall be deemed amended to narrow its
application to the extent necessary to make the provision enforceable
according to law and enforced as amended
XIX. APPLICABLE LAW
The validity and interpretation of this Agreement shall be governed by
the laws of the State of Georgia.
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XX. PREMIUM PAYMENT METHOD AND BANK'S DUE DILIGENCE
Subject to the following, the Bank shall pay an amount equal to the
planned premiums and any other premium payments that might become
necessary to keep the policy in force. The Bank shall exercise due
diligence in reviewing the financial stability of the insurance company
and the policy that are the subject of this Agreement. If the Bank
believes that the Insurer under the policy is financially weak or that
the policy is not performing well, the Bank may, at any time, surrender
the policy or substitute a different policy provided that the Bank is
under no obligation to invest in such replacement policy any more than
the proceeds available from the cash surrender value of the original
policy. The Executive will cooperate by undertaking any necessary
medical examination. If the Bank chooses to surrender the
above-referenced policy without replacing it or the policy otherwise
ceases to exist prior to the death of the Insured, the Bank agrees to
pay the Insured's named beneficiary(ies) as a death benefit under
Paragraph VI of this Agreement.
Executed at Alpharetta, Georgia this ____ day of ____________, 20__.
CHATTAHOOCHEE NATIONAL
BANK
Alpharetta, Georgia
By:
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Title:
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Witness
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BENEFICIARY DESIGNATION FORM
FOR LIFE INSURANCE ENDORSEMENT METHOD
SPLIT DOLLAR PLAN AGREEMENT
PRIMARY DESIGNATION:
Name Address Relationship
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SECONDARY (CONTINGENT) DESIGNATION:
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All sums payable under the Life Insurance Endorsement Method Split
Dollar Plan Agreement by reason of my death shall be paid to the Primary
Beneficiary, if he or she survives me, and if no Primary Beneficiary
shall survive me, then to the Secondary (Contingent) Beneficiary.
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Date
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