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PRIMO WATER CORPORATION
EQUITY INCENTIVE PLANS
RESTRICTED SHARE UNIT AWARD AGREEMENT
(Performance-Based Vesting)
1.    Equity Plan. This Award (as defined below) is issued under the following equity incentive plan (check one): 
 Amended and Restated Primo Water Corporation Equity Incentive Plan 
 Primo Water Corporation 2018 Equity Incentive Plan 
2.    Performance-Based Share Unit Award – Terms and Conditions. Under and subject to the provisions of the equity incentive plan designated above (the “Plan”) and upon the terms and conditions set forth herein, Primo Water Corporation (the “Company”) has granted to ____________ (the “Grantee”), effective ____________ (the “Date of Grant”), a Restricted Share Unit Award (the “Award”) of ____________performance-based restricted share units (such units, the “Performance Units”), in respect of services to be provided in ____________ and thereafter. At all times, each Performance Unit shall be equal in value to one common share in the capital of the Company (each, a “Share”). Such Award is subject to the terms and conditions of this Performance-Based Restricted Share Unit Agreement (the “Agreement”) and the Plan. 
(a)    Performance Period. For purposes of this Agreement, the “Performance Period” is the period beginning on the first day of the Company’s _____ fiscal year, and ending on the last day of the Company’s _____ fiscal year.
(b)    Payout of Award. Provided the Award has not previously been forfeited, as soon as administratively practicable following the expiration of the Performance Period, but in no event later than the later to occur of (i) sixty (60) days following the expiration of the Performance Period and (ii) the date that audited financial statements are available for the Company’s ____________ fiscal year, the Company shall issue to the Grantee in a single payment the number of Shares underlying the Performance Units to which the Grantee is entitled pursuant hereto. The Shares issued by the Company hereunder may at the Company’s option be either (i) evidenced by a certificate registered in the name of the Grantee or his or her designee; or (ii) credited to a book-entry account for the benefit of the Grantee maintained by the Company’s stock transfer agent or its designee.  
(c)    Satisfaction of Performance Objectives. The payout of the Award shall be contingent upon the attainment during the Performance Period of the performance objectives set forth in Section 2(e) herein (the “Performance Objectives”). The payout of the Award shall be determined upon the expiration of the Performance Period in accordance with the Performance Objectives. The final determination of the payout of the Award will be authorized by the Human Resources and Compensation Committee of the Company’s Board of Directors (the “Committee”). 
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(d)    Rights During Performance Period. 
(i)    During the Performance Period, the Grantee shall not have any rights as a shareholder with respect to the Shares underlying the Performance Units, including dividend rights (other than as described in subsection (ii) below). Upon the expiration of the Performance Period and payout of the Award, the Grantee may exercise voting rights and shall be entitled to receive dividends and other distributions with respect to the number of Shares to which the Grantee is entitled pursuant hereto. 
(ii)    As of any date that the Company pays an ordinary cash dividend on its Shares, the Company shall credit the Grantee with a dollar amount equal to (i) the per share cash dividend paid by the Company on its Shares on such date, multiplied by (ii) the total number of Performance Units that are outstanding immediately prior to the record date for that dividend (a “Dividend Equivalent Right”). Any Dividend Equivalent Rights credited pursuant to the foregoing provisions of this Section 2(d) shall be subject to satisfaction of the same Performance Objectives, and to the same payment and other terms, conditions and restrictions as the original Performance Units to which they relate; provided, however, that the amount of any earned Dividend Equivalent Rights shall be paid in cash at the same time as the Company pays its first ordinary cash dividend after the Final Committee Determination (as defined below) is made. No crediting of Dividend Equivalent Rights shall be made pursuant to this Section 2(d) with respect to any Performance Units which, immediately prior to the record date for that dividend, have been paid out or forfeited pursuant to the terms of the Plan. 
(e)    Performance Objectives. The Performance Units shall vest and become non-forfeitable based on the Company’s achievement of specified levels of ROIC and Revenues (each as defined below) for the Performance Period as set forth in the chart below:

																														
	ROIC Performance									
	Payout	50.0%	62.5%	75.0%	87.5%	100.0%	125.0%	150.0%	175.0%	200.0%

															
	Revenue Performance

				
	Payout	50.0%	100.0%	150.0%	200.0%

Following the end of the Performance Period, the Committee will determine actual results for each of the metrics described above (the “Final Committee Determination”). Such results will be interpolated on a straight-line basis between the performance levels identified above, resulting in a payout rate for each metric. The performance measures will be weighted as follows: ROIC 75% and Revenues 25%. The relative weighting for each metric will be applied to such payout rates, and the results will be aggregated, resulting in an aggregate payout rate (the “Payout Rate”).
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To illustrate, if Company performance results in ROIC and Revenues as set forth below,  the payout would be calculated as follows:

															
	Performance Measure	Actual Performance	% Award Earned	Weight	
	ROIC	[__]%	[__]%	75%	#VALUE!
	Revenues	$[___] million	[__]%	25%	#VALUE!
	Payout Rate		-	-	#VALUE!

