Document:

Exhibit

Exhibit 10.100

2017 PROGRESSIVE CAPITAL 
MANAGEMENT ANNUAL INCENTIVE PLAN

		
	1.
	The Plan.  The Progressive Corporation and its subsidiaries (collectively "Progressive" or the “Company”) have adopted the 2017 Progressive Capital Management Annual Incentive Plan (the “Plan”) as part of their compensation program for the Company’s investment professionals for the Company’s 2017 fiscal year (the “Plan year”). The Plan is performance-based, is not a form of commission compensation, and is administered under the direction of the Compensation Committee of the Board of Directors of The Progressive Corporation (the “Compensation Committee” or “Committee”).  Payment under the Plan, if any, is based on Company performance as defined by the Plan, not individual employee performance.  References in this Plan to the Company’s portfolio mean the respective portfolios of the Company’s subsidiaries and affiliates that are actively managed by Progressive Capital Management Corp., and references in this Plan to the Company’s investment results mean the investment results of those portfolios only.

The Company’s investment professionals invest the funds of the Company in accordance with investment guidelines approved from time to time by the Investment and Capital Committee of the Board of Directors.  Those guidelines address such matters as minimum average credit quality and the duration of the portfolio, as well as limitations on the extent to which the portfolio can be concentrated in individual issuers.  Compliance with the guidelines is routinely monitored and variations therefrom must be reported to, and approved by, the Investment and Capital Committee.

		
	2.
	Participants.  Progressive employees who are assigned primarily to the Company’s capital management function, including the Company’s Chief Investment Officer (“CIO”), are eligible to be selected for participation in the Plan.  Eligible employees in addition to the CIO will be selected by the CIO in consultation with the Chief Executive Officer (“CEO”) or Chief Human Resource Officer (“CHRO”) (the “Designated Executives”) to participate in the Plan.  Participants may also participate in other Gainsharing, bonus or incentive compensation plans maintained by Progressive, if so determined by the Designated Executives (or in the case of the CIO or any other executive officer, by the Compensation Committee).  Other eligible employees of the Company may be selected for participation in the Plan for or at any time during the Plan year by the Designated Executives.  In such cases, the Designated Executives will determine the new participant’s Target Percentage (described below) and other terms of participation (except with respect to the CIO or any other executive officer, as to whom all determinations must be made by the Committee).  Throughout this Plan, references to “executive officers” refer to executive officers of The Progressive Corporation within the meaning of any Securities and Exchange Commission (“SEC”) or New York Stock Exchange rule applicable to the Company.

3.    Annual Incentive Payment Determination.

		
	A.
	Annual Incentive Payment.  Each participant may earn an annual cash bonus (the “Annual Incentive Payment”), subject to the terms of this Plan.  The amount of the Annual Incentive Payment earned by any participant will be determined by application of the following formula:

Annual Incentive Payment = Paid Eligible Earnings x Target Percentage x Performance Factor 

		
	B.
	Paid Eligible Earnings.  Paid Eligible Earnings for the Plan year shall mean and include the following:  regular, Earned Time Benefit pay (excluding the payout of unused Earned Time Benefit pay at termination), sick pay, holiday pay, funeral pay, military make-up pay, overtime pay, shift differential, and retroactive payments of any of the foregoing items, in each case received by the participant during the Plan year for work or services performed as an officer or employee of Progressive.

 
For purposes of the Plan, and notwithstanding the foregoing, Paid Eligible Earnings shall exclude all other types of compensation, including, without limitation:  any short-term or long-term disability payments made to the participant; the earnings replacement component of any worker's compensation benefit or award; any amounts paid pursuant to a judgment in, or settlement related to, any action, suit or proceeding, whether in law or equity, to any extent arising from or relating to a participant’s employment with the Company, or work or services performed for or on behalf of the Company;  any amount paid under a separation allowance (or severance) plan; any bonus (including PCM Bonus Plan bonus or PCM Annual Incentive Plan payment), Gainsharing or other incentive compensation award  (whether denominated, or payable, in cash or equity), including, without limitation, payments from any discretionary cash fund; any dividend payments or dividend equivalent amounts; any unused Earned Time Benefit; and any other payment required by applicable law to be paid to a participant by the Company and intended to replace all or any portion of wages or earnings during a period of unemployment, whether due to illness, disability or otherwise (including, but not limited to, payments made pursuant to any statute, rule or regulation of a governmental authority relating to leave on account of maternity, paternity, parental status or responsibility, or sickness).  

C.    Target Percentage.  The Target Percentages for participants in the Plan shall be determined by or under the direction of the Committee, but will not exceed 125% for any participant.  Target Percentages may vary among Plan participants and may be changed from year to year by or under the direction of the Designated Executives (or in the case of the CIO or any other executive officer, by the Compensation Committee).  

