Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. (e) Material Compensatory Plan.
On
? Retirement Benefit.Mr. Harris will be entitled to an annual cash benefit for 20 years if he suffers a Separation from Service (as defined in the SERP Agreement) after reaching the retirement age of 65. The amount of this benefit will be equal to 35% of the average ofMr. Harris' three highest base salaries for the three-year period preceding the date on which the payment obligation is triggered, including the year in which the Separation of Service occurs. This benefit will be paid in 12 equal monthly installments commencing in the month that follows the month in which the Separation of Service occurs. ? Early Termination Benefit. IfMr. Harris suffers a Separation from Service that constitutes an Early Termination, then he will be entitled to receive the Accrued Benefit, which will be paid over 20 years in equal monthly installments commencing in the month that follows the month in which the Separation of Service occurs, with interest credited on the unpaid balance at the Discount Rate (as defined in the SERP Agreement) in effect at the time of the Separation from Service. The term "Early Termination" means a Separation from Service that occurs prior toMr. Harris reaching the age of 65 and not within 24 months of a Change in Control (as defined in the SERP Agreement). The term "Accrued Benefit" means the dollar value of the liability that should be accrued by the Bank, under Generally Accepted Accounting Principles, for the Bank's obligation toMr. Harris under the SERP Agreement, calculating by applyingFinancial Accounting Standards Board's Accounting Standards Codification 710-10 and the Discount Rate. ? Disability Benefit. IfMr. Harris suffers a Disability (as defined in the SERP Agreement) prior to reaching the age of 65, then he will be entitled to receive the Accrued Benefit, which will be paid over 20 years in equal monthly installments commencing in the month that follows the month in which the Disability occurs, with interest credited on the unpaid balance at the Discount Rate (as defined in the SERP Agreement) in effect at the time the Disability occurs. ? Change in Control Benefit. If a Change in Control (as defined in the SERP Agreement) occurs and, prior to reaching the age of 65,Mr. Harris suffers a Separation from Service within 24 months of such Change in Control, then Mr. Harris will be entitled to receive cash in an amount equal to the present value of a 20-year payment stream equal to 35% of the average of Mr. Harris' three highest base salaries for the three-year period preceding the date on which the payment obligation is triggered, including the year in which the Separation of Service occurs, calculated using a 4.0% discount rate (the "CiC Benefit"). The CiC Benefit will be paid over five years in equal monthly installments commencing in the month that follows the month in which the Separation from Service occurs, with interest credited on the unpaid balance at an annual rate of 4%, compounded monthly.
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? Death Benefit. IfMr. Harris dies prior to a Separation from Service, then his designated beneficiaries will be entitled to cash in an amount equal to the greater of (i) the Accrual Benefit and (ii)$2,127,275 . This benefit will be paid in a single lump sum during the month that follows the month in which Mr. Harris dies. ? Benefit Upon Termination of the SERP Agreement. If the Bank terminates the SERP Agreement (i) in connection with a Change in Control following the commencement of benefit payments, (ii) upon its dissolution or in connection with its bankruptcy, or (iii) in connection with the termination of all other compensatory arrangements that would be aggregated with the SERP Agreement pursuant to Section 409A of the Internal Revenue Code (to the extent that Mr. Harris participated in such other arrangements), then, subject to certain conditions specified in the Harris SERP Agreement, including compliance with Section 409A of the Internal Revenue Code,Mr. Harris will be entitled to the Accrued Benefit. If the Bank terminates the SERP Agreement in connection with a Change in Control before the commencement of benefit payments, then Mr. Harris will be entitled to the CiC Benefit.
If benefit payments have begun and an executive dies before all payments have been made, then the Bank will distribute the remaining benefits to the executive's designated beneficiaries, at the same times and in the same manner as if the executive had not died. If an executive becomes entitled to benefits but dies before payments begin, then the Bank will pay the benefits, in a single lump sum on the first day of the fourth month following death, to the executive's designated beneficiaries.
No benefits will be paid if an executive's employment is terminated by the Bank for cause or if he is subject to a final removal or prohibition order issued by an appropriate federal banking agency pursuant to Section 8(e) of the Federal Deposit Insurance Act. Additionally, no benefit will be paid to the extent it constitutes an excess golden parachute payment under Section 280G of the Internal Revenue Code or is determined to be a prohibited golden parachute payment pursuant to 12 C.F.R. § 359.2.
The timing of the distribution of some or all of the foregoing benefits may be
subject to a six-month waiting period under Section 409A of the Internal Revenue
Code to the extent that
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The SERP Agreement provides that, subject to certain exceptions,
The foregoing information relating to the SERP Agreement is intended only as a summary and is qualified in its entirety by reference to the terms of the Harris SERP Agreement. A copy of the Harris SERP Agreement is filed herewith as Exhibit 10.1.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
The exhibits furnished with this report are listed in the following Exhibit Index:
Exhibit No. Description
Supplemental Executive Retirement Agreement datedAugust 8, 2022
10.1 between
herewith) 104 Cover page interactive data file (embedded within the iXBRL document)
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