Exhibit 10.7

Amended Salary Continuation Agreement

Between Opportunity Bank of Montana

and Peter J. Johnson

 

 

 

 

 

 

 

Exhibit 10.7

Opportunity Bank of Montana

Amended Salary Continuation Agreement

 

This Amended Salary Continuation Agreement (this “Agreement”) is entered into as
of , 2015 by and between Opportunity Bank of Montana, a Montana-chartered bank
(the “Bank”), and Peter J. Johnson, a Bank executive (the “Executive”).

 

Whereas, the Executive has contributed substantially to the Bank’s success and
the Bank desires that the Executive continue in its employ,

 

Whereas, to encourage the Executive to remain an employee, the Bank is willing
to provide to the Executive salary continuation benefits payable from the Bank’s
general assets,

 

Whereas, the Bank and the Executive are parties to an April 18, 2002 Salary
Continuation Agreement between the Executive and American Federal Savings Bank,
as amended by the December 31, 2006 First Amendment and the October 20, 2011
Second Amendment,

 

Whereas, the Bank and the Executive intend that this Agreement supersede and
restate in its entirety the April 18, 2002 Salary Continuation Agreement, as
amended by the December 31, 2006 First Amendment and the October 20, 2011 Second
Amendment,

 

Whereas, by this Agreement the Bank and the Executive are changing selected
terms of the April 18, 2002 Salary Continuation Agreement, as amended by the
December 31, 2006 First Amendment and the October 20, 2011 Second Amendment,
including eliminating the vesting and years-of-service provisions, removing the
age 60 minimum-age condition for receipt of early termination benefits,
clarifying that benefits for termination before Normal Retirement Age are based
upon the Accrual Balance existing at the end of the month immediately before
employment termination, deleting the prohibition against excess parachute
payments under Internal Revenue Code section 280G, and providing for legal fee
reimbursement if the Agreement is challenged after a change in control, but by
this Agreement the Bank and the Executive are not changing the time or form of
payment and are not changing the age 65 Normal Retirement Age,

 

Whereas, as of the date of this Agreement none of the conditions or events
included in the definition of the term “golden parachute payment” that is set
forth in section 18(k)(4)(A)(ii) of the Federal Deposit Insurance Act [12 U.S.C.
1828(k)(4)(A)(ii)] and in Federal Deposit Insurance Corporation Rule
359.1(f)(1)(ii) [12 C.F.R. 359.1(f)(1)(ii)] exists or, to the best knowledge of
the Bank, is contemplated insofar as the Bank is concerned, and

 

Whereas, the parties hereto intend that this Agreement be considered an unfunded
arrangement maintained primarily to provide supplemental retirement benefits for
the Executive, and to be considered a nonqualified benefit plan for purposes of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). The
Executive is fully advised of the Bank’s financial status.

 

Now Therefore, in consideration of these premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Executive and the Bank agree as follows.

 

 

 

Article 1

Definitions

 

1.1 “Accrual Balance” means the liability that should be accrued by the Bank
under generally accepted accounting principles (“GAAP”) for the Bank’s
obligation to the Executive under this Agreement, applying Financial Accounting
Standards Board ASC 710-10-30 (formerly known as Accounting Principles Board
Opinion No. 12, as amended by Statement of Financial Accounting Standards No.
106), and the calculation method and discount rate specified hereinafter. The
discount rate means the rate used by the Plan Administrator for determining the
Accrual Balance. In its sole discretion, the Plan Administrator may adjust the
discount rate to maintain the rate within reasonable standards according to
GAAP.

 

1.2 “Beneficiary” means each designated person, or the estate of the deceased
Executive, entitled to benefits, if any, upon the death of the Executive,
determined according to Article 4.

 

1.3 “Beneficiary Designation Form” means the form established from time to time
by the Plan Administrator that the Executive completes, signs, and returns to
the Plan Administrator to designate one or more Beneficiaries.

