Exhibit 10.2
THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT (the "Participation Agreement") is entered
into as of this 20th day of August, 2002 by and between the NB&T Financial
Group, Inc. (the "Sponsor"), The National Bank and Trust Company (the
"Employer") and XXXXXXX X. XXXXX, an executive of the Employer (the
"Participant").
RECITALS:
WHEREAS, the Employer has adopted the ("Plan") effective as of August
20, 2002, and the Administrator has determined that the Participant shall be
eligible to participate in the Plan on the terms and conditions set forth in
this Participation Agreement and the Plan;
NOW, THEREFORE, in consideration of the foregoing and the agreements
and covenants set forth herein, the parties agree as follows:
1. Definitions. Except as otherwise provided, or unless the
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context otherwise requires, the terms used in this Participation Agreement
shall have the same meanings as set forth in the Plan.
2. Incorporation of Plan. The Plan, a copy of which is attached
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hereto as Exhibit A, is hereby incorporated into this Participation Agreement
as if fully set forth herein, and the parties hereby agree to be bound by all of
the terms and provisions contained in the Plan. The Participant hereby
acknowledges receipt of a copy of the Plan and confirms his understanding and
acceptance of all of the terms and conditions contained therein.
3. Effective Date of Participation. The effective date of the
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Participant's participation in the Plan shall be August 20, 2002 (the
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"Participation Date").
4. Normal Retirement Age. The Participant's Normal Retirement
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Age for purposes of the Plan and this Participation Agreement is age fifty-five
(55).
5. Prohibition Against Funding. Should any investment be acquired
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in connection with the liabilities assumed under this Plan and Participation
Agreement, it is expressly understood and agreed that the Participants and
Beneficiaries shall not have any right with respect to, or claim against, such
assets nor shall any such purchase be construed to create a trust of any kind
or a fiduciary relationship between the Employer and the Participants, their
Beneficiaries or any other person. Any such assets shall be and remain a part
of the general, unpledged, unrestricted assets of the Employer, subject to the
claims of its general creditors. It is the express intention of the parties
hereto that this arrangement shall be unfunded for tax purposes and for
purposes of Title I of ERISA. The Participant shall be required to look to the
provisions of the Plan and to the Employer itself for enforcement of any and
all benefits due under this Participation Agreement and, to the extent the
Participant acquires a right to receive
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payment under the Plan and this Participation Agreement, such right shall be no
greater than the right of any unsecured general creditor of the Employer. The
Employer shall be designated the owner and beneficiary of any investment
acquired in connection with its obligation under the Plan and this
Participation Agreement.
6. Provisions Related to SERP Benefit.
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(a) Benefit. The SERP Benefit for the Participant shall be
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the applicable SERP Benefit as provided below:
(1) In the event the Participant has
attained fifty-five (55) years of age, on or prior
to, the Participant's effective date of Termination,
such Participant shall be entitled to an annual SERP
Benefit of seventy five thousand dollars ($75,000);
OR
(2) In the event the Participant continues
to be employed by the Employer beyond the
Participant's attainment of fifty-five (55) years of
age, such Participant shall be entitled to an
enhanced annual SERP Benefit of eighty-five thousand
dollars ($85,0000). Such enhanced SERP Benefit shall
be contingent on: 1) Participant's continuous
full-time employment with the Employer until age
fifty-seven (57) and 2) Participant's attainment of
fifty-seven (57) years of age, on or prior to,
Participant's Termination.
The above SERP Benefits are exclusive of one
another and shall never be considered cumulative
regardless of Participant's age at Termination.
Vesting. There will be no partial Vesting
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available to the Participant. The Participant shall
become 100% vested in the SERP Benefit upon the
occurrence of:
(1) Normal Retirement; or
(2) Change in Control.
Effect of Termination for Cause. A Participant
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who is Terminated for Cause before his or her
Termination will receive no SERP Benefit under this
Plan. A Participant who is Terminated for Cause at
or after his Normal Retirement Date will be
entitled to the amount described in Section 6(a)(1)
of this Participation Agreement (but will not be
entitled to the enhanced benefit described in
Section 6(a)(2) of this Participation Agreement)
regardless of the Participant's age when he
Terminates.
Effect of Change in Control. (i) If a Change
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in Control occurs before the Participant Terminates
and before the Participant reaches age fifty-five
(55), he will be entitled to receive [beginning at
age fifty-five
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(55)] the benefit described in Section 6(a)(1) of
this Participation Agreement as if he had been age
fifty-five (55) on the date of the Change in
Control. This amount will be paid as provided in
Section 6(b) of this Participation Agreement,
applied as of the date the Participant reaches age
fifty-five (55). (ii) If a Change in Control occurs
before the Participant Terminates but after the
Participant reaches age fifty-five (55) he will be
entitled to the benefit described in Section
6(a)(1) of this Participation Agreement [or in
Section 6(b)(2) of this Participation Agreement if
he has attained age fifty-seven (57) on or before
the date of the Change in Control]. This amount
will be paid as provided in Section 6(b) of this
Participation Agreement, applied as of the date the
Participant Terminates.
