Exhibit 10.20

 

AMENDMENT NUMBER EIGHT
TO
TEXAS REGIONAL BANCSHARES, INC.
AMENDED AND RESTATED EMPLOYEE STOCK OWNERSHIP PLAN
(WITH 401(K) PROVISIONS)

 

Texas Regional Bancshares, Inc., a corporation organized and operating under the
laws of the State of Texas, and registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended (the “Company”), together with the
Trustees of the Texas Regional Bancshares, Inc. Amended and Restated Employee
Stock Ownership Plan (with 401(k) Provisions)(the “Plan”) adopt the following
amendments to the Plan effective as of January 1, 2003.

 

WHEREAS, the Company has established and maintains the Texas Regional
Bancshares, Inc. Amended and Restated Employee Stock Ownership Plan (with 401(k)
Provisions); and

 

WHEREAS, pursuant to final Treasury Regulations and subsequent guidance issued
by the Internal Revenue Service, the Plan’s provisions for required minimum
distributions must be timely amended by adoption of a model amendment to the
Plan.

 

NOW THEREFORE, IT IS HEREBY AGREED THAT the Plan is hereby amended for purposes
of determining required minimum distributions for calendar years beginning on or
after January 1, 2003, by the addition to the Plan of Appendix “A,” in the form
attached to these resolutions and incorporated herein.

 

IN WITNESS WHEREOF, this Amendment Number Eight to the Texas Regional
Bancshares, Inc. Amended and Restated Employee Stock Ownership Plan (with 401(k)
Provisions) has been executed this 9th day of December, 2003 to be effective as
of the dates provided above.

 

 

Texas Regional Bancshares, Inc.

 

 

 

 

 

By:

/s/ G.E. Roney

 

 

Glen E. Roney,

 

 

Chairman of the Board and

 

 

Chief Executive Officer

 

 

AGREED TO AND ACCEPTED BY:

 

 

/s/ G.E. Roney

 

Glen E. Roney, Trustee

 

 

/s/ Morris Atlas

 

Morris Atlas, Trustee

 

 

/s/ Frank N. Boggus

 

Frank N. Boggus, Trustee

 

--------------------------------------------------------------------------------

 

Appendix A

 

ARTICLE A.  MINIMUM DISTRIBUTION REQUIREMENTS

 

REVENUE PROCEDURE 2002-29 (MODEL PLAN AMENDMENT 1)

 

SECTION 1. GENERAL RULES

 

1.1.                              Effective Date.  The provisions of this
article will apply for purposes of determining required minimum distributions
for calendar years beginning with the 2003 calendar year.

 

1.2.                              [Reserved]

 

1.3.                              Precedence.  The requirements of this article
will take precedence over any inconsistent provisions of the plan.

 

1.4.                              Requirements of Treasury Regulations
Incorporated.  All distributions required under this article will be determined
and made in accordance with the Treasury regulations under section 401(a)(9) of
the Internal Revenue Code.

 

1.5.                              [Reserved]

 

SECTION 2.                                TIME AND MANNER OF DISTRIBUTION.

 

2.1.                              Required Beginning Date.  The participant’s
entire interest will be distributed, or begin to be distributed, to the
participant no later than the participant’s required beginning date.

 

2.2.                              Death of Participant Before Distributions
Begin.  If the participant dies before distributions begin, the participant’s
entire interest will be distributed, or begin to be distributed, no later than
as follows:

 

(a)                                  If the participant’s surviving spouse is
the participant’s sole designated beneficiary, then, except as provided in
Section 6, distributions to the surviving spouse will begin by December 31 of
the calendar year immediately following the calendar year in which the
participant died, or by December 31 of the calendar year in which the
participant would have attained age 70 1/2, if later.

 

(b)                                 If the participant’s surviving spouse is not
the participant’s sole designated beneficiary, then, except as provided in
Section 6, distributions to the designated beneficiary will begin by December 31
of the calendar year immediately following the calendar year in which the
participant died.

 

(c)                                  If there is no designated beneficiary as of
September 30 of the year following the year of the participant’s death, the
participant’s entire interest will be distributed by December 31 of the calendar
year containing the fifth anniversary of the participant’s death.

