Exhibit 10.1

 

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL RETIREMENT

PLAN FOR EMPLOYEES OF

WEBSTER BANK

As Amended and Restated on October 22, 2007

Effective as of January 1, 2005

TABLE OF CONTENTS

 

General

ARTICLE I Definitions

ARTICLE II Eligibility

ARTICLE III Supplemental Retirement Income

ARTICLE IV Benefit Claims Procedure

ARTICLE V Funding

ARTICLE VI Amendment and Termination

ARTICLE VII Miscellaneous

ANNEX I Special Provisions for Certain Former Participants in the Eagle
Financial Corporation Benefit Equalization Plan

ANNEX II Special Provisions Relating to Supplemental Matching Contributions
Attributable to the Period On and After January 1, 2005 and Prior to July 1,
2006

ANNEX III Certain Change in Control Payments Prior to January 1, 2008

 

 

 

 

SUPPLEMENTAL RETIREMENT PLAN FOR EMPLOYEES

OF WEBSTER BANK

General

This Plan is a non-qualified supplemental retirement plan for certain employees
of Webster Bank (the "Bank") and its affiliates who also have an accrued benefit
under the Webster Bank Pension Plan (the "Pension Plan").

The Plan was established for the purpose of providing deferred compensation for
a select group of management or highly compensated employees. Only certain
employees of the Bank and its affiliates who were members of a select group of
management or highly compensated employees (as determined by the board of
directors of the Bank) are eligible to receive a benefit under the Plan.

The Plan provides a supplemental retirement income equal to the following:

(a) with respect to all Participants other than the Chairman and Chief Executive
Officer of the Bank and the President of the Bank who were in office on January
1, 2004, the excess of: (i) a retirement benefit payable in accordance with the
terms of the Pension Plan, but determined: (A) without regard to the limitations
of Section 415 of the Internal Revenue Code of 1986, as amended (the "Code");
(B) without regard to the limitations of Code Section 401(a)(17); and (C) based
on the definition of compensation set forth in the Pension Plan that is
applicable to the period on and after September 1, 2004, but applying such
definition to the Participant's entire period of employment; over (ii) the
retirement benefit actually provided by the Pension Plan; and

(b) with respect to the Chairman and Chief Executive Officer of the Bank and the
President of the Bank who were in office on January 1, 2004, the excess of: (i)
a retirement benefit equal to 60% of his high five year average compensation,
pro rated for separation from service prior to age 65 and determined: (A)
without regard to the limitations of Code Section 415; (B) without regard to the
limitations of Code Section 401(a)(17); and (C) based on the definition of
compensation set forth in the Pension Plan that is applicable to the period on
and after September 1, 2004, but applying such definition to the Participant's
entire period of employment; over (ii) the sum of: (A) the retirement benefit
actually provided by the Pension Plan; (B) projected Social Security retirement
benefits commencing at age 65; and (C) with respect to the President of the Bank
who was in office on January 1, 2004, the retirement benefits payable under his
prior employer's qualified and nonqualified defined benefit pension plans.

Effective as of January 1, 2007, benefit accruals under the Pension Plan were
frozen with respect to all employees who are first hired or are rehired on or
after January 1, 2007. In addition, effective as of the close of business on
December 31, 2007, benefit accruals under the Pension Plan were frozen for all
other employees. Therefore: (a) all employees who are first hired on or after
January 1, 2007 will receive no supplemental retirement income under the Plan;
(b) all employees who are rehired on or after January 1, 2007 and who were
participants in the Plan at the time of their prior separation from service will
receive no additional accrual of supplemental retirement income on or after
January 1, 2007, and the amount of their supplemental retirement income will not
exceed the amount of their supplemental retirement income determined as of the
date of their prior separation from service; and (c) all other participants will
accrue no additional supplemental retirement income after the close of business
on December 31, 2007, and the amount of their supplemental retirement income
will not exceed the amount of their supplemental retirement income determined as
of the close of business on December 31, 2007.

The Plan is completely separate from the Pension Plan, is unfunded, and is not
qualified for special tax treatment under the Code.

The Plan was adopted effective as of January 1, 1990. This amendment and
restatement of the Plan is effective as of January 1, 2005.

Prior to July 1, 2006, the Plan also provided the supplemental matching
contributions described in Annex II. However, effective as of July 1, 2006, all
liabilities relating to the supplemental matching contributions were transferred
to, and assumed by, the Webster Bank Deferred Compensation Plan for Directors
and Officers.

 

ARTICLE I

Definitions

 

1.1 "Affiliate" means any corporation or other entity which is under common
control with the Bank and the Corporation within the meaning of Section 414(b)
or Section 414(c) of the Code. A "Participating Affiliate" is an Affiliate which
has assumed the obligations of the Plan with the consent of the Board. A
"Nonparticipating Affiliate" is an Affiliate which has not assumed the
obligations of the Plan with the consent of the Board.

1.2 "Bank" means Webster Bank, National Association and any successor
corporation which hereafter assumes its obligations hereunder.

1.3 "Beneficiary" means the person designated by a Participant to receive
benefits payable under the Plan in the event of the Participant's death. If a
Participant has not designated a Beneficiary, or if the Beneficiary does not
survive the Participant, the Participant's Beneficiary will be his or her
surviving spouse or, if none, his or her estate.

1.4 "Board" means the board of directors of the Bank.

1.5 "Change in Control" means the occurrence of any of the following events:

(a) Any person becomes the beneficial owner of twenty-five percent (25%) or more
of the total number of voting shares of the Corporation;

(b) Any person becomes the beneficial owner of ten percent (10%) or more, but
less than twenty-five percent (25%), of the total number of voting shares of the
Corporation, unless the Federal Reserve Board (the "FRB") has approved a
rebuttal agreement filed by such person or such person has filed a certification
with the FRB;

(c) Any person (other than the persons named as proxies solicited on behalf of
the board of directors of the Corporation) holds revocable or irrevocable
proxies, as to the election or removal of two or more directors of the
Corporation, for twenty-five percent (25%) or more of the total number of voting
shares of the Corporation;

(d) Any person has received the approval of the FRB under the Bank Holding
Company Act, as amended (the "Holding Company Act"), or regulations issued
thereunder, to acquire control of the Corporation;

(e) Any person has received approval of the FRB under the Federal Deposit
Insurance Act, as amended (the "Control Act"), or regulations issued thereunder,
to acquire control of the Corporation;

(f) Any person has commenced a tender or exchange offer, or entered into an
agreement or received an option, to acquire beneficial ownership of twenty-five
percent (25%) or more of the total number of voting shares of the Corporation,
whether or not the requisite approval for such acquisition has been received
under the Holding Company Act, the Control Act, or the respective regulations
issued thereunder;

(g) As a result of, or in connection with, any cash tender offer or exchange
offer, merger, or other business combination, sale of assets or contested
election, or any combination of the foregoing transactions, the persons who were
directors of the Corporation before such transaction shall cease to constitute
at least two-thirds of the board of directors of the Corporation or any
successor corporation; or

(h) The Corporation's beneficial ownership of the total number of voting shares
of the Bank is reduced to less than fifty percent (50%).

Notwithstanding the foregoing, a Change in Control will not be deemed to have
occurred under Section 1.5(b), Section 1.5(c), Section 1.5(d), Section 1.5(e) or
Section 1.5(f) if, within thirty (30) days of such action, the board of
directors of the Corporation (by a two-thirds affirmative vote of the directors
in office before such action occurred) makes a determination that such action
does not and is not likely to constitute a Change in Control of the Corporation.
For purposes of this Section 1.5, a "person" includes an individual,
corporation, partnership, trust, association, joint venture, pool, syndicate,
unincorporated organization, joint-stock company or similar organization or
group acting in concert. A person for these purposes shall be deemed to be a
beneficial owner as that term is used in Rule 13d-3 under the Securities
Exchange Act of 1934.