D.    Performance Factor.  The Performance Factor will be determined by the Committee after the expiration of the Plan year based on the performance of the Company’s fixed-income investment portfolio (the “Fixed-Income Portfolio” or “Portfolio”), and such other factors and information relating to the performance of the Company’s investment professionals as the Committee shall determine.  

First, an indicated performance factor will be determined based on the fully taxable equivalent total return of the Fixed-Income Portfolio, in comparison to the total returns of the group of comparable investment firms identified by Rogers Casey (the “Investment Benchmark”), over the one- and three-year periods ending on December 31 of the Plan year, as described below.  After the end of the Plan year, Rogers Casey will determine the firms that are included in the Investment Benchmark in accordance with the criteria specified on Exhibit I hereto.  Rogers Casey will also provide to the Company the monthly total return data for each of the Investment Benchmark firms for the three-year period ending on December 31 of the Plan year.  

Investment results for the Fixed-Income Portfolio will be marked to market, including the benefit of any state premium tax abatements for municipal securities held in the Portfolio that are realized by the Company during the Plan year, in order to calculate the Portfolio’s fully taxable equivalent total return for the one-year (2017) and three-year period (2014-2017) periods, in each case compounded on a monthly basis.  The investment performance achieved by the Fixed-Income Portfolio for the one- and three-year periods (each, a “comparison period”) will then be compared against the total returns of the firms included in the Investment Benchmark for the same periods, also compounded on a monthly basis, as determined by the Company from the monthly performance data supplied by Rogers Casey for each firm in the Investment Benchmark, to determine, for each comparison period, where the Fixed Income Portfolio’s performance falls on a percentile basis when compared to the firms in the Investment Benchmark, as further described on Exhibit II (“Performance Ranking”).    

The Portfolio’s Performance Ranking will be used to determine a performance score of between 0 and 2.0 for each comparison period, based on the following schedule:

	
				
	Comparison 
Period
	Score = 0
Rank at or below
	Score = 1.0
Rank equal to
	Score = 2.0
Rank at or above

	One year 
	15th Percentile
	50th Percentile
	85th Percentile

	Three year
	25th Percentile
	50th Percentile
	75th Percentile

  
A Performance Ranking between the values identified in the schedule will be interpolated on a straight-line basis to generate the applicable performance score, as further described on Exhibit II.  Once these performance scores are determined, an overall indicated performance factor will be determined by averaging the performance scores for the one- and three-year comparison periods.
 
The overall indicated performance factor will be reported to the Compensation Committee after the expiration of the Plan year, together with such supporting documentation as the Committee may require.  The Committee may consider such additional information as it deems necessary or appropriate in its discretion. Such information may include, without limitation: 
		
	•
	the primary investment factors that are responsible for favorable or unfavorable results relative to the peer group, such as the Company’s duration and yield curve position and the extent of its exposure to sectors of the fixed-income markets, including corporate bonds, residential mortgage-backed securities, commercial mortgage-backed securities, other asset-backed securities, government bonds, preferred stocks and non-investment-grade bonds; 

		
	•
	the Company’s holdings within each sector relative to the general market composition of each sector; 

		
	•
	the extent to which material investment decisions may have been driven by Company strategic or capital considerations; and 

		
	•
	the impact on investment results of significant portfolio cash flows driven by Company operations, strategic decisions or capital transactions. 

In addition, the Committee may choose to consult with others, including, without limitation, management, the Board’s Investment and Capital Committee, other Board members, and outside compensation and investment professionals, in evaluating the performance of the Company’s investment professionals for the year.  The Committee will then determine the Performance Factor, which may vary among participants; provided that under no circumstances may the Performance Factor for any participant exceed 2.0 for the year.
    
E.    In the event that Rogers Casey (or its successor or assigns) discontinues providing the data that is necessary to make the calculations required by this Plan, or modifies the information in such a way as to render the comparisons required by this Plan to be not meaningful, in the Committee’s sole judgment, the determinations required above shall be made using investment return data for comparable firms satisfying the criteria set forth on Exhibit I as may be available from another recognized provider of investment industry data as the Committee may approve in its sole discretion.
        
		
	4.
	Payment Procedures; Deferral.  The Annual Incentive Payments will be determined and paid to Plan participants as soon as practicable after the Performance Factor has been determined by the Committee, but no later than March 15th following the Plan year. 

