Document:

United Bancorp Exhibit 10.15 to Form 10-K - 02/27/09

EXHIBIT 10.15

UNITED BANCORP, INC.

UNITED BANK & TRUST

UNITED BANK & TRUST -WASHTENAW

STAKEHOLDER

INCENTIVE COMPENSATION PLAN

The Stakeholder Incentive Compensation Plan ("Plan") has been adopted by the Board of Directors of United Bancorp, Inc. ("UBI"), United Bank & Trust (UB&T) and United Bank & Trust - Washtenaw ("UB&T-W") to be effective on and after January 1, 2009, and until amended or terminated by the Board of Directors. 

I.  Purpose of the Plan

The Purpose of the Stakeholder Incentive Plan is to provide incentives in the form of additional compensation to all co-workers of UBI, UB&T and UB&T-W. The Plan is designed to reward performance and support the concept that working as a team and executing our goals will support the achievement of our financial plan targets for the year, specifically including objectives for the Net Income of UBI.

II.  Definition of Terms

The following defined terms shall have the meanings set forth below:

	
 
	
A.
	
"Compensation Committee" shall mean the compensation committee of UBI.
	
 

	
 
	
 
	
 
	
 

	
 
	
B.
	
"Management Committee Participant" shall mean those Participants who are duly appointed members of the UBI Management Committee.
	
 

	
 
	
 
	
 
	
 

	
 
	
C.
	
"Net Income" shall mean the net income of UBI (as applicable) as determined by the certified public accounting firm retained by UBI to audit its books and records for the applicable Plan Year, provided that the Compensation Committee may in its discretion make any adjustments it deems appropriate to reflect extraordinary events that may otherwise result in distortions of Net Income as intended for purposes of this Plan.
	
 

	
 
	
 
	
 
	
 

	
 
	
D.
	
"Plan Year" shall mean the calendar year, beginning with calendar year 2009.
	
 

	
 
	
 
	
 
	
 

	
 
	
E.
	
"SEO" shall mean each senior executive officer, which shall include only the principal executive officer of UBI, the principal financial officer of UBI, and each of the other three (3) most highly compensated executive officers of UBI and its controlled group, as determined according to the requirements in Item 402 of Regulation S-K under the federal securities laws by reference to total compensation for the last completed fiscal year, without regard to whether the compensation is includible in gross income. Until the compensation data for the current fiscal year are available, UBI shall make its best efforts to identify the three most highly compensated executive officers for the current fiscal year. "Executive officer" has the same meaning as defined in Rule 3b-7 of the Securities Exchange Act of 1934. "Controlled group" has the same meaning as
	
 

	
 
	 	
defined in Section 414(b) and (c) of the Internal Revenue Code, but only taking into account parent-subsidiary relationships.
	
 

III.  General Description

Stakeholder payouts will be based on UBI Net Income adjusted annually by the Compensation Committee, with approval of the Board of Directors.

The Plan protects the interest of shareholders by requiring the attainment of specified levels of Net Income for UBI, thus aligning the interests of shareholders and participants in the Plan.

The Plan is evidence of UBI's commitment to the philosophy that a portion of the total compensation of its co-workers should be awarded on an incentive basis which recognizes the contributions of co-workers to the success of UBI. The Plan is UBI's method of providing that incentive compensation on an equitable basis.

IV.  Administration

The Compensation Committee has the responsibility to interpret, administer, and amend the Plan. The determination of the Compensation Committee with respect to the construction, interpretation and administration of the Plan shall be final and binding on all parties, subject to the provisions of the Claims and Claims Review Procedure set forth in paragraph IX, below.

V.  Plan Participants

Participants in the Plan shall be all full and part-time co-workers of UBI, UB&T and UB&T-W for all or a portion of any Plan Year.

VI.  Determination of Incentive Compensation

Prior to the beginning of each Plan Year (or prior to February 1, 2009, for the first Plan Year), the Compensation Committee, with approval of the Board of Directors, shall establish the following standards for the Plan for the forthcoming Plan Year:

	
 
	
A.
	
The UBI Net Income targets. The UBI Net Income targets for the Plan Year shall be adjusted annually.
	