1.6 "Code" means the Internal Revenue Code of 1986, as amended.

1.7 "Committee" means any committee authorized by the Board to administer the
Plan.

1.8 "Corporation" means Webster Financial Corporation and any successor
corporation which hereafter assumes its obligations.

1.9 "Employee" means an individual who is an employee of either the Bank, the
Corporation or a Participating Affiliate.

1.10 "Participant" means an individual who satisfied the eligibility
requirements of Article II and who is entitled to receive a Supplemental
Retirement Income under Article III.

1.11 "Pension Plan" means the Webster Bank Pension Plan and any subsequent
amendments thereto.

1.12 "Plan" means the Supplemental Retirement Plan for Employees of Webster
Bank, as set forth herein, including any amendments, rules and regulations
adopted pursuant hereto.

1.13 "Section 409A Change in Control" means a change in ownership of the
Corporation, a change in effective control of the Corporation, or a change in
the ownership of a substantial portion of the assets of the Corporation.

(a) A change in ownership of the Corporation occurs when any person (or two or
more persons acting as a group) acquires ownership of stock of the Corporation
which, together with stock held by such person or group, constitutes more than
fifty percent (50%) of the stock of the Corporation. However, if any person or
group of persons is considered to own more than fifty percent (50%) of the stock
of the Corporation, the acquisition of additional stock by the same person or
group of persons is not considered to result in a change in ownership of the
Corporation.

(b) A change in effective control of the Corporation occurs either: (i) when any
person (or two or more persons acting as a group) acquires (or has acquired
during the preceding twelve month period) ownership of stock of the Corporation
possessing thirty percent (30%) or more of the stock of the Corporation; or (ii)
a majority of the board of directors of the Corporation is replaced during a
twelve month period by persons who are not endorsed by a majority of the board
of directors of the Corporation in office prior to such change. However, if any
person or group of persons is considered to have acquired effective control of
the Corporation pursuant to this Section 1.13(b), the acquisition of additional
control of the Corporation by the same person or group of persons is not
considered to result in a change in effective control of the Corporation.

(c) A change in ownership of a substantial portion of the assets of the
Corporation occurs on the date that any one person (or two or more persons
acting as a group) acquires (or has acquired during the preceding twelve month
period) assets from the Corporation that have a total gross fair market value
equal to or greater than forty percent (40%) of the total gross fair market
value of all of the assets of the Corporation immediately prior to such
acquisition or acquisitions. Gross fair market value means the value of the
assets of the Corporation, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets.

1.14 "Separation from Service" means an individual's termination of service with
the Bank, the Corporation and all Affiliates, as defined for purposes of Section
409A of the Code.

1.15 "Spouse" means the person who is legally married to a Participant on the
earlier of such Participant's date of death and the date on which his or her
Supplemental Retirement Income commences.

1.16 "Supplemental Retirement Income" means the monthly amount of retirement
income payable on behalf of a Participant under Article III of the Plan.

 

ARTICLE II

Eligibility

 

2.1. Eligibility. An Employee who has an accrued benefit under the Pension Plan
as of the close of business on December 31, 2007 will be eligible to receive a
Supplemental Retirement Income under the Plan, provided that the following
conditions are met:

(a) the Employee was hired prior to January 1, 2007; and

(b) prior to January 1, 2008, the Employee was a member of a select group of
management or highly compensated employees (as determined by the Board) and was
an executive vice president or above of the Bank, the Corporation or a
Participating Affiliate.

Notwithstanding the above, however, the Chief Financial Officer of the Bank who
was in office on January 1, 2007 will not be eligible to participate in the Plan
and will receive no Supplemental Retirement Income under the Plan, even though
he may have an accrued benefit under the Pension Plan as of the close of
business on December 31, 2007.

If an Employee transfers employment from the Bank, the Corporation or a
Participating Affiliate to a Nonparticipating Affiliate, the amount of the
Employee's Supplemental Retirement Income shall not exceed the amount of the
Supplemental Retirement Income which the Employee had accrued as of the date of
such transfer of employment.

 

ARTICLE III

Supplemental Retirement Income

 

3.1 Supplemental Retirement Income.

(a) This Section 3.1(a) applies to all Participants other than the Chairman and
Chief Executive Officer of the Bank and the President of the Bank who were in
office on January 1, 2004:

(i) The monthly amount of Supplemental Retirement Income payable to such a
Participant will be the excess, if any, of: (A) the Participant's adjusted
monthly retirement income, as determined under Section 3.1(a)(ii); over (B) the
Participant's actual monthly retirement income under the Pension Plan.

(ii) For purposes of Section 3.1(a)(i)(A), a Participant's adjusted monthly
retirement income shall be computed by using the applicable formula set forth in
the Pension Plan, provided that:

(A) the applicable formula set forth in the Pension Plan shall be applied
without regard to the limitations on benefits of Section 415 of the Code;

(B) the applicable formula set forth in the Pension Plan shall be applied
without regard to the limitations on compensation of Section 401(a)(17) of the
Code; and

(C) the applicable formula set forth in the Pension Plan shall be applied by
reference to the definition of compensation set forth in Section 3.1(c).

The adjustments to the applicable formula set forth in the Pension Plan which
are described in this Section 3.1(a)(ii) shall apply to all of the Participant's
years of service, including any years of service performed prior to the
effective date of the Plan or any amendment thereof.

(iii) Notwithstanding the above, pursuant to the terms of Section 3(f), the
Supplemental Retirement Income of a Participant shall not exceed the amount of
his or her Supplemental Retirement Income determined as of the close of business
on December 31, 2007.

(b) This Section 3.1(b) applies to the Participants who were the Chairman and
Chief Executive Officer of the Bank and the President of the Bank in office on
January 1, 2004:

(i) The monthly amount of Supplemental Retirement Income payable to such a
Participant will be the excess, if any, of: (A) the Participant's targeted
monthly retirement income (as determined under Section 3.1(b)(ii)); over (B) the
sum of: (1) the Participant's actual monthly retirement income under the Pension
Plan; (2) the Participant's projected monthly Social Security retirement
benefits commencing at age 65; and (3) with respect to the Participant who was
the President of the Bank in office on January 1, 2004, $6,037.45 per month
prior to November 1, 2007 and $4,448.62 per month on and after November 1, 2007
(representing the monthly retirement benefits payable under the qualified and
nonqualified defined benefit pension plans maintained or previously maintained
by the prior employer of such Participant).

(ii) For purposes of Section 3.1(b)(i)(A), a Participant's targeted monthly
retirement income is a monthly benefit commencing on the Participant's normal
retirement date and payable as a single life annuity equal to: (A) 60%,
multiplied by (B) the ratio (but not greater than one) of the number of the
Participant's years of vesting service as of the date of his Separation from
Service to the number of years of vesting service that the Participant would
have had if his Separation from Service had occurred on his normal retirement
date; and multiplied further by (C) the Participant's high five year average
monthly compensation (as determined under Section 3.1(b)(iii)). For purposes of
this Section 3.1(b)(ii), years of vesting service and normal retirement date
shall be determined under the terms of the Pension Plan as in effect on January
1, 2005.

(iii) For purposes of Section 3.1(b)(ii)(C), a Participant's high five year
average monthly compensation equals one-twelfth of the average of the
Participant's annual compensation (as determined under Section 3.1(c)) for the
five consecutive calendar years which produce the highest such average.

(iv) For purposes of Section 3.1(b)(ii), a Participant's targeted monthly
retirement income shall be computed without regard to the limitations on
benefits of Section 415 of the Code and without regard to the limitations on
compensation of Section 401(a)(17) of the Code.

