Document:

Exhibit 10.1

 

BEACH FIRST NATIONAL BANK

Amended &
Restated Salary Continuation Agreement

 

FIRST AMENDMENT

TO THE

BEACH FIRST NATIONAL BANK

AMENDED & RESTATED

SALARY CONTINUATION AGREEMENT

DATED                  ,
200  

FOR

 

 

THIS FIRST AMENDMENT is
adopted this          day of             
200  , by and between BEACH FIRST NATIONAL BANK, a nationally-chartered
commercial bank located in Myrtle Beach, South Carolina (the “Bank”), and             
(the “Executive”).

 

The Bank and the Executive executed
the Amended & Restated Salary Continuation Agreement on             
    , 200   effective as of                 ,
200   (the “Agreement”).

 

The undersigned hereby
amend the Agreement for the purpose of bringing the (1) changing the
payment streams in the Normal Retirement, Early Termination, Disability and
Change in Control provisions and (2) updating the Agreement to reflect the
Final Regulations of Section 409A of the Internal Revenue Code.  Therefore, the following changes shall be
made:

 

Section 1.6 of the
Agreement shall be deleted in its entirety and replaced with the following:

 

1.6           “Early Termination”
means Separation from Service before Normal Retirement Age for reasons other
than death, Disability, Termination for Cause, or Change in Control.

 

Section 1.9 of the
Agreement shall be deleted in its entirety.

 

The following Section 1.17a shall be added to the Agreement
immediately following Section 1.17:

 

1.17a       “Specified Employee” means an employee who at the time of
Separation from Service is a key employee of the Bank or the Company, if any
stock of the Bank or the Company is publicly traded on an established
securities market or otherwise.  For
purposes of this Agreement, an employee is a key employee if the employee meets
the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied
in accordance with the regulations thereunder and disregarding section
416(i)(5)) at any time during the twelve (12) month period ending on a
Separation from Service.

 

Section 2.1.2 of the Agreement shall be deleted in its entirety
and replaced by the following:

 

1

 

2.1.2        Distribution of Benefit. 
The Bank shall distribute the annual benefit to the Executive in twelve
(12) equal monthly installments commencing on the first day of the month
following the Normal Retirement Date. 
The annual benefit shall be distributed to the Executive for the greater
of (i) seventeen (17) years or (ii) the Executive’s lifetime.

 

Sections 2.2.1 and 2.2.2 of the Agreement shall be deleted in their
entirety and replaced by the following:

 

2.2.1        Amount of Benefit.  The benefit under this Section 2.2
is determined by multiplying the Vesting Percentage by the Account Value for
the Plan Year ending immediately prior to Early Termination and then increasing
the vested balance at an annual rate of six percent (6.0%), compounded monthly,
until commencement of benefit payments under this Section 2.2.  The annual benefit is determined by
calculating a two hundred four (204) month fixed annuity from the vested
inflated Account Value, crediting interest on the unpaid balance at an annual
rate of six percent (6.0%), compounded monthly.

 

2.2.2        Distribution of Benefit. 
The Bank shall distribute the annual benefit to the Executive in twelve
(12) equal monthly installments commencing on the first day of the month
following Normal Retirement Age.  The
annual benefit shall be distributed to the Executive for the greater of (i) seventeen
(17) years or (ii) the Executive’s lifetime.

 

Sections 2.3, 2.3.1 and 2.3.2 of the Agreement shall be deleted in their
entirety and replaced by the following:

 

2.3           Disability Benefit. 
If the Executive experiences a Disability prior to Normal Retirement
Age, the Bank shall distribute the benefit described in this Section 2.3
in lieu of any other benefit under this Agreement.

 

2.3.1        Amount of Benefit. 
The benefit under this Section 2.3
is determined by multiplying one hundred percent (100%) of the Account Value
for the Plan Year ending immediately prior to Disability and then increasing
the balance at an annual rate of six percent (6.0%), compounded monthly, until
commencement of benefit payments under this Section 2.3.  The annual benefit is determined by
calculating a two hundred four (204) month fixed annuity from the vested inflated
Account Value, crediting interest on the unpaid balance at an annual rate of
six percent (6.0%), compounded monthly.

