Exhibit 10.11

 

Second Amendment to Form of Newport Federal Savings Bank Supplemental Director
Retirement Agreement.

 

SECOND AMENDMENT TO

SUPPLEMENTAL DIRECTOR RETIREMENT AGREEMENT

 

This Second Amendment (the “Second Amendment”) to the Supplemental Director
Retirement Agreement, dated as of March __, 2007 (as amended, the “Agreement”),
by and among Newport Federal Savings Bank (the “Bank”) and ______________ (the
“Director”) is effective as of _____________, 2011. Capitalized terms which are
not defined herein shall have the same meaning as set forth in the Agreement.

 

W I T N E S S E T H:

 

WHEREAS, the parties previously amended the Agreement to comply with the final
regulations issued in April 2007 by the Internal Revenue Service under Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”); and

 

WHEREAS, pursuant to Section 10(b) of the Agreement, the parties to the
Agreement desire to further amend the Agreement;

 

NOW, THEREFORE, in consideration of the premises, the mutual agreements herein
set forth and such other consideration the sufficiency of which is hereby
acknowledged, the Bank and the Employee hereby amend the Agreement as follows:

 

1.           This Second Amendment clarifies that the First Amendment, dated
November ___, 2008, is intended to be an amendment of the Supplemental Executive
Retirement Agreement, dated March 31, 2007, except to the extent inconsistent
therewith. The Amendment set forth at paragraph 2 below is intended to correct
an error set forth in the First Amendment.

 

2.           Amendment to Section 3(c) of the Agreement. Section 3(c) is hereby
amended in its entirety to read as follows:

 

If the Director ceases to perform duties due to Director’s Disability, the
Director will be treated as actively performing duties as a Director until the
earlier of (i) the date on which the Director attains age 72 or (ii) the date on
which the Director is age 67 or older and has at least 10 years of service (the
“Benefit Date”). Upon the occurrence of the Benefit Date, the Director’s
services will be deemed to be terminated. If the Director is age 72 on such
Benefit Date, the Director will be entitled to the supplemental annual pension
benefit provided in Section 1 of the Plan, where such benefit shall be payable
at the time and in the manner described in Section 1. If the Director is age 67
but less than age 72 and has at least 10 years of service on such Benefit Date,
the Director will be entitled to the supplemental annual pension benefit
provided in Section 2 of the Plan, where such benefit shall be payable at the
time and in the manner described in Section 2. In accordance with the
requirements of Code Section 409A, in the event that a Director is initially
determined to have a Disability prior to one year following the effective date
of this amendment, the Director’s Disability Benefit will be determined and paid
under Section 3(c) of the First Amendment adopted in November 2008.

Disability shall mean that the Director is (i) unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, or (ii) determined to
be totally disabled by the Social Security Administration.

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3.           Amendment to Section 7(b) of the Agreement. Section 7(b) is hereby
amended to read as follows:

 

(b)A Change in Control shall be deemed to have occurred upon the earlier of the
following events:

 

i.Merger: The Company merges into or consolidates with another entity or merges
another entity into the Company, and as a result less than a majority of the
combined voting power of the resulting entity immediately after the merger or
consolidation is held by persons who were members of the Company immediately
before the merger or consolidation;

 

ii.Change in Board Composition: During any period of two consecutive years,
individuals who constitute the Company’s Board of Directors at the beginning of
the two-year period cease for any reason to constitute at least a majority of
the Company’s Board of Directors; provided, however, that for purposes of this
clause (ii), each director who is first elected by the board (or first nominated
by the board for election by the members) by a vote of at least two-thirds (2/3)
of the directors who were directors at the beginning of the two-year period
shall be deemed to have also been a director at the beginning of such period; or

 

iii.Sale of Assets: The Company sells to a third party all or substantially all
of its assets.

 

4.            Compliance with Section 409A. This Amendment shall be interpreted
and administered consistent with Section 409A of the Code.

 

[Signature Page to Follow]

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IN WITNESS WHEREOF, the Bank, on behalf of its duly authorized officer, and the
Director have caused this Second Amendment to be executed as of the date first
written above

 

  NEWPORT FEDERAL SAVINGS BANK               By:                       DIRECTOR
                    By:  

 

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