Exhibit 10(27)
FIRST FEDERAL SAVINGS BANK OF ▇▇▇▇▇▇
RABBI TRUST FOR THE
EXECUTIVE SUPPLEMENTAL RETIREMENT INCOME PLANS
AND
EXCESS BENEFIT PLANS
This Agreement is made this 1st day of December, 1996 by and between
FIRST FEDERAL SAVINGS BANK OF ▇▇▇▇▇▇, a federally chartered savings institution,
having its principal place of business in Marion, Indiana, (the "Bank"), and
INDIANA FEDERAL BANK FOR SAVINGS, a banking organization organized under the
laws of the state of Indiana, (the "Trustee").
WHEREAS, the Bank has adopted the Restated Executive Supplemental
Retirement Income Plan, the Executive Supplemental Retirement Income Plans
(collectively the "SERPs") and the Excess Benefit Plan ("Excess Plan") with the
SERPs, effective as of the 1st day of December and Excess Plans effective as of
the 28th day of February, 1996, respectively, which all are non-qualified
deferred compensation plan.
WHEREAS, Bank has incurred or expects to incur liability under the
terms of the Plan with respect to the individual(s) participating in the Plan.
WHEREAS, Bank wishes to establish a trust (the "Trust") and to
contribute to the Trust assets that shall be held therein, subject to the claims
of Bank's creditors in the event of Bank's Insolvency, as herein defined, until
paid to Plan participants and their beneficiaries in such manner and at such
times as specified in the Plan.
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan, maintained primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees,
for purposes of Title I of the Employee Retirement Income Security Act of 1974,
as amended.
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WHEREAS, it is the intention of Bank to make contributions to the Trust
to provide itself with a source of funds to assist it in the meeting of its
liabilities under the Plan.
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
1. ESTABLISHMENT OF TRUST.
(A) Bank hereby deposits with Trustee in trust assets which shall
become the principal of the Trust to be held, administered and
disposed of by Trustee as provided in this Trust Agreement.
(B) The Trust hereby established shall be irrevocable.
(C) The Trust is intended to be a grantor trust, of which Bank is
grantor, within the meaning of subpart E. part I, subchapter
J, chapter 1, subtitle A of the Internal Revenue Code of 1986,
as amended, and shall be construed accordingly.
(D) The principal of the Trust, and any earnings thereon shall be
held separate and part from other funds of Bank and shall be
used exclusively for the uses and purposes of Plan
participants and general creditors as herein set forth. Plan
participants and their beneficiaries shall have no preferred
claim on, or any beneficial ownership interest in, any assets
of the Trust. Any rights created under the Plan and this Trust
Agreement shall be mere unsecured contractual rights of Plan
participants and their beneficiaries against Bank. Any assets
held by the Trust will be subject to the claims of Bank's
general creditors under federal and state law in the event of
Insolvency, as defined in Section 3(a) herein.
(E) Within seventy-five (75) days following the end of each
calendar year, Bank shall be required to irrevocably deposit
additional cash or other property to the Trust in an amount
sufficient to pay each Plan participant or beneficiary the
benefits payable pursuant to the terms of the Plan as of the
close of the calendar year.
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(F) Upon (i) a Change in Control (as defined herein) or (ii) the
death of a participant during service but prior to "Benefit
Age" (as such term is defined in the Plan), Bank shall as soon
a possible, but in no event longer than seventy-five (75) days
following such event, make an additional irrevocable
contribution to the Trust in an amount that is sufficient to
pay each Plan participant or beneficiary the benefits to which
Plan participants or their beneficiaries would be entitled
pursuant to the terms of the Plan as of the date such event
occurred.
2. PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES.
(A) Bank shall deliver to Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of
each Plan participant (and his or her beneficiaries), that
provides a formula or other instructions acceptable to Trustee
for determining the amounts so payable, the form in which such
amount is to be paid (as provided for or available under the
Plan), and the time of commencement for payment of such
amounts. Except as otherwise provided herein, Trustee shall
make payments to the Plan participants and their beneficiaries
in accordance with such Payment Schedule. The Trustee shall
make provision for the reporting and withholding of any
federal, state, or local taxes that may be required to be
withheld with respect to the payment of benefits pursuant to
the terms of the Plan and shall pay amounts withheld to the
appropriate taxing authorities or determine that such amounts
have been reported, withheld and paid by Bank.
