Document:

AMENDED AND RESTATED DIRECTOR'S PLAN

 

EXHIBIT 10.8

HUDSON VALLEY BANK

AMENDED AND RESTATED

DIRECTORS RETIREMENT PLAN

EFFECTIVE MAY 1, 2004

     
This Amended and Restated Directors Retirement
Plan (the “Plan”) is adopted by HUDSON VALLEY BANK
(“HVB”), formerly known as HUDSON VALLEY NATIONAL
BANK, and is for the benefit of the Directors of Hudson Valley
Bank and all subsidiaries and affiliates thereof, (hereinafter
referred to as “Directors”). It is in recognition of
the long and distinguished service they have rendered to these
entities and with the hope of encouraging future outside
directors to similarly provide lengthy and distinguished service
as well.

ARTICLE ONE

TYPE OF PLAN

     
This Plan is intended to be an unfunded
retirement plan for the benefit of the outside Directors of the
above named entities. This Plan replaces and supersedes the
Hudson Valley National Bank Directors Retirement Plan dated
November 24, 1987 and the Hudson Valley National Bank
Amended and Restated Directors Retirement Plan dated
December 1, 1993.

ARTICLE TWO

EFFECTIVE DATE

     
The effective date of the original plan was
November 24, 1987 and the effective date of the amended and
restated plan was December 1, 1993 (collectively, the
“Original Plans”). This restatement is effective as of
May 1, 2004. The Original Plans are of no further force and
effect.

ARTICLE THREE

ELIGIBILITY

     
A. Eligibility is restricted to outside
Directors (“Directors”). An “outside
director” shall mean a Director who is not a full-time
employee of any entity referred to in this plan.

     
B. A Director, in order to be eligible, must
accrue two (2) full years of service as a Director. A
“year of service” is determined on a July 1,
fiscal year.

     
C. The Director must retire, resign, or
otherwise relinquish his service as Director to receive a
retirement benefit under the Plan.

ARTICLE FOUR

VESTING

     
A. Every Director who satisfies all of the
requirements of Section 3 herein shall be eligible to
receive either a pro rata or full retirement benefit on his or
her benefit commencement date.

 

     
B. Pro rata retirement benefits are based on
the following vesting schedules:

	 	 	 	 	 
	No. of Years as Directors		Amount Payable
	(As of July 1/st/)		Retirement Age
	
		

	
    
    2 years but less than 3 years
    

    	 	 	5	%
	
    
    3 years but less than 4 years
    

    	 	 	10	%
	
    
    4 years but less than 5 years
    

    	 	 	17.50	%
	
    
    5 years but less than 6 years
    

    	 	 	25	%
	
    
    6 years but less than 7 years
    

    	 	 	32.50	%
	
    
    7 years but less than 8 years
    

    	 	 	40.00	%
	
    
    8 years but less than 9 years
    

    	 	 	47.50	%
	
    
    9 years but less than 10 years
    

    	 	 	55	%
	
    
    10 years but less than 11 years
    

    	 	 	62.50	%
	
    
    11 years but less than 12 years
    

    	 	 	70	%
	
    
    12 years but less than 13 years
    

    	 	 	77.50	%
	
    
    13 years but less than 14 years
    

    	 	 	85	%
	
    
    14 years but less than 15 years
    

    	 	 	92.50	%
	
    
    15 or more years
    

    	 	 	100	%

ARTICLE FIVE

FORFEITURE

     
Section 4 of this plan notwithstanding, a
Director who has become vested under Section 4 shall
forfeit all benefits hereunder if he or she has engaged in any
gross misconduct or criminal activity as a Director.

ARTICLE SIX

RETIREMENT BENEFITS

     
Each Director shall receive an annual retirement
benefit payable in substantially equal monthly installments
equal to the amount of the basic fees that such Director
received during the 12 month period immediately prior to
the benefit commencement date. The term basic fees, as used
herein, shall mean fees paid for attendance at all board
meetings, fees paid for all committee meetings or sub-committees
of the entities of their ultimate parent corporation, the Hudson
Valley Holding Corp. (the “Holding Corp.”). It shall
exclude all other fees, including Directors stipends, special
stipends for selected committee chairman, all reimbursed
expenses and all fees paid for acting as Vice Chairman or
Chairman of the Board of Hudson Valley Bank, the Holding Corp.,
and all other entities as may be covered by this agreement from
time to time.