Any Plan participant who is then eligible to participate in The Progressive Corporation Executive Deferred Compensation Plan ("Deferral Plan") may elect to defer all or any portion of his or her Annual Incentive Payment otherwise payable under this Plan, subject to and in accordance with the terms of the Deferral Plan.   If a Plan participant has made such an election under the Deferral Plan, then to the extent of such election, the Annual Incentive Payment will, instead of being paid to such participant as described in the immediately preceding paragraph, be credited to such participant’s account under the Deferral Plan in accordance with the terms of the Deferral Plan.

		
	5.
	Qualification Date; Leave of Absence; Withholding.  Unless otherwise determined by the Committee, and except as otherwise expressly provided herein, in order to be entitled to receive an Annual Incentive Payment for the Plan year, the participant must be an active officer or regular employee of Progressive on November 30 of the Plan year (“Qualification Date”).  An individual who (i) is hired on or after December 1 of any Plan year, or (ii) whose employment terminates for any reason prior to the Qualification Date is not entitled to an Annual Incentive Payment for that Plan year.  Annual Incentive Payments are not earned until paid. 

Any participant who is on a leave of absence covered by the Family and Medical Leave Act of 1993, as amended (or equivalent state or local law), the American with Disabilities Act of 1991, as amended (or equivalent state or local law), personal leave approved by the Company, military leave or short- or long-term disability (provided that, in the case of a long-term disability, the participant is still an employee of the Company) on the Qualification Date relating to the Plan year will be entitled to receive an Annual Incentive Payment for the Plan year based on the Paid Eligible Earnings received by the participant during the Plan year.  

Any person whose employment with Progressive terminates during the Plan year as a result of a transfer of employment from Progressive to ARX, and who remains employed by ARX continuously from the date of such termination through the Qualification Date, shall be entitled to receive an Annual Incentive Payment for the portion of the Plan year during which the person was an employee of Progressive, based on the amount of Paid 

Eligible Earnings received by such participant during the Plan year and paid in the manner and at the times as are described in Paragraph 4 above but subject to Paragraph 13 below.  For purposes of this paragraph only, (i) “Progressive” means The Progressive Corporation and its subsidiaries, other than ARX Holding Corp. and its subsidiaries, and (ii) “ARX” means ARX Holding Corp. and its subsidiaries and the other entities which it controls.

Annual Incentive Payments made to participants will be net of any legally required deductions and/or withholdings for federal, state and local taxes and other items.

		
	6.
	Other Plans.  Participants may be selected to participate in this Plan and in one or more other incentive plans offered by the Company.  In the case of the CIO or any other executive officer, all determinations with respect to such incentive plans and the executive’s participation therein shall be made by the Compensation Committee.  In all other cases, the Designated Executives shall have full authority to determine the incentive plan or plans in which any employee shall participate during the Plan year and the weighting factor (if any) that will apply to each such plan.

		
	7.
	Non-Transferability.  The right to any Annual Incentive Payments hereunder may not be sold, transferred, assigned or encumbered by any participant.  Nothing herein shall prevent any participant's interest hereunder from being subject to involuntary attachment, levy or other legal process.

		
	8.
	Administration.  The Plan will be administered by or under the direction of the Committee.  The Committee will have the authority to adopt, alter, amend, modify and repeal such rules, guidelines, procedures and practices governing the Plan as it, from time to time, in its sole discretion deems advisable.

The Committee will have full authority to determine the manner in which the Plan will operate, to interpret the provisions of the Plan and to make all determinations thereunder.  All such interpretations and determinations will be final and binding on Progressive, all Plan participants and all other parties.  No such interpretation or determination may be relied on as a precedent for any similar action or decision.

Unless otherwise determined by the Committee, all of the authority of the Committee hereunder (including, without limitation, the authority to administer the Plan, select the persons entitled to participate herein, interpret the provisions hereof, waive any of the requirements specified herein and make determinations hereunder and to establish, approve, change or modify Investment Benchmarks, Performance Targets and Target Percentages) may be exercised by the Designated Officers.  If one or more of the Designated Officers is unavailable or unable to participate, or if such position is vacant, the Chief Financial Officer may act instead of such officer. 

Notwithstanding anything in this Plan to the contrary: (a) all determinations made under this Plan with respect to the CIO or any other individual deemed to be an executive officer of the Company must be made only by the Compensation Committee; and (b) only the Committee may make the determination of the Performance Factor required by Section 3.D. above.

