EXHIBIT 10.9
DEATH BENEFIT ONLY AGREEMENT
THIS DEATH BENEFIT ONLY AGREEMENT (the "Agreement"), made and entered into
as of the ____________ day of ________________, by and among Xxxxxx Financial
Corporation and its wholly owned subsidiary FFC Management, Inc. (hereafter
jointly or severally the "Company") and ____________________ (the "Executive").
WHEREAS, the Executive is a key employee of the Company and/or its
subsidiaries or affiliates, and the Company wishes to retain the Executive in
its employ and the employ of its subsidiaries and affiliates;
WHEREAS, as an inducement to continued employment, the Company 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 Company 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 an amount such
that after the assessment of individual income taxes at all taxation
levels to which this benefit is subject (assuming the highest marginal
tax rate at each level of taxation in effect at the time of the
Executive's death) the amount remaining shall be equal to the product
of the Benefit Factor and the Executive's base salary. Executive's
base salary shall be 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 $_________.
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(C) 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 the amount as calculated in section A
of Article I. until the Executive reaches age 65, at which time the
Executive will be considered retired for purposes of this Agreement.
Executive's base salary shall be at the annual rate in effect at the
time of the Executive's termination for reason of Disability.
(D) Except as otherwise provided in this Article 1(B) or (C), no benefit
shall be payable under this Agreement on or after the effective date
of the Executive's termination of employment unless such termination
has occurred within 12 months of a Change in Control for reasons other
then Cause. If termination occurs within 12 months of Change in
Control for reason other then Cause, this Agreement and the benefits
due hereunder will remain in full force.
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 Company receives
written notice, in a form and manner acceptable to the Company, of the
Executive's death. In the event the Executive has not designated a beneficiary,
or 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 Company
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
Company 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 Company in the same manner as any other general creditor
of the Company. The Company, on behalf of itself and each subsidiary and
affiliate, 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 Company a source for the payment of the Company'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 Company
elect to do so, in whole or in part, through the purchase of life insurance or
any other funding medium, only the Company 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.
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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
Company or one of its owned subsidiaries or affiliates. This Agreement shall
continue in effect after the Executive's termination of employment with the
Company only if such termination occurs by reason of the Executive's Disability,
Retirement, or within twelve (12) months of a Change in Control. Unless the
termination following a Change in Control is 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 Employee 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
Company. As named fiduciary and administrator, the Company shall be
responsible for the management. control and administration of the plan
in accordance with the provisions of this Agreement. The Company 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.
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If the claimants desire a second review, they shall notify the
named fiduciary in writing within sixty (60) days of receiving notice
of the first claim denial. Claimants may review the Agreement or any
documents relating thereto and submit any written issues and comments
they may feel appropriate. In its sole discretion, the named fiduciary
shall then review the second claim and provide a written decision
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.
If the claimants continue to dispute the benefit denial based
upon completed performance of the Agreement or the meaning and effect
of the terms and conditions thereof, then claimants may submit the
dispute to a Board of Arbitration for final arbitration. Said Board
shall consist of one member selected by the claimant, one member
selected by the Company and the third member selected by the first two
members. The Board shall operate under any generally recognized set of
arbitration rules. The parties hereto agree that they and their heirs,
personal representatives, successors and assigns shall be bound by the
decision of such Board with respect to any controversy properly
submitted to it for determination.
Where a dispute arises as to the Company's discharge of Executive
"for cause", such dispute shall likewise be submitted to arbitration
as above described and the parties hereto agree to be bound by the
decision thereunder.
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 Company'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.
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C. Effect on Other Company Benefit Agreements. Nothing contained in this
Agreement shall affect the right of the Executive to participate in or be
covered under any qualified or non-qualified pension, profit sharing, bonus, or
other supplemental compensation or fringe benefit plan or arrangement
constituting a part of the Company's existing or future compensation and
benefits structure. The Executive acknowledges that this Agreement replaces and
supercedes any prior agreement relating to the provision of death benefits to
the Executive, 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 Company. The Company 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 Delaware.
F. Definitions. The following definitions shall apply for purposes of this
Agreement:
"Benefit Factor" shall mean 2 (two).
"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 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 Company representing 25%
or more of the outstanding voting securities of Xxxxxx Financial
Corporation (the "Company") or the right to acquire such
securities, except for any voting securities purchased by any
employee benefit plan of the Company or its subsidiaries;
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(ii) at such time as individuals who constitute the Board of Directors
of the Company 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 by the Incumbent Board), or whose
nomination for election by the Company'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 Company
immediately prior to the consummation of the transaction;
(iv) at such time as substantially all of the assets of the Company
are sold or otherwise transferred to another Company or other
entity that is not controlled by the Company.
"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 of the Company, or in the absence of such 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 Company, is reasonably expected to be of indefinite
duration and to substantially prevent the individual from fulfilling
his duties or responsibilities to the Company.
"Retirement" shall mean the Executive's termination of employment
(other than for Cause) at or after attaining age 65 unless Executive
has voluntarily chosen to retire prior to obtaining the age 65 under
policies established and recognized by the Company pertaining to early
retirement. If such election has been made "Retirement" shall mean the
date upon which Executive takes early retirement
IN WITNESS WHEREOF, the Executive and the Company, by their signatures
below, hereby acknowledge their agreement to the terms and provisions contained
herein, all effective as of the date first written above.
FFC Management, Inc.
BY:
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(Officer Name & Title) (Executive)
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