Payment of vested Performance Units based on the Payout Rate will be made in the period provided for in Section 2(b) of this Agreement. Any Performance Units that do not vest based on the Performance Objectives described herein (and which have not previously terminated pursuant to the terms of this Agreement) will automatically terminate as of the Final Committee Determination. Any such determination by the Committee shall be final and binding.
For purposes of this Section 2(e), the following definitions shall apply:
“Adjusted EBIT” shall mean the Company’s Adjusted Net Income as disclosed publicly, adjusted for: (i) the impact of changes to U.S. generally accepted accounting principles (“US GAAP”); (ii) the impact of changes to laws or other regulations in any jurisdiction the Company operates in; (iii) the impact of discontinued operations or items that are unusual or infrequently occurring as defined by US GAAP; (iv) the impact of foreign currency exchange rate fluctuations on a translational basis; (v) depreciation and amortization (excluding customer list amortization); (vi) interest, and (vii) income taxes; provided, however, that if Adjusted Net Income is not disclosed publicly, such term/amount shall be determined on a basis consistent with historical disclosures. 
“Invested Capital” shall mean (A) Shareholders’ Equity plus (B) that portion of Long-Term Debt, Short-Term Borrowings and Current Maturities of Long-Term Debt that is interest-bearing minus (C) Cash and Cash Equivalents minus (D) Net Assets of Discontinued Operations. In the event the Company completes an acquisition which is financed through the issuance of debt or Company equity, the amount of such debt and/or equity included in the calculation of Invested Capital for the year such acquisition is consummated will be (1) the amount of such debt and/or equity, multiplied by (2) a fraction, the numerator of which is the number of days from the closing date of such acquisition to the end of the fiscal year in which the acquisition is consummated and the denominator of which is the number of days in the fiscal year in which the acquisition is consummated.  
“Net Assets of Discontinued Operations” shall mean (A) the sum of Current Assets of Discontinued Operations and Long-Term Assets of Discontinued Operations, minus (B) the sum of Current Liabilities of Discontinued Operations and Long-Term Liabilities of Discontinued Operations.
“Revenues” shall mean the Company’s revenues for the Performance Period, excluding (i) the impact of foreign exchange, (ii) revenues of any acquired businesses, and (iii) the impact 
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of discontinued operations or items that are unusual or infrequently occurring as defined by US GAAP. 
    “ROIC” shall mean the average of ROIC Year 1, ROIC Year 2 and ROIC Year 3.
    “ROIC Year 1” shall mean (A)Adjusted EBIT for the first fiscal year in the Performance Period divided by (B) the Invested Capital as of the end of the first fiscal year in the Performance Period. 
“ROIC Year 2” shall mean (A) Adjusted EBIT for the second fiscal year in the Performance Period divided by (B) Invested Capital as of the end of the second fiscal year in the Performance Period.
“ROIC Year 3” shall mean (A) Adjusted EBIT for the third fiscal year in the Performance Period divided by (B) Invested Capital as of the end of the third fiscal year in the Performance Period. 
The terms “Shareholders’ Equity,” “Long-Term Debt,” “Short-Term Borrowings,” “Current Maturities of Long-Term Debt”, “Cash and Cash Equivalents,” “Current Assets of Discontinued Operations,” “Long-Term Assets of Discontinued Operations,” “Current Liabilities of Discontinued Operations,” and “Long-Term Liabilities of Discontinued Operations”  shall have the meanings ascribed to those terms as presented in the Company’s Consolidated Balance Sheets or Consolidated Statement of Operations.  
3.    Prohibition Against Transfer.  Until the payout of the Award following the expiration of the Performance Period, the Award, the Performance Units and any interest in Shares related thereto, may not be sold, exchanged, assigned, transferred, pledged, hypothecated, encumbered or otherwise disposed of, shall not be assignable by operation of law, and shall not be subject to execution, attachment, charge, alienation or similar process. Any attempt to effect any of the foregoing shall be null and void and without effect. 
4.    Securities Law Requirements. The Company shall not be required to issue Shares pursuant to the Award, to the extent required, unless and until (a) such Shares have been duly listed upon each stock exchange on which the Common Shares are then registered; and (b) a registration statement under the Securities Act of 1933 with respect to such Shares is then effective. 
5.    Incorporation of Plan Provisions. This Agreement is made pursuant to the Plan, the provisions of which are hereby incorporated by reference. Capitalized terms not otherwise defined herein shall have the meanings set forth for such terms in the Plan. In the event of a conflict between the terms of this Agreement and the Plan, the terms of the Plan shall govern. 
6.    Compliance with Section 409A of the Code. To the extent applicable, it is intended that the Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Grantee. The Agreement and the Plan shall be administered and interpreted in a manner consistent with this intent, and any provision that would cause the Agreement or the Plan to fail to satisfy Section 409A of the Code shall have no force and effect until amended to comply with Section 409A of the Code (which amendment may be retroactive to the extent permitted by Section 409A of the Code and may be made by the Corporation without the consent of the 
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Grantee). Notwithstanding the foregoing, no particular tax result for the Grantee with respect to any income recognized by the Grantee in connection with the Agreement is guaranteed, and the Grantee solely shall be responsible for any taxes, penalties or interest imposed on the Grantee in connection with the Agreement. Reference to Section 409A of the Code will also include any regulations, or any other guidance, promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.

7.    Tax Withholding. The Grantee shall pay all applicable income and employment taxes (including taxes of any foreign jurisdiction) which the Company or a Subsidiary is required to withhold at any time with respect to the Performance Units. Such payment shall be made in full, at the Grantee’s election, in cash or check, by withholding from the Grantee’s next normal payroll check, or by the relinquishment of Shares that otherwise would be issued to the Grantee pursuant to this Agreement. Shares tendered as payment of required withholding shall be valued at the closing price per share of the Company’s common stock on the date such withholding obligation arises.