 

2.3.2        Distribution of Benefit. The Bank shall distribute the annual
benefit to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Normal Retirement Age.  The annual benefit shall be distributed to
the Executive for the greater of (i) seventeen (17) years or (ii) the
Executive’s lifetime.

 

Sections 2.4, 2.4.1, 2.4.2 and 2.4.3 of the Agreement shall be deleted
in their entirety and replaced by the following:

 

2

 

2.4           Change in Control Benefit. 
Upon a Change in Control, the Bank shall distribute to the Executive the
benefit described in this Section 2.4 in lieu of any other benefit under
this Agreement.

 

2.4.1        Amount of Benefit.  The
benefit under this Section 2.4 is the present value of the Projected Benefit
using a six percent (6%) interest rate and a seventeen (17) year payment stream.

 

2.4.2        Payment of Benefit. 
The Bank shall distribute the benefit to the Executive in a lump sum
within ninety (90) days following a Change in Control.

 

2.4.3        Internal
Revenue Service Section 280G Gross Up.  If, as a result of a Change in Control, the
Executive becomes entitled to benefits under this Agreement or under any other
benefit, compensation or incentive plan or arrangement with the Bank
(collectively, the “Total Benefits”), and if any part of the Total Benefits is
subject to the Excise Tax under Section 280G and Section 4999 of the
Internal Revenue Code (the “Excise Tax”), the Bank shall pay to the Executive
the following additional amounts, consisting of (a) a payment equal to the
Excise Tax payable by the Executive on the Total Benefits under Section 4999
of the Internal Revenue Code (the “Excise Tax Payment”), and (b) a payment
equal to the amount necessary to provide the Excise Tax payment net of all
income, payroll and excise taxes.  Any
payment pursuant to this Section 2.4.3 shall be made at the latest by the
end of the Executive’s taxable year next following the calendar year in which
the Change in Control event occurred. Payment of the additional amounts
described in clauses (a) and (b) shall be made in addition to the
amount set forth in Section 2.4.1 above.

 

The following Section 2.4.4
shall be added to the Agreement immediately following Section 2.4.3:

 

2.4.4        Reimbursement
of Legal Fees.  If the Executive seeks any legal action to
compel the bank to pay the Change in Control benefit, the Bank shall reimburse
the Executive any legal fees incurred. 
The Executive shall be reimbursed on the 30th day following the date that
the Executive substantiates any expense incurred pursuant to this Section 2.4.4
with respect to
which reimbursement is applicable.

 

Section 2.5 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

2.5           Restriction on Commencement of
Distributions. 
Notwithstanding any provision of this Agreement to the contrary, if the
Executive is considered a Specified Employee at Separation from Service or at
any time during the 12-month period ending on a Separation from Service, the
provisions of this Section 2.5 shall govern all distributions
hereunder.  If benefit distributions
which would otherwise be made to the Executive due to Separation from Service
are limited because the Executive is a Specified Employee, 

 

3

 

then
such distributions shall not be made during the first six (6) months
following Separation from Service. 
Rather, any distribution which would otherwise be paid to the Executive
during such period shall be accumulated and paid to the Executive in a lump sum
on the first day of the seventh month following Separation from Service.  All subsequent distributions shall be paid in
the manner specified.

 

The following Sections 2.6 and 2.7 shall be added to the Agreement
immediately following Section 2.5:

 

2.6           Distributions Upon Taxation of Amounts
Deferred. If,
pursuant to Code Section 409A, the Federal Insurance Contributions Act or
other state, local or foreign tax, the Executive becomes subject to tax on the
amounts deferred hereunder, then, to the extent such tax liability can be paid
by the amount that may be currently distributed to the Executive under Sections
2.1-2.4 of this Agreement without the imposition of additional tax liability
under Section 409A of the Code, the Bank may make a limited distribution
to the Executive as soon as is administratively practicable following the
discovery of the tax liability of an amount not to exceed the amount that
becomes subject to tax, in accordance with the provisions of Treasury
Regulations Section 1.409A-3(j)(vi), (vii) and (xi).  Any such distribution will decrease the
Executive’s benefit hereunder.