 

1.4 “Change in Control” means a change in control as defined in Internal Revenue
Code section 409A and rules, regulations, and guidance of general application
thereunder issued by the Department of the Treasury, applying the percentage
threshold specified in each of paragraphs (a) through (c) of this section 1.4 or
the related percentage threshold specified in section 409A and rules,
regulations, and guidance of general application thereunder, whichever is
greater –

 

(a) Change in ownership: a change in ownership occurs on the date any one person
or group accumulates ownership of the stock of Eagle Bancorp Montana, Inc., a
Delaware corporation of which the Bank is a wholly owned subsidiary,
constituting more than 50% of the total fair market value or total voting power
of Eagle Bancorp Montana, Inc. stock,

 

(b) Change in effective control: (x) any one person, or more than one person
acting as a group, acquires within a 12-month period ownership of Eagle Bancorp
Montana, Inc. stock possessing 30% or more of the total voting power of Eagle
Bancorp Montana, Inc. stock, or (y) a majority of the board of directors of
Eagle Bancorp Montana, Inc. is replaced during any 12-month period by directors
whose appointment or election is not endorsed in advance by a majority of Eagle
Bancorp Montana, Inc.’s board of directors, or

 

 

 

(c) Change in ownership of a substantial portion of assets: a change in the
ownership of a substantial portion of assets occurs if in a 12-month period any
one person, or more than one person acting as a group, acquires from Eagle
Bancorp Montana, Inc. assets having a total gross fair market value equal to or
exceeding 40% of the total gross fair market value of all of the assets of Eagle
Bancorp Montana, Inc. immediately before the acquisition or acquisitions. For
this purpose, gross fair market value means the value of the assets of Eagle
Bancorp Montana, Inc. or the value of the assets being disposed of, determined
without regard to any liabilities associated with the assets.

 

1.5 “Code” means the Internal Revenue Code of 1986, as amended, and rules,
regulations, and guidance of general application issued thereunder by the
Department of the Treasury.

 

1.6 “Disability” means, because of a medically determinable physical or mental
impairment that can be expected to result in death or that can be expected to
last for a continuous period of at least 12 months, (x) the Executive is unable
to engage in any substantial gainful activity, or (y) the Executive is receiving
income replacement benefits for a period of at least three months under an
accident and health plan of the employer. Medical determination of disability
may be made either by the Social Security Administration or by the provider of
an accident or health plan covering employees of the Bank. Upon request of the
Plan Administrator, the Executive must submit proof to the Plan Administrator of
the Social Security Administration’s or provider’s determination.

 

1.7 “Early Termination” means Separation from Service before Normal Retirement
Age for reasons other than death, Disability, or Termination with Cause.

 

1.8 “Effective Date” means April 18, 2002.

 

1.9 “Normal Retirement Age” means age 65.

 

1.10 “Plan Administrator” means the plan administrator described in Article 8.

 

1.11 “Plan Year” means a twelve-month period commencing on January 1 and ending
on December 31 of each year.

 

1.12 “Separation from Service” means separation from service as defined in
Internal Revenue Code section 409A and rules, regulations, and guidance of
general application thereunder issued by the Department of the Treasury,
including termination for any reason of the Executive’s service as an executive
and independent contractor to the Bank and any member of a controlled group, as
defined in Code section 414, other than because of a leave of absence approved
by the Bank or the Executive’s death. For purposes of this Agreement, if there
is a dispute about the employment status of the Executive or the date of the
Executive’s Separation from Service, the Bank has the sole and absolute right to
decide the dispute unless a Change in Control has occurred.

 

1.13 “Termination with Cause” and “Cause” have the same meaning specified in any
employment or severance agreement existing on the date hereof or entered into
after the date of this Agreement by the Executive and the Bank. If the Executive
is not a party to a severance or employment agreement containing a definition of
termination for cause, Termination with Cause means the Bank terminates the
Executive’s employment as a result of –

 

 

 

(a) gross negligence or gross neglect of duty,

 

(b) commission of a felony or of a gross misdemeanor involving moral turpitude,
or

 

(c) fraud, disloyalty, dishonesty, or wilful violation of any law or significant
Bank policy, resulting in an adverse effect on the Bank.

 

Article 2

Benefit Payment

 

2.1 Normal Retirement. For Separation from Service on or after the date the
Executive attains Normal Retirement Age the Bank will pay to the Executive the
benefit described in this section 2.1 instead of any other benefit under this
Agreement. However, if the Executive’s Separation from Service is a Termination
with Cause or if this Agreement terminates under Article 5 the Executive is
entitled to no benefits.