 

	
 
	
 
	
 
	
 

	
 
	
B.
	
Attached and incorporated Exhibit A sets forth the percentage of each Participant's base compensation which will be paid as incentive compensation in accordance with the percentage of the applicable target achieved for the Plan Year. Exhibit A shall be reviewed and adjusted annually.
	
 

	
 
	
 
	
 
	
 

	
 
	
C.
	
Compensation is defined as all regular earnings paid. Overtime, bonuses and special pays are excluded from eligible earnings, along with any "other" special payments.
	
 

2

VII.  Payment of Incentive Compensation

After the end of each quarter, the Compensation Committee shall determine and certify whether the prorata portion of the Net Income target for the quarter has been met, based on actual Net Income. A partial payment of incentive compensation shall be made to the Participants if the prorata portion of the Net Income target for the quarter has been met, with the payout percentages as follows:

	
 
	
•
	
1st quarter payout
	
50% of year to date incentive payout

	
 
	
•
	
2nd quarter payout
	
50% of year to date incentive payment less 1st quarter payout

	
 
	
•
	
3rd quarter payout
	
50% of year to date incentive payment less 1st and 2nd quarter payouts

	
 
	
•
	
4th quarter payout
	
100% of incentive payment less 1st, 2nd and 3rd quarter payouts

The payment shall be made within the 60 day period following the end of each quarter.

Notwithstanding the preceding, payments to Management Committee Participants shall be paid annually and not quarterly. The incentive compensation for a Plan Year shall be paid to the Management Committee Participants within the 60 day period following the end of the 4th quarter of the applicable Plan Year.

VIII.  Partial Payments of Incentive Awards

          Partial payment of incentive awards will be made under the following circumstances:

	
 
	
A.
	
New Participants - if an individual becomes a Participant during the Plan Year, his or her participation in the Plan for that Plan Year shall be as determined on a prorata basis in the discretion of the Compensation Committee acting in accordance with the provisions of paragraph VI above.
	
 

	
 
	
 
	
 
	
 

	
 
	
B.
	
Retirement/Disability - in the event a Participant's employment is terminated by retirement or disability, the Participant's incentive compensation will be based on a prorata portion of the Plan Year during which the Participant actually provided his or her personal services.
	
 

	
 
	
 
	
 
	
 

	
 
	
C.
	
Death - if a Participant dies during the Plan Year, the Participant's incentive compensation will be based on a prorata portion of the Plan Year during which the Participant actually provided his or her personal services. Any unpaid incentive compensation shall be paid to the Participant's designated beneficiary, or to his or her estate.
	
 

	
 
	
 
	
 
	
 

	
 
	
D.
	
Termination for Other Causes - in the event a Participant's employment is terminated during a Plan Year for any reason other than retirement, disability or death, the Participant shall forfeit all unpaid incentive compensation.
	
 

IX.  Recovery of Incentive Compensation

          If the Net Income determined for a Plan Year is later proven to be materially inaccurate, each Management Committee Participant who received excess incentive compensation shall return the excess incentive compensation to UBI, UB&T or UB&T-W, as the case may be. Excess incentive

3

compensation is the amount by which the incentive compensation paid to the Management Committee Participant under this Plan exceeds the amount that would have been paid based on an accurate determination of Net Income.

X.  Claims and Claims Review Procedure.

          If any claim for incentive compensation under this Plan is denied in whole or in part, the Compensation Committee shall as soon as administratively feasible furnish the claimant with a written notice which:

	
 
	
A.
	
Sets forth the reason for the denial; and
	
 

	
 
	
 
	
 
	
 

	
 
	
B.
	
Explains the claim review procedure set forth herein.
	
 

          Failure by the Compensation Committee to respond to a claim within a reasonable period of time shall be deemed a denial. Within sixty (60) days after denial of any claim for incentive compensation under this Plan, the claimant may make a written request for a review of the denial.

          Any claimant seeking review is entitled to examine all pertinent documents, and to submit issues and comments in writing. The Compensation Committee shall render a decision on review of a claim not later than ninety (90) days after receipt of a request for review. The decision of the Compensation Committee on review shall be in writing and shall state the reason for the decision.

