ex99-1012.htm


    Exhibit
10.12

    
 

    TIERONE
BANK

    FIFTH
AMENDED AND RESTATED

    CONSULTATION
PLAN FOR DIRECTORS

    


    FOREWORD

    


    TierOne
Bank (“Bank”) hereby approves and adopts this TierOne Bank Fifth Amended and
Restated Consultation Plan for Directors (“Plan”), effective as of December 17,
2008 (the “Effective Date”).  This Plan supersedes in its entirety the
Bank’s Fourth Amended and Restated Consultation Plan for Directors, which was
previously amended and restated as of July 27, 2006.

    


    This Plan
is being amended and restated in order to comply with the requirements of
Section 409A of the Code (as defined below), including the guidance issued to
date by the Internal Revenue Service (the “IRS”) and the final regulations
issued by the IRS in April 2007.

    


    The Plan
is intended to promote the interests of the Bank by providing: (i) an added
incentive to continue service to the Bank, (ii) for the continued advice of
retiring members of its Board of Directors, and (iii) eligible Directors with
retirement income.

    


    This
Plan, upon its Effective Date, hereby amends, restates and supersedes all prior
plans of the Bank purporting to grant benefits of a similar nature to its
present or retiring Directors, and specifically supersedes and replaces Board
Resolution BD 04-7-21.

    


    SECTION
1

    DEFINITIONS

    


    As used
herein, the following terms shall have the following respective meanings, unless
a different meaning is required by the context:

    


    1.1           “Bank” means TierOne
Bank, a federal savings bank or its successor-in-interest.

    


    
      	
              1.2

            	
              “Beneficiary”
      means the one person designated by the Participant on the Beneficiary
      designation form to receive benefits, if any, to which the Participant was
      entitled at the time of the Participant’s death. If there is no valid
      Beneficiary designation form on file at the time of the Participant’s
      death, the Participant’s Spouse shall be the Beneficiary, if
      living.

            


    

    


    
      	
              1.3

            	
              “Board of
      Directors” means the Board of Directors of the Bank or its
      successor-in-interest.

            


    

    


    
      	
              1.4

            	
              “Chairman” means
      any member of the Board of Directors who was formally elected and served
      the Board of Directors of the Bank as its Chairman for at least three (3)
      years of Service.

            


    

    


    
      	
              1.5

            	
              “Change of
      Control” means a change in the ownership of the Bank or the Holding
      Company, a change in the effective control of the Bank or the Holding
      Company or a

            


    


    
      
        
           

           

        

         


      

      
        1

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              change
      in the ownership of a substantial portion of the assets of the Bank or the
      Holding Company, in each case as provided under Section 409A of the Code
      and the regulations thereunder.

            


    

    


    1.6           “Code” mean the
Internal Revenue Code of 1986, as amended.

    


    
      	
              1.7

            	
              “Committee”
      means the Committee designated by the Board of Directors to administer the
      Plan pursuant to Section 5.

            


    

    


    
      	
              1.8

            	
              “Consulting
      Agreement” means the consulting agreement by and between a
      Participant and the Bank after such Participant ceases to be a Director,
      pursuant to which the Participant agrees to provide consulting services to
      the Bank as, and if, requested from time to time by the Board of
      Directors, not to exceed four (4) days each month, provided that to the
      extent a Participant does not provide services to the Bank under the
      Consulting Agreement during any month during the term of the Consulting
      Agreement or provides less than four (4) days of services during any such
      month, such non-provided days shall accumulate and carryover; however, the
      Participant shall not be obligated in any month during the term of the
      Consulting Agreement to provide more than twelve (12) days of consulting
      services and any accumulated days of consulting services existing on the
      termination of the Consulting Agreement shall
  lapse.

            


    

    


    1.9           “Director” means a
member of the Board of Directors of the Bank.

    


    
      	
              1.10

            	
              “Disability”
      means a 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 can be expected to
      last for a continuous period of not less than 12 months, or (ii) is, by
      reason of any medically determinable physical or mental impairment which
      can be expected to result in death or can be expected to last for a
      continuous period of not less than 12 months, receiving income replacement
      benefits for a period of not less than three months under an accident and
      health plan covering employees of the Bank or the Participant’s Employer
      (or would have received such benefits if the Participant had been eligible
      to participate in such plan).