8.    Employment.  The rights and obligations of the Grantee under the terms of his or her office or employment with the Employer will not be affected by his or her participation in the Plan or any right which he or she may have under this Agreement and this Agreement does not form part of any contract of employment between the Grantee and the Employer. If the Grantee’s office or employment is terminated for any reason whatsoever (and whether lawful or otherwise) he or she will not be entitled to claim any compensation for or in respect of any consequent diminution or extinction of his or her rights or benefits (actual or prospective) under this Agreement or otherwise in connection with the Plan.

9.    Beneficiary Designation.  The Grantee may, subject to compliance with all applicable laws, name, from time to time, any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in the event of the Grantee’s death before the Grantee receives any or all of such benefit.  Each designation will revoke all prior designations by the Grantee, shall be in the form as may be prescribed by the Committee, and will be effective only when filed by the Grantee in writing with the Committee during his or her lifetime. In the absence of any such designation, benefits remaining unpaid at the Grantee’s death shall be paid to his or her estate.

10.    Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Florida and the laws of the United States applicable therein.

11.    Severability.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.  

12.     Entire Agreement.
        
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(a)    The Grantee hereby acknowledges that he or she has received, reviewed and accepted the terms and conditions applicable to this Agreement, and has not been induced to enter into this Agreement or acquire any Performance Units by expectation of employment or continued employment with the Company or any of its subsidiaries.  The granting of the Award and the issuance of Performance Units are subject to the terms and conditions of the Plan, all of which are incorporated into and form an integral part of this Agreement.

(b)    The Grantee hereby acknowledges that he or she is to consult with and rely upon only the Grantee’s own tax, legal, and financial advisors regarding the consequences and risks of this Agreement and the award of Performance Units.

(c)    This Agreement may not be amended or modified except by a written agreement executed by the parties hereto or their respective successors and legal representatives. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.

13.    Counterparts.  This Agreement may be executed in counterparts, which together shall constitute one and the same original.

[SIGNATURE PAGE FOLLOWS]
    IN WITNESS WHEREOF, Primo Water Corporation has caused this Agreement to be duly executed by one of its duly authorized officers, and the Grantee has executed this Agreement, effective as of the Date of Grant.
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	PRIMO WATER CORPORATIONBy: _____________________________________Print Name: ___________________________Title: _________________________________GRANTEE:By:___________________________________Print Name:____________________________	

7ex_225574.htm

 

Exhibit 10.14

 

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

PLUMAS bank

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

This supplemental executive retirement AGREEMENT (“Agreement”) is made and entered into this first day of April 2020, between Plumas Bank (“Bank”), a bank located in Quincey, CA, and Jeff Moore (“Executive”).

 

Article 1

Benefits Tables

 

The following tables describe the benefits available to the Executive, or the Executive’s Beneficiary, upon the occurrence of certain events. Capitalized terms have the meanings given them in Article 3. Except for death, each benefit described is in lieu of any other benefit herein.

 

Table A: Retirement Benefit

Normal Retirement Date (“NRD”) means any Separation from Service, other than for Cause or due to death, following April 1, 2030

 

	
			Distribution Event

				
			Amount of Benefit

				
			Form of Benefit

				
			Timing of Benefit

			Distribution

			
	
			Executive’s Separation from Service following attainment of the Normal Retirement Date.

				
			Annual benefit equal to $65,000 per year (“Annual Benefit”).

				
			Annual Benefit shall be distributed through equal monthly installments representing 1/12th of the Annual Benefit.

				
			Payments shall commence on the first day of the month immediately following the later of the date of the Executive’s separation from service or attainment of age 65 and shall continue for ten (10) years.

			

 

Table B: Benefit Available Prior to Retirement

 

	
			Distribution Event

				
			Amount of Benefit

				
			Form of Benefit

				
			Timing of Benefit 

			Distribution

			
	
			Separation from Service prior to the Executive’s Normal Retirement Date for reasons other than Separation from Service within twenty-four (24) months following a Change in Control or Separation from Service for Cause.

				
			Accrued Liability Balance, as of the last day of the month immediately prior to Executive’s Separation from Service. The Accrued Liability Balance shall continue to accrue earnings at the Discount Rate until all monthly installments are completely distributed.

				
			Accrued Liability Balance shall be distributed in equal monthly installments.

				
			Payments shall commence on the first day of the month immediately following the later of the date of the Executive’s separation from service or attainment of age 65 and shall continue for ten (10) years.

			
	
			Change in Control followed within twenty-four (24) months by Executive’s Separation from Service.

				
			Annual Benefit as provided in Table A, hereinabove.

				
			Annual Benefit shall be distributed through equal monthly installments representing 1/12th of the Annual Benefit.

				
			Payments shall commence on the first day of the month immediately following the month of Executive’s Separation from Service and shall continue for ten (10) years.

			

 

 

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

 Table C: Death Benefit

 

	
			Distribution Event

				
			Amount of Benefit

				
			Form of Benefit

				
			Timing of Benefit

			Distribution

			
	
			Executive’s death while actively employed with the Bank.

				
			Accrued Liability Balance, as of the last day of the month immediately prior to Executive’s death. The Accrued Liability Balance shall continue to accrue earnings at the Discount Rate until all monthly installments are completely distributed.

				
			Accrued Liability Balance shall be distributed in equal monthly installments. 

				
			Payments to the Beneficiary (ies) shall commence on the first day of the month immediately following the Executive’s death and shall continue for ten (10) years.

			
	
			Death prior to commencement of payments under Table A or Table B.

				
			The same benefit to which the Executive was entitled to prior to the Executive’s death. 

