EXHIBIT 10.17
INDEXED EXECUTIVE SALARY CONTINUATION
PLAN AGREEMENT BY AND BETWEEN
FIRST FEDERAL BANK OF LAGRANGE
and
XXXXXXX X. XXXXX, XX.
INDEXED EXECUTIVE SALARY CONTINUATION PLAN AGREEMENT
This Agreement, made and entered into this 3rd day of February, 1995, by
and between First Federal Savings Bank of LaGrange, a Bank organized and
existing under the laws of the State of Georgia, hereinafter referred to as "the
Bank", and Xxxxxxx X. Xxxxx, Xx., hereinafter referred to as "Xxxxx, Jr."
Xxxxx, Jr. was in the employ of the Bank for several years during which
time he faithfully served the Bank. It is the consensus of the Board of
Directors of the Bank (the Board) that Xxxxx, Jr.'s services have been of
exceptional merit, in excess of the compensation paid and an invaluable
contribution to the profits and position of the Bank. The Board further believes
that Xxxxx Xx.'s experience, knowledge of corporate affairs, reputation and
industry contacts are of extreme value and his continued goodwill is also
essential to the Bank's future growth and profits.
Accordingly, it is the desire of the Bank and Xxxxx, Jr. to enter into
this Agreement under which the Bank will agree to make certain payments to
Xxxxx, Jr.
It is the intent of the parties hereto that this Agreement be considered
an arrangement maintained primarily to provide supplemental retirement benefits
for Xxxxx, Jr., as a member of a select group of management or
highly-compensated employees of the Bank for purposes of the Employee Retirement
Security Act of 1974 (ERISA). Xxxxx, Jr. is fully advised of the Bank's
financial status and has had substantial input in the design and operation of
this benefit plan.
Therefore, in consideration of Xxxxx, Jr.'s services performed in the
past and his continued goodwill in the future and based upon the mutual promises
and covenants herein contained, the Bank and Xxxxx, Jr., agree as follows:
I. DEFINITIONS
A. Effective Date:
The Effective Date of this Agreement shall be February 3,
995.
B. Plan Year:
Any reference to "Plan Year" shall mean a calendar year from
January 1 to December 31. In the year of implementation, the
term "Plan Year" shall mean the period from the effective date
to December 31 of the year of the effective date.
C. Index Retirement Benefit:
The Index Retirement Benefit for Xxxxx, Jr. for any year
shall be equal to the annual earnings (if any) determined by
the Index [subparagraph I (D) for that Plan Year.
D. Index:
The Index for any Plan Year shall be the aggregate annual
after-tax income from the life insurance contracts described
hereinafter as defined by FASB Technical Bulletin 85-4. This
Index shall be applied as if such insurance contracts were
purchased on the effective date hereof.
Insurance Company: Xxxxxxxxx Xxxxxxxx Life Insurance
Company
Policy Form: Universal Life
Policy Name: Executive Security Plan III
Insured's Age and Sex: 44, Male
Riders: None
Ratings: Table 2
Option: A
Face Amount: $379,000
Premiums Paid: $150,000
Number of Premium Payments: One
Assumed Purchase Date: February 3, 1995
Insurance Company: Xxxxxxxxx Xxxxxxxx Life Insurance
Company
Policy Form: Universal Life
Policy Name: Executive Security Plan III
Insured's Age and Sex: 50, Male
Riders: None
Ratings: None
Option: A
Face Amount: $364,000
Premiums Paid: $150,000
Number of Premium Payments: One
Assumed Purchase Date: February 3, 1995
If such contracts of life insurance are actually purchased by
the Bank then the actual policies as of the dates they were
purchased shall be used in calculations under this Agreement.
If such contracts of life insurance are not purchased or are
subsequently surrendered or lapsed, then the Bank shall
receive annual policy illustrations that assume the above
described policies were purchased from the above named
insurance company(ies) on the Effective Date from which the
increase in policy value will be used to calculate the amount
of the Index.
In either case, references to the life insurance contract are
merely for purposes of calculating a benefit. The Bank has no
obligation to purchase such life insurance and, if purchased,
Xxxxx, Jr. and his beneficiary(ies) shall have no ownership
interest in such policy and shall always have no greater
interest in the benefits under this Agreement than that of an
unsecured general creditor of the Bank.
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II. INDEX BENEFITS
A. Retirement Benefits:
Commencing on the Effective Date hereof the Index Retirement
Benefit [as defined in subparagraph I (D) above] for each year
shall be paid to Xxxxx, Jr. until his death.
B. Death Benefit:
There is no death benefit provided under this Agreement.
III. RESTRICTIONS UPON FUNDING
The Bank shall have no obligation to set aside, earmark or entrust any
fund or money with which to pay its obligations under this Agreement.