            


    

    


    
      	
              1.11

            	
              “Effective Date”
      means the last date reflected in the first sentence of this
      Plan.

            


    

    


    
      	
              1.12

            	
              “Holding
      Company” means TierOne Corporation, the parent corporation of the
      Bank.

            


    

    


    
      	
              1.13

            	
              “Participant”
      means a Director or former Director who participates in the Plan pursuant
      to Section 2.

            


    

    


    
      	
              1.14

            	
              “Plan” means the
      TierOne Bank Fourth Amended and Restated Consultation Plan for Directors
      as herein set forth, and as may be amended from time to
    time.

            


    

    


    
      	
              1.15

            	
              “Retirement
      Date” means the date on which a Participant has a cessation of or
      decline in Service, including termination thereof based upon the death or
      Disability of the

            


    


    
      
        
           

           

        

         


      

      
        2

        
          

        

      

      
         


      

    


    
      	
               
      

            	
              Participant,
      a Change of Control, or otherwise by the action of the Participant or the
      Bank, which cessation of or decline in Service constitutes a Separation
      from Service.

            


    

    


    
      	
              1.16

            	
              “Service” means
      membership on the Board of Directors as a Director, including membership
      on the Board of Directors as a Director prior to the Effective
      Date.

            


    

    


    
      	
              1.17

            	
              “Separation from
      Service” means a termination of the Director’s services (whether as
      an employee, consultant or independent contractor) to the Bank (including
      companies which are deemed to be part of a controlled group of
      corporations with the Bank for purposes of Treasury Regulation
      §1.409A-1(h)) for any reason.  Whether a Separation from Service
      has occurred shall be determined in
      accordance with the requirements of Section 409A of the Code based
      on whether the facts and circumstances indicate that the Bank and the
      Director reasonably anticipated that no further services would be
      performed after a certain date or that the level of bona fide services the
      Participant would perform after such date (whether as an employee,
      consultant or independent contractor) would permanently decrease to no
      more than twenty percent (20%) of the average level of bona fide services
      performed (whether as an employee, consultant or independent contractor)
      over the immediately preceding thirty-six (36) month
    period.

            


    

    


    
      	
              1.18

            	
              “Specified
      Employee” means a key employee as defined in Section 416(i) of the
      Code (without regard to Section 416(i)(5) of the Code) and as otherwise
      defined in Section 409A of the Code and the regulations
      thereunder.

            


    

    


    1.19           “Spouse” means the
spouse of a Participant at the Participant's date of death.

    


    Except
where otherwise clearly indicated by the context, any masculine terminology used
herein shall include the feminine and vice versa, and the definition of any term
herein in the singular shall include the plural and vice versa.

    


    SECTION
2

    PARTICIPATION

    


    2.1           Commencement of
Participation.

    


    All
Directors are and shall become Participants in the Plan. All new Directors shall
become Participants immediately upon the commencement of the individual’s
Service as a Director.

    


    2.2           Continuation of
Participation.

    


    A
Director who has become a Participant shall continue as a Participant as long as
he or she continues to be a Director or is entitled to benefits under the
Plan.


    
      
        
           

           

        

         


      

      
        3

        
          

        

      

      
         


      

    


    SECTION
3

    RETIREMENT
BENEFITS

    


    3.1           Entitlement to
Benefits.

    


    (a)           A
Participant who:

    
      	
               
      

            	
              (i)

            	
              has
      ten (10) or more years of Service as of the Participant’s Retirement Date;
      and

            


    

    
      	
               
      

            	
              (ii)

            	
              if
      requested by the Board of Directors or the Bank, executes the Consulting
      Agreement within 30 days after the Participant’s Retirement Date;
      and

            


    

    
      	
               
      

            	
              (iii)

            	
              provided
      a Consulting Agreement is executed by the Participant as provided herein,
      continues to provide the services agreed to in the Consulting Agreement,
      unless relieved of such services through the judgment of the Board of
      Directors under Section 4.2 of the
Plan;

            


    

    shall
have a vested right to receive retirement benefits determined under the first
sentence of Section 3.2 below.

