Exhibit 10(r)-1


 


01/24/05


 


 


TCF FINANCIAL CORPORATION


 


TCF DIRECTORS 2005 DEFERRED
COMPENSATION PLAN


 


(As Amended and Restated
effective as of January 24, 2005)


 





















 


Table of Contents


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Deferral of Stock or Fees.

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Administrative Committee.

  	
  2

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Deferred Compensation
  Accounts.

  	
  2

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Trust.

  	
  3

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Payment of Deferred
  Amounts.

  	
  3

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Emergency Payments.

  	
  4

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Method of Payments.

  	
  5

  
	
   

  	
   

  	
   

  
	
  8.

  	
  Claims Procedures.

  	
  6

  
	
   

  	
   

  	
   

  
	
  9.

  	
  Miscellaneous.

  	
  7

  
	
   

  	
   

  	
   

  
	
  10.

  	
  Rule 16b-3.

  	
  7

  
	
   

  	
   

  	
   

  
	
  11.

  	
  Registration; NYSE Listing.

  	
  8

  
	
   

  	
   

  	
   

  
	
  12.

  	
  Termination or Amendment.

  	
  8

  



 


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TCF
DIRECTORS 2005 DEFERRED COMPENSATION PLAN


 


(Adopted effective as of
January 6, 2005)


 


The TCF Directors 2005 Deferred Compensation Plan (the
“Plan”) is hereby adopted effective January 6, 2005.   This Plan is intended to comply with the
requirements of Internal Revenue Code section 409A (“IRC§409A”) and regulations
issued thereunder with respect to deferrals permitted under the Plan for the
years 2005 and thereafter.  A previous
plan of deferred compensation for TCF non-employee directors entitled the TCF
Directors Deferred Compensation Plan (the “Previous Plan”) was amended in
January 2005 to cease any future deferral elections. The Previous Plan
continues in effect with respect to amounts deferred under that Plan for the
years 2004 and before.  The Previous Plan
is not subject to IRC §409A or regulations issued thereunder, except with
respect to any amounts that were not earned and vested, as defined under IRC
§409A, by December 31, 2004.  There shall
be no duplication of benefits with respect to this Plan and the Previous Plan.


 


1.                                      Deferral of  Stock or Fees.


 


a.             From time to time eligible directors (“Directors”)
of TCF Financial Corporation (referred to hereinafter as “TCF Financial” or the
“Company”) may, by written notice, elect to have payment of all or a portion of
their directors’ fees for the next succeeding calendar year, and/or all or a
portion of any grant of shares of common stock of TCF Financial (“TCF Stock”)
to the Director made on or after such election deferred as hereinafter
provided.  Each such deferral of fees or
TCF Stock shall be (and is hereinafter referred to as) a “Deferred Amount.”  Notwithstanding the foregoing, however, a
Director may not elect to defer any portion of fees or TCF Stock unless such
Director’s deferrals with respect to such year are in round percentage
increments of 10%.


 


b.             Any elections with respect to Deferred Amounts of
fees or TCF Stock shall be exercised in writing by the Director prior to the
later to occur of the following: 
(i)  the last day before the
beginning of the calendar year in which the fees are to be earned or in which
the TCF stock award is made; or (ii) the thirtieth day following the date the
Director first becomes eligible to participate in the Plan or the Plan is first
adopted; provided that, an election made after the first day of a
calendar year shall only apply to fees earned after the date of the election of
TCF stock awarded after the election. An election of Deferred Amounts, once
made, is irrevocable, except as provided in Section 6 hereof. An election of
Deferred Amounts, once made, shall continue to be effective for succeeding
calendar years until revoked by the Director by written request to the
Secretary of TCF Financial  prior to the
beginning of a calendar year for which fees would otherwise be deferred.   Notwithstanding the foregoing, in the case
of fees or TCF stock awards which qualify as performance-based, as defined in
IRC §409A and regulations issued thereunder, a Director’s deferral election may
be made not later than six months before the end of the performance period for
such fees or award (provided the performance period is at least 12 months
long).


 


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c.             Deferred Amounts shall be subject to the rules
set forth in this document, and each Director shall have the right to receive
cash payments on account of Deferred Amounts only in the amounts and under the
circumstances hereinafter set forth.


 


d.             Directors eligible to participate in this Plan
are non-employee Directors of TCF Financial. 
Eligibility shall be determined annually as of the latest practicable
date prior to the commencement of each new calendar year.  In the case of calendar year 2005,
eligibility shall be determined as of January 6, 2005.  In the event a Director ceases to be eligible
for this Plan during the course of a calendar year, the Director’s eligibility
shall nevertheless continue through the end of that calendar year with respect
to fees earned prior to cessation of service.


