Exhibit 10.aa

 

UNIZAN BANK, NATIONAL ASSOCIATION

AMENDED GROUP TERM CARVE OUT PLAN

 

THE GROUP TERM CARVE OUT PLAN entered into as of the 1st day of May, 2001, by
and between the United National Bank & Trust Company, an OCC-chartered,
FDIC-insured national bank with its main offices in Canton, Ohio, and each of
the Participants selected to participate in the Group Term Carve Out Plan (each
a “Participant”) is hereby amended and restated as of this 19th day of June,
2003. As amended and restated, this Amended Group Term Carve Out Plan is
hereinafter referred to as the “Plan.”

 

INTRODUCTION

 

Unizan Bank, National Association, successor by merger to United National Bank &
Trust Company (the “Bank”), wishes to attract and retain highly qualified
executives. To further this objective, the Bank is willing to divide the death
proceeds of certain life insurance policies which are owned by the Bank on the
lives of the participating executives with the designated beneficiary of each
insured participating executive. The Bank will pay the life insurance premiums
from its general assets.

 

Article 1

Definitions

 

Whenever used in this Plan, the following terms shall have the meanings
specified:

 

1.1 “Base Annual Salary” means the current base annual salary of the Participant
at the earliest of (1) the date of the Participant’s death; (2) the date of the
Participant’s Disability; (3) the date the Participant’s employment with Unizan
Financial Corp. or the Bank terminates within three years after a Change in
Control (except for Termination for Cause); (4) the Participant’s Early
Retirement Date; or (5) the Participant’s Normal Retirement Date. Current Base
Annual Salary shall be defined by reference to compensation of the type that
would be required to be reported by Securities and Exchange Commission Rule
228.402(b) (17 CFR 228.402(b)), specifically column (c) of that rule’s Summary
Compensation Table (or any successor provision).

 

1.2 “Change in Control” means in the case of those Participants who are parties
to a severance agreement with Unizan Financial Corp. the definition of Change in
Control specified in that severance agreement. For all other Participants,
Change in Control means that the Bank has terminated the Participant’s
employment for any of the following reasons:

 

  (a)  

Merger: Unizan Financial Corp. merges into or consolidates with another
corporation, or merges another corporation into Unizan Financial Corp., and as a
result less than a majority of the combined voting power of the resulting
corporation immediately after the merger or consolidation is held by persons who
were the holders of Unizan Financial Corp.’s voting securities immediately
before the merger or consolidation. For purposes of this Agreement, the term
person

 

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means an individual, corporation, partnership, trust, association, joint
venture, pool, syndicate, sole proprietorship, unincorporated organization or
other entity;

 

  (b)   Acquisition of Significant Share Ownership: a report on Schedule 13D or
Schedule TO (or any successor schedule, form or report) is filed or is required
to be filed under Sections 13(d) or 14(d) of the Securities Exchange Act of
1934, if the schedule discloses that the filing person or persons acting in
concert has or have become the beneficial owner of 15% or more of a class of
Unizan Financial Corp.’s voting securities (but this subsection 1.2(b) shall not
apply to beneficial ownership of voting shares of Unizan Financial Corp. held by
a Subsidiary (defined as an entity in which Unizan Financial Corp. directly or
indirectly beneficially owns 50% or more of the outstanding voting securities)
of Unizan Financial Corp. in a fiduciary capacity);

 

  (c)   Change in Board Composition: during any period of two consecutive years,
individuals who constitute the Board of Directors of Unizan Financial Corp. at
the beginning of the two-year period cease for any reason to constitute at least
a majority thereof; provided, however, that—for purposes of this subsection 1.2
(c)—each director who is first elected by the Board (or first nominated by the
Board for election by shareholders) by a vote of at least two-thirds (b) of the
directors who were directors at the beginning of the period shall be deemed to
have been a director at the beginning of the two-year period; or

 

  (d)   Sale of Assets: Unizan Financial Corp. sells to a third party
substantially all of Unizan Financial Corp.’s assets. For purposes of this
Agreement, sale of substantially all of Unizan Financial Corp.’s assets includes
sale of the Bank.

 

1.3 “Compensation Committee” means either the Compensation Committee designated
from time to time by the Bank’s Board of Directors (as of the date this Plan is
created, the Bank identifies the board committee performing this function as the
Unizan Financial Corp. Compensation and Pension Committee) or a majority of the
Bank’s Board of Directors, either of which shall hereinafter be referred to as
the Compensation Committee.

 

1.4 “Disability” means the Participant suffers a sickness, accident or injury
that is determined by the carrier of any individual or group disability
insurance policy covering the Participant, or by the Social Security
Administration, to be a disability rendering the Participant totally and
permanently disabled. The Participant must submit proof to the Bank of the
carrier’s or Social Security Administration’s determination upon request of the
Bank.