    


    (b)           A
Participant who:

    
      	
               
      

            	
              (i)

            	
              has
      five (5) or more years, but less than ten (10) years, of Service as of the
      Participant’s Retirement Date; and

            


    

    
      	
               
      

            	
              (ii)

            	
              if
      requested by the Board of Directors or the Bank, executes the Consulting
      Agreement within 30 days after the Participant’s Retirement Date;
      and

            


    

    
      	
               
      

            	
              (iii)

            	
              provided
      a Consulting Agreement is executed by the Participant as provided herein,
      continues to provide the services agreed to in the Consulting Agreement,
      unless relieved of such services through the judgment of the Board of
      Directors under Section 4.2 of the
Plan;

            


    

    


    shall
have a vested right to receive fifty percent (50%) of the retirement benefits
determined under the first sentence of Section 3.2 below.

    


    
      	
               
      

            	
              (c)

            	
              In
      the event a Participant does not satisfy any of the requirements of
      Sections 3.1(a) or 3.1(b) above as of the Participant’s Retirement Date
      and the Participant terminates Service because of a Change of Control
      while actively serving as a member of the Board of Directors, such
      Participant shall have a vested right to receive fifty percent (50%) of
      the retirement benefits determined under the first sentence of Section 3.2
      below.

            


    

    


    
      	
               
      

            	
              (d)

            	
              Notwithstanding
      the foregoing, no benefits may be paid to a Participant if a cease and
      desist order has been entered by the Office of Thrift Supervision (“OTS”)
      or any other regulatory body or agency regulating the activities of the
      Bank requiring the Participant to cease participating in the affairs of
      the Bank.

            


    


    
      
        
           

           

        

         


      

      
        4

        
          

        

      

      
         


      

    


    3.2           Amount of
Benefits.

    The
annual benefit payable under the provisions of Section 3.1(a) above to a
Participant each year shall be equal to the average of the annual monthly Board
fees and yearly retainer, if any, paid to the Participant for the last three (3)
years of Service prior to the Retirement Date, as reduced by the following
percentage for each respective such year:

    


    
      
        	
                Year

              	
                Percent Reduction

              
	
                Year
      1

              	
                0%

              
	
                Year
      2

              	
                20%

              
	
                Year
      3

              	
                40%

              
	
                Year
      4

              	
                60%

              
	
                Year
      5

              	
                80%

              


      

    

    


    The
annual benefit payable under the provisions of Sections 3.1(b) or 3.1(c) above
to a Participant for each such respective year shall be equal to fifty percent
(50%) of the amount determined in the first sentence of this Section
3.2.

    


    3.3           Extra Chairman
Benefits.

    An
additional benefit in the same amount as paid to retired Participants shall be
paid to any Participant who also served as a Chairman, as defined in Section 1.
This benefit is paid to a retired Chairman in addition to the benefits paid as a
retired Participant.

    


    3.4           Duration of
Benefits.

    Retirement
benefits determined under Section 3.2 shall be paid monthly, in installments of
1/12th of the annual amount for each respective year, commencing on the
Participant’s Retirement Date for a maximum of five (5) years; provided,
however, that if a Participant is a Specified Employee, the monthly installments
shall commence on the first day of the month following the lapse of six months
after the Participant’s Retirement Date, with the first installment to equal
7/12ths of the
annual amount for the first year and with each subsequent monthly installment to
equal 1/12th of the
annual amount for each respective year.

    


    3.5           Post Retirement Date Death
Benefit.

    If a
Participant dies: (i) after the Participant’s Retirement Date, but while still a
Participant in this Plan and prior to receiving five (5) years of benefit
participation under the Plan, or (ii) while serving as a Director who satisfies
any of the requirements of Section 3.1 above, any remaining unpaid benefits or
benefits payable under Section 3.2 above shall be paid to the Participant’s
Beneficiary in monthly installments. If a Participant’s Beneficiary should die
prior to receiving all of the benefits to which he or she otherwise would have
been entitled under this Section 3.5, no remaining benefits shall be paid and
the Bank shall be discharged of all further obligations of any
kind.