 


2.                                      Administrative Committee.  Full power and authority to construe,
interpret, and administer this document, shall be vested in the Administrative
Committee (the “Committee”) of the Board of Directors of TCF Financial, which
shall consist of such members of the Compensation/Nominating/Corporate
Governance Committee of the Board of Directors who qualify from time to time as
non-employee or independent directors under Rule 16b-3 of the Securities and
Exchange Commission.  The Committee shall
have full power and authority to make each determination provided for in this
document, and in this connection, to promulgate such rules and regulations as
the Committee considers necessary or appropriate for the implementation and
management of this Plan as are consistent with the terms of this Plan.  Notwithstanding anything in this Section 2 to
the contrary, no action or determination made or taken by the Committee, and no
action or determination by the Committee affecting the amount payable under
this Plan to a participant or beneficiary, shall be entitled to any deference
by a reviewing court (i.e., judicial review of any such actions or
determinations shall be de novo).


 


3.                                      Deferred Compensation Accounts.  The Company shall establish on its books a
separate account (“Account”) for each of its Directors who becomes a
participant in this Plan, and each such Account shall be maintained as follows:


 


a.             Each Account shall be credited with the Deferred
Amounts elected by the Director for whom such Account is established as of the
date on which such Deferred Amount would otherwise have been paid to the
Director.


 


b.             The value of a Director’s Account is to be
measured by the value of and income from TCF Stock (included dividends, which
are deemed to be reinvested in TCF Stock), in which all Deferred Amounts shall
be deemed to be invested, however such value is merely a measuring device to
determine the payments to be made to each Director hereunder.  Each Director, and each other recipient of a
Director’s Deferred Amounts pursuant to Section 7, shall be and remain an
unsecured general creditor of the Company with respect to any payments due and
owing to such Director hereunder.  If a
Company should from time to time, in its discretion, IRC409Aually purchase the
investments deemed to have been made for a Director’s Account, either directly
or through the trust described in Section 4, such investments shall be solely
for the Company’s or such trust’s own account, and the Directors shall have no
right, title or interest therein.


 


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4.                                      Trust.  TCF Financial has established a trust (of the
type commonly known as a “rabbi trust”) to aid in the accumulation of assets
for payment of Deferred Amounts. This trust may also provide for the
accumulation of assets for payment of amounts deferred under the Previous Plan.
The trust provides for separate accounts in the name of each Director who has
elected a Deferred Amount under this Plan or under the Previous Plan. The
Company shall contribute to the trust such amounts as are necessary to keep the
separate accounts maintained for the Directors sufficient at all times to pay
in full all benefits payable under the Plan with respect to the Directors,
including, without limitation, any liquidated damages payable to the Directors
pursuant to Section 9.f.  In addition:


 


a.             TCF Financial may, in its sole discretion,
contribute additional amounts, which TCF Financial may direct the Trustee not
to credit to an account for any Director, but instead to a general account for
the payment of Plan expenses; and


 


b.             within ten (10) business days following the
occurrence of a Change in Control, the Companies shall contribute an amount
equal to 300% of the aggregate expenses incurred by the Companies and the
Trustee in administering the Plan and the trust described in this Section 4
during the last full calendar year immediately preceding the occurrence of the
Change in Control, which amount shall also be credited to a general account for
the payment of Plan expenses.  If the
aggregate expenses that were incurred by the Companies and the Trustee in
administering the Plan and the trust during the last full calendar year
immediately preceding the occurrence of the Change in Control cannot be
determined with reasonable certainty prior to the date on which this
contribution is due, the amount of the contribution shall be $150,000.


 


The assets of the trust shall be invested in accordance with the
provisions of the agreement or agreements pursuant to which the trust is
maintained, which agreement(s) shall be consistent with the terms of this
Plan.  The trustee of the trust (“Trustee”)
shall be a corporate trustee independent of the Company.  The trust assets shall remain subject to the
claims of the Companies’ general creditors.


 


5.                                      Payment
of Deferred Amounts.


 


a.             On or about the 30th day following a
Director’s termination of service on the board of directors of the Company, the
balance credited to the Director’s Account shall be paid in one single
distribution.


 


b.             The payment under Section 5.a. shall be paid in
the form of TCF Stock, plus cash for any fractional shares.


 


c.             For purposes of this section, a Director’s service
on the board is considered to terminate as of the date which is the Director’s
last date of service for the Company as a director.


 


d.             In the event the payment under Secton 5.a is
unpaid at the time of a Director’s death, the payment shall be made as soon as
practicable to the persons specified in Section 7.a.


