Company: FMFG
Filing Date: 2025-03-13
Form Type: PREC14A
Source: 0001437749-25-007538
Chunk: 36

Company: Farmers & Merchants Bancshares, Inc.
Filing Date: 2025-03-13
Form: PREC14A
Chunk 36
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 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 Harris SERP Agreement) in effect at the time the Disability occurs. |

| ● | Death Benefit. If Mr. 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. |

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| ● | Benefit Upon Termination of the SERP Agreement. If the Bank terminates the Harris SERP Agreement (i) in connection with a Change in Control following the commencement of benefit payments under the Harris SERP Agreement; (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 Harris SERP Agreement pursuant to Section 409A of the IRC (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 IRC, Mr. Harris will be entitled to the Accrued Benefit. If the Bank terminates the Harris 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. |

The Harris SERP Agreement provides that, subject to certain exceptions, Mr. Harris will forfeit any undistributed benefits in the event that he engages in certain activities that compete with the Bank, interferes with certain of the Bank’s employee and/or customer relationships, or improperly divulges the Bank’s confidential information.

Mr. Oswald’s agreement (the “Oswald SERP Agreement”) provides for benefits under circumstances similar to the Harris SERP Agreement, but he retired on August 19, 2024 and is therefore entitled only to an annual cash benefit for 20 years equal to 35% of the average of his three highest base salaries for the three-year period preceding the date on which the payment obligation was triggered, including the year in which he experienced Separation of Service. This benefit will be paid in 12 equal monthly installments comm