Tompkins Financial Corporation 10-Q [tmp-10q_093016.htm] 

 

Exhibit 10.2

 

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

This Supplemental Executive Retirement Agreement (the “Agreement”) is entered
into effective November 9, 2016, by Tompkins Financial Corporation, with offices
at 110 The Commons, Ithaca, New York 14851, and ___________________________,
residing at ___________________________________ (the “Executive”).

 

PREAMBLE

 

The principal objective of this Agreement is to provide a supplemental
retirement benefit due to the freezing of the Tompkins Financial Corporation
Retirement Plan (“Retirement Plan”) for those executives who elect to
participate in the 2015 Tompkins Financial Corporation Defined Contribution Plan
(the “Defined Contribution Plan”).

 

SECTION 1.
DEFINITIONS

 

1.1            “Board of Directors” means the Board of Directors of Tompkins
Financial Corporation.

 

1.2            “Committee” means the Compensation Committee of the Board of
Directors, which has been given authority by the Board of Directors to
administer this Agreement.

 

1.3            “Company” means Tompkins Financial Corporation.

 

1.4            “Deferred Compensation Account” or the “Account” means an account
maintained under this Agreement on and after January 1, 2016.

 

1.5            “Retirement Benefit Freeze” has the meaning set forth in Section
2.1.

 

1.6            “Separation from Service” means the Executive’s termination of
active employment, whether voluntary or involuntary, other than by death or
leave of absence with the Company or affiliate(s), within the meaning of Section
409A(a)(2)(A)(i) of the Internal Revenue Code of 1986, as amended (“Code”), and
the treasury regulations thereto, as they may be amended from time to time.

 

1.7            “Surviving Spouse” means the spouse of the Executive, if any,
named at or prior to his Separation from Service on his ‘Form of Benefit and
Beneficiary Designation Form’, surviving on the date of death of the Executive;
provided, however, that if the Executive, as of the date of Executive’s death,
is no longer married to the person so designated, then such person is not a
Surviving Spouse for purposes of this Agreement.

 

The masculine gender, where appearing in this Agreement, will be deemed to
include the feminine gender, and the singular may include the plural, unless the
context clearly indicates the contrary. For purposes of complying with Section
409A of the Code, it is acknowledged that no benefit payments may be made under
this Agreement prior to the Executive’s termination of employment with the
Company, that the payment of benefits pursuant to this Agreement may not be
accelerated by the Company or the Executive, and that there are no elections
provided under the Agreement to defer compensation or to delay a payment of
benefits.

 

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SECTION 2.
ELIGIBILITY FOR BENEFITS

 

2.1            Eligibility. The following Executives are eligible to participate
in this Agreement: Alyssa H. Fontaine, Scott Gruber, Gregory Hartz, Gerald
Klein, Jr., and John M. McKenna. The Board of Directors may determine, in its
sole discretion, that the Executive should cease to continue accruing retirement
benefits under this Agreement (a “Retirement Benefit Freeze”) and in such event
the Board of Directors shall notify the Executive in writing of such
determination. Such determination shall not reduce the then accrued retirement
benefit of the Executive under this Agreement, as follows. The Executive will
remain entitled to receive, in accordance with Section 3.1, the balance of his
Deferred Compensation Account , determined as of the date of the Retirement
Benefit Freeze, which shall continue to be credited with the addition of
interest until the date the balance of his Deferred Compensation Account has
been completely distributed.

 

SECTION 3.
AMOUNT AND FORM OF RETIREMENT BENEFIT

 

3.1            Retirement Benefit. The annual contribution under this Agreement
equals the amount of any contributions otherwise allocable to the Defined
Contribution Plan which would exceed the limitation under Code
section 415(c)(1)(A) for any plan year and shall be allocated to the Deferred
Compensation Account.