    


    3.6           Suspension of
Benefits.

    Notwithstanding
the foregoing, no payments or portions thereof shall be made under this Plan if
such payment or portion thereof would result in the Bank failing to meet its
minimum capital requirements. Any payments or portions thereof which have
been


    
      
        
           

           

        

         


      

      
        5

        
          

        

      

      
         


      

    


    suspended
shall remain suspended until such time as their payment would not result in a
failure to meet the Bank’s minimum capital requirements. Any portion of benefit
payments which have not been suspended will be paid on an equitable basis, pro
rata based upon amounts due each Participant or Beneficiary, among all eligible
Participants and Beneficiaries.

    


    3.7           Unfunded
Plan.

    The Plan
is intended to constitute an “unfunded” plan for the payment of deferred
compensation. With respect to any payments not yet made to a Participant,
nothing contained herein shall give any such Participant any rights that are
greater than those of a general creditor of the Bank. In its sole discretion,
the Board of Directors may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan.

    


    SECTION
4

    MISCELLANEOUS

    


    4.1           Restriction Against
Assignment.

    It is a
condition of the Plan, and all rights of each Participant shall be subject
thereto, that no right or interest of any Participant in the Plan and no benefit
payable under the Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any
action by way of anticipating, alienating, selling, transferring, assigning,
pledging, encumbering, or charging the same shall be void and of no effect; nor
shall any such right, interest or benefit be in any manner liable for or subject
to the debts, contracts, liabilities, engagements, or torts of the person
entitled to such right, interest or benefit, except as specifically provided in
this Plan.

    


    4.2           Payments in the Event of
Incompetence.

    If any
person entitled to receive any benefits hereunder is, in the judgment of the
Committee, legally, physically, or mentally incapable of personally receiving
and receipting for any distribution, the Committee may direct that any
distribution due such person, unless claim has been made therefor by a duly
appointed legal representative, be made to his or her spouse, children or other
dependents, or to a person with whom he or she resides, and any other
distribution so made shall be a complete discharge of the liabilities of the
Plan.

    


    4.3           No Right to Continue as
Director.

    The
establishment of the Plan shall not be construed as conferring any rights upon
any Director for continuation of service as a Director, nor shall it be
construed as limiting in any way the right of the Bank to treat him without
regard to the effect which such treatment might have upon him as a Participant
under the Plan.

    


    4.4           Discharge of Plan
Obligations.

    The
determination of the Committee as to the identity of the proper payee of any
benefit payment and the amount properly payable shall be conclusive, and
payments in


    
      
        
           

           

        

         


      

      
        6

        
          

        

      

      
         


      

    


    accordance
with such determination shall constitute a complete discharge of all obligations
on account thereof.

    


    4.5           Confidentiality.

    It is a
condition of the Plan that each Participant shall keep confidential and shall
not disclose to any third party or use for the Participant’s own benefit or the
benefit of any third party, without the prior written consent of the Bank, any
information, data, trade secrets, know-how, processes, procedures, methods,
discoveries, or improvements of the Bank of which the Participant learns or
discovers as a result of such Participant’s (i) Service or (ii) provision of
services under such Participant’s Consulting Agreement. The parties hereby agree
and acknowledge that all documents or plans either owned or possessed by the
Bank are, and shall be and remain, the sole and exclusive property of the Bank
for all purposes and at all times.  Each Participant’s and any
Beneficiary’s rights under or pursuant to the Plan shall be subject to
compliance by the Participant and the Beneficiary with the terms and provisions
hereof.