 

2.1.1 Amount of benefit. The annual benefit under this section 2.1 is $69,500.

 

2.1.2 Payment of benefit. Beginning with the month immediately after the month
in which the Executive’s Separation from Service occurs, the Bank will pay the
annual benefit to the Executive in equal monthly installments on the first day
of each month. The annual benefit is payable for 180 months or for the
Executive’s lifetime, whichever is longer.

 

2.2 Early Termination. Upon Early Termination the Bank will pay to the Executive
the benefit described in this section 2.2 instead of any other benefit under
this Agreement. If the Executive’s Separation from Service is a Termination with
Cause no benefit will be paid.

 

2.2.1 Amount of benefit. The benefit is the amount that amortizes the Accrual
Balance existing at the end of the month immediately before the month in which
Separation from Service occurs, taking into account interest at the discount
rate or rates established by the Plan Administrator.

 

2.2.2 Payment of benefit. Beginning with the month immediately after the month
in which the Executive’s Separation from Service occurs, the Bank will pay the
benefit to the Executive in equal monthly installments on the first day of each
month. The benefit is payable for 180 months or for the Executive’s lifetime,
whichever is longer.

 

2.3 Disability. Upon Separation from Service because of Disability before Normal
Retirement Age the Bank will pay to the Executive the benefit described in this
section 2.3 instead of any other benefit under this Agreement.

 

 

 

2.3.1 Amount of benefit. The benefit is the amount that amortizes the Accrual
Balance existing at the end of the month immediately before the month in which
Separation from Service occurs, taking into account interest at the discount
rate or rates established by the Plan Administrator.

 

2.3.2 Payment of benefit. Beginning with the month immediately after the month
in which the Executive’s Separation from Service occurs, the Bank will pay the
benefit to the Executive in equal monthly installments on the first day of each
month. The benefit is payable for 180 months or for the Executive’s lifetime,
whichever is longer.

 

2.4 Annual Benefit Statement. As promptly as practicable after the end of each
Plan Year, the Plan Administrator will provide or cause to be provided to the
Executive an annual benefit statement showing benefits payable or potentially
payable to the Executive under this Agreement. Each annual benefit statement
supersedes the previous year’s annual benefit statement. If there is a
contradiction between this Agreement and the annual benefit statement concerning
the amount of a particular benefit payable or potentially payable to the
Executive under sections 2.1, 2.2, 2.3, 2.4, or 2.5, the amount of the benefit
determined under this Agreement controls.

 

2.5 Savings Clause Relating to Compliance with Code Section 409A. Despite any
contrary provision of this Agreement, if when the Executive’s employment
terminates the Executive is a specified employee, as defined in Code section
409A, and if any payments under Article 2 of this Agreement will result in
additional tax or interest to the Executive because of section 409A, the
Executive will not be entitled to the payments under Article 2 until the
earliest of (x) the date that is at least six months after termination of the
Executive’s employment for reasons other than the Executive’s death, (y) the
date of the Executive’s death, or (z) any earlier date that does not result in
additional tax or interest to the Executive under section 409A. Payments that
are delayed because the Executive is a specified employee at Separation from
Service will be accumulated and paid to the Executive in a single lump sum on
the first day of the seventh month after the month in which Separation from
Service occurs. If any provision of this Agreement would subject the Executive
to additional tax or interest under section 409A, the Bank will reform the
provision. However, the Bank will maintain to the maximum extent practicable the
original intent of the applicable provision without subjecting the Executive to
additional tax or interest, and the Bank will not be required to incur any
additional compensation expense as a result of the reformed provision.

 

2.6 One Benefit Only. Despite anything to the contrary in this Agreement, the
Executive and Beneficiary are entitled to one benefit only under this Agreement,
which will be determined by the first event to occur that is dealt with by this
Agreement. Except as provided in Article 3, subsequent occurrence of events
dealt with by this Agreement do not entitle the Executive or Beneficiary to
other or additional benefits under this Agreement.