		
	9.
	Miscellaneous.  

		
	A.
	Recoupment.  Progressive shall have the right to recoup any Annual Incentive Payment (or an appropriate portion thereof, as hereinafter provided) with respect to any Plan year paid to a participant hereunder who was an executive officer of Progressive at any time during such Plan year, if: (i) the Annual Incentive Payment was predicated upon the achievement during such Plan year of certain financial or operating results (which includes, for purposes hereof, the performance of the Fixed-Income Portfolio); (ii) such financial or operating results were incorrect and were subsequently the subject of a restatement by Progressive within three (3) years after the date on which such Annual Incentive Payment was paid to the participant; and (iii) a lower payment would have been made to the participant if the restated financial or operating results had been known at the time the payment was made.  Such recoupment right shall be available to Progressive whether or not the participant in question was at fault or responsible in any way in causing such restatement.  In such circumstances, Progressive will have the right to recover from each participant for such Plan year, and each such participant will refund to Progressive, the amount by which the Annual Incentive Payment paid to such participant for the Plan year in question exceeded the lower payment that would have been made based on the restated results, without interest; provided, however, that Progressive will not seek to recover such amounts unless the amount due would exceed the lesser of five percent (5%) of the Annual Incentive Payment previously paid or twenty-thousand dollars ($20,000).  Such recovery, at the Committee’s discretion, may be made by lump sum payment, installment payments, credits against future bonus payments, or other appropriate mechanism.

		
	B.
	Further Rights.  Notwithstanding the foregoing subsection A., if any participant that was an executive officer at any time during such Plan year engaged in fraud or other misconduct (as determined by the Committee or the Board, in their respective sole discretion) resulting, in whole or in part, in a restatement of the financial or operating results used hereunder to determine the Annual Incentive Payments for a specific Plan year, Progressive will further have the right to recover from such participant, and the participant will refund to Progressive upon demand, an amount equal to the entire Annual Incentive Payment paid to such participant for such Plan year plus interest at the rate of eight percent (8%) per annum or, if lower, the highest rate permitted by law, calculated from the date that such bonus was paid to the participant.  Progressive shall further have the right to recover from such participant Progressive’s costs and expenses incurred in connection with recovering such Annual Incentive Payment from the participant, including, without limitation, reasonable attorneys’ fees.  There shall be no time limit on the Company’s right to recover such amounts under this subsection B., except as otherwise provided by applicable law.

		
	C.
	Rights Not Exclusive.  The rights contained in the foregoing subsections A. and B. shall be in addition to, and shall not limit, any other rights or remedies that the Company may have under any applicable law or regulation.

		
	D.
	Compliance with Law and Exchange Requirements.  The Annual Incentive Payments determined and paid pursuant to the Plan shall be subject to all applicable laws and regulations.  Without limiting the foregoing, and notwithstanding anything to the contrary contained in this Plan, if the SEC adopts final rules under Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that require, as a condition to the Company’s continued listing on a national securities exchange (“Exchange”),  that the Company develop and implement a policy requiring the recovery of erroneously awarded compensation, and such regulations are applicable to any participant awarded an Annual Incentive Payment pursuant to the Plan, then the Annual Incentive Payment paid to such participant shall be subject to recoupment by the Company pursuant to the terms of the rules of the SEC and any applicable Exchange and any policy of the Company adopted in response to such rules.

		
	10.
	Termination; Amendments.  The Plan may be terminated, amended or revised, in whole or in part, at any time and from time to time by the Committee, in its sole discretion.

		
	11.
	Unfunded Obligations.  The Plan will be unfunded and all payments due under the Plan will be made from Progressive's general assets.

		
	12.
	No Employment Rights.  Nothing in the Plan shall be construed as conferring upon any person the right to remain a participant in the Plan or to remain employed by Progressive, nor shall the Plan limit Progressive's right to discipline or discharge any of its officers or employees or change any of their job titles, duties or compensation.

		
	13.
	Misconduct; Set-off Rights.  No participant shall have the right to receive any Annual Incentive Payment if, prior to such payment being made, participant’s employment is terminated as a result of any action or inaction that, under Progressive’s employment practices or policies as then in effect, constitutes grounds for immediate termination of employment, as determined by Progressive (or, in the case of an executive officer, the Committee) in its sole discretion.  Progressive shall have the unrestricted right to set off against or recover out of any bonuses or other sums owed to any participant under the Plan any amounts owed by such participant to Progressive.

		
	14.
	Prior Plans.  This Plan supersedes all prior plans, agreements, understandings and arrangements regarding bonuses or other cash incentive compensation payable or due to any participant from Progressive with respect to the performance of Progressive’s investment portfolio. Without limiting the generality of the foregoing, this Plan supersedes and replaces the 2016 Progressive Capital Management Bonus Plan (the "Prior Plan”), which is and shall be deemed to have terminated on the last day of the Company’s 2016 fiscal year (the "Prior Plan Termination Date"); provided, however, that any bonuses or other sums earned and payable under the Prior Plan with respect to any Plan year ended on or prior to the Prior Plan Termination Date shall be unaffected by such termination and shall be paid to the appropriate participants when and as provided thereunder. 