Effect of Parachute Excise Taxes. If the sum
of the payments provided in the preceding subsection
and those provided under any other plan, program or
agreement between the Participant and any Related
Entity member constitute "excess parachute payments"
as defined in Code ss.280G(b)(1), the Sponsor will
reduce (or cause the Employer to reduce) the
Participant's SERP Benefits so that his total
"parachute payment" as defined in Code
ss.280G(b)(2)(A) under this and any all other
agreements will be $1.00 less than the amount that
would be an "excess parachute payment."
(b) Form of SERP Benefit Payment. The annual SERP Benefit
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will be paid equally in quarterly installments for a
period of twenty (20) years, as provided for in the
attached Exhibit B "The NB&T Financial Group, Inc.
Supplemental Executive Retirement Plan Schedule of
Benefit Payments" beginning on the last day of the
first calendar quarter of the first calendar year that
begins after the Participant Terminates.
(c) Post Termination Death Benefit. Participant's SERP
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Benefit shall be payable to the Participant in
quarterly installments for twenty (20) years for a
total of eighty (80) quarterly payments. In the event
the Participant should die after payments have commenced
but before the eightieth (80th) quarterly payment has
been made, the Participant's Beneficiary, as designated
pursuant to this Participation Agreement, shall be paid
the balance of the remaining quarterly SERP Benefit
payments that would have been made to the Participant
had he lived, in equal quarterly installments. Payments
will cease upon the earlier of the Beneficiary's death
or payment of the eightieth (80th) payment (determined
by aggregating all quarterly payments made to the
Participant before his death and those made to the
Beneficiary after the Participant's death). No SERP
Benefits will be paid to any beneficiary of a
Beneficiary.
(d) Post-Normal Retirement (but Pre Termination) Death
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Benefit. In the event the Participant dies prior to his
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Termination of service but after attaining Normal
Retirement Age, the Participant's Beneficiary shall
receive the
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SERP Benefit in effect at the time of the Participant's
death. The following are examples of this process and
are provided for illustrative purposes only:
Example 1 - In the event the Participant dies
after having attained fifty-five (55) years of age but
before Termination and before reaching age fifty-seven
(57), Participant's Beneficiary would be entitled to an
annual SERP Benefit distribution equaling seventy-five
thousand dollars ($75,000) payable quarterly for twenty
(20) years or, if earlier, until the quarter during
which the Beneficiary dies. No SERP Benefits will be
paid to any beneficiary of a Beneficiary.
Example 2 - In the event the Participant dies
after having attained fifty-seven (57) years of age but
before Termination, Participant's Beneficiary would be
entitled to an enhanced annual SERP Benefit
distribution equaling eighty-five thousand dollars
($85,000) not to exceed a twenty (20) year distribution
period (or, if earlier, until the quarter during which
the Beneficiary dies. No SERP Benefits will be paid to
any beneficiary of a Beneficiary).
(e) Pre Termination Death Benefit. In the event the
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Participant dies prior to his Termination but before
attaining Normal Retirement Age, the Participant's
Beneficiary shall receive a SERP Benefit calculated as
if the Participant had reached age fifty-five (55) on
the day preceding his death. This is an example of this
process and is provided for illustrative purposes only:
Example - In the event the Participant dies
before having attained fifty-five (55) years of age and
before Termination, Participant's Beneficiary would be
entitled to an annual SERP Benefit distribution
equaling seventy-five thousand dollars ($75,000)
payable quarterly for twenty (20) years (or, if
earlier, until the quarter during which the Beneficiary
dies. No SERP Benefits will be paid to any beneficiary
of a Beneficiary).
7. Participant's Covenants.
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(a) Covenant Not to Compete. Commencing on the date of
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Participant's Termination with the Employer and all
Affiliates (hereinafter defined) and ending on the
third anniversary thereof (the "Restricted Competition
Period"), Participant agrees that he shall not, and
shall not permit any of his Affiliates, alone, together
or in association with others, either as principal,
agent, owner, shareholder, officer, director, partner,
lender, investor, independent contractor, consultant or
in any other capacity, to engage in, have a financial
interest in or be in any way connected or affiliated
with, or render advice or services to any natural
person, organization or entity of any type that engages
in any activity which would compete, in any way, in any
county in which a Related Entity has a branch or
business operation at the time of Participant's
Termination of
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employment, with the business operated by any Related
Entity or conducting the business of banking and
providing other financial services. For purposes of
this subsection, an "Affiliate" of a person shall mean
(i) any natural person, organization or entity of any
type that directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under
common control with, such specified person; (ii) any
relative or spouse of such person, or any relative of
such spouse, any one of whom has the same home as such
person; (iii) any trust or estate in which such person
or any of the persons specified in (ii) collectively
own ten percent or more of the total beneficial
interest or of which any of such persons serve as
trustee, executor or in any similar capacity; or (iv)
any corporation or other organization in which such
person or any of the persons specified in (ii) are the
beneficial owners collectively of ten percent or more
of any class of equity securities or ten percent or
more of the equity interest. For purposes of the
definition of the term "Affiliate," "control" means the
power to direct the management and policies of such
person, directly or indirectly, whether through the
ownership of voting securities, by contract or
otherwise.