 

Article 3

Death Benefits

 

 

 

3.1 Death During Active Service. Except as provided in section 5.2, if the
Executive dies in active service to the Bank, at the Executive’s death the
Executive’s Beneficiary is entitled to the Normal Retirement benefit specified
in section 2.1. Beginning with the month immediately after the month in which
the Executive’s death occurs, the Bank will pay the annual benefit to the
Beneficiary in equal monthly installments on the first day of each month. The
annual benefit is payable for 180 months.

 

3.2 Death During Benefit Period. (a) If the Executive dies after benefit
payments commence under Article 2 but before receiving payments for 180 months
(treating as payment for six months the single lump-sum payment made seven
months after separation from service, in the case of payments that are delayed
for six months because of Code section 409A), the Executive’s Beneficiary is
entitled to remaining benefits at the same time and in the same amount they
would have been paid to the Executive had the Executive survived. The benefit is
payable to the Executive’s Beneficiary under this section 3.2 until the
Executive and the Executive’s Beneficiary have together received a total of 180
monthly payments (treating as six monthly payments the single lump-sum payment
made seven months after separation from service, in the case of payments that
are delayed for six months because of Code section 409A).

 

(b) If the Executive dies after receiving payments for 180 months (treating as
payment for six months the single lump-sum payment made seven months after
separation from service, in the case of payments that are delayed for six months
because of Code section 409A), the Executive’s Beneficiary is entitled to no
benefits under this Agreement.

 

Article 4

Beneficiaries

 

4.1 Beneficiary Designations. The Executive may at any time designate a
Beneficiary to receive at the Executive’s death any benefits payable under this
Agreement. The Beneficiary designated under this Agreement may be the same as or
different from the beneficiary designation under any other benefit plan of the
Bank in which the Executive participates.

 

4.2 Beneficiary Designation: Change. The Executive may designate a Beneficiary
by completing and signing the Beneficiary Designation Form and delivering it to
the Plan Administrator or its designated agent. The Executive’s Beneficiary
designation is deemed automatically revoked if the Beneficiary predeceases the
Executive or if the Executive names a spouse as Beneficiary and the marriage is
subsequently dissolved. The Executive may change a Beneficiary by completing,
signing, and otherwise complying with the terms of the Beneficiary Designation
Form and the Plan Administrator’s rules and procedures, as in effect from time
to time. Upon the acceptance by the Plan Administrator of a new Beneficiary
Designation Form, all Beneficiary designations previously filed are cancelled.
The Plan Administrator is entitled to rely on the last Beneficiary Designation
Form filed by the Executive and accepted by the Plan Administrator before the
Executive’s death.

 

 

 

4.3 Acknowledgment. No designation or change in designation of a Beneficiary is
effective until received, accepted, and acknowledged in writing by the Plan
Administrator or its designated agent.

 

4.4 No Beneficiary Designation. If the Executive dies without a valid
beneficiary designation or if all designated Beneficiaries predecease the
Executive, the Executive’s spouse is the designated Beneficiary. If the
Executive has no surviving spouse, the benefit payments will be made to the
personal representative of the Executive’s estate.

 

4.5 Facility of Payment. If a benefit is payable to a minor, to a person
declared incapacitated, or to a person incapable of handling the disposition of
his or her property, the Bank may pay the benefit to the guardian, legal
representative, or person having the care or custody of the minor, incapacitated
person, or incapable person. The Bank may require proof of incapacity, minority,
or guardianship as it may deem appropriate before distribution of the benefit.
Distribution completely discharges the Bank from all liability for the benefit.

 

Article 5

General Limitations

 

5.1 Termination with Cause. Despite any contrary provision of this Agreement,
the Bank will not pay any benefit under this Agreement and this Agreement will
terminate if Separation from Service is a Termination with Cause.

5.2 Misstatement. The Bank will not pay any benefit under this Agreement if the
Executive makes any material misstatement of fact on any application or resume
provided to the Bank or on any application for benefits provided by the Bank.

 

5.3 Removal. If the Executive is removed from office or permanently prohibited
from participating in the Bank’s affairs by an order issued under section
8(e)(4) or (g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. 1818(e)(4) or
(g)(1), all obligations of the Bank under this Agreement terminate as of the
effective date of the order.