(v) Notwithstanding the above, pursuant to the terms of Section 3(f), the
Supplemental Retirement Income of a Participant shall not exceed the amount of
his or her Supplemental Retirement Income determined as of the close of business
on December 31, 2007.

(c) In computing a Participant's adjusted monthly retirement income under
Section 3.1(a) and a Participant's targeted monthly retirement income under
Section 3.1(b), the Participant's compensation shall be based on the definition
of compensation set forth in the Pension Plan that is applicable to the period
on and after September 1, 2004, but applying such definition to the
Participant's entire period of employment.

(d) For purposes of calculating the monthly amount of a Participant's
Supplemental Retirement Income pursuant to Section 3.1(a), a Participant's
adjusted monthly retirement income as determined under Section 3.1(a)(ii) and
actual monthly retirement income under the Pension Plan shall each be based upon
the actuarially equivalent single life annuity form of payment commencing at
normal retirement date.

For purposes of calculating the monthly amount of a Participant's Supplemental
Retirement Income pursuant to Section 3.1(b), a Participant's targeted monthly
retirement income as determined under Section 3.1(b)(ii) and actual monthly
retirement income under the Pension Plan shall each be based upon the
actuarially equivalent single life annuity form of payment commencing at normal
retirement date.

For purposes of this Section 3.1(d): (i) actuarial equivalence shall be
determined by applying the actuarial factors set forth in the Pension Plan; and
(ii) normal retirement date shall be determined under the terms of the Pension
Plan as in effect on January 1, 2005.

(e) If a Participant (or the survivor of a Participant) commences to receive a
Supplemental Retirement Income prior to the Participant's normal retirement
date, the Supplemental Retirement Income shall be actuarially reduced to reflect
the early commencement of the benefit; provided, however, that in adjusting the
Supplemental Retirement Income payable under Section 3.1(b) to reflect the early
commencement of the benefit:

(i) calculate the excess, if any, of: (A) the Participant's targeted monthly
retirement income (as determined under Section 3.1(b)(ii)); over (B) the sum of:
(1) the Participant's actual monthly retirement income under the Pension Plan
and (2) the Participant's projected monthly Social Security retirement benefits
commencing at age 65;

(ii) actuarially adjust the amount in subsection (i) in order to reflect the
early commencement of the benefit; and

(iii) with respect to the Participant who was the President of the Bank in
office on January 1, 2004, offset the result in subsection (ii), on a dollar for
dollar basis, by the amount set forth in Section 3.1(b)(i)(B)(3) (representing
the monthly retirement benefits payable under the qualified and nonqualified
defined benefit pension plans maintained or previously maintained by the prior
employer of such Participant).

(f) Effective as of January 1, 2007, benefit accruals under the Pension Plan
ceased for all Employees who were first hired or were rehired on or after
January 1, 2007. Effective as of the close of business on December 31, 2007,
benefit accruals under the Pension Plan ceased for all other Employees
(including but not limited to the Chairman and Chief Executive Officer of the
Bank and the President of the Bank who were in office on January 1, 2004).
Therefore, notwithstanding anything else in this Article III to the contrary:

(i) all Employees who were first hired on or after January 1, 2007 will receive
no Supplemental Retirement Income under the Plan;

(ii) all Employees who were rehired on or after January 1, 2007 and who were
Participants in the Plan at the time of their prior Separation from Service will
receive no additional accrual of Supplemental Retirement Income on or after
January 1, 2007, and the amount of their Supplemental Retirement Income will not
exceed the amount of their Supplemental Retirement Income determined as of the
date of their prior Separation from Service; and

(iii) all other Participants (including but not limited to the Chairman and
Chief Executive Officer of the Bank and the President of the Bank who were in
office on January 1, 2004) will accrue no additional Supplemental Retirement
Income after the close of business on December 31, 2007, and the amount of their
Supplemental Retirement Income will not exceed the amount of their Supplemental
Retirement Income determined as of the close of business on December 31, 2007.

In addition, because the Chief Financial Officer of the Bank who was in office
on January 1, 2007 is not eligible to participate in the Plan, he will receive
no Supplemental Retirement Income under the Plan, even though he may have an
accrued benefit under the Pension Plan as of the close of business on December
31, 2007.

3.2 Vesting of Supplemental Retirement Income.

(a) A Participant becomes vested and has a nonforfeitable right to receive a
Supplemental Retirement Income under the Plan in the same manner and to the same
extent as provided under the Pension Plan.

(b) Notwithstanding the above, however, if the Committee determines, after a
hearing, that a Participant who is eligible to receive or is receiving a
Supplemental Retirement Income under the Plan has engaged in any activities
which, in the opinion of the Committee, are detrimental to the interests of, or
are in competition with, the Bank, the Corporation or any Affiliates, then all
benefits payable under the Plan shall thereupon be terminated and forfeited.

3.3 Time of Payment of Supplemental Retirement Income. A Participant shall
commence to receive a Supplemental Retirement Income described in Section 3.1(a)
or Section 3.1(b) on the first day of the month coinciding with or next
following the later of: (a) the date that is six months after his or her
Separation from Service with the Bank, the Corporation and all Affiliates; or
(b) the date on which he or she has reached age fifty-five (55).

If a Participant's Supplemental Retirement Income will commence on the first day
of the month coinciding with or next following the date that is six months after
his or her Separation from Service, the amount of his or her Supplemental
Retirement Income shall be determined as if it had commenced on the first day of
the month coinciding with or next following his or her Separation from Service.
The payments to which the Participant would otherwise have been entitled during
the first six months following his or her Separation from Service shall then be
accumulated (together with interest at the long term applicable federal rate (as
defined in Section 1274(d) of the Code) for the month preceding the
Participant's Separation from Service), and shall be paid on the first day of
the month coinciding with or next following the date that is six months after
his or her Separation from Service.

For the period prior to January 1, 2008, a Participant commenced to receive his
or her Supplemental Retirement Income on the date he or she commenced to receive
his or her retirement benefits under the Pension Plan (as permitted by Notice
2006-79, Section 3.03).

3.4 Form of Payment of Supplemental Retirement Income.

(a) The normal form of payment of a Participant's Supplemental Retirement Income
shall be a single life annuity payable in substantially equal monthly
installments for the lifetime of the Participant.

(b) Notwithstanding the provisions of Section 3.4(a), a Participant may elect,
prior to the commencement date of his or her Supplemental Retirement Income, to
have his or her Supplemental Retirement Income paid in substantially equal
monthly installments in the form of any actuarially equivalent annuity that is
offered as an optional form of benefit under the Pension Plan. In calculating
the amount of such annuity, the actuarial factors set forth in the Pension Plan
will be used.

(c) Effective as of the date of adoption of the amendment and restatement of
this Plan, notwithstanding the provisions of Section 3.4(a) and Section 3.4(b),
a Participant may elect, prior to the commencement date of his or her
Supplemental Retirement Income, to have his or her Supplemental Retirement
Income paid in a lump sum distribution equal to the actuarially equivalent
present value of such Supplemental Retirement Income (calculated by reference to
the interest rate and mortality table that are used to calculate the Pension
Plan's liabilities in accordance with Statement of Financial Accounting
Standards No. 87 and that are disclosed in the financial statements of Webster
Financial Corporation). In addition, a Participant who has elected to have his
or her Supplemental Retirement Income paid in a lump sum distribution may make a
subsequent election, prior to the commencement date of his or her Supplemental
Retirement Income, to have his or her Supplemental Retirement Income paid as an
annuity pursuant to Section 3.4(a) and Section 3.4(b). Any election pursuant to
this Section 3.4(c) shall be subject to the following requirements:

(i) The election: (i) must be made at least twelve months prior to the date on
which the Supplemental Retirement Income would otherwise have commenced; (ii)
cannot become effective until at least twelve months after the date on which the
election is made; and (iii) must delay the date of payment of the lump sum
distribution for at least five years from the date the Supplemental Retirement
Income would otherwise have commenced.