 

1.5 “Early Retirement Age” means the first day of the month following the
Participant’s 55th birthday, provided the Participant has at least 10 Years of
Service with the Bank on that date. If the Participant does not have 10 years of
service with the Bank by the first day of the month following the date of his
55th birthday, the Participant’s Early Retirement Age means the date on which
the Participant has 10 years of service with the Bank, provided such 10 Years of
Service occurs before the Participant’s Normal Retirement Age.

 

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1.6 “Early Termination” means the Termination of Employment before Early
Retirement Age for reasons other than death, Disability, Termination for Cause
or following a Change in Control.

 

1.7 “Early Termination Date” means the month, day and year in which Early
Termination occurs.

 

1.8 “Insured” means the individual whose life is insured.

 

1.9 “Insurer” means the insurance company issuing the life insurance policy on
the life of the Insured.

 

1.10 “Normal Retirement Age” means the Participant attaining age 65, but for
Roger L. Mann Normal Retirement Age is age 64.

 

1.11 “Normal Retirement Date” means the later of the Normal Retirement Age or
the date that the Participant terminates or is terminated for any reason other
than Termination for Cause.

 

1.12 “Participant” means the employee designated by the Compensation Committee
as eligible to participate in the Plan and who has elected in writing to
participate in the Plan and signs a Split Dollar Endorsement for the Policy in
which he or she is the Insured.

 

1.13 “Policy” or “Policies” means the individual insurance policy or policies
adopted by the Compensation Committee for purposes of insuring a Participant’s
life under this Plan.

 

1.14 “Plan” means this instrument, including all amendments thereto.

 

1.15 “Terminated for Cause” or “Termination for Cause” means in the case of
those Participants who are parties to a severance agreement with Unizan
Financial Corp. the definition of termination for cause specified in that
severance agreement. For all other Participants, Termination for Cause or
Terminated for Cause means that the Bank has terminated the Participant’s
employment for any of the following reasons:

 

  (a)   Gross negligence or gross neglect of duties;

 

  (b)   Commission of a felony or of a gross misdemeanor involving moral
turpitude; or

 

  (c)   Fraud, disloyalty, dishonesty or willful violation of any law or
significant Bank policy committed in connection with the Participant’s
employment and resulting in an adverse effect on the Bank. No act, or failure to
act, on the Participant’s part shall be considered “willful” unless he has
acted, or failed to act, with an absence of good faith and without a reasonable
belief that his action or failure to act was in the best interest of the Bank.

 

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1.16 “Years of Service” means the total number of consecutive twelve-month
periods during which the Participant serves as an employee of the Bank.

 

Article 2

Participation

 

2.1 Eligibility to Participate. The Compensation Committee in its sole
discretion shall designate from time to time Participants that are eligible to
participate in this Plan.

 

2.2 Participation. The eligible executive may participate in this Plan by
executing an Election to Participate and a Split Dollar Endorsement for each
Policy. The Split Dollar Endorsement shall bind the Participant and his or her
beneficiaries, assigns and transferees, to the terms and conditions of this
Plan. An executive’s participation is limited to Policies for which he or she is
the Insured. Exhibit A attached hereto sets forth the original Insured
Participants and the Policies on their lives as of May 1, 2001, when the Plan
was entered into by the Bank’s predecessor, United National Bank & Trust
Company.

 

2.3 Termination of Participation. A Participant’s rights under this Plan shall
cease and his or her participation in this Plan shall terminate if any of the
following events occur:

 

  (a)   If the Participant is Terminated for Cause,

 

  (b)   If the Participant’s employment with the Bank is terminated prior to the
Early Retirement Age for reasons other than Disability or Change in Control, or

 

  (c)   If the Participant terminates employment due to Disability and
thereafter becomes gainfully employed with an entity other than the Bank.

 

If the Bank decides to maintain the Policy after the Participant’s termination
of participation in the Plan, the Bank shall be the direct beneficiary of the
entire death proceeds of the Policy.

 

Article 3

Policy Ownership/Interests

 

3.1 Participant’s Interest. With respect to each Policy, the Participant or the
Participant’s assignee shall have the right to designate the beneficiary of one
of the following death benefit amounts:

 

  (a)   Pre-Retirement Death Benefit. If the Participant was employed by the
Bank at the time of death, the death benefit shall be the lesser of (1) two
times the Participant’s current Base Annual Salary; or (2) $1,000,000, in either
case, less the participant’s $50,000 group term life insurance benefit under the
Bank’s group term life insurance policy.

 

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  (b)   Post-Retirement Death Benefit. If the Participant was no longer employed
by the Bank at the time of death but had terminated employment

 

  • due to Disability,

 

  • or on or after Early Retirement Age, or

 

  • within three years after a Change in Control,

 

the death benefit shall be the lesser of (1) one times the Participant’s Base
Annual Salary at the time of termination of employment or (2) $1,000,000.