          A claimant must first exhaust these administrative procedures before pursuing any claim for benefits under this Plan in any other venue.

XI.  Amendments or Termination

The Compensation Committee may modify, amend or terminate this Plan at any time, provided that no such modification, amendment or termination shall adversely affect a Participant's right to incentive compensation for the then current Plan Year, except to the extent required by law or to the extent the Compensation Committee determines that a modification is needed to ensure that the Plan does not encourage SEOs to take unnecessary or excessive risks that threaten the value of UBI or any of its controlled group members.

XII.  Miscellaneous Provisions

	
 
	
A.
	
A Participant's rights and interests under the Plan may not be assigned, pledged or transferred in any manner.
	
 

	
 
	
 
	
 
	
 

	
 
	
B.
	
No Participant or other person shall have any claim or right to be granted incentive compensation under this Plan. Neither this Plan nor any action taken hereunder shall be construed as giving any Participant or employee of UBI, UB&T or UB&T-W any right to be retained as an employee.
	
 

	
 
	
 
	
 
	
 

	
 
	
C.
	
UBI, UB&T and UB&T-W, as applicable, shall have the right to deduct any taxes required by law to be withheld from all incentive compensation paid in accordance with this Plan.
	
 

4

XIII.  Governing Law

This Plan and all the determinations made and actions taken pursuant hereto shall be governed by and interpreted under the laws of the state of Michigan, except as otherwise specifically provided by the terms of the Plan.

IN WITNESS WHEREOF, this Plan has been executed by the undersigned duly authorized corporate officers by authority duly vested in them by appropriate action of the applicable Board of Directors, as of this ____ day of January, 2009.

	
 
	
United Bancorp, Inc.

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
By:
	
 

	
 
	
 
	
Robert Chapman, Chairman and Chief Executive

Officer

	
 
	
 

	
 
	
 

	
 
	
United Bank & Trust

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
By:
	
 

	
 
	
 
	
Joseph R. Williams, President and Chief

Executive Officer

	
 
	
 

	
 
	
 

	
 
	
United Bank & Trust- Washtenaw

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
By:
	
 

	
 
	
 
	
Todd C. Clark, President and Chief Executive

Officer

5United Bancorp Exhibit 10.16 to Form 10-K - 02/27/09

EXHIBIT 10.16

AGREEMENT

SUPPLEMENTAL EXECUTIVE RETIREMENT BENEFITS

(As amended through February 26, 2009)

          This Agreement is made and entered into by and between David S. Hickman (the "Employee"), and United Bank & Trust with its principal office in Tecumseh, Michigan (the "Employer").

ARTICLE I

Recitals

          The Employer, in recognition of the Employee's valuable services and considerable knowledge and experience relating to its business and operations, desires to provide the Employee additional compensation in the event of termination of employment with the Employer, in order to achieve an overall targeted level of retirement benefits. In consideration of the foregoing, and for other good and valuable consideration, the Employee and the Employer hereby enter into this Agreement and agree to be bound by its terms and conditions.

ARTICLE II

Definitions

          2.1   Beneficiary. "Beneficiary" means the person(s) designated in writing by the Employee to the Employer to receive any Supplemental Retirement Benefits that may be payable hereunder after the Employee's death.

          2.2   Commencement Date. "Commencement Date" means the date selected by the Employee pursuant to Section 3.02 for payment of Supplemental Retirement Benefits to begin under this Agreement. The Commencement Date shall be the first day of a month, and shall not be earlier than the Termination Date.

          2.3   Disability. "Disability" means the Employee is unable to perform any substantially gainful activity by reason of any medically determinable physical or mental impairment that is expected to last for more than twelve (12) months or result in death.

          2.4   Effective Date. "Effective Date" shall mean the effective date of this Agreement, which shall be January 1, 2000.

          2.5   Hours of Service. "Hours of Service" means each hour that the Employee performs services for the Employer, and for which the Employee is paid, or is entitled to payment from the Employer.

