ex10_5.htm


    
      

    

    Exhibit
10.5

     

    ATLANTIC
COAST BANK

    2005
AMENDED AND RESTATED

    DIRECTOR
RETIREMENT PLAN

    


    


    The
Atlantic Coast Bank 2005 Amended and Restated Director Retirement Plan (the
“Plan”) was originally established on July 1, 2001, and was amended and restated
on December 15, 2005, and is hereby amended and restated by this document,
effective January 1, 2005, in order to comply with Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) and the 2007 final regulations
issued thereunder.

    


    The
purpose of the Plan is to provide retirement benefits to those non-employee
members of the Board of Directors (“Directors”) who have contributed
significantly to the success and growth of Atlantic Coast Bank (the “Bank”) and
its holding company, Atlantic Coast Federal Corporation (the “Company”) (and any
successors thereto), and the Bank’s predecessor, Atlantic Coast Federal Credit
Union, whose services are vital to its continued growth and success in the
future and who are to be encouraged to remain a member of such Boards until
retirement.

    


    ARTICLE
I

    ELIGIBILITY
AND VESTING

    


    1.1           Eligibility.  Each
individual who is a Director of the Bank (or any predecessors or successors)
shall be eligible to participate in the Plan (“Participants”).

    


    1.2           Vesting.  Participants
shall be 100% vested in their benefits under this Plan upon completion of one
hundred and twenty (120) full months of service as a Director, whether
continuous or otherwise.  Except as provided in Section 2.3(b), until
completing such service requirement, Participants are 0% vested in benefits
under the Plan.  Notwithstanding the preceding provisions, any
Participant who resigns at the request of, or is removed from service by, the
Office of Thrift Supervision, Federal Deposit Insurance Corporation or any other
regulatory authority for the Bank, shall be ineligible to participate and shall
forfeit any benefits under this Plan.

    


    ARTICLE
II

    BENEFIT

    


    2.1           Normal
Retirement.

    


    (a)           Upon
Separation from Service (as defined below) at or after age sixty-five (65)
(“Normal Retirement Age”), the Bank shall pay the Participant a “Normal
Retirement Benefit” of ten thousand dollars ($10,000) per year, payable in equal
monthly installments over a period of One Hundred and Twenty (120) months (the
“Benefit Period”), commencing on the first day of the month following the
Participant’s Separation from Service. Any Director who has at least 240 full
months of service, whether continuous or otherwise, may receive such annual
benefit for the Benefit Period upon Separation from Service prior to the age of
65.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    (b)           “Separation
from Service” means the Participant’s retirement or termination from service
from the Board.  For these purposes, a Participant shall not be deemed
to have a Separation from Service until the Participant no longer serves on the
Board of the Bank, the Bank’s holding company, or any member of a controlled
group of corporations with the Bank or holding company within the meaning of
Final Treasury Regulation §1.409A-1(a)(3).  Whether a Participant has
had a Separation from Service shall be determined in accordance with the
requirements of Final Treasury Regulation 1.409A-1(h).

     

    2.2           Death
During Benefit Period.  If the
Participant dies within the Benefit Period, the remaining monthly payments due
to the Participant shall continue be paid to the Participant’s “Beneficiary” (as
defined below) in the same time and form as payments were being made to the
Participant.

    


    “Beneficiary”
means the person(s) designated by the Participant on the form set forth at
Appendix A to receive any death benefits hereunder.  If the
Participant has not designated a Beneficiary, the Participant’s spouse shall be
the Beneficiary. In the absence of any surviving Beneficiary or spouse, the
benefits shall be paid to the Participant’s estate.

    


    2.3          
Death
Before Separation from Service

    


    (a)           Death After
Vesting.  In the event the
Participant is fully vested in his or her benefits hereunder and dies prior to
Separation from Service but before beginning to receive a Normal Retirement
Benefit, the Bank agrees to pay to the Participant’s Beneficiary the Normal
Retirement Benefit that the Participant would have otherwise received as if he
or she had attained Normal Retirement Age at his or her death, with such
payments commencing on the first day of the month after the Participant’s
death.

    


    (b)         
 Death or Disability Before
Vesting.  In the event a Participant who has completed at least
sixty (60) full months of service (whether continuous or otherwise), dies or
becomes Disabled (as defined below) while serving as a Director, such person
shall be eligible for benefits under this Plan whether or not the Participant
has attained the Retirement Age.  In the event a Participant dies or
become Disabled prior to Separation from Service and such Participant has
attained at least sixty (60) full months of service (whether continuous or
otherwise), then the amount of the annual benefits payable to the Participant’s
Beneficiary shall be equal to the product of ten thousand dollars ($10,000)
multiplied by a fraction, the denominator of which is one-hundred and twenty
(120) and the numerator of which is the number of full months of service
performed by the Participant. Such benefits shall be paid in equal monthly
installments over the Benefit Period, beginning on the first day of the month
following the Participant’s date of death or Disability.