(B) The entitlement of a Plan participant or his or her
beneficiaries to benefits under the Plan shall be determined
by Bank or such party as it shall designate under the Plan,
and any claim for such benefits shall be considered and
reviewed under the procedures set out in the Plan.
(C) Bank may make payment of benefits directly to Plan
participants or their beneficiaries as they become due under
the terms of the Plan. Bank shall notify Trustee of its
decision to make payment of benefits directly prior to the
time amounts
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are payable to participants or their beneficiaries. In
addition, if the principal of the Trust, and any earnings
thereon, are not sufficient to make payments of benefits in
accordance with the terms of the Plan, Bank shall make the
balance of each such payment as it falls due. Trustee shall
notify Bank where principal and earnings are not sufficient.
3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST
BENEFICIARY WHEN BANK IS INSOLVENT.
(A) Trustee shall cease payment of benefits to Plan participants
and their beneficiaries if the Bank is Insolvent. Bank shall
be considered "Insolvent" for purposes of this Trust Agreement
if (i) Bank is unable to pay its debts as they become due,
(ii) Bank is subject to a pending proceeding as a debtor under
the United States Bankruptcy Code, or (iii) Bank is determined
to be insolvent by the Director of the Federal Deposit
Insurance Corporation or the Resolution Trust Corporation.
(B) At all times during the continuance of this Trust, as provided
in Section 1 (d) hereof, the principal and income of the Trust
shall be subject to claims of general creditors of Bank under
federal and state law as set forth below.
(i) The Board of Directors and the Chief Executive
Officer of Bank shall have the duty to inform Trustee
in writing of Bank's Insolvency. If a person claiming
to be a creditor of Bank alleges in writing to
Trustee that Bank has become Insolvent, Trustee shall
determine whether Bank is Insolvent and, pending such
determination, Trustee shall discontinue payment of
benefits to Plan participants or their beneficiaries.
(ii) Unless Trustee has actual knowledge of Bank's
Insolvency, or has received notice from Bank or
person claiming to be a creditor alleging that Bank
is Insolvent, Trustee shall have no duty to inquire
whether Bank is Insolvent. Trustee may in all events
rely on such evidence concerning Bank's solvency
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as may be furnished to Trustee and that provides
Trustee with a reasonable basis for making a
determination concerning Bank's solvency.
(iii) If at any time Trustee has determined that Bank is
Insolvent, Trustee shall discontinue payments to Plan
participants or their beneficiaries and shall hold
the assets of the Trust for the benefit of Bank's
general creditors. Nothing in this Trust Agreement
shall in any way diminish any rights of Plan
participants or their beneficiaries and shall hold
the assets of the Trust for the benefit of Bank's
general creditors. Plan participants or their
beneficiaries to pursue their rights as general
creditors of Bank with respect to benefits due under
the Plan or otherwise.
(iv) Trustee shall resume the payment of benefits to Plan
participants or their beneficiaries in accordance
with Section 2 of this Trust Agreement only after
Trustee has determined that Bank is not Insolvent (or
is no longer Insolvent).
(C) Provided that there are sufficient assets, if Trustee
discontinues the payment of benefits from the Trust pursuant
to Section 3(b) hereof and subsequently resumes such payments,
the first payment following such discontinuance shall include
the aggregate amount of all payments due to Plan participants
or their beneficiaries under the terms, of the Plan for the
period of such discontinuance, less the aggregate amount of
any payments made to Plan participants or their beneficiaries
by Bank in lieu of the payments provided for hereunder during
any such period of discontinuance.
4. PAYMENTS TO BANK.
Except as provided in Sections 3 or 12 hereof, after the Trust has
become irrevocable, Bank shall have no right or power to direct Trustee to
return to Bank or to divert to others any of the Trust assets before all payment
of benefits have been made to Plan participants and their beneficiaries pursuant
to the terms of the Plan.
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5. INVESTMENT AUTHORITY.