          2.6   Monthly Retirement Benefit. "Monthly Retirement Benefit" shall equal $848, multiplied by the number of Years of Service of the Employee from the Effective Date of the Agreement through December 31, 2005. The Monthly Retirement Benefit earned under this Agreement shall be 100% vested at all times.

          2.7   Qualifying Termination. "Qualifying Termination" means, termination of the Employee's employment with the Employer by reason of the Employee's Separation from Service, death or Disability.

          2.8   Separation from Service. "Separation from Service", only for benefits earned and vested after December 31, 2004, shall have the same meaning given to that term under Treas. Reg. §§ 1.409A-1(h) and shall be determined in the same manner.

          2.9   Supplemental Retirement Benefits. "Supplemental Retirement Benefits" means benefits payable by the Employer to the Employee pursuant to this Agreement in the form of an Annuity, or as a Single Sum Settlement.

          2.10   Termination Date. "Termination Date" means the date and time at which the Employee's employment with the Employer terminates by reason of a Qualifying Termination. 

          2.11   Years of Service. "Years of Service" means each calendar year, starting with the Effective Date of this agreement, in which the Employee works at least 1,000 Hours of Service for the Employer.

ARTICLE III

Supplemental Retirement Benefits

          3.1   Annuity Benefits. Subject to the Employee's election to receive an alternate form of benefit set forth in Section 3.04, upon a Qualifying Termination, the Employee shall be entitled to receive from the Employer the Monthly Retirement Benefit, payable as an Annuity for 240 equal monthly payments. Payment of the Annuity benefits shall begin on the Commencement Date and shall continue to be paid on the first day of each month for a total of 240 monthly payments.

          3.2   Selection of Commencement Date. The Employee's selection of the date on which payment of the Annuity shall commence (or the alternate form of benefit selected under Section 3.04) shall be in writing, signed by the Employee, and delivered to the Employer prior to the Commencement Date of benefits under this Agreement. A distribution of Supplemental Retirement Benefits, to the extent applicable to benefits which accrue after December 31, 2004, will not be made until at least six months after separation from service (or until death, if earlier)) if the Employee is a Specified Employee. A " Specified Employee" is a an employee who: (a) own more than 5% of the stock of the Employer; (b) owns more than 1% of the stock of the Employer and has compensation from the Employer in excess of $150,000 a year; or (c) is an officer of the Employer under rules promulgated by the Internal Revenue Service under IRC §416 having compensation in excess of $130,000 a year (indexed in accordance with rules promulgated by the Internal Revenue Service under IRC §416).

Absent an election in writing to the Employer by the Employee, the Supplemental Retirement Benefits will begin on the first day of a month following the:

	
 
	
(a)
	
The Termination Date; and,

	
 
	
 
	
 

	
 
	
(b)
	
With respect to Supplemental Retirement Benefits which accrue after December 31, 2004, six months after the Termination Date if the relevant Employee is a Specified Employee,

(collectively, the "Default Commencement Dates", and singly, the "Default Commencement Date").

With respect to Supplemental Retirement Benefits which accrue after December 31, 2004, the Employee's election of a Commencement Date other than the Default Commencement Date may not take effect until at least 12 months after the date on which the election is made and may not be made less than 12 months prior to the Default Commencement Date.

          3.3   Reduction for Early or Late Commencement Date. If the Commencement Date occurs prior to or after the Employee's attainment of age 65, the amount of the Monthly Retirement Benefit payable as an Annuity shall be adjusted as follows: 

	
 
	
(a)
	
The Monthly Retirement Benefit shall be reduced by 1/180th of such amount for each month that the Commencement Date precedes attainment of age 65;

	
 
	
 
	
 

	
 
	
(b)
	
The Monthly Retirement Benefit shall be increased by 1/180th of such amount for each month that the Commencement Date follows attainment of age 65.

          3.4   Optional Form of Benefit. In lieu of receiving the Monthly Retirement Benefits as an Annuity, the Employee may elect to receive benefits under this Agreement as a single sum payment ("Single Sum Settlement") in an amount that is actuarially equivalent to the Annuity payments that would have been received absent his election to receive a Single Sum Settlement. The actuarial equivalence of the Single Sum Settlement shall be determined using the Pension Benefit Guaranty Corporation (PBGC) Rate in effect for immediate annuities at the time the benefit payments are to commence.