ARTICLE SEVEN

BENEFIT COMMENCEMENT DATE

     
A Director shall begin to receive benefits under
the plan on the first day of the month after he or she retires,
resigns, or otherwise relinquishes his or her place as a
Director.

ARTICLE EIGHT

FORM OF BENEFIT

     
Each Director shall receive a monthly benefit,
payable as follows: Directors receive credit towards pension
benefits equal to six (6) months for each year of service
(subject to vesting and minimum age criteria) up to a maximum of
120 months (10 years), payable to the Director during
his life, and on his or her

2

 

death prior to receiving payments for such
period, to the spouse of such Director, if such Director is
married, and to his or her estate, if such Director is
unmarried, for the remainder of such period.

ARTICLE NINE

DEATH PRIOR TO BENEFIT COMMENCEMENT DATE

     
If such Director who is vested in his or her
retirement benefit dies prior to his or her benefit commencement
date, he or she will be deemed to have retired on the day before
his or her death, and his or her spouse or estate will receive
benefits in accordance with Articles “Four” through
“Eight” hereof.

ARTICLE TEN

ASSIGNMENT

     
No retirement benefit under the plan shall be
subject in any manner to alienation, anticipation, encumbrance,
sale, assignment, transfer, pledge, charge or hypothecation,
whether voluntary or involuntary, and any attempt to alienate,
anticipate, encumber, sell, assign, transfer, pledge, charge or
hypothecate shall be null and void and shall be disregarded by
Hudson Valley Bank, which shall continue to discharge its
obligations hereunder as though no such assignment had been made.

ARTICLE ELEVEN

FUNDING

     
The plan is intended to be an unfunded
arrangement. Nothing contained in the plan and no action taken
pursuant to the provision of this plan shall create or be
construed to create a trust of any kind, or a fiduciary
relationship between Hudson Valley Bank and any Director, his or
her spouse, or his or her estate.

ARTICLE TWELVE

RIGHTS OF DIRECTORS

     
Any retirement benefits payable hereunder shall
represent only an unsecured contractual obligation on the part
of Hudson Valley Bank to pay the amounts described herein. No
person, including the Director, his or her spouse, or his or her
estate, shall have, by virtue of the terms of this plan, any
interest in such amounts. The extent that any person acquires a
right to secure payments from Hudson Valley Bank under this
plan, such right shall not be greater than the right of any
unsecured general creditor of Hudson Valley Bank. If Hudson
Valley Bank elects to satisfy its obligations hereunder through
the purchase of an annuity certificate, neither the Director,
his or her spouse, nor his or her estate, shall have any rights
whatsoever in the annuity certificate. Hudson Valley Bank shall
be the sole owner and beneficiary thereof and may exercise all
incidents of ownership therein.

ARTICLE THIRTEEN

AMENDMENT

     
Hudson Valley Bank, through its Board of
Directors, reserves the right to amend this plan, or to
terminate the plan, at any time, except that all benefits in pay
status shall be continued.

ARTICLE FOURTEEN

ADMINISTRATION

     
The Executive Committee, or the Board of
Directors itself of HVB or, if there is no such committee, the
Board of Directors, shall administer the plan. No members of
such committee, while serving as a committee

3

 

member, shall be eligible to receive any
retirement benefit under the plan, but such Director will accrue
years of service. Decisions and determinations by the committee
shall be final and binding upon all parties. The committee shall
have the authority to interpret the plan, to adopt and revise
rules and regulations relating to the plan, and to make any
other determinations which it believes necessary or advisable
for the administration of the plan.

ARTICLE FIFTEEN

MANDATORY RETIREMENT DATE

     
Mandatory retirement age for Directors of the
entities shall be seventy-five (75) years of age. However,
upon request, the Board may grant year to year extensions until
the Director reaches age eighty (80), at which time they
must retire on their eightieth (80th) birthday.

ARTICLE SIXTEEN

LEGAL INCAPACITY

     
Whenever, in the committee’s opinion, a
person entitled to receive any retirement benefit hereunder is
under a legal disability or is incapacitated in any way as to be
unable to manage the person’s financial affairs, the
committee may direct that payment be made to such person’s
legal representative or guardian or to a friend of relative of
such person for such person’s benefit, or the committee may
direct that application of the payment for the benefit of such
person in any manner as the committee considers advisable. Any
payment of a retirement benefit in accordance with the provision
of this Article 16 shall be complete discharge of any
liability for the making of such payment under the provisions of
the plan.