Trustee shall maintain all investments deposited upon establishment of
the trust (and listed on Exhibit A), until such time as the investments reach
maturity. Liquidation of such investments prior to maturity shall only be
allowable by the Trustee if (i) there is insufficient cash in the trust at the
time a benefit payment is due under the Plan and (ii) with knowledge of such
insufficiency, the Bank affirmatively chooses not to pay any or all of the
benefit payment due from Bank assets held outside the trust itself. As the
investments listed on Exhibit A mature, the Trustee's investment authority, with
respect to the proceeds from such investments, shall be subject to the
following:
(A) In no event may Trustee invest in securities (including stock
or rights to acquire stock) or obligations issued by Bank,
other than a de minimis amount held in common investment
vehicles in which Trustee invests, except where such de
minimis investment is prohibited by applicable banking
regulations. All rights associated with assets of the Trust
shall be exercised by Trustee or the person designated by
Trustee, and shall in no event be exercisable by or rest with
Plan participants.
(B) Trustee shall have the following powers and authority in the
administration of the assets of Trust, in addition to those
vested in it elsewhere in this Trust or by law:
(i) To invest and reinvest the assets of Trust, without
distinction between principal and income, in any kind
of property, real, personal or mixed, tangible or
intangible, and in any kind of investment, security
or obligation suitable for the investment of Trust
assets, including federal, state and municipal
tax-free obligations and other tax-free investment
vehicles, insurance policies and annuity contracts,
and any common trust fund, group trust, pooled fund,
or other commingled investment fund maintained by the
Trustee or any other bank or entity for trust
investment purposes;
(ii) To purchase, and maintain as owner, life insurance
policies with respect to participants;
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(iii) To sell for cash or on credit, to grant options,
convert, redeem, exchange for other securities or
other property, or otherwise to dispose of, any
security or other property at any time held;
(iv) To settle, compromise or submit to arbitration, any
claims, debts or damages, due or owing to or from the
Trust, to commence or defend suits or legal
proceedings and to represent the Trust in all suits
or legal proceedings;
(v) To exercise any conversion privilege and/or
subscription right available in connection with
securities or other property at any time held, to
oppose or to consent to the reorganization,
consolidation, merger or readjustment of the finances
of any corporation, Bank or association or to the
sale, mortgage, pledge or lease of the property of an
corporation, Bank or association any of the
securities of which may at any time be held and to do
any act with reference thereto, including the
exercise of options, the making of agreement or
subscription, which may be deemed necessary or
advisable in connection therewith, and to hold and
retain any securities or other properties so
acquired;
(vi) To hold cash uninvested for a reasonable period of
time (not in excess of ten (10) days) under the
circumstances without liability for interest, pending
investment thereof or the payment of expenses or
making distributions therewith;
(vii) To form corporations and to create trusts to hold
title to any securities or other property, all upon
such terms and conditions as may be deemed advisable;
(viii) To register any securities held hereunder in the name
of the Trustee or in the name of a nominee with or
without the addition of words indicating that such
securities are held in a fiduciary capacity and to
hold any securities in bearer form;
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(ix) To make, execute and deliver, as Trustee, any and all
conveyances, contracts, waivers, releases or other
instruments in writing necessary or proper for the
accomplishment of any of the foregoing powers;
(x) To employ suitable agents and counsel and to pay
their reasonable expenses and compensation; and
(xi) To have any and all other power of authority, under
the laws of the state in which the Trustee's
principal executive offices are located, relevant to
performance in the capacity as Trustee.
6. DISPOSITION OF INCOME.
During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.
7. ACCOUNTING BY TRUSTEE.
Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between Bank
and Trustee. Within ninety (90) days following the close of each calendar year
and within sixty (60) days after the removal or resignation of Trustee, Trustee
shall deliver to Bank a written account of its administration of the Trust
during such year or during the period from the close of the last preceding year
to the date of such removal or resignation, setting forth all investments,
receipts, disbursements and other transactions effected by it, including a
description of all securities and investments purchased and sold with the cost
or net proceeds of such purchases or sales (accrued interest paid or receivable
being shown separately), and showing all cash, securities and other property
held in the Trust at the end of such year or as of the date of such removal or
resignation, as the case may be.
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8. RESPONSIBILITY OF TRUSTEE.
(A) Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person
acting in like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and
with like aims, provided, however, that Trustee shall incur no
liability to any person for any action taken pursuant to a
direction, request or approval given by Bank which is
contemplated by, and in conformity with, the terms of the Plan
or this Trust and is given in writing by Bank. In the event of
a dispute between Bank and a party, Trustee may apply to a
court of competent jurisdiction to resolve the dispute.