 

The Participant shall also have the right to elect and change settlement options
with the consent of the Bank and the Insurer as long as the Policy is in place.
The rights granted by this Section 3.1 do not supersede the Bank’s right to
cancel a Policy without replacement.

 

3.2 Bank’s Interest. The Bank shall own the Policies and shall have the right to
exercise all incidents of ownership, including but not limited to the right to
cancel a Policy or Policies without replacement. For any Policy cancelled by the
Bank without replacement, the Bank shall nevertheless pay or cause to be paid to
the beneficiary(ies) designated by the Participant death proceeds in the amount
specified in Section 3.1. For any Policy not cancelled, the Bank shall be the
direct beneficiary of any death proceeds remaining after the Participant’s
interest has been paid under Section 3.1.

 

Article 4

Premiums

 

4.1 Premium Payment. The Bank shall pay all premiums due on all Policies.

 

4.2 Imputed Income. The Bank shall impute income to the Participant in an amount
equal to the current term rate for the Participant’s age multiplied by the net
death benefit payable to the Participant’s beneficiary. The “current term rate”
is the minimum amount required to be imputed under Revenue Rulings 64-328 and
66-110, or any subsequent applicable authority.

 

Article 5

Assignment

 

A Participant may assign without consideration to any person, entity, or trust
all interests in the Bank’s obligation to the Participant under this Plan. If
the Participant transfers all of the Participant’s interest in the Bank’s
obligation, then all of the Participant’s interest in the obligation shall be
vested in the Participant’s transferee, who shall be substituted as a party
hereunder, and the Participant shall have no further interest in the Bank’s
obligation or in this Amended Split Dollar Agreement.

 

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Article 6

Insurer

 

The Insurer shall be bound only by the terms of their corresponding Policy. Any
payments the Insurer makes or actions it takes in accordance with a Policy shall
fully discharge it from all claims, suits and demands of all persons relating to
that Policy. The Insurer shall not be bound by the provisions of this Plan. The
Insurer shall have the right to rely on the Bank’s representations with regard
to any definitions, interpretations, or Policy interests as specified under this
Plan.

 

Article 7

Claims and Review Procedure

 

7.1 Claims Procedure. A person or beneficiary (“claimant”) who has not received
benefits under the Plan that he or she believes should be paid shall make a
claim for such benefits as follows:

 

  7.1.1   Initiation — Written Claim. The claimant initiates a claim by
submitting to the Bank a written claim for the benefits.

 

  7.1.2   Timing of Bank Response. The Bank shall respond to such claimant
within 90 days after receiving the claim. If the Bank determines that special
circumstances require additional time for processing the claim, the Bank can
extend the response period by an additional 90 days by notifying the claimant in
writing, prior to the end of the initial 90-day period, that an additional
period is required. The notice of extension must set forth the special
circumstances and the date by which the Bank expects to render its decision.

 

  7.1.3   Notice of Decision. If the Bank denies part or all of the claim, the
Bank shall notify the claimant in writing of such denial. The Bank shall write
the notification in a manner calculated to be understood by the claimant. The
notification shall set forth:

 

  7.1.3.1   The specific reasons for the denial,

 

  7.1.3.2   A reference to the specific provisions of the Plan on which the
denial is based,

 

  7.1.3.3   A description of any additional information or material necessary
for the claimant to perfect the claim and an explanation of why it is needed,

 

  7.1.3.4   An explanation of the Plan’s review procedures and the time limits
applicable to such procedures, and

 

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  7.1.3.5   A statement of the claimant’s right to bring a civil action under
ERISA (Employee Retirement Income Security Act) Section 502(a) following an
adverse benefit determination on review.

 

7.2 Review Procedure. If the Bank denies part or all of the claim, the claimant
shall have the opportunity for a full and fair review by the Bank of the denial,
as follows:

 

  7.2.1   Initiation — Written Request. To initiate the review, the claimant,
within 60 days after receiving the Bank’s notice of denial, must file with the
Bank a written request for review.

 

  7.2.2   Additional Submissions — Information Access. The claimant shall then
have the opportunity to submit written comments, documents, records and other
information relating to the claim. The Bank shall also provide the claimant,
upon request and free of charge, reasonable access to, and copies of, all
documents, records and other information relevant (as defined in applicable
ERISA regulations) to the claimant’s claim for benefits.

 

  7.2.3   Considerations on Review. In considering the review, the Bank shall
take into account all materials and information the claimant submits relating to
the claim, without regard to whether such information was submitted or
considered in the initial benefit determination.

