BROOKLYN FEDERAL SAVINGS BANK SPLIT DOLLAR INSURANCE AGREEMENT Amendment Number One
Exhibit
10.4
BROOKLYN
FEDERAL SAVINGS BANK
________________________________
Amendment
Number One
________________________________
The
Brooklyn Federal Savings Bank Split
Dollar Insurance Agreement with Xxxxxxx X. Xxxxxx (“Employee”) dated as of
November 3, 1994 (the “Agreement”) is hereby amended in accordance with the
following, effective as of December 1, 2007:
1. The
following paragraph is hereby added to the end of the definition of “Change in
Control” in Section 1.A. of the Agreement, as follows:
| “Notwithstanding the foregoing, to the extent necessary in order to avoid taxes and penalties under Section 409A of the Internal Revenue Code of 1986, ‘Change in Control’ shall mean (i) a change in ownership of the Corporation under paragraph (a) below, or (ii) a change in effective control of the Corporation under paragraph (b) below, or (iii) a change in the ownership of a substantial portion of the assets of the Corporation under paragraph (c) below: | ||
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(a)
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Change
in the ownership of the Corporation. A change in the ownership
of the Corporation shall occur on the date that any one person,
or more
than one person acting as a group (as defined in Treasury Regulation
Section 1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the
corporation that, together with stock held by such person or group,
constitutes more than 50 percent of the total fair market value
or total
voting power of the stock of such corporation. However, if any
one person or more than one person acting as a group, is considered
to own
more than 50 percent of the total fair market value or total voting
power
of the stock of a corporation, the acquisition of additional stock
by the
same person or persons is not considered to cause a change in the
ownership of the corporation (or to cause a change in the effective
control of the corporation (within the meaning of paragraph (b)
below). An increase in the percentage of stock owned by any one
person, or persons acting as a group, as a result of a transaction
in
which the corporation acquires its stock in exchange for property
will be
treated as an acquisition of stock for purposes of this
section. This paragraph (a) applies only when there is a
transfer of stock of a corporation (or issuance of stock of a corporation)
and stock in such corporation remains outstanding after the
transaction.
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(b)
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Change
in the effective control of the Corporation. A change in the
effective control of the Corporation shall occur on the date that
either
(i) any one person, or more than one person acting as a group (as
defined
in Treasury Regulation Section 1.409A-3(i)(5)(v)(B)), acquires
(or has
acquired during the 12-month period ending on the date of the most
recent
acquisition by such person or persons) ownership of stock of the
corporation possessing 30 percent or more of the total voting power
of the
stock of such corporation; or (ii) a majority of members of the
corporation’s board of directors is replaced during any 12-month period by
directors whose appointment or election is not endorsed by a majority
of
the members of the corporation’s board of directors prior to the date of
the appointment or election, provided that for purposes of this
paragraph
(b)(ii), the term corporation refers solely to a corporation for
which no
other corporation is a majority shareholder. In the absence of
an event described in paragraph (i) or (ii), a change in the effective
control of a corporation will not have occurred. If any one
person, or more than one person acting as a group, is considered
to
effectively control a corporation (within the meaning of this paragraph
(b)), the acquisition of additional control of the corporation
by the same
person or persons is not considered to cause a change in the effective
control of the corporation (or to cause a change in the ownership
of the
corporation within the meaning of paragraph (a)). Persons will
not be considered to be acting as a group solely because they purchase
or
own stock of the same corporation at the same time, or as a result
of the
same public offering.
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(c)
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Change
in the ownership of a substantial portion of the Corporation’s
assets. A change in the ownership of a substantial portion of
the Corporation’s assets shall occur on the date that any one person, or
more than one person acting as a group (as defined in Treasury
Regulation
Section 1.409A-3(i)(5)(vii)(C)), acquires (or has acquired during
the
12-month period ending on the date of the most recent acquisition
by such
person or persons) assets from the corporation that have a total
gross
fair market value equal to or more than 40% of the total gross
fair market
value of all of the assets of the corporation immediately prior
to such
acquisition or acquisitions. For this purpose, gross fair
market value means the value of the assets of the corporation,
or the
value of the assets being disposed of, determined without regard
to any
liabilities associated with such assets. There is no Change in
Control under this paragraph (c) when there is a transfer to an
entity
that is controlled by the shareholders of the transferring corporation
immediately after the transfer.”
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2. The
following sentence is hereby added to the end of the definition of “Disability”
in Section 1.C. of the Agreement, as follows:
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“Notwithstanding
the foregoing, to the extent necessary in order to avoid taxes
and
penalties under Section 409A of the Internal Revenue Code of 1986,
‘Disability’ shall mean anytime Employee (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 3
months under an accident and health plan covering employees of
the
participant’s employer, or (iii) is determined to be totally disabled by
the Social Security
Administration.”
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IN
WITNESS WHEREOF, this Amendment Number One has been executed by the duly
authorized officers of Brooklyn Federal Savings Bank as of the 4th day of
December, 2007.
| BROOKLYN FEDERAL SAVINGS BANK | ||||
| By: | /s/ Xxxxxx X. Xx Xxxxxxx | |||
| Its: | President & Chief Executive Officer | |||
| EMPLOYEE | ||||
| By: | /s/ Xxxxxxx X. Xxxxxx | |||
|
Xxxxxxx
X. Xxxxxx
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