 


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e.             For purposes of this Plan, a Change in Control
shall be deemed to have occurred if (i) any “person” as defined in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is
or becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange
Act, directly or indirectly, of securities of TCF Financial representing fifty
percent (50%) or more of the combined voting power of TCF Financial’s then
outstanding securities (for purposes of this clause (i), the term “beneficial
owner” does not include any employee benefit plan maintained by TCF Financial
that invests in TCF Financial’s voting securities); or (ii) during any period
of two (2) consecutive years there shall cease to be a majority of the Board
comprised as follows: individuals who at the beginning of such period
constitute the Board or new directors whose nomination for election by the
company’s shareholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved; or (iii) the shareholders of TCF Financial approve a merger or
consolidation of TCF Financial with any other corporation, other than a merger
or consolidation which would result in the voting securities of TCF Financial
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least fifty percent (50%) of the combined voting power of
the voting securities of TCF Financial or such surviving entity outstanding
immediately after such merger or consolidation, or the shareholders of TCF
Financial approve a plan of complete liquidation of TCF Financial or an
agreement for the sale or disposition by TCF Financial of all or substantially
all TCF Financial’s assets; provided, however, that no Change in Control will
be deemed to have occurred if such merger, consolidation, sale or disposition
of assets, or liquidation is not subsequently consummated.  The date of a Change in Control, for purposes
of this Plan, is the date on which the Change in Control is consummated.   Notwithstanding the foregoing, however, a
Change in Control shall not be deemed to occur unless the event qualifies as a
change in control as defined in regulations issued pursuant to IRC § 409A.


 


f.              Subject to being permissible under IRC § 409A
and regulations issued thereunder, notwithstanding any other provision of this
Section 5, in the event that the Internal Revenue Service should finally
determine that part or all of the value of a Director’s Deferred Amounts or
Plan Account which have not actually been distributed to the Director, or that
part or all of a separate account that has been established for the Director
under a trust described in Section 4, is nevertheless required to be included
in the Director’s gross income for federal and/or State income tax purposes,
then the Deferred Amounts or the Account or the part thereof that was
determined to be includible in gross income shall be distributed to the
Director in a lump sum distribution in the form of TCF Stock as soon as
practicable after such determination without any action or approval by the
Committee.  A “final determination” of
the Internal Revenue Service for purposes of this Section 5.f. is a
determination in writing by said Service ordering the payment of additional
tax, reporting of additional gross income or otherwise requiring Plan amounts
to be included in gross income, which is not appealable or which the Director
does not appeal within the time prescribed for appeals.


 


6.                                      Emergency Payments.  In the event of an “unforeseeable emergency”
as determined pursuant to IRC § 409A and regulations issued thereunder, the
Committee may


 


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determine the shares distributable under Section 5 hereof and
distribute all or a part of such shares without regard to the distribution
dates provided in Section 5 to the extent the Committee determines that such
action is necessary in light of immediate and heavy needs of the Director
occasioned by severe financial hardship and that such action is permissible
under IRC § 409A and regulations issued thereunder.


 


7.  Method of Payments.


 


a.             In the event of Director’s death, payments shall
be made to the persons (including a trustee or trustees) named in the last
written instrument signed by Director and received by the Committee prior to
Director’s death, or if Director fails to so name any person, the amounts shall
be paid to Director’s estate or the appropriate distributee thereof.  The Committee, the Company, and the Trustee
shall be fully protected in making any payments due hereunder in accordance
with what the Committee believes to be such last written instrument received by
it.


 


b.             Payments due to a legally incompetent person may
be made in such of the following ways as the Committee shall determine:


 


i.              directly to such incompetent person,


 


ii.             to the legal representative of such incompetent
person, or


 


iii.            to some near relative of the incompetent person to
be used for the latter’s benefit.


 


c.             Except as otherwise provided in  Sections 7.a. and b., all payments to persons
entitled to benefits hereunder shall be made to such persons in person or upon
their personal receipt or endorsement, and shall not be subject in any manner
to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment by creditors of the participant or the participant’s
beneficiary.


 


d.             All payments to persons entitled to benefits
hereunder shall be made out of the general assets, and shall be the sole
obligations, of the Companies, except to the extent that such payments are made
out of the trust described in Section 4. 
The Plan is a mere promise by the Companies to pay benefits in the
future and it is the intention of the parties that it be “unfunded” for tax
purposes (and for the purposes of Title I of the Employee Retirement Income
Security Act of 1974 (“ERISA”)).