		
	15.
	Effective Date.  This Plan is adopted, and is effective, as of the first day of the Company’s 2017 fiscal year and will be effective for the 2017 Plan year (which coincides with Progressive’s 2017 fiscal year, except that investment returns are calculated on a calendar year basis).

		
	16.
	Governing Law.  This Plan shall be interpreted and construed in accordance with the laws of the State of Ohio.

EXHIBIT I

INVESTMENT BENCHMARK CRITERIA

After the end of the Plan year, Rogers Casey will determine the firms comprising the Investment Benchmark for the Plan year from its records and will supply to the Company the monthly total returns and any other relevant data for each of those firms for the three-year period ending on December 31 of the Plan year.  

A firm will be included in the Investment Benchmark if Rogers Casey is able to determine from its records that:

    
		
	1.
	The firm has provided monthly data  regarding its holdings and investment return, as necessary to determine or calculate such firm’s monthly total return, and to evaluate such firm’s compliance with each of the criteria set forth below, for the entire three-year period ending on December 31 of the Plan year; and 

		
	2.
	At all times during the three-year period ending on December 31 of the Plan year, the information provided by the firm shows, or Rogers Casey is able to calculate, that such firm’s investment portfolio satisfies each of the following criteria:

Duration:             Effective Duration between 1.5 years and 5.0 years
Credit Quality Average         = A, or = AA, or = AAA, or = AAA+
Convexity (%)             >= -1
Sector Allocation:         U.S. High Yield Corporate Debt <= 10%
Sector Allocation:         Mortgages <= 60%
Sector Allocation:         U.S. Investment Grade Corporate Debt <= 60%
Sector Allocation:         CMBS <= 60%
Sector Allocation:         ABS <= 60%
Sector Allocation:         Emerging Markets Debt <= 5%

		
	3.
	The Company will have no discretion to alter the Investment Benchmark list after it is finalized by Rogers Casey.

EXHIBIT II

DETERMINATION OF PERFORMANCE RANKING AND PERFORMANCE SCORES

Once all the total returns are calculated, the data is sorted in descending order from highest to lowest total return. From here, the process to compute the Performance Factor is as follows (this Exhibit shows the procedures and related calculations for the 1-year comparison period required by the Plan; the calculations for the 3-year comparison period would follow the same procedures, except that necessary adjustments would be made to determine the top and bottom 25% levels and the performance score variances between those levels):

INTERPOLATED VALUES FOR SETTING TOP AND BOTTOM 15% LEVELS 
The top 15% and bottom 15% total return rankings are computed based on the total number of firms in the Investment Benchmark, excluding the PCM Fixed-Income Portfolio return. For example, if there were 279 participants, the return required to earn a 2.0 portfolio performance factor would be determined by interpolating between the forty-first and forty-second firm’s returns, since 15% of 279 = 41.85. The same procedure would be used to determine the 0.0 portfolio 

performance factor. 

The total returns, computed by Investment Accounting, for the interpolated positions are calculated as follows (continuing to use an example of 279 survey firms):

Interpolated Value = Firm 41 return - ((Firm 41 Return - Firm 42 Return)*0.85) 
Firm 41 = 18.35%
Firm 42 = 18.23%

Firm 41.85 (Interpolated Value) = 18.35% - ((18.35%-18.23%)*0.85) = 18.25%.

In this case, the PCM Performance Factor will equal 2.0 if its total return equals the interpolated value for Firm 41.85 of 18.25%.  A similar calculation is then used to determine the bottom 15% group and interpolated value for a 0.0 performance score.  

Once the two groups are computed, top and bottom 15%, the remainder of the performance scores are calculated as follows:

Performance score variance =  (2.00) / Number of positions from first participant after the top 15% ranking to the 1st participant in the bottom 15% ranking. In the case of 279 participants, the number of positions to divide the 2.00 performance factors by would be 198. 

The calculation for the performance score variance from 2.00 - 0.00 would be:

2.00 / 198 = .010101 per position for 279 firms

In the case of a tie in total returns between firms, each firm will have the same performance score, one step under the next higher position. The next lowest position would then be stepped down by a factor based on the number of participants who tie. In the case of a tie between two firms, the step down will be twice the performance score variance to maintain the proper stepping to the 0.00 performance score level. 

Example: If firms 42 and 43 each had the same total return in the 279 firm example, then firms 42 and 43 would each have a Performance Factor of 1.989899, which is 2.00 - .0010101. The number 44 position in this example would have a performance score of 1.969697, which is the required step down from 42 to 44. 