 

2.7           Change in Form or Timing of
Distributions.  All changes in the form or timing of
distributions hereunder must comply with the following requirements.  The changes:

 

(a)           may not accelerate the time or schedule of any distribution, except as provided
in Code Section 409A and the regulations thereunder;

(b)           must, for benefits distributable under Sections 2.2 and 2.3, be made at
least twelve (12) months prior to the first scheduled distribution;

(c)           must, for benefits distributable under Sections 2.1, 2.2 and 2.4, delay
the commencement of distributions for a minimum of five (5) years from the
date the first distribution was originally scheduled to be made;  and

(d)           must take effect not less than twelve (12) months after the election is
made.

 

Article 3 of the Agreement
shall be deleted in its entirety and replaced by the following:

 

Article 3

Distribution at Death

 

3.1           Death During
Active Service.  If the Executive dies prior to Separation
from Service, the Executive’s Beneficiary shall be entitled to an amount equal
to the Account Value less any amount the Beneficiary is entitled to receive
under any split dollar arrangement 

 

4

 

between
the Bank and the Executive, in a single lump sum on the first day of the fourth
month following the Executive’s death. 
The Beneficiary shall be required to provide to the Bank the Executive’s
death certificate.

 

3.2           Death During
Distribution of a Benefit.  If the Executive dies after any benefit
distributions have commenced under this Agreement but before receiving the
minimum seventeen (17) years of such distributions, the Bank shall distribute
to the Beneficiary the present value of the remaining portion of the minimum
seventeen (17) years of benefits due under this Agreement, in a single lump sum
on the first day of the fourth month following the Executive’s death.  The Beneficiary shall be required to provide
to the Bank the Executive’s death certificate.

 

3.3           Death Before
Benefit Distributions Commence. 
If the Executive is entitled
to benefit distributions under this Agreement but dies prior to the date that
commencement of said benefit distributions are scheduled to be made under this
Agreement, the Bank shall distribute to the Beneficiary the present value of
the minimum seventeen (17) years of benefits due under this Agreement, in a
single lump sum on the first day of the fourth month following the Executive’s
death.  The Beneficiary shall be required
to provide to the Bank the Executive’s death certificate.

 

Article 7 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

Article 7

Amendments and Termination

 

7.1           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 with written directives to the Bank from its auditors or
banking 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.

 

7.2           Plan Termination Generally.  This
Agreement may be terminated only by a written agreement signed by the Bank and
the Executive.  The benefit hereunder
shall be the Account Value as of the date the Agreement is terminated.  Except as provided in Section 7.3, 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 Article 2.

 

7.3           Plan Terminations Under Section 409A. 
Notwithstanding anything to the contrary in Section 7.2, 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 distributions are made no later than twelve (12)
months following such termination of this Agreement and provided that all
agreements, 

 

5

 

methods, programs, and other arrangements sponsored
by the Bank or the Company immediately after the Change in Control with respect
to which deferrals of compensation are treated as having been deferred under a
single plan under §1.409A-1(c) (“Similar Arrangements”) are terminated and liquidated with respect to
each participant that experienced the Change in Control and all participants
receive all amounts of compensation deferred under this Agreement and
all Similar Arrangements within twelve
(12) months of the date the Bank or Company irrevocably takes all necessary
action to terminate and liquidate this Agreement and all Similar
Arrangements;

(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 Executive’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 Agreement and all 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 arrangement 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 Account Value,
determined as of the date of the termination of this Agreement, to the
Executive in a lump sum subject to the above terms.

 

The following Section 8.14
shall be added to the Agreement immediately following Section 8.13:

 

8.14         Compliance with Code Section 409A.  This
Agreement shall be interpreted and administered consistent with Code Section 409A.

 

IN
WITNESS OF THE ABOVE,
the Bank and the Executive hereby consent to this First Amendment.