(B) If Trustee undertakes or defends any litigation arising in
connection with this Trust, except litigation arising out of
the Trustee's negligence or breach of fiduciary duty, Bank
agrees to indemnify Trustee against Trustee's costs, expenses
and liabilities (including, without limitation, attorney's
fees and expenses) relating thereto and to be primarily liable
for such payments. If Bank does not pay such costs, expenses
and liabilities in a reasonable manner, Trustee may obtain
payment from the Trust.
(C) Trustee may consult with legal counsel (who may also be
counsel for Bank generally) with respect to any of its duties
or obligations hereunder.
(D) Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to
assist it in performing any of its duties or obligations
hereunder.
(E) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided
otherwise herein, provided, however, that if an insurance
policy is held as an asset of the Trust, Trustee shall have no
power to name a beneficiary of the policy other than the
Trust, to assign the policy (as distinct from conversion of
the policy to a different form) other than to a successor
Trustee, or to loan to any person the proceeds of any
borrowing against such policy.
(F) Notwithstanding any powers granted to Trustee pursuant to this
Trust Agreement or to applicable law, Trustee shall not have
any power that could give this Trust the
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objective of carrying on a business and dividing the gains
therefrom, within the meaning of section 301.7701-2 of the
Procedure and Administrative Regulations promulgated pursuant
to the Internal Revenue Code.
9. FEES AND EXPENSES OF TRUSTEE.
Bank shall pay all administrative and Trustee's fees and expenses. If
not so paid, the fees and expenses shall be paid from the Trust.
10. RESIGNATION AND REMOVAL OF TRUSTEE.
(A) Trustee may resign at any time by written notice to Bank,
which shall be effective sixty (60) days after receipt of such
notice unless Bank and Trustee agree otherwise.
(B) Trustee may be removed by Bank on sixty (60) days prior
written notice or upon shorter notice accepted by Trustee.
(C) Upon a Change of Control, as defined herein, Trustee may not
be removed by Bank for two (2) years following the date of
such Change in Control, nor may such Trustee be removed by
Bank in anticipation of a Change of Control.
(D) If Trustee resigns at any time following a Change in Control,
or if Trustee is removed by Bank at any time following the
expiration of the two (2) year period (as described in Subpart
(c) above) following a Change in Control, Trustee shall select
a successor Trustee in accordance with the provisions of 11(a)
hereof prior to the effective date of Trustee's resignation or
removal. In all other instances of resignation or removal,
Bank shall select a successor Trustee in accordance with the
provisions of 11(a) hereof prior to the effective date of
Trustee's resignation or removal.
(E) Upon resignation or removal of Trustee and appointment of a
successor Trustee, all assets shall subsequently be
transferred to the successor Trustee. The transfer shall be
completed within fifteen (15) days after receipt of notice of
resignation, removal or transfer, unless Bank extends the time
limit.
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(F) If Trustee resigns or is removed under paragraph (a), (b), or
(d) of this Section 10, a successor shall be appointed in
accordance with Section 11 hereof, by the effective date of
resignation or removal. If no such appointment has been made,
Trustee or Bank (as specified above) may apply to a court of
competent jurisdiction for appointment of a successor or for
instructions. Should the Trustee be required to apply to a
court of competent jurisdiction for such purpose, all expenses
of Trustee in connection with the proceeding shall be allowed
as administrative expenses of the Trust.
11. APPOINTMENT OF SUCCESSOR.
(A) If Trustee resigns or is removed pursuant to the provisions of
Section 10 hereof, Bank or Trustee (as specified above) may
appoint any third party, such as a bank trust department or
other party that may be granted corporate trustee powers under
state law, as a successor to replace Trustee upon resignation
or removal. The appointment of a successor Trustee shall be
effective when accepted in writing by the new Trustee. The new
Trustee shall have all of the rights and powers of the former
Trustee, including ownership rights in the Trust assets. The
former Trustee shall execute any instrument necessary or
reasonably requested by the successor Trustee to evidence the
transfer.
(B) The successor Trustee need not examine the records and acts of
any prior Trustee and may retain or dispose of existing Trust
assets, subject to Sections 7 and 8 hereof. The successor
Trustee shall not be responsible for and Bank shall indemnify
and defend the successor Trustee from any claim or liability
resulting from any action or inaction of any prior Trustee or
from any other past event, or any condition existing at the
time it becomes successor Trustee.
