**EXHIBIT10.1**

 

DEFERREDCOMPENSATION AND

SPLIT-DOLLARINSURANCE AGREEMENT

 

Effective the 13th day of November, 1990, WestSuburban Bank, a bankingorganizationorganized and existing under the laws of the State of Illinois,  hereinafterreferred to as “Corporation” and                                 ,a Key Employee and Executive of the Corporation, hereinafter referred to as“Executive,” entered into a DeferredCompensation Agreement. By the terms thereof, the Corporation and the Executive reserved the right to modifyor amend that agreement. Byexecution hereof, the Corporation and Executive hereby amend and restate that agreement in its entirety. 

 

The Executive has been in the employ of theCorporation for several years,  and has now and for years past faithfullyserved the Corporation. It is the consensusof the Board of Directors of the Corporation that Executive’s services have been of exceptional merit, inexcess of the compensation paid andan invaluable contribution to the profits and position of the Corporationin its field of activity. 

 

It is the mutual desire of the Corporation andthe Executive that Executiveremain in the employ of the Corporation, and to establish a program toprovide supplemental employment benefitsand pre-retirement death benefits forthe Executive. Accordingly, it is the desire of the Corporation and the Executive to enter into this Agreement underwhich the Corporation will agree tomake certain payments to Executive upon his employment termination and,  alternatively,to his beneficiaries in the event of his death while employed by the Corporation. 

 

Therefore, in consideration of Executive’sservices performed in the past andthose to be performed in the future, and based upon the mutual promisesand covenants herein contained,the Corporation and Executive agree as follows: 

 

I.              ARTICLE ONE - DEFINITIONS

 

A.            EFFECTIVE DATE. The effective date of thisAgreement shall be May 1,  1997. 

 

B.            EMPLOYMENT AGREEMENT. The Employment Agreemententered into between Executiveand the Corporation dated May 1, 1997, as amended. 

 

II.         ARTICLE TWO - EMPLOYMENT

 

a)             Employment shall be in accordance with theterms of the Employment Agreement.

 

III.        ARTICLE THREE - DEFERRED COMPENSATION

 

A.            The Corporation shall set aside and accrue tothe benefit of Executive the sumof the following no later than December 31 of each year subject to the terms set forth in thisAgreement: 

 

1.             A base of Twenty-five Thousand Dollars($25,000) per year; and

 

2.             Such additional annual deferred compensationas determined by the Board ofDirectors. 

 

3.             In the event Executive becomes entitled toreceive benefits under ArticleFive of this Agreement, he shall be entitled to a pro-rata portion of his base benefit basedupon his completed calendarmonths of employment for the year of employment termination and any additional annual deferred compensation determined by the Board of Directors.

 

B.            The sum of the above annual set aside, pluseach prior year’s set aside,shall be referred to as Executive’s Deferred Compensation Account (“EDC Account”). The EDC Account shallbear annual interest equal to theone year treasury note constant maturity interest rate published by the Federal Home Loan Bank ineffect on January 1 of each year(constant one year U.S. Treasury Index per FRB H15).

 

C.            The Corporation may purchase life insurance tofund all or part of the above EDCAccount and Executive shall execute all reasonable insurance applications to facilitate suchpurchase provided,  however, Executive shall have no right, titleor interest in such insurance orin the EDC Account, unless otherwise provided by the Corporation.

 

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IV.           ARTICLE FOUR - SPLIT-DOLLAR-LIFE INSURANCE

 

A.            If the Executive is insurable, the Corporationshall purchase life insurance onthe life of Executive with a minimum death benefit of $                                to fund its obligations under this Agreement in the event of the death of Executive beforetermination of employment.

 

B.            All premiums due on such insurance shall bepaid by the Corporation.  However, Executive shall be responsible forthe income taxes incurred eachyear on the value of the “economic benefit” of the life insurance protection for federal incometax purposes.

 

C.            All dividends attributable to such lifeinsurance will be applied to reducepremiums.

 

D.            The Corporation shall have all ownershiprights under such life insurance,except Executive shall have the right to designate the beneficiary thereunder.

 

E.             The amount receivable by the Corporation upontermination of such lifeinsurance shall be:

 

1.             Upon termination of this Agreement or thedeath of Executive,  the Corporation’s share shall be an amountequal to the greater of theaggregate premiums paid by the Corporation or the cash value.

 

2.             Upon surrender of such life insurance, theCorporation’s share shall be anamount equal to the cash value.

 

3.             For purposes of this Agreement, “aggregatepremiums” shall mean all premiumspaid by the Corporation. Such premiums shall be reduced by any indebtedness and any accrued unpaid interest incurred by the Corporation on the lifeinsurance and by the amount ofany policy dividends used to reduce or offset such premiums. “Cash value” shall mean theguaranteed cash value of the lifeinsurance plus the cash value of any dividend additions as of the date to which premiums have beenpaid plus any dividend creditsoutstanding, and reduced by any indebtedness and any accrued unpaid interest incurred by the Corporation on the life insurance.

 

F.             Upon Executive’s death, the Corporation andExecutive’s beneficiary shallexecute such forms and furnish such other documents or information as are required to receive paymentunder the life insurance.