 

 

	
  Executive:

  	
  Beach First National Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  	
   

  
							

 

6Exhibit 10.2

 

BEACH
FIRST NATIONAL BANK

Amended &
Restated Director Retirement Agreement

 

FIRST AMENDMENT

TO
THE

BEACH FIRST NATIONAL BANK

AMENDED & RESTATED

DIRECTOR RETIREMENT AGREEMENT

DATED             
    , 200  

FOR

 

 

THIS FIRST AMENDMENT is adopted this     
day of             
200  , by and between BEACH FIRST NATIONAL BANK, a
nationally-chartered commercial bank located in Myrtle Beach, South Carolina
(the “Bank”), and             
(the “Director”).

 

The Bank and the Director executed the Amended &
Restated Director Retirement Agreement on             
    , 200   effective as of July 1, 2002
(the “Agreement”).

 

The
undersigned hereby amend the Agreement for the purpose of (1) changing the
Normal Retirement Age (2) changing the payment streams for the Normal
Retirement, Early Termination and Disability benefits, (3) changing the
Early Involuntary Separation from Service benefit to a Change in Control
benefit and (4) updating the Agreement to reflect the Final Regulations of
Section 409A of the Internal Revenue Code. Therefore, the following
changes shall be made:

 

Section 1.7 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

1.7           “Early
Termination” means
Separation from Service before Normal Retirement Age for reasons other than
death, Disability, Termination for Cause, or Change in Control.

 

Section 1.9 of the Agreement shall be deleted in its entirety.

 

Section 1.10 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

1.10       “Normal Retirement Age” means age sixty-five (65).

 

The following Section 1.16a shall be added to the Agreement
immediately following Section 1.16:

 

1.16a                     “Specified Employee” means an employee
who at the time of Separation from Service is a key employee of the Bank or the
Company, if any stock of the Bank or the Company is publicly traded on an
established securities market or otherwise. For purposes of this Agreement, an
employee is a key employee if the employee meets the requirements of Code Section 416(i)(1)(A)(i),
(ii), or (iii) (applied in accordance with the regulations thereunder and
disregarding section 416(i)(5)) at any time during the twelve (12) month 

 

1

 

period ending on a Separation from Service.

 

Section 2.1.2 of the Agreement shall be deleted in its entirety
and replaced by the following:

 

2.1.2        Distribution of Benefit. The Bank shall distribute the annual
benefit to the Director in twelve (12) equal monthly installments commencing on
the first day of the month following Normal Retirement Age. The annual benefit
shall be distributed to the Director for the greater of (i) seventeen (17)
years or (ii) the Director’s lifetime.

 

Sections 2.2.1 and 2.2.2 of the Agreement shall be deleted in their
entirety and replaced by the following:

 

2.2.1        Amount of Benefit. The benefit under this Section 2.2 is
determined by multiplying the Vesting Percentage by the Account Value for the
Plan Year ending immediately prior to Early Termination and then increasing the
vested balance at an annual rate of six percent (6.0%), compounded monthly,
until commencement of benefit payments under this Section 2.2. The annual
benefit is determined by calculating a two hundred four (204) month fixed
annuity from the vested inflated Account Value, crediting interest on the
unpaid balance at an annual rate of six percent (6.0%), compounded monthly.

 

2.2.2        Distribution of Benefit. The Bank shall distribute the annual
benefit to the Director in twelve (12) equal monthly installments commencing on
the first day of the month following Normal Retirement Age. The annual benefit
shall be distributed to the Director for the greater of (i) seventeen (17)
years or (ii) the Director’s lifetime.

 

Sections 2.3, 2.3.1 and 2.3.2 of the Agreement shall be deleted in
their entirety and replaced by the following:

 

2.3           Disability Benefit. If the Director experiences a
Disability prior to Normal Retirement Age, the Bank shall distribute the
benefit described in this Section 2.3 in lieu of any other benefit under
this Agreement.

 

2.3.1        Amount of Benefit. The benefit under this Section 2.3 is one
hundred percent (100%) of the Account Value determined as of the end of the
Plan Year preceding Disability.