 

The Deferred Compensation Account will be credited with the addition of
interest, to be accrued during each quarter and to be credited to such Deferred
Compensation Account on the first business day following the end of such quarter
on the basis of the day weighted average balance in such Account during each
quarter, at a rate equal to the higher of either (a) the highest yield on any
U.S. Government Treasury Constant Maturity on the first business day of the
calendar year in which the interest is accrued, as reported in the Federal
Reserve Statistical Release, or if such source is not available, such other
comparable source as is available (the “Guaranteed Rate”), or, (b) the Prime
Rate as published in The Wall Street Journal on the first business day of the
calendar year in which the interest is accrued.

 

The balance of the Deferred Compensation Account shall be the aggregate fair
market value of the assets allocated to and held in the Account. Upon the
Separation from Service of Executive for any reason, Company will pay to
Executive, in the form hereinafter provided, his Deferred Compensation Account.
The Deferred Compensation Account shall be paid, pursuant to the Executive’s
election, in a lump sum or in annual installments over a period of five (5) or
ten (10) years. The Executive’s election shall be made in writing upon execution
of this Plan document. In the absence of an election by the Executive at the
time of execution of this Plan document, payment of the Deferred Compensation
Account shall be in a lump sum. Payment of the Deferred Compensation Account
will commence within ninety (90) days following the Executive’s Separation from
Service. During the period that installment payments are made (if any), the
Executive’s Deferred Compensation account shall be credited with interest.
Installment payments (if applicable) made after the first payment shall be paid
on or about the applicable modal anniversary of the first payment date until all
required installments have been paid. The amount of each payment shall be
determined by dividing the value of the Deferred Compensation Account
immediately prior to such payment by the number of payments remaining to be
paid. The final installment payment shall be equal to the balance of the
Deferred Compensation Account, calculated as of the applicable modal
anniversary. Notwithstanding the above, in the event the Executive is determined
to be a specified employee” as such term is defined in Treasury Regulations
§1.409A-1(i), then any monthly benefit otherwise payable on or before the date
which is six (6) months after the Executive’s termination of employment date
shall be delayed until the earlier of the Executive’s date of death or the date
which is six (6) months after the Executive’s termination of employment date;
provided, however, that such delay is only required for benefits constituting
nonqualified deferred compensation under Code Section 409A, and the delay will
apply only to those benefits that are not exempt from Code Section 409A. Any
such delayed payments shall be accumulated and paid in a lump sum and payments
thereafter will be made as scheduled in accordance with this Section 3.1.

 

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3.2            Death Benefit. Upon the death of the Executive , the Executive’s
beneficiary shall be paid the remaining value of the Deferred Compensation
Account in one single lump sum, even if the Executive had previously elected a
different to receive payment in the form of annual installments.

 

SECTION 4.
MISCELLANEOUS

 

4.1            Termination and Amendment. The Committee may, in its sole
discretion suspend or amend this Agreement at any time or from time to time, in
whole or in part; provided, however, that no suspension or amendment of this
Agreement will, without the written consent of the Executive or the Surviving
Spouse (if the Executive is not then living), reduce the Executive’s right or
the right of the Surviving Spouse to receive or continue receiving a benefit
accrued at the time of the suspension or amendment in accordance with this
Agreement. The Parties agree that a Retirement Benefit Freeze, as described in
Section 2.1, shall not be deemed a reduction of rights requiring consent
hereunder. A suspension of this Agreement shall not result in the acceleration
of any benefit provided pursuant to this Agreement except as permitted in
connection with a plan termination satisfying the conditions set forth in
Treasury Regulations §1.409A-3(j)(ix), where the Committee decides to accelerate
such benefit in accordance with the requirements of such regulation.

 

4.2            No Employment Agreement. Nothing contained herein will confer
upon the Executive the right to be retained in the service of the Company or its
subsidiaries, nor will it interfere with the right of the Company or its
subsidiaries to discharge or otherwise deal with the Executive without regard to
the existence of this Agreement.

 

4.3            Unfunded Arrangement. The benefits under this Agreement are
unfunded, and the Company will make benefit payments solely on a current
disbursement basis from the Company’s general assets. Notwithstanding anything
herein to the contrary, the Executive, and the Executive’s Surviving Spouse, if
any, shall have the status of general unsecured creditors of the Company.