    


    A
Participant shall be considered “Disabled” if the Participant: (i) is unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death, or last for a continuous period of not less than 12 months; (ii) by
reason of any medically determinable physical or mental impairment which can be
expected to result in death, or last for a continuous period of not less than 12
months, is receiving income replacement benefits for a period of not less than
three months under an accident and health plan covering the Bank’s employees; or
(iii) is determined to be totally disabled by the Social Security
Administration.


    
      
         


      

      
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    2.4           Unforeseeable
Emergency.

    


    (a)           Upon
an “Unforeseeable Emergency” (as defined below), (i) a Participant who is vested
in his or her benefit hereunder but has not yet begun to receive payments; (ii)
a Participant who is receiving Normal Retirement Benefits; or (iii) a
Beneficiary who is receiving death benefits hereunder, may request a lump sum
payment in an amount necessary (but not exceeding the present value of the
remaining benefits) to meet the Unforeseeable Emergency, including an amount
necessary to pay any taxes due as a result of such lump sum payment from the
Plan.  The present value shall be equal to the amount accrued by the
Bank in accordance with generally accepted accounting principles.

    


    (b)           “Unforeseeable
Emergency” means a severe financial hardship to the Participant or Beneficiary
resulting from (i) an illness or accident of the Participant or Beneficiary, his
or her spouse, or dependent (as defined in Code Section 152(a)); (ii) loss of
the Participant’s or Beneficiary’s property due to casualty; or (iii) other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant or Beneficiary.  The term
“Unforeseeable Emergency” shall be construed consistent with Code Section 409A
and the final regulations and other guidance issued thereunder.

     

    2.5           Tax
Withholding.  All benefits paid under this Plan shall be
subject to withholding in accordance with federal and state law.

    


    ARTICLE
III

    ADMINISTRATION;
CLAIMS PROCEDURES

    


    3.1           Plan
Administrator.  The Board of Directors of the Bank (the
“Board”) is hereby designated the Plan Administrator.

    


    3.2           Powers
of Plan Administrator. As Plan Administrator, the Board shall be
responsible for the management, control, interpretation and administration of
this Plan and may allocate to others certain aspects of the management and
operational responsibilities of the Plan including the employment of advisors
and the delegation of any ministerial duties to qualified
individuals.  All decisions of the Plan Administrator shall be final
and binding on all persons.

    


    3.3           Claims
Procedures.  Claims for benefits hereunder shall be submitted
to the President of the Bank, as agent for the Plan Administrator.  In
the event a claim for benefits is wholly or partially denied under this Plan,
the Participant or any other person claiming benefits under this Plan (a
“Claimant”), shall be given notice of the denial in writing within thirty (30)
calendar days after the Plan Administrator’s receipt of the
claim.  The Plan Administrator may extend this period for an
additional thirty (30) calendar days.  Any denial must specifically
set forth the reasons for the denial and any additional information necessary to
perfect the claim for benefits.  The Claimant shall have the right to
seek a review of the denial by filing a written request with the Plan
Administrator within sixty (60) calendar days after receipt of the initial
denial.  Such request may be supported by such documentation and
evidence deemed relevant by the Claimant.  Following receipt of this
information, the Plan Administrator shall make a final determination and notify
the Claimant within sixty (60) calendar days of the Plan Administrator’s receipt
of the request for review together with the specific reasons for the
decision.


    
      
         


      

      
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      ARTICLE
IV

    

    AMENDMENT
AND TERMINATION

    


    4.1           Amendments.  The
Board may amend this Plan any time, but no such amendment shall affect the
rights of, or reduce the benefits to, any Participant without their written
consent.

    


    4.2           Termination.  The
Board may completely terminate the Plan.  Subject to the requirements
of Code Section 409A, in the event of complete termination with respect to such
benefits, the Plan shall cease to operate and the Bank shall pay out to each
Participant his or her account as if that Participant had terminated service as
of the effective date of the complete termination.  Such complete
termination of the Plan shall occur only under the following circumstances and
conditions:

    


    (a)           The
Board may terminate the Plan within 12 months of a corporate dissolution taxed
under Code section 331, or with approval of a bankruptcy court pursuant to 11
U.S.C. §503(b)(1)(A), provided that the amounts deferred under the Plan are
included in each Participant’s gross income in the latest of (i) the calendar
year in which the Plan terminates; (ii) the calendar year in which the amount is
no longer subject to a substantial risk of forfeiture; or (iii) the first
calendar year in which the payment is administratively practicable.

     

    (b)           The
Board may terminate the Plan within the 30 days preceding a Change in Control
(but not following a Change in Control), provided that the Plan shall only be
treated as terminated if all substantially similar arrangements sponsored by the
Bank are terminated so that the Participants and all participants under
substantially similar arrangements are required to receive all amounts of
compensation deferred under the terminated arrangements within 12 months of the
date of the termination of the arrangements.