    


    4.6           Agreement Not to
Compete.

    It is a
condition of the Plan that no Participant shall during the Participant’s term as
a Director or during the term of such Participant’s Consulting Agreement,
without the prior express written consent of the Bank in each instance, engage
directly or indirectly in any business or activity competitive with or adverse
to the business or welfare of the Bank (as determined by the Committee), whether
as a proprietor, partner, member, manager, joint venturer, agent,
representative, employee, consultant, officer, shareholder or director of a
corporation, limited liability company, partnership or other
entity.  Each Participant’s and any Beneficiary’s rights under or
pursuant to the Plan shall be subject to compliance by the Participant with the
terms and provisions hereof.

    


    4.7           Regulatory
Provisions.

    Notwithstanding
any other provision of this Plan to the contrary, any payments made to a
Participant pursuant to this Plan, or otherwise, are subject to and conditioned
upon their compliance with Section 18(k) of the Federal Deposit Insurance Act
(12 U.S.C. § 1828(k)) and the regulations promulgated thereunder, including 12
C.F.R. Part 359.

    


    SECTION
5

    ADMINISTRATION
OF THE PLAN

    


    5.1           Administration of the
Plan.

    Administration
of the Plan shall be the responsibility of the Committee.

    


    5.2           Responsibility of the
Committee.

    The
Committee shall be responsible for the administration, operation and
interpretation of the Plan. The Committee shall establish rules from time to
time for the transaction of its business. It shall have the exclusive right to
interpret the Plan and to decide any and all matters arising thereunder or in
connection with the administration of the Plan, and it shall endeavor to act,
whether by general rules or by particular decisions, so as not to discriminate
in favor of any person or class of person. Such decisions, actions and
records


    
      
        
           

           

        

         


      

      
        7

        
          

        

      

      
         


      

    


    of the
Committee shall be conclusive and binding upon the Bank and all persons having
or claiming to have any right or interest in or under the Plan.

    


    5.3           Claims
Procedure.

    In the
event that any Participant or other payee claims to be entitled to a benefit
under the Plan, and the Committee determines that such claim should be denied in
whole or in part, the Committee shall, in writing, notify such claimant within
90 days of receipt of such claim that his or her claim has been denied, setting
forth the specific reasons for such denial. Such notification shall be written
in a manner reasonably expected to be understood by such Participant or other
payee and shall set forth the pertinent sections of the Plan relied on, and
where appropriate, an explanation of how the claimant can obtain review of such
denial. Within 60 days after receipt of such notice, such claimant may request,
by mailing or delivery of written notice to the Committee, a review by the
Committee of the decision denying the claim. If the claimant fails to request
such a review within such 60 day period, it shall be conclusively determined for
all purposes of this Plan that the denial of such claim by the Committee is
correct. If such claimant requests a review within such 60 day period, the
Participant or other payee shall have 30 days after filing a request for review
to submit additional written material in support of the claim. Within 60 days
after the later of its receipt of the request for review or the Participant’s
submission of additional written material, the Committee shall determine whether
such denial of the claim was correct and shall notify such claimant in writing
of its determination. If such determination is favorable to the claimant, it
shall be binding and conclusive. If such determination is adverse to such
claimant, it shall be binding and conclusive unless the claimant notifies the
Committee within 90 days after the mailing or delivery to him or her by the
Committee of its determination, that the claimant intends to institute legal
proceedings challenging the determination of the Committee, and actually
institutes such legal proceedings within 180 days after such mailing or
delivery.

    


    5.4           Limitation on
Liability.

    The
Committee shall not be liable for any act or omission on its part, excepting
only its own willful misconduct or gross negligence or except as otherwise
expressly provided by applicable law. To the extent permitted by applicable law,
and not otherwise covered by insurance, the Bank shall indemnify and save
harmless the Committee members against any and all claims, demands, suits or
proceedings in connection with the Plan that may be brought by Participants or
by any other person, corporation, entity, government or agency thereof;
provided, however that such indemnification shall not apply with respect to acts
or omissions of willful misconduct or gross negligence. The Board of Directors,
at the expense of the Bank, may settle such claim or demand asserted, or suit or
proceedings brought, against the Committee when such settlement appears to be in
the best interest of the Bank.

    


    5.5           Agent for Service of
Process.

    The
Committee or such other person as may from time to time be designated by the
Committee shall be the agent for service of process under the Plan.