				
			Benefit shall be distributed in equally monthly installments.

				
			Payments to the Beneficiary (ies) shall commence on the first day of the month immediately following the Executive’s death and shall continue for ten (10) years.

			
	
			Death during installment payout of benefit under Tables A or B.

				
			Remaining installment payments, if any, under Table A or B.

				
			In the same form of benefit distribution had the Executive lived.

				
			Payment(s) to the Beneficiary (ies) continue on same schedule as if Executive had lived.

			

 

Article 2

Purpose

 

The purpose of this Agreement is to further the growth and development of the Bank by providing Executive with supplemental retirement income, and thereby encourage Executive’s productive efforts on behalf of the Bank and the Bank’s depositors, and to align the interests of the Executive and those depositors. The Bank promises to make certain payments to the Executive, or the Executive’s Beneficiary, at retirement, death, or upon some other qualifying event pursuant to the terms of this Agreement.

 

Article 3

Definitions and Construction

 

It is intended that this Agreement comply and be construed in accordance with Section 409A of the Internal Revenue Code (the “Code”). It is also intended that the Agreement be “unfunded” and maintained for a select group of management or highly compensated employees of the Bank, for purposes of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and not be construed to provide income to the Executive or Beneficiary under the Code prior to actual receipt of benefits.

 

Where the following words and phrases appear in the Agreement, they shall have the respective meanings set forth below, unless their context clearly indicates to the contrary:

 

	
			3.1

				
			“Accrued Liability Balance” shall mean the amount accrued by the Bank to fund the future benefit expense associated with this Agreement. The Bank shall account for this benefit using Generally Accepted Accounting Principles, regulatory accounting guidance of the Bank’s primary federal regulator, and other applicable accounting guidance, including APB 12 and FAS 106. Accordingly, the Bank shall establish a liability retirement account for the Executive into which appropriate accruals shall be made using a reasonable discount rate, which may be adjusted from time to time.

			

 

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PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			3.2

				
			“Beneficiary” shall mean the person(s) designated by the Executive, including the estate of the Executive, entitled to a benefit under this Agreement.

			

 

	
			3.3

				
			“Board” shall mean the Board of Directors of the Bank.

			

 

	
			3.4

				
			“Change in Control” shall mean a change in ownership or control of the Bank as defined in Treasury Regulation §1.409A-3(i)(5) or any subsequently applicable published authority or guidance.

			

 

	
			3.5

				
			“Code” shall mean the Internal Revenue Code of 1986, as amended, and all regulations and guidance thereunder.

			

 

	
			3.6

				
			“Discount Rate” shall mean the rate used by the Bank for determining the Accrued Liability Balance.

			

 

	
			3.7

				
			“Effective Date” shall mean April 1, 2020.

			

 

	
			3.8

				
			”Plan Year” shall mean each a twelve (12) month period commencing on January 1 and ending on December 31 of each year. The initial Plan Year shall commence on the Effective Date of the Agreement and end on the following December 31.

			

 

	
			3.9

				
			“Separation from Service” shall have the meaning set forth in Treasury Regulations Section 1.409A-1(h).

			

 

	
			3.10

				
			“Termination for Cause” shall mean a termination of employment for:

			

 

	 	
			(a)

				
			Gross negligence or gross neglect of duties to the Bank; or

			

	 	
			(b)

				
			Conviction of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive’s employment with the Bank;

			

	 	
			(c)

				
			Disqualification from performance of duties by a governmental body or loss of applicable to the job licensure; or

			

	 	
			(d)

				
			Fraud, disloyalty, dishonesty or willful violation of any law or significant Bank policy committed in connection with the Executive’s employment and resulting in a material adverse effect on the Bank.

			

 

	
			3.11

				
			”Unforeseeable Emergency” shall mean a severe financial hardship to the Executive resulting from an illness or accident of the Executive, the Executive’s spouse, the Executive’s dependent, or the Executive’s Beneficiary, loss of the Executive’s property due to casualty, other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Executive. The imminent foreclosure of or eviction from the service provider’s primary residence may constitute an Unforeseeable Emergency. In addition, the need to pay for medical expenses, including non-refundable deductibles, as well as for the costs of prescription drug medication, may constitute an Unforeseeable Emergency. Finally, the need to pay for the funeral expenses of a spouse, a beneficiary, or a dependent may also constitute an Unforeseeable Emergency. At all times this definition shall be construed in accordance with the definition under Section 409A. If the Executive seeks to terminate any current deferral elections or re-start the deferral election, it must be done in accordance with Section 409A.

			

 

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PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

Article 4

Distributions During Lifetime

 

	
			4.1

				
			Hardship Distribution. The Bank will permit early withdrawals for an Unforeseeable Emergency under certain circumstances arising as a result of events beyond the control of the Executive. The Executive may submit an application for an in-service early withdrawal due to an Unforeseeable Emergency to the Board of Directors. If, in the discretion of the Board, the Executive is permitted to take an early withdrawal due to an Unforeseeable Emergency, the Board shall make a distribution to such Executive from the Deferral Account. Such distribution shall be paid in one (1) lump sum within thirty (30) days, after the Board determines that the Executive is permitted to take an early withdrawal due to an Unforeseeable Emergency. The amount of such lump sum payment shall be limited to the amount reasonably necessary to meet the Executive’s requirements to the extent such emergency is not relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the Executive’s assets, (to the extent the liquidation of such assets will not cause severe financial hardship) or by cessation of deferrals.