     

    (c)           The
Board may terminate the Plan provided that (i) the termination and liquidation
does not occur proximate to a downturn in the financial health of the Bank or
Company, (ii) all arrangements sponsored by the Bank that would be aggregated
with this Plan under Final Regulations Section 1.409A-1(c) if the Participant
covered by this Plan was also covered by any of those other arrangements are
also terminated; (iii) no payments other than payments that would be payable
under the terms of the arrangement if the termination had not occurred are made
within 12 months of the termination of the arrangement; (iv) all payments are
made within 24 months of the termination of the arrangements; and (v) the Bank
does not adopt a new arrangement that would be aggregated with any terminated
arrangement under Final Regulations Section 1.409A-1(c) if the Participant
participated in both arrangements, at any time within three years following the
date of termination of the arrangement.

     

    (d)           The
Board may terminate the Plan pursuant to such other terms and conditions as the
Internal Revenue Service may permit from time to time.


    
      
         


      

      
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      ARTICLE
V

    

    
      UNFUNDED
ARRANGEMENT

    

    


    5.1           Unsecured
General Creditors.  The Participant and Beneficiaries are
general unsecured creditors of the Bank for the payment of benefits under this
Plan.  The benefits represent the mere promise by the Bank to pay such
benefits.  The benefits payable under this Plan are payable from the
general assets of the Bank and no special fund or arrangement is intended to be
established hereby nor shall the Bank be required to earmark, place in trust or
otherwise segregate assets with respect to this Plan or any benefits
hereunder.

    


    5.2           Rabbi
Trust.  The Bank shall be responsible for the payment of all
benefits provided under the Plan. At its discretion, the Bank may establish one
or more trusts, with such trustees as the Board may approve, for the purpose of
providing for the payment of such benefits. Such trust or trusts may be
irrevocable, but the assets thereof shall be subject to the claims of the Bank’s
creditors. To the extent any benefits provided under the Plan are actually paid
from any such trust, the Bank shall have no further obligation with respect
thereto, but to the extent not so paid, such benefits shall remain the
obligation of, and shall be paid by, the Bank.  Under no circumstances
shall a Participant serve as trustee or co-trustee of any trust established by
the Bank pursuant to this Plan.

    


    ARTICLE
VI

    MISCELLANEOUS

    


    6.1           No
Guarantee of Continued Service on the Board.  This Plan does
not constitute a guaranty of continued service on the Board.

    


    6.2           Binding
Effect.  This Plan shall be binding upon the Bank, the Company
and their successors and assigns, and upon the Participants and the
Beneficiaries and legal representatives of the Participant.

    


    6.3           No
Assignment.  Neither the Participant nor any Beneficiary or
personal representative of the Participant can assign any of the rights to
benefits under this Plan.  Any attempt to anticipate, sell, transfer,
assign, pledge, encumber or change the Participant’s right to receive benefits
shall be void. The rights to benefits are not subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment by creditors.

    


    6.4           Choice
of Law.  This Plan shall be construed under and governed by the
laws of the State of Georgia, except to the extent preempted by the laws of the
United States of America.

    


    6.5           Payment
to Guardians.  If a Participant’s benefit is payable to a minor
or a person declared incompetent or to a person incapable of handling the
disposition of his property, the Plan Administrator may direct payment of such
Plan benefit to the guardian, legal representative or person having the care and
custody of such minor, incompetent or person. The Plan Administrator may require
proof of incompetency, minority, incapacity or guardianship as it may deem
appropriate prior to distribution of the Plan benefit. Such distribution shall
completely discharge the Plan Administrator and the Bank from all liability with
respect to such benefit.


    
      
         


      

      
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    IN WITNESS WHEREOF, and the
Bank has caused this amended and restated Plan to be executed by its duly
authorized officer.

    


    


    
      
        	 
      	 
      	
                ATLANTIC
      COAST BANK

              
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
                October 30, 2008

              	 
      	
                By:

              	
                /s/ Robert J. Larison,
  Jr.

              
	
                Date

              	 
      	 
      	
                Robert
      J. Larison, Jr. President and

              
	 
      	 
      	 
      	
                Chief
      Executive Officer

              


      

    


    
      
         


      

      
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    Appendix A

    ATLANTIC
COAST BANK

    2005
AMENDED AND RESTATED

    DIRECTOR
RETIREMENT PLAN

    


    BENEFICIARY
DESIGNATION

    


    
      


      
        
          
            	
                    Name:

                  	
                      

                  


          

        

      

       
I hereby
designate the following Beneficiary(ies) to receive any guaranteed payments or
death benefits under such Plan, following my death:

    
       

      PRIMARY
BENEFICIARY:

      
        


        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      
	 	 	 	 
	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      
	 	 	 	 
	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      


                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

         

      

      SECONDARY
BENEFICIARY (if all Primary Beneficiaries pre-decease the
Director):

       

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      
	 	 	 	 
	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      
	 	 	 	 
	
                                          Name:

                                        	 
      	
                                          %
      of Benefit:

                                        	 
      


                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

         

      

    

    This
Beneficiary Designation hereby revokes any prior Beneficiary Designation which
may have been in effect and this Beneficiary Designation is
revocable.

     

    
      


      
        
          
            
              	 
      	 
      	 
      	 
      
	
                      Date

                    	 
      	
                      Director

                    	 
      


            

          

        

      

       

    

     

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