 

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4.4            Assignment. To the maximum extent permitted by law, no benefit
under this Agreement shall be assignable or made subject by Executive in any
manner to alienation, sale, transfer, claims of Executor’s creditors, pledge,
attachment or encumbrances of any kind.

 

4.5            Rules. The Committee may adopt rules and regulations to assist it
in the administration of this Agreement. This Agreement shall be administered
and construed entirely in the discretion of the Committee and the Board of
Directors, as applicable.

 

4.6            Information. The Executive shall receive a copy of this Agreement
and the Committee will make available for inspection by the Executive a copy of
any rules and regulations used by the Committee in administering this Agreement.

 

4.7            Controlling Law. This Agreement is established under and will be
construed according to the laws of the State of New York, without regard for
principles of conflicts of law. Notwithstanding the foregoing, this Agreement
shall be construed consistent with the requirements of Code §409A, the
regulations promulgated thereunder and other official guidance relating thereto
such that the operation or terms of this Agreement do not result in the
inclusion in income of any amount under such Code provision. For purposes of
this Agreement, any term hereunder relating to the Executive’s termination of
employment, the Executive terminating employment, the Executive being terminated
or similar expression shall be deemed to refer to a separation from service, as
defined in Treasury Regulations §1.409A-1(h). If an amount is to be paid under
this Agreement in two or more installments, each installment shall be treated as
a separate payment for purposes of Code Section 409A.

 

4.8            Legal Expenses. The Company shall pay, upon request and
documentation thereof (and not later than ninety (90) days after receipt of such
request and documentation), all reasonable legal fees and expenses which the
Executive/Surviving Spouse may incur as a result of the Company contesting the
validity or enforceability of any provision of this Agreement or any claim by
the Executive/Surviving Spouse under this Agreement; provided, however, that
such request is made and supporting documentation provided to the Company by the
Executive/Surviving Spouse within ninety (90) days after incurring the expense,
and provided further, the Company shall be entitled to be reimbursed by the
Executive for such amount previously paid to such Executive if it is finally
judicially determined that such Executive’s claims under this Agreement are
frivolous.

 

IN WITNESS WHEREOF, this Agreement has been executed this 9th day of November,
2016.

 

  TOMPKINS FINANCIAL CORPORATION

 

ATTEST:     By:         Name: Stephen S. Romaine       Title: President & Chief
Executive Officer           ATTEST:                  (Executive)       Name: 

 

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SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

Form of Benefit and Beneficiary Designation Form

 

As an Executive participating in a Supplemental Executive Retirement Agreement
with Tompkins Financial Corporation, I hereby elect the following form of
benefit payment for retirement benefits due pursuant to this Agreement. (Please
initial your selection.)

  

_____Annual Installments over a 5 year period

 

_____Annual Installments over a 10 year period

 

_____Lump Sum

 

As an Executive participating in a Supplemental Executive Retirement Agreement
with Tompkins Financial Corporation, I hereby designate the following
beneficiary to receive my death benefits due under the Agreement. In the event
that the following beneficiary predeceases me, I hereby designate the person(s)
listed as my contingent beneficiary(ies) under the Company’s Investment & Stock
Ownership Plan to receive my death benefits due under the Agreement.

 

Beneficiary
Name:______________________________________________________________________________________

 

Relationship to
Executive:________________________________________________________________________________

 

Social Security
Number:__________________________________________________________________________________

 

Date of
Birth:__________________________________________________________________________________________

 

Home
Address:________________________________________________________________________________________

 

Executive’s
Signature:___________________________________________________________________________________

 

Witness’
Signature:_____________________________________________________________________________________

 

Spouse’s Signature (if waiving right to benefits under this
Agreement):______________________________________________

 

Date:
________________________________________________________________________________________________

 

Witness’ Signature:
_____________________________________________________________________________________

 

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