 

2.3.2        Distribution of Benefit. The Bank shall distribute the benefit
to the Director in a lump sum within ninety (90) days following such
Disability.

 

Sections 2.4, 2.4.1, 2.4.2 and 2.4.3 of the Agreement shall be deleted
in their entirety and replaced by the following Sections 2.4, 2.4.1, 2.4.2 and
2.4.3:

 

2.4           Change in Control Benefit. Upon a Change in Control, the Bank shall
distribute to the Director the benefit described in this Section 2.4 in
lieu of any other benefit under this Agreement.

 

2

 

2.4.1        Amount of Benefit. The benefit under this Section 2.4 is the
present value of the Projected Retirement Benefit using a six percent (6%)
interest rate and a payment stream equal to seventeen (17) years.

 

2.4.2        Payment of Benefit. The Bank shall distribute the benefit
to the Director in a lump sum within ninety (90) days following a Change in
Control.

 

2.4.3        Internal Revenue Service Section 280G Gross
Up. If, as a
result of a Change in Control, the Director becomes entitled to benefits under
this Agreement or under any other benefit, compensation or incentive plan or
arrangement with the Bank (collectively, the “Total Benefits”), and if any part
of the Total Benefits is subject to the Excise Tax under Section 280G and Section 4999
of the Internal Revenue Code (the “Excise Tax”), the Bank shall pay to the Director
the following additional amounts, consisting of (a) a payment equal to the
Excise Tax payable by the Director on the Total Benefits under Section 4999
of the Internal Revenue Code (the “Excise Tax Payment”), and (b) a payment
equal to the amount necessary to provide the Excise Tax payment net of all
income, payroll and excise taxes. Any payment pursuant to this Section 2.4.3
shall be made at the latest by the end of the Director’s taxable year next
following the calendar year in which the Change in Control event occurred.
Payment of the additional amounts described in clauses (a) and (b) shall
be made in addition to the amount set forth in Section 2.4.1 above.

 

The following Section 2.4.4 shall be added to the Agreement immediately
following Section 2.4.3:

 

2.4.4        Reimbursement of Legal Fees. If the Director seeks any legal action
to compel the bank to pay the Change in Control benefit, the Bank shall
reimburse the Director any legal fees incurred. The Director shall be reimbursed
on the 30th day following the date that the Director substantiates any expense
incurred pursuant to this Section 2.4.4 with respect to which
reimbursement is applicable.

 

The following Sections 2.5, 2.6 and 2.7 shall be added to the Agreement
immediately following Section 2.4.4:

 

2.5           Restriction on Commencement of Distributions.  Notwithstanding any provision of this
Agreement to the contrary, if the Director is considered a Specified Employee
at Separation from Service or at any time during the 12-month period ending on
a Separation from Service, the provisions of this Section 2.5 shall govern
all distributions hereunder. If benefit distributions which would otherwise be
made to the Director due to Separation from Service are limited because the Director
is a Specified Employee, then such distributions shall not be made during the
first six (6) months following Separation from Service. Rather, any
distribution which would otherwise be paid to the Director during such period
shall be accumulated and paid to the Director in a lump sum on the first day of
the seventh month following Separation from Service. All subsequent
distributions shall be paid in the manner specified.

 

3

 

2.6           Distributions Upon Taxation of Amounts
Deferred. If, pursuant to
Code Section 409A, the Federal Insurance Contributions Act or other state,
local or foreign tax, the Director becomes subject to tax on the amounts
deferred hereunder, then, to the extent such tax liability can be paid by the
amount that may be currently distributed to the Director under Sections 2.1-2.4
of this Agreement without the imposition of additional tax liability under Section 409A
of the Code, the Bank may make a limited distribution to the Director as soon
as is administratively practicable following the discovery of the tax liability
of an amount not to exceed the amount that becomes subject to tax, in
accordance with the provisions of Treasury Regulations Section 1.409A-3(j)(vi),
(vii) and (xi). Any such distribution will decrease the Director’s benefit
hereunder.