			

 

	
			4.2

				
			Restriction on Timing of Distributions.  Solely to the extent necessary to avoid penalties under Section 409A, distributions under this Agreement may not commence earlier than six (6) months after a Separation from Service (as described under the “Separation from Service” provision herein) if, pursuant to Internal Revenue Code Section 409A, the Executive hereto is considered a “Specified Employee” of a publicly-traded company. In the event a distribution is delayed pursuant to this Section, the originally scheduled distribution shall be delayed for six (6) months, and shall commence instead on the first day of the seventh month following Separation from Service. If payments are scheduled to be made in installments, the first six (6) months of installment payments shall be delayed, aggregated, and paid instead on the first day of the seventh month, after which all installment payments shall be made on their regular schedule. If payment is scheduled to be made in a lump sum, the lump sum payment shall be delayed for six (6) months and instead be made on the first day of the seventh month.

			

 

	
			4.3

				
			Distributions Upon Income Inclusion Under Section 409A of the Code. If any amount is required to be included in income by the Executive prior to receipt due to a failure of this Agreement to meet the requirements of Code Section 409A, the Executive may petition the Plan Administrator for a distribution of that portion of the amount the Bank has accrued with respect to the Bank’s obligations hereunder that is required to be included in the Executive’s income. Upon the grant of such petition, which grant shall not be unreasonably withheld, the Bank shall distribute to the Executive immediately available funds in an amount equal to the portion of the amount the Bank has accrued with respect to the Bank’s obligations hereunder required to be included in income as a result of the failure of this Agreement to meet the requirements of Code Section 409A, within ninety (90) days of the date when the Executive’s petition is granted. Such a distribution shall effect and reduce the Executive’s benefits to be paid under this Agreement.

			

 

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PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			4.4

				
			Change in Form or Timing of Distributions. Any change to the form or timing of distributions hereunder shall be considered made only when it becomes irrevocable under the terms of the Agreement. Any change will be considered irrevocable not later than thirty (30) days following acceptance of the change by the Plan Administrator and must comply with the following rules:

			

 

	 	
			(1)

				
			The change may not accelerate the time or schedule of any distribution, except as provided in Code Section 1.409A-3(j)(4);

			

	 	
			(2)

				
			The subsequent deferral election may not take effect until at least twelve (12) months after the date on which the election is made;

			

	 	
			(3)

				
			The payment (except in the case of death, becoming disabled (as such term is used in Treasury Regulations Section 1.409A-3(a)(2), or Unforeseeable Emergency) upon which the subsequent deferral election is made is deferred for a period of not less than five (5) years from the date such payment would otherwise have been paid; and

			

	 	
			(4)

				
			In the case of a payment made at a specified time, the election must be made not less than twelve (12) months before the date the payment is scheduled to be paid.

			

 

Article 5

Beneficiary

 

	
			5.1

				
			Beneficiary. Executive shall have the right to name a Beneficiary of the death benefit, if any, described in Article 1 herein. Executive shall have the right to name such Beneficiary at any time prior to Executive’s death and submit it to the Plan Administrator (or Plan Administrator’s representative) on the form provided. Once received and acknowledged by the Plan Administrator, the form shall be effective. The Executive may change a Beneficiary designation at any time by submitting a new form to the Plan Administrator. Any such change shall follow the same rules as for the original Beneficiary designation and shall automatically supersede the existing Beneficiary form on file with the Plan Administrator.

			

 

	
			5.2

				
			Failure to Designate a Beneficiary. If Executive dies without a valid Beneficiary designation on file with the Plan Administrator, the Executive’s surviving spouse, if any, shall become the designated Beneficiary. If Executive has no surviving spouse, death benefits shall be paid to the personal representative of Executive’s estate.

			

 

	
			5.3

				
			Facility of Distribution. If the Plan Administrator determines in its discretion that a benefit is to be paid to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of that person’s property, the Plan Administrator may direct distribution of such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person. The Plan Administrator may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Any distribution of a benefit shall be a distribution for the account of the Executive and the Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Agreement for such distribution amount.

			

 

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PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

Article 6

General Limitations

 

	
			6.1

				
			Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under this Agreement (and all such benefits will be forfeited) if Executive’s employment is terminated for Cause.

			

 

	
			6.2

				
			Removal. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under this Agreement (and all such benefits will be forfeited) if the Executive is subject to a final removal or prohibition order issued by an appropriate federal banking agency pursuant to Section 8(e) of the Federal Deposit Insurance Act.

			

 

	
			6.3

				
			Suicide or Misstatement. The Bank shall not pay any benefit under this Agreement (and all such benefits will be forfeited) if the Executive commits suicide within three (3) years after the date of this Agreement. In addition, the Bank shall not pay any benefit under this Agreement (and all such benefits will be forfeited) if the Executive has made any material misstatement of fact on an employment application or resume provided to the Bank, or on any application for any benefits provided by the Bank to the Executive.

			

 

Article 7

Administration of Agreement

 

	
			7.1

				
			Plan Administrator Duties. The Bank shall be the Plan Administrator, unless the Bank appoints a committee to be the Plan Administrator. The Bank may appoint a Committee (“Committee”) of one or more individuals in the employment of Bank for the purpose of discharging the administrative responsibilities of the Bank under the Plan. The Bank may remove a Committee member for any reason by giving such member ten (10) days’ written notice and may thereafter fill any vacancy thus created. The Committee shall represent the Bank in all matters concerning the administration of this Plan; provided however, the final authority for all administrative and operational decisions relating to the Plan remains with the Bank.