(ii) In no event can an election made pursuant to this Section 3.4(c) constitute
an acceleration for purposes of Code Section 409A.

(d) In Notice 2005-1, Question 19(c), as modified by the preamble to the
proposed regulations under Code Section 409A, Notice 2006-79, and the preamble
to the final regulations under Code Section 409A (the "Election Guidance"), the
Internal Revenue Service stated that, with respect to deferred compensation
subject to Code Section 409A, a nonqualified deferred compensation arrangement
may be amended to allow a participant to make a new payment election with
respect to the form of payment of his or her deferred compensation, and such
election will not be treated as a change in the form of payment of the deferred
compensation under Code Section 409A(a)(4) or an acceleration of a payment under
Code Section 409A(a)(3), provided that: (i) the amendment is adopted and
effective on or before December 31, 2007; (ii) the employee makes an election
regarding the form of payment of his or her deferred compensation on or before
December 31, 2007; (iii) the election applies only to amounts that would not
otherwise be payable in 2007 and does not cause an amount to be paid in 2007
that would not otherwise be payable in 2007; and (iv) the election otherwise
satisfies the constructive receipt rule and other provisions of the Code and
common law doctrines.

Pursuant to the Election Guidance, a Participant may elect on or after the date
of adoption of the amendment and restatement of this Plan and on or before
December 31, 2007 to have his or her Supplemental Retirement Income paid in a
lump sum distribution equal to the actuarial equivalent present value of such
Supplemental Retirement Income without being subject to the requirements of
Section 3.4(c); provided, however, that the actuarial equivalent present value
of such Supplemental Retirement Income shall be calculated by reference to the
interest rate and mortality table described in Section 3.4(c); and provided
further, that the effective date of such an election shall be delayed to the
extent required by the constructive receipt rule or other provisions of the Code
or common law doctrines.

(e) A Participant may make any election described in this Section 3.4 by
submitting an election form to the Committee.

3.5. Death Benefits.

(a) If a Participant dies after commencing to receive his or her Supplemental
Retirement Income under Section 3.1(a) or Section 3.1(b) and the Participant was
receiving a single life annuity, or if the Participant elected to receive his or
her Supplemental Retirement Income under Section 3.1(a) or Section 3.1(b) in the
form of an actuarially equivalent lump sum distribution, then no survivor's
benefit will be paid under the Plan following the death of the Participant.

If a Participant dies after commencing to receive his or her Supplemental
Retirement Income under Section 3.1(a) or Section 3.1(b) and the Participant was
receiving an actuarially equivalent annuity that is an optional form of benefit
offered under the Pension Plan, then the Participant's joint annuitant or
Beneficiary (who may be the Participant's Spouse) will receive a survivor's
benefit in accordance with the terms of the annuity selected pursuant to Section
3.4(b).

(b) If a Participant dies prior to commencing to receive a Supplemental
Retirement Income described in Section 3.1(a) or Section 3.1(b) and the
Participant is married on his or her date of death, then the surviving Spouse of
the Participant shall be entitled to receive an annuity for the lifetime of the
surviving Spouse. The amount of the survivor's benefit shall equal the benefit
that the surviving Spouse would have received if the Participant had survived
until the later of the Participant's date of death or the date on which the
Participant would have reached age fifty-five (55), the Participant had
commenced to receive on such date his or her Supplemental Retirement Income in
the form of a 100/50 joint and survivor annuity with his or her Spouse as the
joint annuitant, and the Participant had died immediately thereafter.

If a Participant dies prior to commencing to receive a Supplemental Retirement
Income described in Section 3.1(a) or Section 3.1(b), the Participant is married
on his or her date of death, the Participant dies while in the service of the
Bank, the Corporation or an Affiliate, and the Participant completed ten or more
years of vesting service (as defined under the terms of the Pension Plan in
effect on January 1, 2005) by his or her date of death, then the surviving
Spouse of the Participant shall be entitled to receive an annuity for the
lifetime of the surviving Spouse. The amount of the survivor's benefit shall
equal the benefit that the surviving Spouse would have received if the
Participant had survived until the later of the Participant's date of death or
the date on which the Participant would have reached age fifty-five (55), the
Participant had commenced to receive on such date his or her Supplemental
Retirement Income in the form of a 100/50 joint and survivor annuity with his or
her Spouse as the joint annuitant, and the Participant had died immediately
thereafter. The survivor's benefit shall be payable for the lifetime of the
surviving Spouse; provided, however, if the surviving Spouse dies prior to the
receipt of one-hundred twenty (120) monthly payments, the remainder of the one
hundred twenty (120) monthly payments shall be paid to the beneficiaries
designated by the surviving Spouse (or, if the surviving Spouse fails to
designate a beneficiary or no such beneficiary survives the Spouse, to the
Participant's estate). If the surviving Spouse dies after the Participant but
before commencing to receive the survivor's benefit, the survivor's benefit will
be deemed to have commenced immediately prior to the Spouse's death. In
determining the amount of the survivor's benefit, the amount of the 100/50 joint
and survivor annuity will not be actuarially adjusted to reflect the one hundred
twenty (120) month minimum payment period.

If a Participant dies prior to commencing to receive a Supplemental Retirement
Income described in Section 3.1(a) or Section 3.1(b), the Participant is not
married on his or her date of death, the Participant dies while in the service
of the Bank, the Corporation or an Affiliate, the Participant has reached age
fifty-five (55) by his or her date of death, and the Participant has completed
five years of vesting service (as defined under the terms of the Pension Plan in
effect on January 1, 2005) by his or her date of death, then the Beneficiary of
the Participant shall be entitled to receive a survivor's benefit payable for
one hundred twenty (120) months. The amount of the survivor's benefit shall
equal the benefit that a surviving spouse of the Participant would have received
if the Participant had been married on his or her date of death to a spouse who
was the same age as the Participant, the Participant had commenced to receive on
his or her date of death his or her Supplemental Retirement Income in the form
of a 100/50 joint and survivor annuity with such spouse as the joint annuitant,
and the Participant had died immediately thereafter.

The monthly amount of a survivor's benefit payable under this Section 3.5(b)
shall be calculated in the same manner and by applying the same actuarial
factors as the corresponding survivor's benefit is calculated under the Pension
Plan.

(c) If a Participant dies after commencing to receive a Supplemental Retirement
Income described in Section 3.1(a) or Section 3.1(b), the survivor's benefit (if
any) payable to the Participant's surviving Spouse or Beneficiary shall commence
on the first day of the month coinciding with or next following the date of the
Participant's death, and shall cease on the date required by the terms of the
annuity. A survivor's benefit shall in no event be payable after the death of a
Participant who was receiving his or her Supplemental Retirement Income in the
form of a single life annuity or who received a lump sum distribution of the
actuarial equivalent present value of his or her Supplemental Retirement Income.

If a Participant dies prior to commencing to receive a Supplemental Retirement
Income described in Section 3.1(a) or Section 3.1(b), the Participant is married
on his or her date of death, and a survivor's benefit is payable under Section
3.5(b) to the surviving Spouse of the Participant, then such survivor's benefit
shall commence on the first day of the month coinciding with or next following
the later of the date of the Participant's death or the date on which the
Participant would have reached age fifty-five (55). The survivor's benefit shall
cease on the date of the surviving Spouse's death (unless the survivor's benefit
is payable for at least one hundred twenty (120) months and the surviving Spouse
dies prior to the receipt of one hundred twenty (120) monthly payments).