In addition, if the returns are tied between the interpolated value set for the 2.00 performance score and any position below the 2.00 level, those lower positions will also be set to a 2.00 performance score. The step down factor in the performance score will work similarly as noted in the example above. For the last 15% group, all firms with total returns equaling the last interpolated total return value would have the same performance score as the last interpolated value (.0101012), and all others in the last 15% group would have a 0.00 Portfolio Performance Factor. 

Once all the performance scores have been created, from 2.00 to 0.00, PCM’s return is compared to the rankings to determine its Performance Factor. If the PCM return is not in the top or bottom 15% and does not match the return of any participant, then PCM’s Performance Factor is an interpolated value between the firms with the next highest and next lowest returns.

The interpolation computation for the Performance Factor based on PCM’s return is as follows:

Performance score of firm below PCM return + (PCM’s Return - Return below PCM) / (Return above PCM - Return below PCM) * (Performance score of firm above PCM -Performance score of firm below PCM)

Assuming the following data, using the 279 firm example:

	
			
	Firm
	Performance score
	Total return

	Firm above PCM
	.90
	13.61

	PCM
	 
	13.39

	Firm below PCM
	.89
	13.34

The calculation of PCM’s Performance Factor is:

0.89 + (13.39-13.34) / (13.61-13.34) * (0.90-0.89) = 0.89 
    
The final performance score is rounded to the nearest one-hundredth, if necessary.uwhr-ex10e_467.htm

Exhibit 10e

 

 

 

 

Uwharrie Capital Corp

 

NONQUALIFIED DEFERRED COMPENSATION PLAN

 

Executive Supplemental Retirement Plan Agreement

 

 

 

This document is drafted with the intent that it comply with Internal Revenue Code Section 409A and regulations promulgated thereunder.  

 

 

 

 

Uwharrie Capital Corp, a North Carolina corporation, hereby adopts this Uwharrie Capital Corp Nonqualified Deferred Compensation Plan (the “Plan”) for the benefit of a select group of management or highly compensated employees.  This Plan is an unfunded arrangement and is intended to be exempt from the participation, vesting, funding, and fiduciary requirements set forth in Title I of the Employee Retirement Income Security Act of 1974, as amended.  It is intended to comply with Internal Revenue Code Section 409A.  

 

This Agreement is made and entered into this 4th day of January 2, 2015 by and between Uwharrie Capital Corp and Roy David Beaver III, an Eligible Employee and shall amend and restate the Executive Supplemental Retirement Plan Agreement effective June 3, 2004.

 

Amendment  I  Effective January 1, 2016

 

This Agreement was amended and approved by the Uwharrie Capital Corp Board of Directors on December 15, 2015 to reflect an annual contribution increase of $5,000.00 per year to be made effective on January 1, 2016.  The total contribution beginning with Plan year 2016 is reflected in the Contribution Schedule included herein.  Modification of the Contribution Schedule constitutes the entirety of the amended revisions.

 

 

 

Article 1 - Definitions

 

1

 

1.1Account  

The sum of all the bookkeeping accounts as may be established for each Participant.  

 

1.2Administrator

An administrative committee appointed by the Board. The Plan Administrator shall serve as the agent for the Employer with respect to the Trust.  The Plan Administrator will be comprised of 1) the Uwharrie Capital Corp Chief Executive Officer, 2) the Uwharrie Capital Corp Director of Administration, 3) the Uwharrie Capital Corp Vice President of Human Resources 4) the Uwharrie Capital Corp Board Chair and 5) the Chair of the Uwharrie Capital Corp Human Resources Committee. 

 

1.3Board

The Board of Directors of the Employer.

 

1.4Change-in-Control

Provided that such term shall be interpreted within the meaning of regulations promulgated under Code Section 409A, a “Change-in-Control” of the Employer (which, for purpose of this Section 1.4 shall mean Uwharrie Capital Corp but not any of its affiliates or subsidiaries) shall mean the first to occur of any of the following:

 

(a)the date that any one person or persons acting as a group acquires ownership of Employer stock constituting more than fifty percent (50%) of the total fair market value or total voting power of the Employer;

 

(b)the date that any one person or persons acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of the stock of the Employer possessing thirty percent (30%) or more of the total voting power of the stock of the Employer; 

 

(c)the date that any one person or persons acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Employer that have a total gross fair market value equal to or more than forty percent (40%) of the total gross fair market value of all of the assets of the Employer immediately prior to such acquisition; or

 

(d)the date that a majority of members of the Employer’s Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or elections.

 

1.5Code

The Internal Revenue Code of 1986, as amended.

 

2

 

1.6Compensation

The Participant’s earned income, including Salary, Bonus, Performance-based Compensation, Stock Units and other remuneration from the Employer as may be included by the Administrator.  