 

2.7           Change in Form or Timing of
Distributions. All changes
in the form or timing of distributions hereunder must comply with the following
requirements. The changes:

 

(a)           may not accelerate the time or schedule of
any distribution, except as provided in Code Section 409A and the
regulations thereunder;

(b)           must, for benefits distributable under
Sections 2.1 and 2.2, be made at least twelve (12) months prior to the first
scheduled distribution;

(c)           must, for benefits distributable under
Sections 2.1, 2.2 and 2.4, delay the commencement of distributions for a
minimum of five (5) years from the date the first distribution was
originally scheduled to be made; and

(d)           must take effect not less than twelve (12)
months after the election is made.

 

Article 3 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

Article 3

Distribution at Death

 

3.1           Death During
Active Service. If the
Director dies prior to Separation from Service, the Director’s Beneficiary
shall be entitled to an amount equal to the Account Value less any amount the
Beneficiary is entitled to receive under any split dollar arrangement between
the Bank and the Director, in a single lump sum on the first day of the fourth
month following the Director’s death. The Beneficiary shall be required to
provide to the Bank the Director’s death certificate.

 

3.2           Death During
Distribution of a Benefit. If
the Director dies after any benefit distributions have commenced under this
Agreement but before receiving the minimum seventeen (17) years of such
distributions, the Bank shall distribute to the Beneficiary the present value
of the remaining portion of the minimum seventeen (17) years of benefits due
under this Agreement, in a single lump sum on the first day of the fourth month
following the Director’s death. The Beneficiary shall be required to provide to
the Bank the Director’s death certificate.

 

4

 

3.3           Death Before
Benefit Distributions Commence.
If the Director is entitled
to benefit distributions under this Agreement but dies prior to the date that
commencement of said benefit distributions are scheduled to be made under this
Agreement, the Bank shall distribute to the Beneficiary the present value of
the minimum seventeen (17) years of benefits due under this Agreement, in a
single lump sum on the first day of the fourth month following the Director’s
death. The Beneficiary shall be required to provide to the Bank the Director’s
death certificate.

 

Article 7 of the Agreement shall be deleted in its entirety and
replaced by the following:

 

Article 7

Amendments and Termination

 

7.1           Amendments. This Agreement may be amended only by a written agreement signed by
the Bank and the Director. However, the Bank may unilaterally amend this
Agreement to conform with written directives to the Bank from its auditors or
banking 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.

 

7.2           Plan Termination Generally. This Agreement may be terminated only by a
written agreement signed by the Bank and the Director. The benefit hereunder
shall be the Account Value as of the date the Agreement is terminated. Except
as provided in Section 7.3, 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 Article 2.

 

7.3           Plan Terminations Under Section 409A. Notwithstanding anything to the contrary in
Section 7.2, 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 distributions are made no
later than twelve (12) months following such termination of this Agreement and
provided that all agreements, methods, programs, and other arrangements
sponsored by the Bank or the Company immediately after the Change in Control
with respect to which deferrals of compensation are treated as having been
deferred under a single plan under §1.409A-1(c) (“Similar Arrangements”)
are terminated and liquidated with respect to each participant that experienced
the Change in Control and all participants receive all amounts of compensation
deferred under this Agreement and all Similar Arrangements within twelve (12)
months of the date the Bank or Company irrevocably takes all necessary action
to terminate and liquidate this Agreement and all Similar Arrangements;

 

(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 Director’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 

 

5

 

distribution is administratively practical; or

 

(c)           Upon the Bank’s termination of this Agreement
and all 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 arrangement 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 Account Value,
determined as of the date of the termination of the Agreement, to the Director
in a lump sum subject to the above terms.

 

The following Section 8.14 shall be added to the Agreement
immediately following Section 8.13:

 

8.14         Compliance with Section Code 409A. This Agreement shall be interpreted and
administered consistent with Code Section 409A.

 

IN WITNESS OF THE ABOVE, the Bank and the Director hereby consent to this First Amendment.

 

 

	
  Director:

  	
  Beach
  First National Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  	
   

  
								

 

6

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