If a Participant dies prior to commencing to receive a Supplemental Retirement
Income described in Section 3.1(a) or Section 3.1(b), the Participant is not
married on his or her date of death, and a survivor's benefit is payable under
Section 3.5(b) to the Beneficiary of the Participant, then such survivor's
benefit shall commence on the first day of the month coinciding with or next
following the Participant's death. The survivor's benefit shall cease after the
Beneficiary's receipt of one hundred twenty (120) monthly payments.

 

 

ARTICLE IV

Benefit Claims Procedure

4.1 Claims for Benefits. Any claim for benefits under the Plan shall be made in
writing to the Committee. The Committee shall promptly process each claim for
benefits received by it and shall notify the claimant in writing of the action
taken regarding the claim for benefits within a reasonable period of time
following its receipt, but not later than ninety (90) days. This period may be
extended by the Committee for up to ninety (90) days, provided that the notice
of the extension of time is furnished to the claimant prior to the beginning of
the extension period. In the event of a denial of benefits, the Committee shall
furnish the claimant with a written notification which shall include: (a) the
reasons for the denial; (b) specific references to the Plan provisions on which
the denial is based; (c) a description of any additional material or information
necessary for the claimant to perfect the claim for benefits, including an
explanation of why such material or information is necessary; and (d) an
explanation of the review procedure set forth in Section 4.2.

4.2 Appeal Procedure.

(a) A claimant who has received a written denial of a claim for benefits may
appeal by filing with the Committee a written request for review. Such request
must be made within sixty (60) days following the receipt of the written denial.
In connection with any request for review, the claimant may at any time review
all documents, records, and other information relevant to the claim free of
charge, and request a review that takes into account all comments, documents,
records and other information submitted (without regard to whether such
information was submitted or considered in the initial benefit determination).

(b) The Committee shall notify the claimant of its determination on review
within sixty (60) days following receipt of the request for review. This period
may be extended by the Committee for up to sixty (60) days, provided that the
Committee determines that special circumstances (such as the need to hold a
hearing) require an extension of time for processing the claim. Written notice
of the extension shall be furnished to the claimant prior to the beginning of
the extension period. The extension notice must indicate the special
circumstances requiring the extension and the date as of which the Committee
expects to render a decision.

 

ARTICLE V

Funding

5.1 Funding. It is the intention of the Bank, the Corporation, the Participating
Affiliates, the Participants and their survivors and Beneficiaries, and each
other party to the Plan that the arrangements hereunder be unfunded for tax
purposes and for purposes of Title I of the Employee Retirement Income Security
Act of 1974, as amended. The rights of Participants and their survivors and
Beneficiaries shall be solely those of a general unsecured creditor of the Bank,
the Corporation or a Participating Affiliate (as applicable). The Plan
constitutes a mere promise by the Bank, the Corporation or a Participating
Affiliate (as applicable) to make benefit payments in the future.

The obligation of the Bank, the Corporation or a Participating Affiliate (as
applicable) to pay benefits under the Plan shall be interpreted as a contractual
obligation to pay only those amounts described in the Plan in the manner and
under the conditions prescribed by the Plan. Any assets set aside to fund
deferred compensation shall be subject to the claims of general creditors, and
no person other than the Bank, the Corporation or a Participating Affiliate (as
applicable) shall, by virtue of the provisions of the Plan, have any interest in
such funds.

Prior to the occurrence of a Change in Control, neither the Bank, the
Corporation nor any Participating Affiliate shall have any obligation to fund
the benefits payable under the Plan. If the Bank, the Corporation or a
Participating Affiliate determines, prior to a Change in Control, that deferred
compensation under the Plan should be funded, it may utilize, singly or in
combination, any method of funding it may deem appropriate, including, but not
limited to, terminal funding, annuity contracts, life insurance contracts, or a
group or individual trust (including a trust the terms of which conform with the
language of the model trust agreement set forth in Revenue Procedure 92-64
issued by the Internal Revenue Service (or any successor thereto) relating to
trusts established in connection with unfunded deferred compensation
arrangements (a "Rabbi Trust")).

Upon the occurrence of a Change in Control, the Bank, the Corporation and each
Participating Affiliate shall (unless their liabilities under the Plan have been
fully discharged) adopt and fully fund a Rabbi Trust (or, if Rabbi Trusts are no
longer available for use in connection with unfunded deferred compensation
arrangements, any other instrument which is designed to provide a similar level
of security and to have the same tax results as a Rabbi Trust). All of the
assets of the Rabbi Trust shall be located, and shall remain located, within the
United States, whether or not such assets are available to satisfy the claims of
general creditors. In addition, the Rabbi Trust shall not contain any provision
which states that the assets of the Rabbi Trust will be restricted to the
provision of benefits under the Plan in the event of a change in the financial
health of the Bank, the Corporation, or an Affiliate (or any successor thereof),
whether or not such assets are available to satisfy the claims of general
creditors.

 

ARTICLE VI

Amendment and Termination

 

6.1 Right to Amend. At any time, and from time to time, the Board of the Bank,
by resolutions adopted by it, may amend the Plan or change the designation of
Participants under the Plan.

6.2 Right to Terminate. The Plan can be terminated by action of the Board of the
Bank only if: (a) the termination of the Plan does not occur proximate to a
downturn in the financial health of the Bank, the Corporation or an Affiliate;
(b) all nonqualified deferred compensation arrangements of the same type (i.e.,
all nonaccount balance plans) maintained by the Bank, the Corporation and all
Affiliates are terminated with respect to all employees; (c) no payments are
made within twelve months after the termination of the Plan (other than payments
that would have been payable under the terms of the Plan if the termination had
not occurred); (d) all payments are made within twenty-four (24) months after
the termination of the Plan; and (e) neither the Bank, the Corporation nor any
Affiliate adopts a nonqualified deferred compensation arrangement of the same
type (i.e., a nonccount balance plan) for a period of three years with respect
to any employee following the date of the termination of the Plan. If the Plan
is terminated, the actuarial equivalent present value of each Participant's
Supplemental Retirement Income (as calculated by reference to the interest rate
and mortality table described in Section 3.4(c)) will be paid to the Participant
in a lump sum on the first day of the month coinciding with or next following
the first anniversary of the termination of the Plan.

If the Board of the Bank takes irrevocable action to terminate the Plan and all
nonqualified deferred compensation arrangements of the same type (i.e., all
nonccount balance plans) sponsored by the Bank, the Corporation and all
Affiliates within thirty (30) days preceding or within twelve months following a
Section 409A Change in Control, then the actuarial equivalent present value of
each Participant's Supplemental Retirement Income (as calculated by reference to
the interest rate and mortality table described in Section 3.4(c)) will be
distributed in a lump sum within twelve (12) months following the date of such
irrevocable action.

If the Board of the Bank terminates the Plan within twelve months following a
corporate dissolution that is taxable under Code Section 331 or within twelve
months following the bankruptcy court's approval of the termination of the Plan,
then the actuarial equivalent present value of each Participant's Supplemental
Retirement Income (as calculated by reference to the interest rate and mortality
table described in Section 3.4(c)) will be distributed in the calendar year in
which the Plan is terminated, the first calendar year in which the Supplemental
Retirement Income is no longer subject to a substantial risk of forfeiture, or
the first calendar year in which the distribution is administratively
practicable (whichever is latest).

6.3 Limitations. Notwithstanding the preceding provisions of this Article VI:
(a) no modification, amendment, discontinuance or termination of the Plan may
permit any distribution of a Participant's Supplemental Retirement Income other
than in accordance with the provisions of Section 409A of the Code; (b) no
modification, amendment, discontinuance or termination of the Plan shall
adversely affect the rights of any former Employee (or the survivor of any
former Employee) then receiving benefits; and (c) the vested benefits which any
Participant had accrued immediately prior to the effective date of any
modification, amendment, discontinuance or termination of the Plan shall not be
reduced. Notice of every such modification, amendment, discontinuance or
termination shall be given in writing to each Participant.