 

5.4 Default. Despite any provision of this Agreement to the contrary, if the
Bank is in “default” or “in danger of default,” as those terms are defined in
section 3(x) of the Federal Deposit Insurance Act, 12 U.S.C. 1813(x), all
obligations under this Agreement terminate.

 

5.5 FDIC Open-Bank Assistance. All obligations under this Agreement terminate,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the Bank, when the Federal Deposit Insurance
Corporation enters into an agreement to provide assistance to or on behalf of
the Bank under the authority contained in Federal Deposit Insurance Act section
13(c). 12 U.S.C. 1823(c). Rights of the parties that have already vested are not
affected, however.

 

Article 6

Claims and Review Procedures

 

 

 

6.1 Claims Procedure. The Bank will notify any person or entity that makes a
claim for benefits under this Agreement (the “Claimant”) in writing, within 90
days after receiving Claimant’s written application for benefits, of his or her
eligibility or noneligibility for benefits under the Agreement. If the Plan
Administrator determines that the Claimant is not eligible for benefits or full
benefits, the notice shall set forth (w) the specific reasons for such denial,
(x) a specific reference to the provisions of the Agreement on which the denial
is based, (y) a description of any additional information or material necessary
for the Claimant to perfect his or her claim, and a description of why it is
needed, and (z) an explanation of the Agreement’s claims review procedure and
other appropriate information as to the steps to be taken if the Claimant wishes
to have the claim reviewed. If the Plan Administrator determines that there are
special circumstances requiring additional time to make a decision, the Bank
will notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an additional
90 days.

 

6.2 Review Procedure. If the Claimant is determined by the Plan Administrator
not to be eligible for benefits, or if the Claimant believes that he or she is
entitled to greater or different benefits, the Claimant will have the
opportunity to have such claim reviewed by the Bank by filing a petition for
review with the Bank within 60 days after receipt of the notice issued by the
Bank. Said petition will state the specific reasons which the Claimant believes
entitle him or her to benefits or to greater or different benefits. Within 60
days after receipt by the Bank of the petition, the Plan Administrator will
afford the Claimant (and counsel, if any) an opportunity to present his or her
position verbally or in writing, and the Claimant (or counsel) will have the
right to review the pertinent documents. The Plan Administrator will notify the
Claimant of the Plan Administrator’s decision in writing within the 60-day
period, stating specifically the basis of its decision, written in a manner to
be understood by the Claimant and the specific provisions of the Agreement on
which the decision is based. If, because of the need for a hearing, the 60-day
period is not sufficient, the decision may be deferred for up to another 60 days
at the election of the Plan Administrator, but notice of this deferral will be
given to the Claimant.

 

Article 7

Miscellaneous

 

7.1 Amendments and Termination. This Agreement may be amended solely by a
written agreement signed by the Bank and by the Executive. This Agreement may be
terminated by the Bank without the Executive’s consent. Unless Article 5
provides that the Executive is not entitled to payment or unless when
termination occurs the Executive has already received payment of benefits under
this Agreement, the Bank must pay the vested Accrual Balance in a single lump
sum to the Executive if the Bank terminates this Agreement. The lump-sum
termination payment will be made to the Executive on the first day of the
thirteenth month after the month in which the Bank terminates this Agreement.

 

7.2 Binding Effect. This Agreement binds the Executive, the Bank, and their
beneficiaries, survivors, executors, successors, administrators, and
transferees.

 

 

 

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

 

7.4 Non-Transferability. Benefits under this Agreement may not be sold,
transferred, assigned, pledged, attached, or encumbered.

 

7.5 Successors; Binding Agreement. By an assumption agreement in form and
substance satisfactory to the Executive, the Bank will require any successor
(whether direct or indirect, by purchase, merger, consolidation, or otherwise)
to all or substantially all of the business or assets of the Bank to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Bank would be required to perform this Agreement had no
succession occurred.

 

7.6 Tax Withholding. The Bank will withhold any taxes that are required to be
withheld from the benefits provided under this Agreement.