Xxxxx, Jr., his beneficiary(ies) or any successor in interest to him
shall be and remain simply a general creditor of the Bank in the same
manner as any other creditor having a general claim for matured and
unpaid compensation.
The Bank reserves the absolute right at its sole discretion to either
fund the obligations undertaken by this Agreement or to refrain from
funding the same and to determine the exact nature and method of such
funding. Should the Bank elect to fund this Agreement, in whole or in
part, through the purchase of life insurance, mutual funds, disability
policies or annuities, the Bank reserves the absolute right, in its
sole discretion, to terminate such funding at any time, in whole or in
part. At no time shall Xxxxx, Jr. be deemed to have any lien or right,
title or interest in or to any specific funding investment or to any
assets of the Bank.
If the Bank elects to invest in a life insurance, disability or annuity
policy upon the life of Xxxxx, Jr., then Xxxxx, Jr. shall assist the
Bank by freely submitting to a physical exam and supplying such
additional information necessary to obtain such insurance or annuities.
IV. MISCELLANEOUS
A. Alienability and Assignment Prohibition:
Neither Xxxxx, Jr., his widow nor any other beneficiary under
this Agreement 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 Xxxxx, Jr. or his beneficiary, nor be
transferable by operation of law in the event of bankruptcy,
insolvency or otherwise. In the event Xxxxx, Jr. or any
beneficiary attempts assignment, commutation, hypothecation,
transfer or disposal of the benefits hereunder, the Bank's
liabilities shall forthwith cease and terminate.
B. Binding Obligation of Bank and Any Successor in Interest:
The Bank expressly agrees that it shall not merge or
consolidate into or with another bank or sell substantially
all of its assets to another bank, firm or person until such
bank, firm or person expressly agrees, in writing, to assume
and discharge the duties and obligations of the Bank under
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this Agreement. This Agreement shall be binding upon the
parties hereto, their successors, beneficiary(ies), heirs and
personal representatives.
C. Revocation:
It is agreed by and between the parties hereto that, during
the lifetime of Xxxxx, Jr., this Agreement may be amended or
revoked at any time or times, in whole or in part, by the
mutual written assent of Xxxxx, Jr. and the Bank.
D. 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.
E. Effect on Other Bank Benefit Plans:
Nothing contained in this Agreement shall affect the right of
Xxxxx, Jr. to participate in or be covered by any qualified or
non-qualified pension, profit-sharing, group, bonus or other
supplemental compensation or fringe benefit plan constituting
a part of the Bank's existing or future compensation
structure.
F. Headings:
Headings and subheadings in this Agreement are inserted for
reference and convenience only and shall not be deemed a part
of this Agreement.
G. Applicable Law:
The validity and interpretation of this Agreement shall be
governed by the laws of the State of Georgia.
V. ERISA PROVISION
A. Named Fiduciary and Plan Administrator:
The "Named Fiduciary and Plan Administrator" of this plan
shall be First Federal Savings Bank of LaGrange until its
removal by the Board. As Named Fiduciary and Administrator,
the Bank shall be responsible for the management, control and
administration of the Salary Continuation Agreement as
established herein. He may delegate to others certain aspects
of the management and operation responsibilities of the plan
including the employment of advisors and the delegation of
ministerial duties to qualified individuals.
B. Claims Procedure and Arbitration:
In the event a dispute arises over benefits under this
Agreement and benefits are not paid to Xxxxx, Jr. (or to his
beneficiary in the case of Xxxxx, Jr.'s death) and such
claimants feel they are entitled to receive such benefits,
then a written claim must be made to the Plan Administrator
named above within ninety (90) days from the date payments are
refused. The Plan Administrator shall review the written claim
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and if the claim is denied, in whole or in part, they shall
provide in writing within ninety (90) days of receipt of such
claim their 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 Plan Administrator fails to take any action
within the aforesaid ninety-day period.
If claimants desire a second review they shall notify the Plan
Administrator in writing within ninety (90) days of the first
claim denial. Claimants may review this Agreement or any
documents relating thereto and submit any written issues and
comments they may feel appropriate. In its sole discretion,
the Plan Administrator shall then review the second claim and
provide a written decision within ninety (90) 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 this Agreement upon which the decision
is based.
If claimants continue to dispute the benefit denial based upon
completed performance of this Agreement or the meaning and
effect of the term 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 Bank, 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 Bank's discharge of Xxxxx,
Jr. "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.
IN WITNESS WHEREOF, the parties hereto acknowledge that each has
carefully read this Agreement and executed the original thereof on the 3rd day
of February, 1995 and that, upon execution, each has received a conforming copy.
First Federal Savings Bank of LaGrange
/s/ Xxxxxx Xxxxx By: /s/ Xxxxxxx X. Xxxx
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Witness Title
/s/ Xxxxx Xxxxxx By: /s/ Xxxxxxx X. Xxxxx, Xx.
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Witness Xxxxxxx X. Xxxxx, Xx.
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