 


e.             Unless commenced earlier at the direction of the
Committee or suspended due to a Company’s Insolvency, payments from the trust
described in Section 4 shall be commenced by the Trustee (without the need for
further instructions from the Committee) in accordance with the most recent
payment instructions provided by the Committee after the Trustee (i) acquires
actual knowledge of the occurrence of an event that requires payment to
commence (a “payment event”), (ii) is notified by the Committee that a payment
event has occurred, (iii) determines (in the absence of actual knowledge and
any notice from the Committee) that a Change in Control has occurred as defined
in Section 5.e of this Plan, or (iv) in the case of a participant’s termination
of


 


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service,
is notified in writing by the participant that the participant’s termination of
service has occurred.  The Trustee shall
make a determination with respect to whether a Change in Control has occurred
if the Trustee receives notice that a Change in Control may have occurred from
any source other than the Committee. 
Promptly after receiving such notice of a possible Change in Control,
the Trustee shall request from the Committee all information relevant to the
Trustee’s determination.  If the
Committee fails to provide information sufficient to demonstrate the absence of
a Change in Control within 30 days after the Trustee’s request, and the other
information received by the Trustee indicates that a Change in Control has
occurred, the Trustee shall make distribution of accounts (that are not payable
earlier) in a single distribution in the form of TCF stock as soon as
practicable within 30 days after a Change in Control.


 


f.              Payments made by the Trustee from an account
established for a participant shall be debited against such account and shall
cease when the balance credited to the account has been reduced to zero or if
earlier, when the Trustee determines, based upon its review of the records of
the Plan, that payment of any additional amounts from the participant’s account
will result in the payment of benefits in excess of those required under the
Plan.  The Trustee shall have no
obligation to perform such a review and consider such a determination until
after (i) the Committee notifies the Trustee and the participant (or, if the
participant has died, the participant’s beneficiary) of the potential excess
payment, (ii) the Trustee has been provided with all Plan records that may be
reasonably required by the Trustee to make its determination, and (iii) the
participant (or beneficiary) has had a reasonable time (not less than 30 days)
to respond.  Pending its determination,
the Trustee shall continue payment of the affected account(s) in accordance
with the applicable payment instructions.


 


8.                                      Claims Procedures.


 


a.             If a claim for benefits made by any person (the “Applicant”)
is denied, the Committee shall furnish to the Applicant within 90 days after
its receipt of such claim (or within 180 days after such receipt if special
circumstances require an extension of time) a written notice which:  (i) specifies the reasons for the denial,
(ii) refers to the pertinent provisions of the Plan on which the denial is
based, (iii) describes any additional material or information necessary for the
perfection of the claim and explains why such material or information is
necessary, and (iv) explains the claim review procedures.


 


b.             Upon the written request of the Applicant
submitted within 60 days after his receipt of such written notice, the
Committee shall afford the Applicant a full and fair review of the decision
denying the claim and, if so requested: 
(i) permit the Applicant to review any documents which are pertinent to
the claim, (ii) permit the Applicant to submit to the Committee issues and
comments in writing, and (iii) afford the Applicant an opportunity to meet with
a quorum of the Committee as a part of the review procedure.


 


c.             Within 60 days after its receipt of a request for
review (or within 120 days after such receipt if special circumstances, such as
the need to hold a hearing, require an extension of time) the Committee shall
notify the Applicant in writing of its decision and


 


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the
reasons for its decision and shall refer the Applicant to the provisions of the
Plan which form the basis for its decision.


 


9.                                      Miscellaneous.


 


a.             Except as limited by Section 7.c. and except that
a Director shall have a continuing power to designate a new recipient in the
event of Director’s death at any time prior to such death without the consent
or approval of any person theretofore named as Director’s recipient by an
instrument meeting the requirements of Section 7.a., this document shall be
binding upon and inure to the benefit of each Company, Director, their legal
representatives, successors and assigns, and all persons entitled to benefits
hereunder.


 


b.             Any notice given in connection with this document
shall be in writing and shall be delivered in person or by registered mail,
return receipt requested.  Any notice
given by registered mail shall be deemed to have been given upon the date of delivery
indicated on the registered mail return receipt, if correctly addressed.


 


c.             Nothing in this document shall interfere with the
rights of any Director to participate or share in any profit sharing or pension
plan which is now in force or which may at some future time become a recognized
plan of any Company.


 


d.             Nothing in this document shall be construed as an
employment agreement nor as in any way impairing the right of any Company, its
board, committees or shareholders, to remove the Director from service as a
director, to refuse to renominate or reelect such person as a director, or to
enforce the duly adopted retirement policies of the board of directors of such
Company.