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12. AMENDMENT OR TERMINATION.
(A) This Trust Agreement may be amended by a written instrument
executed by Trustee and Bank. Notwithstanding the foregoing,
no such amendment shall conflict with the terms of the Plan or
shall make the Trust revocable after it has become irrevocable
in accordance with Section 1(b) hereof.
(B) The Trust shall not terminate until the date on which Plan
participants and their beneficiaries are no longer entitled to
benefits pursuant to the terms of the Plan. Upon termination
of the Trust any assets remaining in the Trust shall be
returned to Bank.
(C) Upon written approval of participants or beneficiaries
entitled to payment of benefits pursuant to the terms of the
Plan, Bank may terminate this Trust prior to the time all
benefit payments under the Plan have been made. All assets in
the Trust at termination shall be returned to Bank.
(D) Sections l (one), 2 (two), 6 (six), 10 (ten) and 12 (twelve)
of this Trust Agreement may not be amended by Bank (i) in
anticipation of or (ii) for two (2) years following a Change
of Control, as defined herein.
13. MISCELLANEOUS.
(A) Any provision of this Trust Agreement prohibited by law shall
be ineffective to the extent of any such prohibition, without
invalidating the remaining provisions hereof.
(B) Benefits payable to Plan participants and their beneficiaries
under this Trust Agreement may not be anticipated, assigned
(either at law or in equity), alienated, pledged, encumbered
or subjected to attachment, garnishment, levy, execution or
other legal or equitable process.
(C) This Trust Agreement shall be governed by and construed in
accordance with the laws of the state in which the Trustee's
principal executive offices are located.
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(D) For purposes of this Trust, Change of Control shall mean and
include the following with respect to the Bank and/or
Northeast Indiana Bancorp, Inc., a bank holding company which
owns all of the stock of the Bank (in this section 13(d)
referred to collectively and individually as the Bank):
(i) a change of control of a nature that would be
required to be reported in response to Item 1 of the
current report on Form 8-K, as in effect on the date
hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (hereinafter the
"Exchange Act"); or
(ii) a change of control of the Bank within the meaning of
12 C.F.R.ss.574.4; or
(iii) a change of control at such time as
(a) any "person" (as the term is used in
Sections 13(d) and 14(d) of the Exchange
Act) is or becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities
of the Bank representing Twenty Percent
(20%) or more of the combined voting power
of the Bank's outstanding securities
ordinarily having the right to vote at the
elections of Directors except for (i) any
stock of the Bank purchased by the Holding
Company in connection with the conversion of
the Bank to stock form, and (ii) any stock
purchased by any Employee Stock Ownership
Plan and/or trust sponsored by the Bank; or
(b) individuals who constitute the Board of
Directors on the date hereof (hereinafter
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 comprising
the Incumbent Board, or whose nomination for
election by the Bank's members (or
stockholders) was approved by the Bank's
Nominating Committee which is comprised of
members of the Incumbent Board,
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shall be, for purposes of this clause (ii),
considered as though he were a member of the
Incumbent Board; or
(c) merger, consolidation, or sale of all or
substantially all the assets of the Bank
occurs; or
(d) a proxy statement is issued soliciting
proxies from the members (or stockholders)
of the Bank by someone other than the
current management of the Bank, seeking
member (or stockholder) approval of a plan
of reorganization, merger, or consolidation
of the Bank with one or more corporations as
a result of which the outstanding shares of
the class of the Bank's securities are
exchanged for or converted into cash or
property or securities not issued by the
Bank. For these purposes, the terms
"stockholders(s)" and "member(s)" shall be
considered one and the same. The term
"Holding Company" shall mean the holding
company (including any successor thereto)
organized to acquire the capital stock of
the Bank upon the Bank's conversion from
mutual to stock form.
14. EFFECTIVE DATE.
The effective date of this Trust Agreement shall be the 1st day of
December, 1996.
IN WITNESS WHEREOF, this instrument has been executed as of the day and
year first written above.
FIRST FEDERAL SAVINGS BANK
(Bank)
Attest: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
(Title:) President
INDIANA FEDERAL BANK FOR SAVINGS
(Trustee)
Attest: /s/ ▇. ▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(Title:)
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