ARTICLE VII

Miscellaneous

 

7.1 Plan Administrator. In its discretion, the Board of the Bank may appoint a
Committee consisting of at least one (1) but not more than five (5) persons. If
appointed, the Committee shall be deemed to be the plan administrator of the
Plan. If the Board has not appointed a Committee to administer the Plan, the
Board will act as the Committee.

The Committee shall interpret and construe the provisions of the Plan, shall
decide any disputes which may arise relative to the rights of Participants (and
their survivors and Beneficiaries) under the terms of the Plan, and shall, in
general, direct the administration of the Plan embodied herein. The Committee
may adopt such rules as it deems necessary for the proper administration of the
Plan. The decision of the Committee in all matters involving the interpretation
and application of the Plan shall be final, binding and conclusive (unless the
Committee has acted in an arbitrary or capricious manner).

7.2 Nonassignability. Except to the extent required by law, the right of any
Participant or his or her survivors or Beneficiaries to any benefit or payment
under the Plan: (a) shall not be subject to voluntary or involuntary
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors of the Participant or his or her
survivors or Beneficiaries; (b) shall not be considered an asset of the
Participant or his or her survivors or Beneficiaries in the event of any
divorce, insolvency or bankruptcy; and (c) shall not be subject to attachment,
execution, garnishment, sequestration or other legal or equitable process. In
the event that a Participant or any survivors or Beneficiaries who are receiving
or are entitled to receive benefits under the Plan attempt to assign, transfer
or dispose of such right, or if an attempt is made to subject said right to such
process, such assignment, transfer, disposition or process shall, unless
required by law, be null and void.

7.3 Code Section 409A. Any provision of the Plan that is susceptible to more
than one interpretation shall be interpreted in a manner that is consistent with
the Plan satisfying the requirements of Code Section 409A.

7.4 Governing Law. Except to the extent preempted by applicable federal laws,
the provisions of the Plan shall be interpreted, construed and administered in
accordance with the laws of the State of Connecticut, other than its choice of
law principles.

7.5 No Employment Contract. The adoption and maintenance of the Plan shall not
be deemed to constitute a contract between the Bank, the Corporation or an
Affiliate and its employees or to be consideration for, or an inducement or
condition of, the employment of any person. Nothing herein contained shall be
deemed: (a) to give to any Employee the right to be retained in the employ of
the Bank, the Corporation or an Affiliate; (b) to affect the right of the Bank,
the Corporation or an Affiliate to discipline or discharge any Employee at any
time; (c) to give the Bank, the Corporation or an Affiliate the right to require
any Employee to remain in its employ; or (d) to affect any Employee's right to
terminate his or her employment at any time.

7.6 Withholding. The Corporation, the Bank or an Affiliate shall have the right
to deduct from any distribution any taxes required by law to be withheld from a
Participant with respect to such award.

7.7 Rights of Survivors and Beneficiaries. Whenever the rights of a Participant
are stated or limited in the Plan, his or her survivors and Beneficiaries shall
be bound thereby.

7.8 Masculine, Feminine, Singular and Plural. The masculine shall be read in the
feminine, the singular in the plural, and vice versa, whenever the context shall
so require.

7.9 Titles. The titles to Articles and Sections in this Plan are placed herein
for convenience of reference only, and the Plan is not to be construed by
reference thereto.

7.10 Other Plans. Nothing in this Plan shall be construed to affect the rights
of a Participant, his or her survivors or Beneficiaries, or his or her estate to
receive any retirement or death benefit under any tax qualified pension plan,
another nonqualified deferred compensation arrangement, insurance agreement,
tax-deferred annuity, or other retirement plan of the Corporation, the Bank or
an Affiliate.

 

 

 

Dated this day of , 20 .

 

Witness: WEBSTER BANK, NATIONAL ASSOCIATION

 

 

By

Its

ANNEX I

 

Special Provisions for Certain Former Participants

in the Eagle Financial Corporation Benefit Equalization Plan

Effective as of April 15, 1998 (the "Eagle Acquisition Date"), Eagle Financial
Corporation ("Eagle") was merged with and into Webster Financial Corporation.
Effective as of the Eagle Acquisition Date, all of the obligations of Eagle
under the Eagle Financial Corporation Benefit Equalization Plan (the "Eagle
SERP") were transferred to, and assumed by, Webster Financial Corporation.
Webster Financial Corporation has, in turn, transferred all of such obligations
to Webster Bank, National Association, a wholly-owned subsidiary of Webster
Financial Corporation. Therefore, effective as of the Eagle Acquisition Date,
all of the obligations of Eagle under the Eagle SERP have been transferred to,
and assumed by, Webster Bank.

Effective as of April 15, 1998, the Eagle SERP was merged with and into the
Plan.

Effective as of July 1, 1998, certain of the assets and liabilities of the
Financial Institutions Retirement Plan as Adopted by Eagle Financial Corporation
(the "Eagle Pension Plan") were transferred to and assumed by the Webster Bank
Pension Plan (the "Webster Pension Plan").

Effective as of the first day with respect to which the processing of the
payroll for the former employees of Eagle was performed in conjunction with the
processing of the payroll for the employees of Webster Bank (the "Eagle Payroll
Merger Date"), the former employees of Eagle became eligible to participate in
the Webster Bank Retirement Savings Plan (formerly known as the Webster Bank
Employee Investment Plan) (the "Webster 401(k) Plan"). In addition, effective as
of July 1, 1998, certain of the assets and liabilities of the Financial
Institutions Thrift Plan as Adopted by Eagle Financial Corporation (the "Eagle
401(k) Plan") were transferred to and assumed by the Webster 401(k) Plan.

Prior to July 1, 2006, the Plan provided the supplemental matching contributions
described in Annex II. Effective as of July 1, 2006, all liabilities relating to
the supplemental matching contributions were transferred to, and assumed by, the
Webster Bank Deferred Compensation Plan for Directors and Officers.

(1) If an Employee was a participant in the Eagle SERP, the Employee will not
receive any additional Supplemental Retirement Income under this Plan unless he
or she otherwise satisfies the eligibility requirements of Section 2.1. If he or
she does not satisfy such eligibility requirements, no Supplemental Retirement
Income will be payable to him or her under the Plan other than the supplemental
retirement income which he or she accrued under the Eagle SERP prior to April
15, 1998.

(2) If an Employee was a participant in the Eagle Pension Plan on June 30, 1998
and he or she becomes a Participant under the Plan, the amount of such a
Participant's Supplemental Retirement Income under Section 3.1 shall be
determined as follows:

(a) the Participant's adjusted monthly retirement income shall be calculated by
reference to the applicable formula set forth in the Eagle Pension Plan with
respect to compensation earned and service performed prior to July 1, 1998, and
by reference to the applicable formula set forth in the Webster Pension Plan
with respect to compensation earned and service performed on and after July 1,
1998 and prior to January 1, 2008;

(b) the Participant's actual monthly retirement income shall equal the sum of
the Employee's accrued benefit under the Eagle Pension Plan as of June 30, 1998
(whether or not such benefit was transferred to and assumed by the Webster
Pension Plan) and the Employee's Webster Benefit (as defined in the applicable
annex of the Webster Pension Plan); and

(c) the Participant's adjusted monthly retirement income and actual monthly
retirement income shall each be actuarially adjusted to the equivalent single
life annuity form of payment.