 


e.             Amounts that due to administrative error are paid
more than 30 days after the later of the date on which they are due according
to the terms of this Plan or the date on which the Participant notified the
Company in writing of the benefit due date shall incur interest at the rate of
fifteen percent per annum (eighteen percent per annum if the payment occurs
after a Change in Control) from the date as of which payment was due.  In addition, if all or any portion of the
distribution is payable in the form of TCF Financial stock, and the value of
such stock at the time of distribution is less than its value on the date as of
which payment was due, the payee shall be entitled to liquidated damages equal
to 100% (120% if the payment occurs after a Change in Control) of the aggregate
difference in value between the value of the distributed shares on the date
their distribution was due (without regard to the 30-day grace period) and the
value of the distributed shares on the actual date of distribution.


 


f.              Any costs or attorneys’ fees incurred by a
participant or beneficiary in connection with the collection of benefits that were
not timely paid under this Plan shall be reimbursed by the Company.


 


10.                               Rule 16b-3.  This Plan is intended to qualify for the
exemption from short swing profits liability under Section 16(b) of the
Securities Exchange IRC409A of 1934 provided by Rule 16b-3 of the Securities
and Exchange Commission.  Notwithstanding
anything in this Plan


 


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to the contrary, for a director who is subject to liability under
Section 16 of the Securities and Exchange IRC409A of 1934, the following
special provisions apply:


 


a.             Deferred Amounts of fees, to the extent they are
forwarded to the Trustee, shall be so forwarded on or immediately after the
date on which the fees would otherwise be paid and shall be deemed to be invested
in TCF Stock on the same date and for the same purchase price as the Trustee
actually purchases such Stock.  Dividends
deemed to be paid on accounts deemed to be invested in TCF stock shall be
deemed to be invested in TCF stock on the same date and for the same purchase
price as the Trustee actually reinvests such dividends. The Trustee shall
purchase such Stock as soon as practicable after the fees payment date for
which the Deferred Amount is received, and in any event no later than two weeks
after such date, with the exact date and purchase terms to be determined by a
stock broker or other investment professional on the basis of such person’s
judgment as to the best available purchase price for the Plan and Trust.  If Deferred Amounts are not promptly invested
in TCF stock, the deferred fees shall be deemed to be invested in TCF Stock at
the average of the high and low sales prices for such Stock on the date the
fees would otherwise be paid or on the date the dividend is paid.


 


b.             In the event of a distribution to a Director
subject to this Section under Section 5 of this Plan, such distribution shall
consist of whole shares of TCF Stock, plus cash for any fractional share.


 


c.             In the case of a Director subject to this
Section, for purposes of an emergency payout resulting in distribution of TCF
Stock, the TCF Stock shall be distributed in kind, plus cash for any fractional
share.


 


11.                               Registration; NYSE Listing.  TCF Financial may, in its discretion,
register the shares of TCF Stock subject to this Plan under the Securities Act
of 1933 and any other applicable provisions of State or Federal law, and may
enter into a listing agreement for such shares with the New York Stock
Exchange, if such actions are deemed necessary or advisable by TCF Financial in
order to provide directors with freely marketable shares.  However, nothing herein shall be deemed to
require any such registration or listing.


 


12.                               Termination or Amendment.  This Plan may be amended at any time and from
time to time upon the approval of the Board of Directors of TCF Financial or
the Committee; provided, however, that no amendment shall be effective unless
it has the written consent of all participants, all participants who are former
Directors but who are entitled to benefits under the Plan, and all
beneficiaries of deceased participants who are entitled to benefits under the
Plan.  In the event that all of the Plan’s
participants and beneficiaries do not consent to a proposed amendment, such
amendment shall not take effect but the Plan Accounts of the consenting
participants and beneficiaries shall be transferred to a separate plan that is
identical to this Plan in all respects except that it may include the proposed
amendment.  The Board of Directors or the
Administrative Committee may terminate this Plan in its discretion, except that
any such termination shall require the written consent of all participants, all
participants who are former Directors but who are entitled to benefits under
the Plan, and all beneficiaries of deceased participants who are entitled to
benefits under the Plan, unless it is an automatic distribution of a


 


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Director’s account under Section 5.f. hereof.  In the event that all of the Plan’s
participants and beneficiaries do not consent to a proposed termination of the
Plan, the Plan shall terminate as to the consenting participants and
beneficiaries and shall continue in effect for the participants and
beneficiaries who do not consent. 
Distributions shall be made to participants and beneficiaries after such
termination if authorized and directed by the Administrative Committee, but
only to the extent permitted by IRC § 409A and regulations issued
thereunder.  The Board of Directors or
the Administrative Committee may at any time discontinue future participation
in the Plan by any or all participants.


 


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