The Participant and each Related Entity
agree that the value to them of this Covenant Not to
Compete is equal to three hundred percent of the
annualized gross compensation due to the Participant at
his rate of compensation as in effect immediately
before his Termination and that this amount has been
included in the SERP Benefit.
(b) Covenant Not to Solicit. During the Restricted
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Competition Period [defined in Section 7(a)],
Participant further agrees that he will not, and will
not permit any Affiliate [defined in Section 7(a)],
directly or indirectly, to solicit, divert, take away
or interfere with, or attempt to solicit, divert, take
away or interfere with, the relationship of any Related
Entity with any person who is or was a customer,
employee or supplier of any Related Entity at any time
during the period commencing two years immediately
prior to the date of this Participation Agreement and
ending upon the Participant's Termination.
The Participant and each Related Entity
agree that the value to them of this Covenant Not to
Solicit is equal to two hundred percent of the
annualized gross compensation due to the Participant at
his rate of compensation as in effect immediately
before his Termination and that this amount has been
included in the SERP Benefit.
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(c) Interpretation of Covenants. The parties to this
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Participation Agreement acknowledge and agree that the
duration and area for which the Covenant Not to Compete
and the Covenant Not to Solicit are to be effective are
fair and reasonable and are reasonably required for the
protection of the business of the Related Entities. In
the event that any court or arbitrator determines that
the time period or the area, or both of them, are
unreasonable as to any covenant and that such covenant
is to that extent unenforceable, the parties hereto
agree that the covenant shall remain in full force and
effect for the greatest time period and in the greatest
area that would not render it unenforceable. The
parties intend that each covenant shall be deemed to be
a series of separate covenants, one for each and every
county of each and every state of the United States of
America and one for each and every political
subdivision of each and every other country in which
the Covenant Not to compete or other covenant is
intended to be effective and is not proscribed by law.
8. Beneficiary. Notwithstanding the definition of "Beneficiary"
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set forth in the Plan, Beneficiary means the person to whom the Participant is
legally married on the date this Participation Agreement is signed ("Spouse").
If the Participant's Spouse dies while the Participant is alive, no benefit will
be paid after the Participant's death whether or not the Participant
subsequently remarries and no person claiming through the Spouse or Participant
will have any rights under this Plan. Also, no benefits will be due to any
beneficiary of a Beneficiary.
SIGNATURE PAGE TO IMMEDIATELY FOLLOW
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, each of the parties has caused this Participation Agreement
to be executed as of the day first above written.
NB&T FINANCIAL GROUP, INC.
By:________________________________
Title:_____________________________
PARTICIPANT: THE NATIONAL BANK AND TRUST COMPANY
XXXXXXX X. XXXXX By:________________________________
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[Name of Participant]
_______________________________ Title:_____________________________
Signature of Participant
ATTESTED: ATTESTED:
By:____________________________ By:________________________________
Title:_________________________ Title:_____________________________
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LIST OF COLLATERAL DOCUMENTS
EXHIBIT A
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THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
EXHIBIT B
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THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
SCHEDULE OF BENEFIT PAYMENTS
EXHIBIT C
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THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
BENEFICIARY DESIGNATION
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EXHIBIT B
THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
SCHEDULE OF BENEFIT PAYMENTS
Age Year Annual Payment
55 2006 $75,000
57 2008 $85,000
Annual payments shall not exceed $85,000
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EXHIBIT C
THE NB&T FINANCIAL GROUP, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
BENEFICIARY DESIGNATION
In the event of the Participant's death, any benefits to which the
Participant may be entitled shall be paid to the Beneficiary(ies) designated
below. This Beneficiary Designation shall be subject to the terms and conditions
set forth in the Plan and shall supersede all prior Beneficiary Designations
made by the Participant. This Beneficiary Designation shall be attached to and
become part of that certain Participation Agreement, dated as of _____________,
2002, between the Employer and the Participant.
Primary Beneficiary: _______________________________________
Address: _______________________________________
_______________________________________
Secondary Beneficiary:_______________________________________
Address: _______________________________________
_______________________________________
IN WITNESS WHEREOF, the Participant has executed this Beneficiary
Designation as of the date indicated.
___________________________________________
Signature
XXXXXXX X. XXXXX
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Printed Name of Participant
____________________________________________
Date
Received on: ____________________
By: _____________________________
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