ARTICLE SEVENTEEN

GOVERNING LAW

     
This plan shall be construed in accordance with
the laws of the State of New York, except to the extent (if any)
pre-empted by federal law.

4

 

     
The foregoing constitutes the entire Agreement
known the HUDSON VALLEY BANK DIRECTORS RETIREMENT PLAN.

DIRECTORS OF HUDSON VALLEY BANK AS OF MAY 1, 2004

		
	 	
    

	 	
    WILLIAM E. GRIFFIN, Chairman of the Board
    
	 
	 	
    

	 	
    JAMES J. LANDY, President and CEO
    
	 
	 	
    

	 	
    STEPHEN R. BROWN
    
	 
	 	
    

	 	
    JAMES M. COOGAN
    
	 
	 	
    

	 	
    GREGORY F. HOLCOMBE
    
	 
	 	
    

	 	
    ANGELO R. MARTINELLI
    
	 
	 	
    

	 	
    WILLIAM J. MULROW
    
	 
	 	
    

	 	
    JOHN A. PRATT JR.
    
	 
	 	
    

	 	
    CECILE D. SINGER
    
	 
	 	
    

	 	
    CRAIG S. THOMPSON
    

5<PAGE>
                                                                    EXHIBIT 10.1

           FIRST AMENDMENT AND WAIVER TO CREDIT AGREEMENT DATED AS OF
       APRIL 30, 2003 (AS AMENDED FROM TIME TO TIME, THE "AGREEMENT"), BY
            AND BETWEEN HEADS & THREADS INTERNATIONAL LLC, A DELAWARE
           LIMITED LIABILITY COMPANY (THE "COMPANY") AND LASALLE BANK
                        NATIONAL ASSOCIATION (THE "BANK")

      This First Amendment and Waiver to the Agreement ("Amendment") is entered
into as of March 30, 2004 by and between the Company and the Bank.

      All capitalized terms stated in this Amendment and not defined herein
shall have the same meaning as set forth in the Agreement.

      WHEREAS, the Bank has made Loans to the Company pursuant to the Agreement;
and

      WHEREAS, the Company has requested the Bank's consent to the Company's
conduct of business in Mexico through the formation and operation of the Mexican
Subsidiary (as defined below); and

      WHEREAS, the Bank is willing to consent to the formation and operation of
such Mexican Subsidiary; and

      WHEREAS, the Company and the Bank have agreed to amend the Agreement as
stated herein and grant certain waivers as referenced herein. Now, therefore, in
consideration of the fulfillment of each of the terms and conditions set forth
herein, the parties hereto agree as follows:

      Section 1. Amendments to Agreement.

      a.    The definition of "Eligible Inventory" in Section 1.1 of the
Agreement is amended to delete the phrase "and (v)" and substitute therefor the
following:

            (v) it is not owned by the Mexican Subsidiary or located in the
            Country of Mexico; and (vi)

      b.    The definition of "Loan Documents" in Section 1.1 of the Agreement
is amended to include the Stock Pledge and all documents related thereto as
additional Loan Documents.

      c.    A new definition of "Mexican Subsidiary" is added to Section 1.1 of
the Agreement as follows:

            "Mexican Subsidiary" means a Subsidiary (including Subsidiaries of
            such Subsidiary) organized and existing in the Country of Mexico.

      d.    A new definition of "Stock Pledge" is added to Section 1.1 of the
Agreement as follows:

<PAGE>

            "Stock Pledge" means the Stock Pledge Agreement dated as of March
            30, 2004 executed and delivered by the Company to the Bank and the
            Membership Pledge Agreement dated as of March 30, 2004 executed and
            delivered by the Company to the Bank pledging the Company's
            membership interest in Heads and Threads (Mexico) LLC, a Delaware
            limited liability company ("H&T Mexico") to the Bank.

      e.    Section 6.15 of the Agreement is amended to add a new subsection
(viii) stating:

            (viii) Investments in the Mexican Subsidiary not exceeding
            $3,000,000 in the aggregate at any time outstanding whether directly
            or indirectly through Heads and Threads (Mexico) LLC.

      f.    Section 6.22 of the Agreement is amended to add the following after
the phrase "acquire any Subsidiary": "(except the Mexican Subsidiary and Heads
and Threads (Mexico) LLC)".

      g.    The Company's address for receipt of notices pursuant to Article XII
of the Agreement is changed pursuant to Section 12.2 of the Agreement to be the
following:

            255 E. Lake Street, Bloomingdale, Illinois, 60108, Attn: Fred J.
            Weber

      Section 2. Waivers and Consent.

      a.    The Company has requested that the Bank waive certain provisions of
the Security Agreement set forth on Schedule 1 hereto which would otherwise be
violated by the maintenance of certain Company Inventory and cash in Mexico from
time to time. Subject to the Company's satisfaction of all conditions stated in
Section 4 hereof, the Bank hereby grants to the Company a waiver of any
violations of such provisions which would be caused solely by the Company's,
Heads and Threads (Mexico) LLC's or the Mexican Subsidiary's maintenance in
Mexico of Inventory and cash with a combined aggregate cost (for the Inventory)
and value (for the cash) not exceeding $3,000,000 (the "Waivers").

            The Waivers set forth herein are effective solely for the purpose
set forth herein and shall be limited precisely as written and shall not be
deemed to be a consent to any amendment, waiver, modification of, or
noncompliance with, any other term or condition of the Agreement as amended
hereby or otherwise prejudice any right or remedy which the Bank may now have or
may have in the future in connection with the Agreement.

      Section 3. Representations and Warranties. The Company represents and
warrants that:

      a.    The representations and warranties contained in the Agreement are
true and correct in all material respects on and as of the date hereof as if
such representations and warranties had been made on and as of the date hereof
(except to the extent any such representation or warranty is stated to relate
solely to an earlier date, in which case such representation or warranty is true
and correct in all material respects on and as of such earlier date); and

                                       -2-

<PAGE>

      b.    The Company is in compliance with all the terms and provisions set
forth in the Agreement and no Default or Unmatured Default has occurred and is
continuing except for those waived pursuant to Section 2 hereinbefore or as
previously waived.

      Section 4. Conditions to Effectiveness. This Amendment is subject to the
satisfaction in full of the following conditions precedent:

      a.    The Lender shall have received executed originals of this Amendment;

      b.    The Lender shall have received copies of the organization documents
and respective by-laws and operating agreement for the Mexican Subsidiary and
H&T Mexico certified by the Company's Secretary or Assistant Secretary (with
copies certified by the applicable Secretary of State to be delivered to the
Lender as soon as practicable thereafter);

      c.    The Lender shall have received executed originals of the Stock
Pledge along with the original stock certificates for the stock pledged therein
and executed stock powers with respect to such stock;

      d.    The Lender shall have received payment of the fees provided in
Section 7 of this Amendment; and

      e.    All legal matters incident to this Amendment shall be reasonably
satisfactory to Arnstein & Lehr LLP, counsel for the Bank.

      Section 5. Full Force and Effect. Except as expressly amended and waived
herein, the Agreement and the Loan Documents are hereby ratified and confirmed,
and shall continue in full force and effect in accordance with the provisions
thereof on the date hereof. As used in the Agreement and the Loan Documents, the
terms "Agreement", "this Agreement", "herein", "hereafter", "hereto", "hereof",
and words of similar import, shall, unless the context otherwise requires, mean
the Agreement as amended by this Amendment.

      Section 6. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.

      Section 7. Expenses. The Company agrees to pay all out-of-pocket expenses
incurred by Lender in connection with the preparation, execution and delivery of
this Amendment and the other documents incident hereto, including, but not
limited to, the reasonable fees and disbursements of Arnstein & Lehr LLP,
counsel for the Bank.

      Section 8. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute one instrument.

      Section 9. Headings. The headings of this Amendment are for the purposes
of reference only and shall not affect the construction of this Amendment.

                                       -3-

<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their duly authorized officers, all as of the date and year
first above written.

                                           COMPANY:

                                           HEADS & THREADS INTERNATIONAL LLC

                                           BY: /s/ Fred J. Weber
                                               ---------------------------------
                                               ITS: VP Finance & CFO

                                           BANK:

                                           LASALLE BANK NATIONAL ASSOCIATION

                                           BY: /s/ Henry J. Munez
                                               ---------------------------------
                                               ITS: First Vice President

                                      -4-

<PAGE>

                                   SCHEDULE 1

           PROVISIONS OF THE SECURITY AGREEMENT SUBJECT TO THE WAIVERS

1.    The Warranties and Representations in Sections 3(iv) and 3(v) of the
      Security Agreement.

2.    The Covenant in Section 7(ii) of the Security Agreement.

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