 

V.         ARTICLE FIVE - BENEFITS

 

a)          The following benefits provided by the Corporation to Executive shall beavailable under this Agreement:

 

A.            Executive shall be entitled to receive theaccrued balance in his EDCAccount upon any termination of his employment other than upon death. Such amount shall be paid in the numberof annual installments elected byExecutive. The Board of Directors of the Corporation may at any time accelerate the payment of any outstanding balance.

 

B.            Upon any termination of employment other thanupon death, Executive may electto acquire any life insurance maintained by the Corporation under Article Four. In the event of such an election,  anyamount receivable under Section A above shall be reduced by the cash value of such insurance, as defined underArticle Four.

 

C.            In the event of Executive’s death beforetermination of employment,  the beneficiary named by Executive shallreceive the death benefit payableunder any life insurance purchased by the Corporation, less an amount equal to the greater of theaggregate premiums paid by the Corporationfor or the cash value of such insurance, each as defined under Article Four, such benefit payment to bein full satisfaction of anyamounts due under this Agreement. Notwithstanding the preceding sentence, in the event the deathbenefit receivable by the beneficiaryis less than the accrued balance in the EDC Account of Executive, the beneficiary shall receive anadditional amount equal to thedifference between the EDC Account balance and the death benefit receivable.

 

VI.        ARTICLE SIX - RESTRICTIONS UPON DEFERREDCOMPENSATION FUNDING

 

The Corporation shall have noobligation to set aside, earmark orentrust any fund or money with which to pay its deferred compensation obligations under this Agreement.Executive, his beneficiaries orany successor in interest to him shall be and 

 

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remain simply a generalcreditor of the Corporation in the samemanner as any other creditor having a general claim for matured andunpaid compensation.

 

The Corporation reserves theabsolute right in its sole discretionto either fund the deferred compensation obligations undertaken by thisAgreement or to refrain from funding the same and to determine the extent, nature and method of such funding.

 

Should Corporation elect tofund its deferred compensation obligationunder this Agreement, in whole or in part, through the purchase of lifeinsurance, mutual funds, disability policies or annuities, the Corporation reserves the absolute right, inits sole discretion, to terminatesuch funding at any time, in whole or in part. At no time shall Executive be deemed to have any lien orright, title or interest in or toany specific funding investment or to any assets of the Corporation.

 

If Corporation elects toinvest in a life insurance, disability, orannuity policy upon the life of Executive,then Executive shall assist theCorporation by freely submitting to a physical exam and supplying such additional informationnecessary to obtain such insuranceor annuities.

 

VII.      ARTICLE SEVEN - MISCELLANEOUS

 

A.            ALIENABILITY AND ASSIGNMENT PROHIBITION. NeitherExecutive, his surviving spousenor any other beneficiary under this Agreement shall have any power or right to transfer, assign, anticipate,  hypothecate,mortgage, commute, modify or otherwise encumber, in advance, any of the benefits payable hereundernor shall any of said benefits besubject to seizure for the payment of any debts,  judgments,alimony or separate maintenance owed by the Executive or his beneficiary nor be transferable byoperation of law in the event ofbankruptcy, insolvency or otherwise. In the event Executive or any beneficiary attempts assignment,commutation, hypothecation,  transfer or disposal of the benefitshereunder, the Corporation’s liabilitiesshall forthwith cease and terminate.

 

B.            BINDING OBLIGATION OF CORPORATION AND ANYSUCCESSOR IN INTEREST.  Corporation expressly agrees that it shall notmerge or consolidate into or withanother corporation or sell substantially all of its assets to another corporation, firm or personuntil such corporation, firm orperson expressly agrees, in writing, to assume and discharge the duties and obligations of the Corporation underthis Agreement. This Agreement shall bebinding upon the parties hereto,their successors, beneficiaries, heirs and personal representatives.

 

C.            REVOCATION. It is agreed by and between theparties hereto that, during thelifetime of the Executive, this Agreement may be amended or revoked at any time or times, in whole orin part, by the mutual written assent of the Executive and the Corporation.

 

D.            TERMINATION. It is agreed by and between theparties hereto that the annualset aside under this Agreement may be terminated by the Corporation at the end of the then currentterm of the Employment Agreementin the event of the non-extension or termination thereof.

 

E.             GENDER. Whenever in this Agreement words areused in the masculine or neutergender, they shall be read and construed as in the masculine, feminine or neuter gender wheneverthey should so apply.

 

F.             EFFECT ON OTHER CORPORATION BENEFIT PLANS. Nothingcontained in this Agreement shallaffect the right of the Executive to participate in or be covered by any qualified or non-qualified pension, profit-sharing, group, bonus or othersupplemental compensation orfringe benefit plan constituting a part of Corporation’s existing or future compensation structure.

 

G.            HEADINGS. Headings and subheadings in thisAgreement are inserted forreference and convenience only and shall not be deemed a part of this Agreement.

 

H.            APPLICABLE LAW. The validity andinterpretation of this Agreement shallbe governed by the laws of the State of Illinois.