    



    
      
        
           

           

        

         


      

      
        8

        
          

        

      

      
         


      

    


    SECTION
6

    AMENDMENT
OF THE PLAN

    


    6.1           Plan
Amendments.

    This Plan
may be wholly or partially amended or otherwise modified at any time by the
Board of Directors, provided, however, that no amendment or modification shall
have any retroactive effect so as to deprive any person of any benefit already
vested or accrued without the consent of such person.  In addition,
notwithstanding anything in this Plan to the contrary, the Board of Directors
may amend in good faith any terms of this Plan, including retroactively, in
order to comply with Section 409A of the Code.

    


    SECTION
7

    DISCONTINUANCE
OF THE PLAN

    


    7.1           Termination of
Plan.

    The Plan
may be terminated at any time by the Board of Directors by written notice to the
Committee at the time acting hereunder. In the event of the termination of the
Plan, Participants with a vested right under Section 3.1 of the Plan shall
continue to receive benefits as described herein under all the terms of this
Plan. No person who at the time of the termination of this Plan does not then
have a fully vested right or who is otherwise ineligible for payment of benefits
shall receive any benefit under this Plan.

    


    SECTION
8

    CONSTRUCTION
OF THE PLAN

    


    8.1           Construction of the
Plan.

    The
validity of the Plan or any of the provisions thereof shall be determined under
and shall be construed according to the laws of the State of
Nebraska.

    


    8.2           Headings.

    Headings
or titles to sections or paragraphs in this document are for convenience of
reference only and are not part of the Plan for any other purposes.

    


    8.3           Supersede Prior
Plans.

    Upon the
Effective Date of the Plan, all prior plans or arrangements are hereby amended,
restated and superseded by this Plan, and the Plan specifically supersedes and
replaces Board Resolution BD 04-7-21.


    
      
        
           

           

        

         


      

      
        9

        
          

        

      

      
         


      

    


    IN WITNESS WHEREOF, and as
evidence of the adoption of the Plan by the Board of Directors of the Bank, the
Bank has caused the same to be signed by its officer duly authorized, and its
corporate seal to be affixed hereto.

    


    ATTEST:                                                                                                                  
   TIERONE BANK

    


    


    /s/ Judith A.
Klinkman                                                                By:  /s/ Gilbert G.
Lundstrom

    Judith A.
Klinkman, Assistant
Secretary                                                                                 Gilbert
G. Lundstrom, Chairman and

                            
Chief Executive Officer

    


    

      
        
          
             

             

          

           


        

        
          10

          
            

          

        

        
           


        

      



    TIERONE
BANK

    FOURTH
AMENDED AND RESTATED

    CONSULTATION
PLAN FOR DIRECTORS

    


    DESIGNATION
OF BENEFICIARY

    


    I hereby
designate the one following named beneficiary to receive from the Fourth Amended
and Restated Consultation Plan For Directors of TierOne Bank (the “Plan”) any
amounts payable pursuant to said Plan by reason of my death:

    


    
      	 
      	
               Beneficiary

            


    

    


    ______________________________________

    Name

    


    ______________________________________________________________

    Address                      Street                      City                       State

    


    
      	
              ______________________________________

            	
              ______________________________________

            
	
              Social
      Security Number

            	
              Date
      of Birth

            


    

    


    Further,
that it shall be the responsibility of said beneficiary to notify the Corporate
Secretary at the home office of the Bank of any change in address.

    


    Further,
unless I have a Designation of Beneficiary in effect at the time an amount
becomes payable to a Beneficiary, that amount will be paid in accordance with
Section 1.2 of the Plan.

    


    Further,
that upon the death of the Beneficiary, no remaining benefits will be
paid.

    


    
      	 
      	
              ______________________________________

            
	 
      	
              Director

            
	 
      	
               

              ______________________________________

            
	 
      	
              Social
      Security Number

            
	
               

               

              Date
      Accepted______________________________

            
	
               

               

              By:_______________________________________

            
	
              Title:______________________________________

            


    

     

     

    11