			

 

	
			7.2

				
			Authority of Plan Administrator. The Plan Administrator shall have full power and authority to adopt rules and regulations for the administration of the Plan, provided they are not inconsistent with the provisions of this Plan, and Section 409A of the Code, to interpret, alter, amend or revoke any rules and regulations so adopted, to enter into contracts on behalf of the Bank with respect to this Agreement, to make discretionary decisions under this Plan, to demand satisfactory proof of the occurrence of any event that is a condition precedent to the commencement of any payment or discharge of any obligation under the Plan, and to perform any and all administrative duties under this Plan.

			

 

	
			7.3

				
			Recusal. An individual serving as Plan Administrator may be eligible to participate in the Plan, but such person shall not be entitled to participate in discretionary decisions under Article 8 relating to such person’s own interests in the Plan.

			

 

	
			7.4

				
			Agents. In the administration of this Agreement, the Plan Administrator may employ agents and delegate to them such administrative duties as it sees fit, (including acting through a duly appointed representative), and may from time to time consult with counsel who may be counsel to the Bank.

			

 

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PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			7.5

				
			Binding Effect of Decisions. The decision or action of the Plan Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of the Agreement and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in the Agreement.

			

 

	
			7.6

				
			Indemnity of Plan Administrator. The Bank shall indemnify and hold harmless any party contracted for the purposes of assisting the Plan Administrator in performing its duties under this Agreement against any and all claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Agreement, except in the case of willful misconduct by such contracted party.

			

 

	
			7.7

				
			Bank Information. To enable any party contracted for the purposes of assisting the Plan Administrator in performing its duties under this Agreement to perform its functions, the Bank shall supply full and timely information to such contracted party on all matters relating to the date and circumstances of any event triggering a benefit hereunder.

			

 

	
			7.8

				
			Annual Statement. Any party contracted for the purposes of assisting the Plan Administrator in performing its duties under this Agreement shall provide to the Bank, on the schedule set forth in the Administrative Services Contract, a statement setting forth the benefits to be distributed under this Agreement.

			

 

Article 8

Claims and Review Procedures

 

	
			8.1

				
			Claims Procedure. If Executive, beneficiary or his or her representative is denied all or a portion of an expected Agreement benefit for any reason and the Executive, beneficiary or his or her representative desires to dispute the decision of the Administrator, he or she must file a written notification of his or her claim with the Plan Administrator ("Claimant").

			

 

	 	
			8.1.1

				
			Initiation – Written Claim. Upon receipt of any written claim for benefits, the Plan Administrator shall be notified and shall give due consideration to the claim presented. If any Claimant claims to be entitled to benefits under the Agreement and the Plan Administrator determines that the claim should be denied in whole or in part, the Plan Administrator shall, in writing, notify such Claimant within ninety (90) days of receipt of the claim that the claim has been denied. The Plan Administrator may extend the period of time for making a determination with respect to any claim for a period of up to ninety (90) days, provided that the Plan Administrator determines that such an extension is necessary because of special circumstances and notifies the Claimant, prior to the expiration of the initial ninety (90) day period, of the circumstances requiring the extension of time and the date by which the Agreement expects to render a decision. If the claim is denied to any extent by the Plan Administrator, the Plan Administrator shall furnish the Claimant with a written notice setting forth:

			

     

	 	(a)	the specific reason or reasons for denial of the claim;

 

6

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	 	
			(b)

				
			a specific reference to the Agreement provisions on which the denial is based;

			
	 	(c)	a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation of why such material or information is necessary; and
	 	(d)	an explanation of the provisions of this Article.

     

Under no circumstances shall any failure by the Plan Administrator to comply with the provisions of this Section 8.1.1 be considered to constitute an allowance of the Claimant’s claim.

 

	
			8.2

				
			Review Procedure. A Claimant who has a claim denied wholly or partially under Section 8.1.1 may appeal to the Plan Administrator for reconsideration of that claim. A request for reconsideration under this Section 8.2 must be filed by written notice within sixty (60) days after receipt by the Claimant of the notice of denial under Section 8.1.1.

			

 

8.2.1     Upon receipt of an appeal the Plan Administrator shall promptly take action to give due consideration to the appeal. Such consideration may include a hearing of the parties involved, if the Plan Administrator feels such a hearing is necessary. In preparing for this appeal the Claimant shall be given the right to review pertinent documents and the right to submit in writing a statement of issues and comments. After consideration of the merits of the appeal the Plan Administrator shall issue a written decision which shall be binding on all parties. The decision shall specifically state its reasons and pertinent Agreement provisions on which it relies. The Plan Administrator’s decision shall be issued within sixty (60) days after the appeal is filed, except that the Plan Administrator may extend the period of time for making a determination with respect to any claim for a period of up one-hundred and twenty (120) days, provided that the Plan Administrator determines that such an extension is necessary because of special circumstances and notifies the Claimant, prior to the expiration of the initial one-hundred and twenty (120) day period, of the circumstances requiring the extension of time and the date by which the Plan Administrator expects to render a decision. Under no circumstances shall any failure by the Plan Administrator to comply with the provisions of this Section 8.2.1 be considered to constitute an allowance of the Claimant’s claim. For issues involving medical judgment, the employee must consult with an independent health care professional who may not be the health care professional who rendered the initial claim.

 

	
			8.3

				
			Designation. The Plan Administrator may designate any other person of its choosing to make any determination otherwise required under this Article. Any person so designated shall have the same authority and discretion granted to the Plan Administrator hereunder.