 

VIII.     ARTICLE EIGHT - ERISA PROVISIONS

 

A.            NAMED FIDUCIARY AND PLAN ADMINISTRATOR. The “NamedFiduciary and Plan Administrator”of this Agreement shall be Duane G. Debs until his resignation or removal by the Board of Directors of the Corporation. As Named Fiduciary and PlanAdministrator, Duane G.

 

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Debs shall be responsible forthe management, control andadministrationof this Agreement as established herein. He may delegate to others certain aspects of the management and operation responsibilitiesof the plan including the employment of advisors and the delegation of ministerial duties to qualified individuals.

 

B.            CLAIMS PROCEDURE. In the event that benefitsunder this Plan Agreement are notpaid to the Executive (or to his beneficiary in the case of Executive’s death) and such claimants feel they are entitled to receive such benefits, then awritten claim must be made to theNamed Fiduciary and Administrator named above within sixty (60) days from the date payments are refused. ThePlan Fiduciary and Administratorand the corporation shall review the written claim and, if the claim is denied in whole or inpart, they shall provide,  in writing and within ninety (90) days ofreceipt of such claim,  their specific reasons for such denial andreference to the provisions of this Agreement upon which the denial is based and any additional material orinformation necessary to perfectthe claim. Such written notice shall further indicate the additional steps to be taken by claimantsif a further review of the claimdenial is desired. A claim shall be deemed denied if the Plan Fiduciary and Administrator fails to takeany action within the aforesaidninety (90) day period.

 

If claimants desire a secondreview, they shall notify the PlanFiduciary and Administrator in writing within sixty (60) days of the firstclaim denial. Claimants may review the Plan Agreement or any documents relating thereto and submit anywritten issues and comments theymay feel appropriate. In its sole discretion, the Plan Fiduciary and Administrator shall then reviewthe second claim and provide awritten decision within sixty (60) days of receipt of such claim. This decision shall likewise state thespecific reasons for the decisionand shall include reference to specific provisions of the Plan Agreement upon which the decision isbased.

 

C.            ARBITRATION. If claimants continue to disputeany benefit denial after thesecond review, the claimants may submit the dispute to arbitration. Such arbitration shall beconducted by a single arbitratorsitting in a location selected by Executive within fifty (50) miles of the main office of Corporation,in accordance with the rules ofthe American Arbitration Association (the “AAA”) then in effect. The arbitrator shall be selected bythe parties from a list ofarbitrators provided by the AAA, provided that no arbitrator shall be related to or affiliated with eitherof the parties. No later than ten(10) days after the list of proposed arbitrators is received by the parties, the parties, or theirrespective representatives, shallmeet at a mutually convenient location or telephonically. At that meeting, the party who sought arbitration shalleliminate one (1) proposed arbitrator and then the other party shall eliminate one (1) proposed arbitrator. Theparties shall continue toeliminate names from the list of proposed arbitrators in this manner until a single proposed arbitratorremains. This remainingarbitrator shall arbitrate the dispute. Each party shall submit, in writing, the specific requestedaction or decision it wishes totake, or make, with respect to the matter in dispute, and the arbitrator shall be obligated to chooseone (1) party’s specific requestedaction or decision, without being permitted to effectuate any compromise position. Judgment may beentered on the arbitrator’s awardin any court having jurisdiction; provided,  however,that Executive shall be entitled to seek specific performance of his right to be paid throughthe date of termination duringthe pendency of any dispute or controversy arising under or in connection with this Agreement.

 

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IN WITNESS WHEREOF, the parties heretoacknowledge that each has carefully readthis Agreement and executed the original thereof on the             day of May, 1997 and that, uponexecution, each has received a confirming copy. 

 

 
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| (WITNESS) |   |               |
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|      |   | WEST SUBURBAN BANK |
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|      |   | By:                |   |
| (WITNESS) |   | Its:               |   |
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DEFERREDCOMPENSATION AND

SPLIT-DOLLARINSURANCE AGREEMENT

DEFERRALELECTION

 

TO:  TheBoard of Directors of West Suburban Bank

 

In accordance with the provisions of theDeferred Compensation and Split-DollarInsurance Agreement, I hereby elect to have the amounts deferred underthe Agreement paid to me in            (INSERT A NUMBER ONE (1) THROUGH TEN (10)) annual installments. I understand that I cannotmodify the manner of payment election made by me any later than twelve (12) months before my anticipated dateof employment termination.

 
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| WEST SUBURBAN BANK |   |   |
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| By:                |   |   |   |
| Its:               |   |   | Date   |
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DEFERREDCOMPENSATION AND

SPLIT-DOLLARINSURANCE AGREEMENT

DESIGNATIONOF BENEFICIARIES

 

TO:  TheBoard of Directors of West Suburban Bank

 

In accordance with the provisions of theDeferred Compensation and Split-DollarInsurance Agreement, I hereby revoke any prior designations anddesignate the followingbeneficiary* to receive the benefits under the Agreement upon my death:

 
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| Address: |   |   |
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*  If more than one beneficiary isto be designated, separately list thebeneficiaries and specify the percentage of each distribution to bereceived by each beneficiary.

 

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