(3) If an Employee was a participant in the Eagle SERP, no Supplemental Matching
Contributions were credited under the provisions of Annex II of the Plan unless
he or she otherwise satisfied the eligibility requirements of Annex II. If he or
she did not satisfy such eligibility requirements, no Supplemental Matching
Contributions were payable to him or her under the Plan other than the
supplemental matching contributions which he or she accrued under the Eagle SERP
prior to April 15, 1998. In addition, no Supplemental Matching Contributions
will be credited to such an Employee under the Plan with respect to the period
on and after July 1, 2006.

(4) Except as otherwise provided in this Annex I, all of the provisions of the
Plan shall apply to each Participant who was an employee of Eagle prior to April
15, 1998.

 

ANNEX II

Special Provisions Relating to Supplemental Matching Contributions

Attributable to the Period On and After January 1, 2005 and Prior to July 1,
2006

 

Prior to July 1, 2006, the Plan provided for the crediting of Supplemental
Matching Contributions to the Supplemental Matching Contributions Accounts of a
select group of management or highly compensated employees. Only those employees
of the Bank and its affiliates who were members of a select group of management
or highly compensated employees (as determined by the board of directors of the
Bank) were eligible to receive Supplemental Matching Contributions under the
Plan.

Effective as of July 1, 2006, all liabilities relating to Supplemental Matching
Contributions were transferred to, and assumed by, the Webster Bank Deferred
Compensation Plan for Directors and Officers. Therefore, effective as of July 1,
2006, the Plan no longer provides for the crediting of Supplemental Matching
Contributions.

The Supplemental Matching Contributions payable under the Plan were based on the
amount of matching contributions which an employee would have been allocated
under the 401(k) Plan, but determined: (a) without regard to the limitations on
annual elective deferrals imposed by Section 401(k) and Section 402(g) of the
Code; (b) without regard to the limitations on matching contributions imposed by
Section 401(m) of the Code; (c) without regard to the limitations of Section 415
of the Code; (d) without regard to the limitations of Code Section 401(a)(17);
and (e) based on the definition of compensation set forth in the 401(k) Plan
that was applicable to the period on and after September 1, 2004.

The payment of Supplemental Matching Contributions under the Plan was completely
separate from the 401(k) Plan, was unfunded, and was not qualified for special
tax treatment under the Code.

The following provisions were applicable during the period on and after January
1, 2005 and prior to July 1, 2006:

(1) For purposes of this Annex II, the following terms shall have the following
meanings:

(a) "401(k) Plan" means the Webster Bank Retirement Savings Plan (formerly known
as the Webster Bank Employee Investment Plan), including any amendments, rules
or regulations adopted pursuant thereto.

(b) "Matching Percentage" means the percentage of a Participant's elective
deferrals to the 401(k) Plan (to the extent such elective deferrals were not in
excess of the Minimum Percentage of the Participant's compensation) which the
Bank, the Corporation or a Participating Affiliate had agreed to contribute to
the 401(k) Plan on behalf of the Participant as matching contributions.

(c) "Minimum Percentage" means the lowest percentage of compensation which a
Participant had to elect to have contributed to the 401(k) Plan as elective
deferrals in order to receive the maximum amount of matching contributions
available under the terms of the 401(k) Plan.

(d) "Supplemental Matching Contributions" mean the amounts of deferred
compensation credited to the Supplemental Matching Contributions Account of a
Participant under Section 3 of Annex II of the Plan.

(e) "Supplemental Matching Contributions Account" means the two bookkeeping
accounts maintained for each Participant. One bookkeeping account is credited
with the Supplemental Matching Contributions (and the earnings and losses
allocable thereto) that the Participant elected to be paid in installments
pursuant to Section 4 of this Annex II (the "Installment Subaccount"). The other
bookkeeping account is credited with the Supplemental Matching Contributions
(and the earnings and losses allocable thereto) that will be paid in a single
lump sum pursuant to Section 4 of this Annex II (the "Lump Sum Subaccount").

(2) An Employee who was a participant in the 401(k) Plan was eligible to have
Supplemental Matching Contributions credited to his or her Supplemental Matching
Contributions Account, provided that the following conditions were met:

(a) the Employee was a member of a select group of management or highly
compensated employees (as determined by the Board) and was an executive vice
president or above of the Bank, the Corporation or a Participating Affiliate;

(b) if the Employee had made the maximum elective deferrals permitted by the
terms of the 401(k) Plan for a calendar year, the matching contributions which
would have been allocated to the account of the Employee under the 401(k) Plan
for the calendar year would have been limited due to the Employee's inability to
make elective contributions equal to at least the Minimum Percentage of his or
her compensation as a result of the applicability of the limitations on elective
deferrals under Section 402(g) of the Code, the limitations on contributions
under Section 415 of the Code, or the limitations on compensation under Section
401(a)(17) of the Code; and

(c) such Employee either: (i) separated from service with the Bank, the
Corporation and all Affiliates; or (ii) died while in the service of the Bank,
the Corporation or an Affiliate.

For purposes of Section 2(c)(i) of this Annex II, an Employee was not deemed to
have separated from service as the result of a transfer of employment between
the Bank, the Corporation or an Affiliate. However, if an Employee transferred
employment from the Bank, the Corporation or a Participating Affiliate to a
Nonparticipating Affiliate, the Employee was not credited with any Supplemental
Matching Contributions with respect to compensation earned after the date of
such transfer of employment.

(3) The amount of Supplemental Matching Contributions allocated to a Participant
was determined as follows:

(a) As of the last day of each calendar year, the amount of a Participant's
Supplemental Matching Contributions was determined. The amount of such
Supplemental Matching Contributions for a calendar year equaled the excess, if
any, of: (i) the Participant's adjusted matching contributions, as determined
under Section 3(b) of this Annex II, for such calendar year; over (ii) the
maximum amount of matching contributions which would have been allocated for the
benefit of the Participant under the 401(k) Plan for such calendar year if he or
she had actually made the maximum elective deferrals permitted by the terms of
the 401(k) Plan (determined in accordance with the limitations set forth in the
401(k) Plan and in Code Sections 401(k), 401(m), 402(g), 415 and 401(a)(17)).

(b) For purposes of Section 3(a)(i) of this Annex II, a Participant's adjusted
matching contributions equaled the Matching Percentage of the Participant's
elective deferrals under the 401(k) Plan to the extent they did not exceed the
Minimum Percentage of the Participant's compensation, except that:

(i) it was assumed that the Participant elected to contribute at least the
Minimum Percentage of his or her compensation as elective deferrals under the
401(k) Plan;

(ii) adjusted matching contributions were determined without regard to the
limitations on elective deferrals under Section 401(k) and Section 402(g) of the
Code;

(iii) adjusted matching contributions were determined without regard to the
limitations on matching contributions under Section 401(m) of the Code;

(iv) adjusted matching contributions were determined without regard to the
limitations on contributions under Section 415 of the Code;

(v) adjusted matching contributions were determined without regard to the
limitations on compensation under Section 401(a)(17) of the Code; and

(vi) adjusted matching contributions were determined by reference to the
definition of compensation set forth in Section 3(c) of this Annex II.

The adjustments for determining adjusted matching contributions which are
described in Section 3(b) of this Annex II applied to all calendar years in
which the Participant was eligible to participate in the Plan, including any
calendar years prior to the effective date of any amendment to the Plan.

(c) In computing a Participant's adjusted matching contributions under Section
3(b) of this Annex II, the Participant's compensation was based on the
definition of compensation set forth in the 401(k) Plan that was applicable to
the period on and after September 1, 2004. Pursuant to such definition, the
Participant's compensation: (i) included all of the Participant's regular
salary, overtime, commissions, bonuses, and pre-tax contributions made to the
401(k) Plan, to an employee benefit plan under an arrangement described in
Section 125 of the Code or to a qualified transportation fringe benefit plan
described in Section 132(f)(4) of the Code; but (ii) excluded taxable car
benefits, taxable reimbursements (such as moving expenses), taxable fringe
benefits (such as the cost of excess group term life insurance), and any taxable
income realized in connection with the exercise of a nonqualified stock option,
the disqualifying disposition of stock received under an incentive stock option,
or the grant or vesting of restricted property. In addition, if a Participant
elected to defer all or any portion of his or her compensation, such deferred
compensation was included in the Participant's compensation during the calendar
year in which it would have been paid to the Participant but for the deferral
election.