			

 

Article 9

Amendments and Termination

 

	
			9.1

				
			Amendments. This Agreement may be amended only by a written agreement signed by the Bank and the Executive. However, the Bank may unilaterally amend this Agreement to conform to written directives to the Bank from its auditors or bank regulators or to comply with legislative changes or tax law, including without limitation Section 409A of the Code and any and all Treasury regulations and guidance promulgated thereunder.

			

 

7

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			9.2

				
			Plan Termination – Generally. This Agreement may be terminated only by a written agreement signed by the Bank and the Executive. Except as provided in Section 9.3, the termination of this Agreement shall not cause a distribution of benefits under this Agreement. Rather, after such termination, benefit distributions will be made at the earliest distribution event permitted under Table A.

			

 

	
			9.3

				
			Plan Terminations Under Section 409A. Notwithstanding anything to the contrary in Section 9.2, if this Agreement terminates in the following circumstances:

			

 

	 	
			(a)

				
			Within thirty (30) days before or twelve (12) months after a Change in Control, provided that all distribution of benefits are made no later than twelve (12) months following such termination of the Agreement and further provided that all the Bank’s arrangements which would be aggregated with this Agreement pursuant to Treasury Regulations Section 1.409A-1(c) are terminated so the Trustee and all participants in the similar arrangements are required to receive all amounts of compensation deferred under the terminated arrangements within twelve (12) months of such terminations;

			

	 	
			(b)

				
			Upon the Bank’s dissolution or with the approval of a bankruptcy court provided that the amounts deferred under the Agreement are included in the Trustee’s gross income in the latest of (i) the calendar year in which the Agreement 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 distribution is administratively practical; or

			

	 	
			(c)

				
			Upon the Bank’s termination of this and all other arrangements that would be aggregated with this Agreement pursuant to Treasury Regulations Section 1.409A-1(c) if the Trustee participated in such arrangements (“Similar Arrangements”), provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Bank, (ii) all termination distributions are made no earlier than twelve (12) months and no later than twenty-four (24) months following such termination, and (iii) the Bank does not adopt any new arrangements that would be a Similar Arrangement for a minimum of three (3) years following the date the Bank takes all necessary action to irrevocably terminate and liquidate the Agreement;

			

 

the Bank may distribute the appropriate benefit as provided for within this Agreement and determined as of the date of the termination of the Agreement, to the Trustee in a lump sum subject to the above terms.

 

Article 10

Miscellaneous

 

	
			10.1

				
			Binding Effect. This Agreement shall bind the Executive and the Bank, and their beneficiaries, survivors, executors, administrators and transferees.

			

 

	
			10.2

				
			No Guarantee of Employment. This Agreement is not a contract for employment. It does not give the Executive the right to remain as an employee of the Bank, nor does it interfere with the Bank's right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive's right to terminate employment at any time.

			

 

8

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			10.3

				
			Non-Transferability. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

			

 

	
			10.4

				
			Tax Withholding. The Bank shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement. The Executive acknowledges that the Bank’s sole liability regarding taxes is to forward any amounts withheld to the appropriate taxing authority (ies).

			

 

	
			10.5

				
			Applicable Law. This Agreement shall be governed by, construed and administered in accordance with the applicable provisions of ERISA, Code Section 409(A), Treasury Regulation § 1.409A and any other applicable federal law, provided, however, that to the extent not preempted by federal law this Agreement shall be governed by the laws of the state where the Bank’s primary corporate headquarters is located, except to the extent preempted by the laws of the United States of America.

			

 

	
			10.6

				
			Unfunded Arrangement. The Executive is a general unsecured creditor of the Bank for the distribution of benefits under this Agreement. The benefits represent the mere promise by the Bank to distribute such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any insurance on the Executive's life or other informal funding asset is a general asset of the Bank to which the Executive has no preferred or secured claim.

			

 

	
			10.7

				
			Reorganization. The Bank shall not merge or consolidate into or with another bank, or reorganize, or sell substantially all of its assets to another bank, firm, or person unless such succeeding or continuing bank, firm, or person agrees to assume and discharge the obligations of the Bank under this Agreement. Upon the occurrence of such event, the term “Bank” as used in this Agreement shall be deemed to refer to the successor or survivor bank.

			

 

	
			10.8

				
			Entire Agreement. This Agreement constitutes the entire agreement between the Bank and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

			

 

	
			10.9

				
			Interpretation. Wherever the fulfillment of the intent and purpose of this Agreement requires, and the context will permit, the use of the masculine gender includes the feminine and use of the singular includes the plural.

			

 

	
			10.10

				
			Alternative Action. In the event it shall become impossible for the Bank or the Plan Administrator to perform any act required by this Agreement, the Bank or Plan Administrator may in its discretion perform such alternative act as most nearly carries out the intent and purpose of this Agreement and is in the best interests of the Bank.

			

 

	
			10.11

				
			Headings. Article and section headings are for convenient reference only and shall not control or affect the meaning or construction of any of its provisions.

			

 

9

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			10.12

				
			Validity. If any provision of this Agreement is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provision of this Agreement and this Agreement shall be construed and enforced as if such provision had not been included therein.

			

 

	
			10.13

				
			Notice. Any notice or filing required or permitted to be given to the Bank or Plan Administrator under this Agreement shall be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below:

			

 

	
			Plumas Bank

			
	
			35 S. Lindan Ave.

			
	
			Quincey, CA 95971 

			Atten: CFO

			
	 

 

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Any notice or filing required or permitted to be given to the Executive under this Agreement shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Executive.