 

  7.2.4   Timing of Bank Response. The Bank shall respond in writing to such
claimant within 60 days after receiving the request for review. If the Bank
determines that special circumstances require additional time for processing the
claim, the Bank can extend the response period by an additional 60 days by
notifying the claimant in writing, prior to the end of the initial 60-day
period, that an additional period is required. The notice of extension must set
forth the special circumstances and the date by which the Bank expects to render
its decision.

 

  7.2.5   Notice of Decision. The Bank shall notify the claimant in writing of
its decision on review. The Bank shall write the notification in a manner
calculated to be understood by the claimant. The notification shall set forth:

 

  7.2.5.1   The specific reason for the denial,

 

  7.2.5.2   A reference to the specific provisions of the Plan on which the
denial is based,

 

  7.2.5.3   A statement that the claimant is entitled to receive, upon request
and free of charge, reasonable access to, and copies of, all documents, records
and other information relevant (as defined in applicable ERISA regulations) to
the claimant’s claim for benefits, and

 

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  7.2.5.4   A statement of the claimant’s right to bring a civil action under
ERISA Section 502(a).

 

Article 8

Amendments and Termination

 

8.1 Amendment or Termination of Plan. The Bank may amend or terminate the Plan
at any time, and the Bank may amend or terminate a Participant’s rights under
the Plan at any time before a Participant’s death by written notice to the
Participant. The Bank’s right to amend or terminate the Plan includes the right
to cancel a Policy or Policies without replacement.

 

8.2 The Policies Are Subject to the Claims of Creditors. The Policy or any
comparable policy shall be subject to the claims of the Bank’s creditors.

 

8.3 Participant Waiver. A Participant may, in the Participant’s sole and
absolute discretion, waive his or her rights under the Plan at any time. Any
waiver permitted under this section 8.3 shall be in writing and delivered to the
Bank’s board of directors.

 

Article 9

Miscellaneous

 

9.1 Binding Effect. This Plan in conjunction with each Split Dollar Endorsement
shall bind each Participant and the Bank, their beneficiaries, survivors,
executors, administrators, and transferees and any Policy beneficiary.

 

9.2 No Guarantee of Employment. This Plan is not an employment policy or
contract. It does not give a Participant the right to remain an employee of the
Bank, nor does it interfere with the Bank’s right to discharge a Participant. It
also does not require a Participant to remain an employee nor interfere with a
Participant’s right to terminate employment at any time.

 

9.3 Applicable Law. The Plan and all rights hereunder shall be governed by and
construed according to the laws of the State of Ohio, except to the extent
preempted by the laws of the United States of America.

 

9.4 Notice. Any notice, consent or demand required or permitted to be given
under the provisions of this Plan by one party to another shall be in writing,
shall be signed by the party giving or making the same, and may be given either
by delivering the same to such other party personally, or by mailing the same,
by United States certified mail, postage prepaid, to such party, addressed to
his/her last known address as shown on the records of the Bank. The date of such
mailing shall be deemed the date of such mailed notice, consent or demand.

 

9.5 Entire Agreement. This Plan constitutes the entire agreement between the
Bank and the Participant as to the subject matter hereof. No rights are granted
to the Participants under this Plan other than those specifically set forth
herein.

 

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9.6 Administration. The Bank shall have powers which are necessary to administer
this Plan, including but not limited to:

 

  (a)   Interpreting the provisions of the Plan;

 

  (b)   Establishing and revising the method of accounting for the Plan;

 

  (c)   Maintaining a record of benefit payments; and

 

  (d)   Establishing rules and prescribing any forms necessary or desirable to
administer the Plan.

 

9.7 Designated Fiduciary. For purposes of the Employee Retirement Income
Security Act of 1974, if applicable, the Bank shall be the named fiduciary and
plan administrator. The named fiduciary may delegate to others certain aspects
of the management and operation responsibilities of the Plan, including the
employment of advisors and the delegation of ministerial duties to qualified
individuals.

 

9.8 Severability. If for any reason any provision of this Plan is held invalid
such invalidity shall not affect any other provision of this Plan not held so
invalid, and each such other provision shall, to the full extent consistent with
the law, continue in full force and effect. If any provision of this Plan shall
be held invalid in part, such invalidity shall in no way affect the rest of such
provision, not held so invalid, and the rest of such provision, together with
all other provisions of this Plan shall, to the full extent consistent with the
law, continue in full force and effect.

 

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9.9 Headings. The headings of Sections herein are included solely for
convenience of reference and shall not affect the meaning or interpretation of
any provision of this Plan.

 

IN WITNESS WHEREOF, the Bank has executed this amended and restated Plan as of
the date indicated above.

 

BANK

UNIZAN BANK, NATIONAL

ASSOCIATION

By

       

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Title   Senior Vice President:

HumanResources

 

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