(4) Prior to the first day of each calendar year, a Participant could elect that
any amounts to be credited to his or her Supplemental Matching Contributions
Account during the calendar year would be credited either to his or her
Supplemental Matching Contributions Account - Lump Sum Subaccount or to his or
her Supplemental Matching Contributions Account - Installment Subaccount. If the
Participant did not make an election, the Participant was deemed to have elected
that all amounts to be credited to his or her Supplemental Matching
Contributions Account for the calendar year would be credited to the
Supplemental Matching Contributions Account - Lump Sum Subaccount.

(5) Supplemental Matching Contributions were accounted as follows:

(a) A Participant's Supplemental Matching Contributions were credited by the
Corporation, the Bank or an Affiliate (as applicable) to the Supplemental
Matching Contributions Account maintained for the Participant. Supplemental
Matching Contributions were credited to the Participant's Supplemental Matching
Contributions Account as of the end of the calendar year with respect to which
the Supplemental Matching Contributions were made. A payment to a Participant or
Beneficiary was charged to the appropriate Supplemental Matching Contributions
Account as of the time the payment was made.

(b) Interest, compounded monthly, was credited on the balance in a Participant's
Supplemental Matching Contributions Account from time to time: (i) as of the
last day of each calendar year during the period beginning when the Supplemental
Matching Contributions were first so credited, and ending on the last day of the
calendar year preceding the date described in Section 5(b)(ii) of this Annex II;
and (ii) as of the date of distribution of a final installment payment (pursuant
to Section 8(b) of this Annex II) or a single sum distribution (pursuant to
Section 8(a) of this Annex II) of the amounts credited to the Participant's
Supplemental Matching Contributions Account. The rate of interest was the
interest rate on one year United States Treasury obligations (as reported from
time to time in The Wall Street Journal) plus fifty (50) basis points, adjusted
monthly.

(6) Supplemental Matching Contributions were vested as follows:

(a) A Participant became vested and had a nonforfeitable right to receive the
amount credited to his or her Supplemental Matching Contributions Account under
the Plan in the same manner and to the same extent as the amount credited to the
Participant's matching contributions account under the 401(k) Plan.

(b) Notwithstanding the above, however, if the Committee determined, after a
hearing, that a Participant who was eligible to receive or was receiving
Supplemental Matching Contributions under the Plan had engaged in any activities
which, in the opinion of the Committee, were detrimental to the interests of, or
were in competition with, the Bank, the Corporation or any Affiliates, then all
amounts credited to his or her Supplemental Matching Contributions Account that
were payable under the Plan were thereupon terminated and forfeited.

(7) Supplemental Matching Contributions were distributed, or were commenced to
be distributed, at the time set forth below:

(a) On the first day of the month coinciding with or next following the date
that was six months after the Participant's Separation from Service with the
Corporation, the Bank and all Affiliates.

(b) On the first day of the month coinciding with or next following the date
that was sixty (60) days after the Participant's death.

(8) A Participant's Supplemental Matching Contributions were distributed, or
were commenced to be distributed, in the form of distribution elected, or deemed
elected, by the Participant pursuant to Section 4 of this Annex II, depending on
whether such Supplemental Matching Contributions were credited to his or her
Supplemental Matching Contributions Account - Lump Sum Subaccount or his or her
Supplemental Matching Contributions - Installment Subaccount:

(a) Amounts credited to the Participant's Supplemental Matching Contributions
Account - Lump Sum Subaccount were paid to such Participant in a single lump sum
at the time determined pursuant to Section 7 of this Annex II.

(b) Amounts credited to the Participant's Supplemental Matching Contributions
Account - Installment Subaccount were distributed in ten substantially equal,
annual installments. Each installment was equal to the balance credited to the
Supplemental Matching Contributions Account - Installment Subaccount multiplied
by a fraction, the numerator of which was one and the denominator of which was
ten minus the number of annual installments previously paid to the Participant
(so that the first installment was 1/10th of the account, the second installment
was 1/9th of the account, and so on).

If a Participant was entitled to receive installment payments due to a
Separation from Service, the installment payment to which the Participant would
otherwise have been entitled if installment payments had commenced on the first
day of the month coinciding with or next following the date of his or her
Separation from Service was segregated as of such date, credited with interest,
and paid on the first day of the month coinciding with or next following the
date that was six months after his or her Separation from Service. The remainder
of the installments were paid to the Participant annually on each subsequent
anniversary of the first day of the month coinciding with or next following the
date of his or her Separation from Service until the ten installments had been
paid.

If a Participant's Beneficiary was entitled to receive installment payments due
to the death of the Participant, the first installment was paid to the
Beneficiary on the first day of the month coinciding with or next following the
date that was sixty (60) days after the Participant's death. Subsequent
installments were paid to the Beneficiary annually on each subsequent
anniversary of such date until the ten installments had been paid.

If a Participant began to receive installment payments but he or she died before
his or her entire Supplemental Matching Contributions Account - Installment
Subaccount had been distributed, the remaining installment payments were made to
the Participant's Beneficiary.

 

 

ANNEX III

Certain Change in Control Payments Prior to January 1, 2008

 

The provisions of this Annex III shall apply to the Participants who were the
Chairman and Chief Executive Officer of the Bank and the President of the Bank
in office on January 1, 2004.

For the period prior to the close of business on December 31, 2007,
notwithstanding the provisions of Section 3.1(b) and Section 3.4 of the Plan, if
such a Participant was entitled to receive a Supplemental Retirement Income
under Section 3.1(b) and the Participant's employment was involuntarily
terminated following a change in control (as defined for purposes of any change
in control or employment agreement entered into between the Participant and the
Bank or any Affiliate of the Bank), then:

(a) the Participant's targeted monthly retirement income (as determined under
Section 3.1(b)(ii)) was calculated by taking into account the service which the
Participant would have performed, and the compensation which the Participant
would have received, if he had remained actively employed during the period of
time in which he was entitled to receive severance benefits under the terms of
such change in control or employment agreement;

(b) the ratio in Section 3.1(b)(ii)(B) was deemed to equal one if the
Participant had more than twenty-five (25) years of vesting service as of the
date of his separation from service; and

(c) the excess of the Supplemental Retirement Income that the Participant would
be entitled to receive by applying the provisions of subsection (a) and
subsection (b) of this Annex III over the Supplemental Retirement Income that
the Participant would be entitled to receive without regard to the provisions of
subsection (a) and subsection (b) of this Annex III would be paid to the
Participant in an actuarially equivalent single lump sum on the date that was
six months after the date of the Participant's Separation from Service. The
Supplemental Retirement Income that the Participant would be entitled to receive
without regard to the provisions of subsection (a) and subsection (b) of this
Annex III would be paid to the Participant in accordance with the provisions of
Article III. For purposes of this Annex III, actuarial equivalence was
determined by applying the actuarial factors set forth in the Pension Plan.

The Pension Plan has been frozen effective as of the close of business on
December 31, 2007 with respect to the Participants who were the Chairman and
Chief Executive Officer of the Bank and the President of the Bank in office on
January 1, 2004. Therefore, no lump sum benefit shall be paid to such
Participants pursuant to the terms of this Annex III with respect to a change in
control that occurs on or after the close of business on December 31, 2007.