 

1.7Disability

Provided that such term shall be interpreted within the meaning of regulations promulgated under Code Section 409A, a Participant shall be considered to have incurred a Disability if: (i) the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months; (ii) the Participant is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Participant’s Employer; or (iii) determined to be totally disabled by the Social Security Administration.

 

1.8Effective Date

January 1, 2005

 

1.9Eligible Employee

An Employee shall be considered an Eligible Employee if such Employee is a member of a “select group of management or highly compensated employees,” within the meaning of Sections 201, 301 and 401 of ERISA, and is designated as an Eligible Employee by the Administrator. The Administrator may at any time, in its sole discretion, change the eligible criteria for an Eligible Employee or determine that one or more Participants will cease to be an Eligible Employee.  The designation of an Employee as an Eligible Employee in any year shall not confer upon such Employee any right to be designated as an Eligible Employee in any future Plan Year.

 

1.10Employee

Any person employed by the Employer.

 

1.11Employer

Uwharrie Capital Corp and its subsidiaries and affiliates.

 

1.12Employer Discretionary Contribution

A discretionary contribution made by the Employer that is credited to one or more Participant’s Accounts.

 

1.13Employer Supplemental Contribution

A contribution made by the Employer that is credited to one or more Participant’s Accounts.

 

3

 

1.14ERISA

The Employee Retirement Income Security Act of 1974, as amended.

 

1.15Investment Fund

Each investment(s) which serves as a means to measure value, increases or decreases with respect to a Participant’s Accounts.

 

1.16Participant

An Eligible Employee who is a Participant as provided in Article 2.

 

1.17Plan Year

For the initial Plan Year, Effective Date through December 31, 2008.  For each year thereafter, January 1 through December 31.

 

1.18Retirement

Retirement shall mean a Participant’s Separation from Service on, or subsequent to, the Participant attaining their applicable retirement age as provided for in their employment agreement, Uwharrie Capital Corp Executive and Director Supplemental Retirement Plan or as defined by the Plan Administrator upon participation in this Plan, as applicable.  In the event the Participant has not been provided with a retirement age, such Participant's retirement age shall be attainment of sixty-five (65) years of age.

 

1.19Separation from Service

Provided that such term shall be interpreted within the meaning of regulations promulgated under Code Section 409A, a Participant shall incur a Separation from Service with the Service Recipient due to death, retirement or other termination of employment with the Service Recipient unless the employment relationship is treated as continuing intact while the individual is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the individual retains a right to reemployment with the Service Recipient under an applicable statute or by contract.  Upon a sale or other disposition of the assets of the Employer to an unrelated purchaser, the Administrator reserves the right, to the extent permitted by Code section 409A to determine whether Participants providing services to the purchaser after and in connection with the purchase transaction have experienced a Separation from Service.

 

1.20Service Recipient

Provided that such term shall be interpreted within the meaning of regulations promulgated under Code Section 409A, Service Recipient shall mean the Employer or person for whom the services are performed and with respect to whom the legally binding right to compensation arises, and all persons with whom such person would be considered a single employer under Code Section 414(b) (employees of controlled group of corporations), and all persons with whom such person would be considered a single employer under Code Section 414(c) (employees of partnerships, proprietorships, etc., under common control).

 

4

 

1.21Share

Share shall mean a share of the Employer’s common stock, no par value.

 

1.22Specified Employee

Provided that such term shall be interpreted within the meaning of regulations promulgated under Code Section 409A, a “Specified Employee” shall mean a participant who is considered a key employee on the Identification Date, as defined in Code Section 416(i) without regard to section 416(i)(5) and such other requirements imposed under Code Section 409A(a)(2)(B)(i) and regulations there under for the period beginning April 1 of the year subsequent to the Identification Date and ending March 31 of the following year.  The Identification Date for this Plan is December 31 of each year.   

 

1.23Stock Units

Stock Units shall mean Shares of the Employer’s Company Stock, to be included as an Investment Fund option for the Participant’s Account.

 

1.24Trust

The agreement between the Employer and the Trustee under which the assets of the Plan are held, administered and managed, which shall conform to the terms of Rev. Proc. 92-64.

 

1.25Trustee

John R. Morgan  , or such other successor that shall become trustee pursuant to the terms of the Plan.

 

1.26Years of Service

A Participant’s Years of Service shall be measured by employment during a twelve (12) month period commencing with the Participant’s date of hire and anniversaries thereof.

 

Article 2 - Participation

 

2.1Commencement of Participation

Each Eligible Employee shall become a Participant at the earlier of the date on which an Employer Supplemental or Employer Discretionary Contribution is first credited to his or her Account.