 

(d)                                 If the participant’s surviving spouse is the
participant’s sole designated beneficiary and the surviving spouse dies after
the participant but before distributions to the surviving spouse begin, this
section 2.2, other than section 2.2(a), will apply as if the surviving spouse
were the participant.

 

For purposes of this section 2.2 and section 4, unless section 2.2(d) applies,
distributions are considered to begin on the participant’s required beginning
date.  If section 2.2(d) applies, distributions are considered to begin on the
date distributions are required to begin to the surviving spouse under section
2.2(a).  If distributions under an annuity purchased from an insurance company
irrevocably commence to the participant before the participant’s required
beginning date (or to the participant’s surviving spouse before the date
distributions are required to begin to the surviving spouse under section
2.2(a)), the date distributions are considered to begin is the date
distributions actually commence.

 

2.3.                              Forms of Distribution.  Unless the
participant’s interest is distributed in the form of an annuity purchased from
an insurance company or in a single sum on or before the required beginning
date, as of the first distribution calendar year distributions will be made in
accordance with sections 3 and 4 of this article.  If the participant’s interest
is distributed in the form of an annuity purchased from an insurance company,
distributions thereunder will be made in accordance with the requirements of
section 401(a)(9) of the Code and the Treasury regulations.

 

SECTION 3.                                REQUIRED MINIMUM DISTRIBUTIONS DURING
PARTICIPANT’S LIFETIME.

 

3.1.                              Amount of Required Minimum Distribution For
Each Distribution Calendar Year.  During the participant’s lifetime, the minimum
amount that will be distributed for each distribution calendar year is the
lesser of:

 

(a)                                  the quotient obtained by dividing the
participant’s account balance by the distribution period in the Uniform Lifetime
Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the
participant’s age as of the participant’s birthday in the distribution calendar
year; or

 

--------------------------------------------------------------------------------

 

(b)                                 if the participant’s sole designated
beneficiary for the distribution calendar year is the participant’s spouse, the
quotient obtained by dividing the participant’s account balance by the number in
the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the
Treasury regulations, using the participant’s and spouse’s attained ages as of
the participant’s and spouse’s birthdays in the distribution calendar year.

 

3.2.                              Lifetime Required Minimum Distributions
Continue Through Year of Participant’s Death.  Required minimum distributions
will be determined under this section 3 beginning with the first distribution
calendar year and up to and including the distribution calendar year that
includes the participant’s date of death.

 

SECTION 4.                                REQUIRED MINIMUM DISTRIBUTIONS AFTER
PARTICIPANT’S DEATH.

 

4.1.                              Death On or After Date Distributions Begin.

 

(a)                                  Participant Survived by Designated
Beneficiary.  If the participant dies on or after the date distributions begin
and there is a designated beneficiary, the minimum amount that will be
distributed for each distribution calendar year after the year of the
participant’s death is the quotient obtained by dividing the participant’s
account balance by the longer of the remaining life expectancy of the
participant or the remaining life expectancy of the participant’s designated
beneficiary, determined as follows:

 

(1)                                  The participant’s remaining life expectancy
is calculated using the age of the participant in the year of death, reduced by
one for each subsequent year.

 

(2)                                  If the participant’s surviving spouse is
the participant’s sole designated beneficiary, the remaining life expectancy of
the surviving spouse is calculated for each distribution calendar year after the
year of the participant’s death using the surviving spouse’s age as of the
spouse’s birthday in that year.  For distribution calendar years after the year
of the surviving spouse’s death, the remaining life expectancy of the surviving
spouse is calculated using the age of the surviving spouse as of the spouse’s
birthday in the calendar year of the spouse’s death, reduced by one for each
subsequent calendar year.

 

(3)                                  If the participant’s surviving spouse is
not the participant’s sole designated beneficiary, the designated beneficiary’s
remaining life expectancy is calculated using the age of the beneficiary in the
year following the year of the participant’s death, reduced by one for each
subsequent year.

 

(b)                                 No Designated Beneficiary.  If the
participant dies on or after the date distributions begin and there is no
designated beneficiary as of September 30 of the year after the year of the
participant’s death, the minimum amount that will be distributed for each
distribution calendar year after the year of the participant’s death is the
quotient obtained by dividing the participant’s account balance by the
participant’s remaining life expectancy calculated using the age of the
participant in the year of death, reduced by one for each subsequent year.