 

7.7 Applicable Law. This Agreement and all rights hereunder are governed by the
laws of the State of Montana, except to the extent preempted by the laws of the
United States of America.

 

7.8 Unfunded Arrangement. The Executive and Beneficiary are general unsecured
creditors of the Bank for the payment of benefits under this Agreement. The
benefits represent the mere promise by the Bank to pay benefits. Rights to
benefits are not subject to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any
insurance on the Executive’s life is a general asset of the Bank to which the
Executive and Beneficiary have no preferred or secured claim.

 

7.9 Entire Agreement. This Agreement constitutes the entire agreement between
the Bank and the Executive concerning the subject matter. No rights are granted
to the Executive under this Agreement other than those specifically set forth.
This Agreement amends and restates in its entirety the April 18, 2002 Salary
Continuation Agreement, as amended by the December 31, 2006 First Amendment and
the October 20, 2011 Second Amendment.

 

7.10 Severability. If any provision of this Agreement is held invalid, the
invalidity does not affect any other provision of this Agreement not held
invalid, and each such other provision continues in full force and effect to the
full extent consistent with law. If any provision of this Agreement is held
invalid in part, invalidity does not affect the remainder of the provision not
held invalid and the remainder of the provision, together with all other
provisions of this Agreement, continues in full force and effect to the full
extent consistent with law.

 

7.11 Headings. Caption headings and subheadings herein are included solely for
convenience of reference and do not affect the meaning or interpretation of any
provision of this Agreement.

 

 

 

7.12 Notices. All notices, requests, demands, and other communications hereunder
must be in writing and will be deemed to have been duly given if delivered by
hand or mailed, certified or registered mail, return receipt requested, with
postage prepaid, or delivered by email to the following addresses or to such
other address as either party may designate by like notice. Unless otherwise
changed by notice, notice is properly addressed to the Executive if addressed to
the postal address or electronic mail address of the Executive on the books and
records of the Bank at the time of the delivery of notice, and properly
addressed to the Bank if addressed to the Board of Directors, Opportunity Bank
of Montana, 1400 Prospect Avenue, Helena, Montana 59601.

 

7.13 Payment of Legal Fees. The Bank is aware that after a Change in Control
management could cause or attempt to cause the Bank to refuse to comply with the
obligations under this Agreement, or could institute or cause or attempt to
cause the Bank to institute litigation seeking to have this Agreement declared
unenforceable, or could take or attempt to take other action to deny the
Executive the benefits intended under this Agreement. In these circumstances the
purpose of this Agreement would be frustrated. The Bank desires that the
Executive not be required to incur the expenses associated with the enforcement
of rights under this Agreement, whether by litigation or other legal action,
because the cost and expense thereof would substantially detract from the
benefits intended to be granted to the Executive hereunder. The Bank desires
that the Executive not be forced to negotiate settlement of rights under this
Agreement under threat of incurring expenses. Accordingly, if after a Change in
Control occurs it appears to the Executive that (x) the Bank has failed to
comply with any of its obligations under this Agreement, or (y) the Bank or any
other person has taken any action to declare this Agreement void or
unenforceable or instituted any litigation or other legal action designed to
deny, diminish, or to recover from the Executive the benefits intended to be
provided to the Executive hereunder, the Bank irrevocably authorizes the
Executive from time to time to retain counsel of the Executive’s choice, at the
Bank’s expense as provided in this section 7.13, to represent the Executive in
the initiation or defense of any litigation or other legal action, whether by or
against the Bank or any director, officer, stockholder, or other person
affiliated with the Bank, in any jurisdiction. Regardless of any existing or
previous attorney-client relationship between the Bank and any counsel chosen by
the Executive under this section 7.13, the Bank irrevocably consents to the
Executive entering into an attorney-client relationship with that counsel and
the Bank and the Executive agree that a confidential relationship exists between
the Executive and that counsel. The fees and expenses of counsel selected from
time to time by the Executive as provided in this section will be paid or
reimbursed to the Executive by the Bank on a regular, periodic basis upon
presentation by the Executive of a statement or statements prepared by counsel
in accordance with counsel’s customary practices, whether suit be brought or not
and whether or not incurred in trial, bankruptcy, or appellate proceedings, but
the Bank’s payment or reimbursement of the Executive’s counsel’s fees and
expenses must occur on or before the last day of the Executive’s tax year
immediately after the Executive’s tax year in which the expense is incurred. If
the Executive is a specified employee, as defined in Code section 409A, on the
date of termination, payment under this section 7.13 will be made on the first
day of the seventh month after the month in which the Executive’s termination
occurs. Interest will accrue on the payment from the date of termination through
the date of payment at the Prime Rate of Interest in effect on the date of
termination and as reported in the Wall Street Journal. The six-month delay
applies if and only if an exemption from the six-month delay requirement of Code
section 409A is not available. The Executive’s right to payment or reimbursement
under this section 7.13 is not subject to liquidation or exchange for another
benefit. The Bank’s obligation to pay the Executive’s legal fees provided by
this section 7.13 operates separately from and in addition to any legal fee
reimbursement obligation the Bank may have with the Executive under any separate
severance, employment, salary continuation, or other agreement. Despite anything
to the contrary in this section 7.13 however, the Bank is not required to pay or
reimburse the Executive’s legal expenses if doing so would violate section 18(k)
of the Federal Deposit Insurance Act [12 U.S.C. 1828(k)] and Rule 359.3 of the
Federal Deposit Insurance Corporation [12 CFR 359.3].