 

	
			10.14

				
			Right to Setoff. The Bank may, to the extent permitted by applicable law, deduct from and setoff against any amounts payable to an Executive from this Agreement such amounts as may be owed by an Executive to the Bank, although the Executive shall remain liable for any part of the Executive’s payment obligation not satisfied through such deduction and setoff. By participating in the Agreement, the Executive agrees to any deduction or setoff under this Section 10.14, which is allowed by law.

			

 

	
			10.15

				
			Limitation on Actions. Executive or Beneficiary who disagrees with a denial of his appealed claim under Article 8 of this Agreement must file any complaint in a federal District Court to dispute such determination (a) within three (3) years of the earlier of the date on which such claim for benefits first accrued or arose under the terms of the Agreement, or (b) within one (1) year after the such claim was denied upon appeal, or deemed denied under Article 8 hereof.

			

 

	
			10.16

				
			No Guarantee of Tax Consequences. While the Agreement is intended to provide tax deferral for Executive, the Agreement is not a guarantee that the intended tax deferral will be achieved. Executive is solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection with this Agreement. Neither the Bank nor any of its directors, officers or employees shall have any obligation to indemnify or otherwise hold Executive harmless from any such taxes.

			

 

	
			10.17

				
			Deduction Limitation on Benefit Payments. If the Bank reasonably anticipates that the Bank’s deduction with respect to any distribution under this Agreement would be limited or eliminated by application of Code Section 162(m), then to the extent deemed necessary by the Bank to ensure that the entire amount of any distribution from this Agreement is deductible, the Bank may delay payment of any amount that would otherwise be distributed under this Agreement. The delayed amounts shall be distributed to the Executive (or Beneficiary in the event of the Executive’s death) at the earliest date the Bank reasonably anticipates that the deduction of the payment of the amount will not be limited or eliminated by application of Code Section 162(m).

			

 

10

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

	
			10.18

				
			Opportunity to Consult with Independent Advisors. The Executive acknowledges that he has been afforded the opportunity to consult with independent advisors of his choosing including, without limitation, accountants or tax advisors and counsel regarding both the benefits granted to him under the terms of this Agreement and the (i) terms and conditions which may affect the Executive's right to these benefits, and (ii) personal tax effects of such benefits including, without limitation, the effects of any federal or state taxes, Section 280G of the Code, Section 409A of the Code, and any other taxes, costs, expenses or liabilities whatsoever related to such benefits, which in any of the foregoing instances the Executive acknowledges and agrees shall be the sole responsibility of the Executive notwithstanding any other term or provision of this Agreement. The Executive further acknowledges and agrees that the Bank shall have no liability whatsoever related to any such personal tax effects or other personal costs, expenses, or liabilities applicable to the Executive and further specifically waives any right for himself or herself, and his or her heirs, beneficiaries, legal representatives, agents, successor and assign to claim or assert liability on the part of the Bank related to the matters described above in this Section 10.19. The Executive further acknowledges that he has read, understands and consents to all of the terms and conditions of this Agreement, and that he enters into this Agreement with a full understanding of its terms and conditions.

			

 

11

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

IN WITNESS WHEREOF, the Executive and a duly authorized representative of the Bank have signed this Agreement as of the date indicated above.

 

 

	
			EXECUTIVE: 

				
			BANK: 

				
			 

			
	 	 	 
	 	Plumas Bank	 
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			/s/ Jeff Moore 

				
			By

				
			/s/ Andrew Ryback

				
			 

			
	
			Jeff Moore 

				
			 

				
			 

				
			 

			
	
			 

				
			Title 

				
			CEO 

				
			 

			

      

12

PLUMAS BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

 

 

BENEFICIARY DESIGNATION FORM

 

(   )     New Designation     

(   )     Change in Designation

 

I,                                                                      , designate the following as Beneficiary under the Agreement:

 

	 	Primary:	 	 	 
	 	 	 	 	_____%
	 	Name	Relationship	 	 
	 	 	 	 	_____%
	 	Name	Relationship	 	 
	 	 	 	 	 
	 	Contingent:	 	 	 
	 	 	 	 	_____%
	 	Name	Relationship	 	 
	 	 	 	 	_____%
	 	Name	Relationship	 	 
	 	 	 	 	_____%
	 	Name	Relationship	 	 
	 	 	 	 	 

 

Notes: 

	 	
			●

				
			Please PRINT CLEARLY or TYPE the names of the beneficiaries.

			

	 	
			●

				
			To name a trust as beneficiary, please provide the name of the trustee(s) and the exact name and date of the trust agreement.

			

	 	
			●

				
			To name your estate as beneficiary, please write “Estate of [your name]”.

			

	 	
			●

				
			Be aware that none of the contingent beneficiaries will receive anything unless ALL of the primary beneficiaries predecease you.

			

 

I understand that I may change these beneficiary designations by delivering a new written designation to the Plan Administrator, which shall be effective only upon receipt and acknowledgment by the Plan Administrator prior to my death.

 

Name:            _______________________________

 

Signature:                                                                                                    Date: _______________

 

	
			SPOUSAL CONSENT (Required if Spouse is not named beneficiary): 

			 

			I consent to the beneficiary designation above, and acknowledge that if I am named Beneficiary and our marriage is subsequently dissolved, the designation will automatically be revoked.

			 

			Spouse Name:      ___________________________________

			 

			Signature:             ____________________________________               Date: _______________

			 

			

 

 

Received by the Plan Administrator this _____ day of __________________, 2020

 

By:     _______________________________

 

Title:  _______________________________

 

 

13

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