 

4.2.                              Death Before Date Distributions Begin.

 

(a)                                  Participant Survived by Designated
Beneficiary.  Except as provided in Section 6, if the participant dies before
the date distributions begin and there is a designated beneficiary, the minimum
amount that will be distributed for each distribution calendar year after the
year of the participant’s death is the quotient obtained by dividing the
participant’s account balance by the remaining life expectancy of the
participant’s designated beneficiary, determined as provided in section 4.1.

 

(b)                                 No Designated Beneficiary.  If the
participant dies before the date distributions begin and there is no designated
beneficiary as of September 30 of the year following the year of the
participant’s death, distribution of the participant’s entire interest will be
completed by December 31 of the calendar year containing the fifth anniversary
of the participant’s death.

 

(c)                                  Death of Surviving Spouse Before
Distributions to Surviving Spouse Are Required to Begin.  If the participant
dies before the date distributions begin, the participant’s surviving spouse is
the participant’s sole designated beneficiary, and the surviving spouse dies
before distributions are required to begin to the surviving spouse under section
2.2(a), this section 4.2 will apply as if the surviving spouse were the
participant.

 

SECTION 5.                                DEFINITIONS.

 

5.1.                              Designated beneficiary.  The individual who is
designated as the beneficiary under sections 2.6, 8.2, and 8.5 of the plan and
is the designated beneficiary under section 401(a)(9) of the Internal Revenue
Code and section 1.401(a)(9)-1, Q&A-4, of the Treasury regulations.

 

5.2.                              Distribution calendar year.  A calendar year
for which a minimum distribution is required. For distributions beginning before
the participant’s death, the first distribution calendar year is the calendar
year immediately preceding the calendar year which contains the participant’s
required beginning date.  For distributions beginning after the participant’s
death, the first distribution calendar year is the calendar year in which
distributions are required to begin under section 2.2.  The required minimum
distribution for the participant’s first distribution calendar year will be made
on or before the participant’s required beginning date.  The required minimum
distribution for other distribution calendar years, including the required

 

--------------------------------------------------------------------------------

 

minimum distribution for the distribution calendar year in which the
participant’s required beginning date occurs, will be made on or before December
31 of that distribution calendar year.

 

5.3.                              Life expectancy.  Life expectancy as computed
by use of the Single Life Table in section 1.401(a)(9)-9 of the Treasury
regulations.

 

5.4.                              Participant’s account balance.  The account
balance as of the last valuation date in the calendar year immediately preceding
the distribution calendar year (valuation calendar year) increased by the amount
of any contributions made and allocated or forfeitures allocated to the account
balance as of dates in the valuation calendar year after the valuation date and
decreased by distributions made in the valuation calendar year after the
valuation date.  The account balance for the valuation calendar year includes
any amounts rolled over or transferred to the plan either in the valuation
calendar year or in the distribution calendar year if distributed or transferred
in the valuation calendar year.

 

5.5.                              Required beginning date.  The date specified
in section 8.5(e)(1) or 8.5(f) of the plan.

 

SECTION 6.                                EFFECTIVE DATE OF PLAN AMENDMENT FOR
SECTION 401(A)(9) FINAL AND TEMPORARY TREASURY REGULATIONS.

 

6.1                                 Effective Date.  Article A, Minimum
Distribution Requirements, applies for purposes of determining required minimum
distributions for distribution calendar years beginning with the 2003 calendar
year.

 

6.2.                              Election to Allow Participants or
Beneficiaries to Elect 5-Year Rule.  Participants or beneficiaries may elect on
an individual basis whether the 5-year rule or the life expectancy rule in
sections 2.2 and 4.2 of Article A of the plan applies to distributions after the
death of a participant who has a designated beneficiary.  The election must be
made no later than the earlier of September 30 of the calendar year in which
distribution would be required to begin under section 2.2 of Article A of the
plan, or by September 30 of the calendar year which contains the fifth
anniversary of the participant’s (or, if applicable, surviving spouse’s) death. 
If neither the participant nor beneficiary makes an election under this
paragraph, distributions will be made in accordance with sections 2.2 and 4.2 of
Article A of the plan and, if applicable, the elections in section 2 above.

 

--------------------------------------------------------------------------------