 

 

 

Article 8

Administration of Agreement

 

8.1 Plan Administrator Duties. This Agreement will be administered by a Plan
Administrator consisting of the board or such committee or person as the board
appoints. The Executive may not be a member of the Plan Administrator. The Plan
Administrator has the discretion and authority to (x) make, amend, interpret,
and enforce all appropriate rules and regulations for the administration of this
Agreement and (y) decide or resolve any and all questions that may arise.

 

8.2 Agents. In the administration of this Agreement the Plan Administrator may
employ agents and delegate to them such administrative duties as it sees fit
(including acting through a duly appointed representative) and may from time to
time consult with counsel, who may be counsel to the Bank.

 

8.3 Binding Effect of Decisions. The decisions and actions of the Plan
Administrator concerning the administration, interpretation, and application of
the Agreement and the rules and regulations promulgated hereunder are final and
conclusive and binding upon all persons having any interest in the Agreement. No
Executive or Beneficiary has a right, vested or not vested, regarding the
continued use of any previously adopted assumptions, including but not limited
to the discount rate and calculation method described in section 1.1.

 

8.4 Indemnity of Plan Administrator. The Bank will indemnify and hold harmless
the members of the Plan Administrator against any and all claims, losses,
damages, expenses, or liabilities arising from any action or failure to act with
respect to this Agreement, except in the case of willful misconduct by the Plan
Administrator or any of its members.

 

8.5 Bank Information. To enable the Plan Administrator to perform its functions,
the Bank will supply full and timely information to the Plan Administrator on
all matters relating to the date and circumstances of the retirement,
Disability, death, or Separation from Service of the Executive and such other
pertinent information as the Plan Administrator may reasonably require.

 

In Witness Whereof, the Executive and a duly authorized officer of the Bank have
executed this Amended Salary Continuation Agreement as of the date first written
above.

 

 

 

 

Executive:   Bank:       Opportunity Bank of Montana                          
By:     Peter J. Johnson   Its:    

 

 

 

 

 

 

 

 

 

 

 

 

Beneficiary Designation

Opportunity Bank of Montana

Amended Salary Continuation Agreement

 

I, Peter J. Johnson, designate the following as beneficiary of any death
benefits under this Amended Salary Continuation Agreement –

 

Primary:   . Contingent:   .

 

Note: To name a trust as beneficiary, please provide the name of the trustee(s)
and the exact name and date of the trust agreement.

 

I understand that I may change these beneficiary designations by filing a new
written designation with the Bank. I further understand that the designations
will be automatically revoked if the beneficiary predeceases me or if I name my
spouse as beneficiary and our marriage is subsequently dissolved.

 

Signature:           Peter J. Johnson           Date:   __________, 20__  

 

 

Accepted by the Bank this ___ day of _____________, 20__

 

 

  By:                   Print Name:                   Title:      

 

 

 

 

 

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