          3.5   Election of Optional Benefit Forms. If the Employee wishes receive a Single Sum Settlement in lieu of Annuity payments, the Employee must make an election in writing on a form provided by the Employer, and deliver the signed election to the Employer prior to (or coincident with) the execution of this Agreement.

          3.6   Payments After Employee's Death. If the Employee dies before receiving all benefits the Employee is entitled to under this Agreement, the Employer shall make payment of any such remaining benefits to the Employee's Beneficiary. Absent a valid Beneficiary designation, the Employer shall make such payments to the Employee's surviving spouse or, in the absence of a surviving spouse, to the Employee's estate.

ARTICLE IV

Miscellaneous

          4.1   Succession. This Agreement shall inure to the benefit of and be binding upon the legal representatives, successors and assigns of the Employee and the Employer. The Employer shall assign this Agreement to any person that succeeds to all or substantially all of its business and assets by merger, consolidation, sale of assets or otherwise, and with which the Employee accepts employment, and shall obtain the assumption hereof by such successor. In such event, all references herein to the Employer shall be deemed and construed to be references to such successor, provided, however, that such assignment and assumption shall not reduce or affect any of the obligations of the assignor hereunder, which obligations shall continue in full force and effect as the obligations of a principal and not as the obligations of a surety to the same extent as though no assignment had been made.

          4.2   Legal Expenses. In the event that the Employee or his successors institute any legal action to enforce their rights under, or to recover damages for breach of, this Agreement, the Employee or his successors, if the prevailing party, shall be entitled to recover from the Employer actual expenses (including attorneys' fees) incurred in connection with such legal action.

          4.3   Amendment or Modification. No provision hereof may be amended, modified or waived unless such amendment, modification or waiver is agreed to in writing signed by the Employee and the Employer.

          4.4   Severability. In the event that any provision or portion hereof is determined to be invalid or unenforceable for any reason, the remaining provisions and portions hereof shall be unaffected and shall remain in full force and effect to the fullest extent permitted by law; provided, however, that if the remaining provisions and portions hereof are so essentially and inseparably connected, and so dependent upon, the provision or portion declared invalid that they are incomplete and incapable of being given

effect without such provision or portion, then this entire Agreement shall be deemed to be invalid and unenforceable.

          4.5   No Employee Interest or Trust. Neither anything contained herein nor any action taken pursuant to the provisions hereof shall create or be construed to create an interest of the Employee in any insurance or annuity policy purchased and owned by the Employer for the purpose of paying the retirement benefits payable hereunder, and neither anything contained herein nor any such action shall create or be construed to create a trust of any kind or a fiduciary relationship between the Employer and the Employee, his beneficiary or any other person. Any funds that may be set aside or invested by the Employer for the purpose of paying the benefits hereunder shall continue for all purposes to be a part of the general funds of the Employer, and no person other than the Employer shall, by virtue of the provisions hereof, have any interest in such funds. To the extent that any person acquires a right to receive payments from the Employer hereunder, such right shall be no greater than the right of any unsecured general creditor of the Employer.

          4.6   Other Benefits. Nothing contained herein shall be deemed to exclude the Employee from any supplemental compensation, bonus, pension, insurance, severance pay or other benefit to which he might otherwise be or become entitled as an employee of the Employer.

          4.7   Governing Law. This Agreement contains the entire understanding between the parties with respect to the subject matter hereof, and shall be governed by the laws of the State of Michigan.

IN WITNESS WHEREOF, the Employer and Employee have executed this Agreement on this ________ day of ___________, 2000.

	
 
	
EMPLOYER:
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
United Bank & Trust
	
 

	
 
	
 
	
 

	
 
	
By:
	
 

	
 

	
 
	
 
	
 

	
 
	
Attest:
	
 

	
 
	
 
	
 

	
 
	
 

	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
EMPLOYEE:
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
David S. Hickman
	
 

	
 
	
 
	
 

	
 
	
By:
	
 

	
 

	
 
	
 
	
 

	
 
	
Attest:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00153-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00153-of-00352.parquet"}]]