 

2.2Loss of Eligible Employee Status

Amounts credited to the Account of a Participant who is no longer an Eligible Employee shall continue to be held pursuant to the terms of the Plan and shall be distributed as provided in Article 6.

 

Article 3 - Contributions

 

5

 

3.1Employer Supplemental Contribution

The Employer shall make an Employer Supplemental Contribution to the Account of some or all of the Participants.  For Participants in the prior Employer Executive and Director Supplemental Retirement Plan, Employer Supplemental Contributions shall mirror those contributions provided for in the Employer Executive and Director Supplemental Retirement Plan Agreement.  For Participants who were not in the Employer Executive and Director Supplemental Retirement Plan Agreement the amount of the Employer Supplemental Contribution shall be determined by the Employer annually and communicated to the Participant(s).  Such Employer Supplemental Contribution shall be credited to the Participant’s Retirement Account to which contributions are being credited for the Plan Year.  Employer Supplemental Contributions shall be credited to a Participant’s Account as soon as administratively feasible following the close of each Plan Year. 

 

3.2Employer Discretionary Contributions

The Employer reserves the right to make discretionary contributions to some or all Participants’ Accounts in such amount and in such manner as may be determined by the Employer.  Such Employer Discretionary Contribution, at the option of the Employer, in accounts established by the Administrator.  The Employer, in its sole discretion, may determine which account will be credited with each Employer Discretionary Contribution.  In the event the Employer does not designate which Participant account shall be credited, such Employer Discretionary Contributions shall be credited to the Participant’s Retirement account.  Employer Discretionary Contributions, if any, shall be credited to a Participant’s Account, and if applicable transferred to the Trust, at such time as the Employer shall determine.  

 

 

Article 4 – Vesting

 

4.1Vesting of Employer Discretionary Contributions

A Participant shall have a vested right to the portion of his or her Account attributable to Employer Discretionary Contribution(s) and any earnings or losses on the investment of such Employer Discretionary Contribution(s) according to such vesting schedule as the Employer shall determine at the time an Employer Discretionary Contribution is made.  

 

4.2Vesting of Employer Supplemental Contributions

A Participant shall have a vested right to the portion of his or her Account  attributable to Employer Supplemental Contribution(s) and any earnings or losses on the investment of such Employer Supplemental Contribution(s) according to such vesting schedule as the Employer shall determine at the time an Employer Supplemental Contribution is made.  For Participants in the prior Employer Executive and Director Supplemental Retirement Plan, Employer Supplemental Contributions shall vest in accordance with the vesting schedule as provided for in the Employer Executive and Director Supplemental Retirement Plan.

 

6

 

4.3Vesting due to Certain Events

(a) A participant who incurs a Separation from Service due to Retirement shall be fully vested in the amounts credited to his or her Account as of the date of Retirement.

 

(b)  A Participant who incurs a Separation from Service due to Disability shall be fully vested in the amounts credited to his or her Account as of the date of Disability.

 

(c)  Upon a Participant’s death, the Participant shall be fully vested in the amounts credited to his or her Account.  

 

(d)Upon a Change-in-Control, all Participants shall be fully vested in the amounts credited to their Accounts as of the date of the Change-in-Control.

 

(e)Upon termination of employment prior to attaining Normal Retirement Age, the participant shall be fully vested in the amounts credited to his or her account.

 

 

Article 5 – Accounts

 

5.1Investments, Gains and Losses

	
(a)
	
As applicable, a Participant may change his or her selection of Investment Funds no more than six (6) times each Plan Year with respect to his or her Account by filing a new election in accordance with procedures established by the Administrator.  An election shall be effective as soon as administratively feasible following the date the change is submitted on a form prescribed by the Administrator.

 

	
(b) 
	
Notwithstanding the foregoing, any Stock Units shall be deemed to be invested in Shares at all times.

 

 

Article 6 - Distributions

 

6.1Distribution Election

Each Participant shall designate in his or her election the timing of his or her distribution as described in the accompanying election form.  Notwithstanding anything to the contrary contained herein provided, no acceleration of the time or schedule of payments under the Plan shall occur except as permitted under both this Plan and Code Section 409A.  If the Participant fails to properly designate the time and form of a distribution, the Participant’s Account shall be paid in a lump sum.

 

6.2Distributions Upon Retirement

If the Participant has a Separation from Service due to Retirement, the Participant’s Retirement Account shall be distributed as soon as administratively feasible, but no later than ninety (90) days after the first day of the seventh month following Participant’s Retirement.  

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Distribution shall be made either in a lump-sum payment or in substantially equal annual installments, over a period of up to ten (10) years as elected by the Participant.  

 

6.3Substantially Equal Annual Installments

(a)The amount of the substantially equal payments shall be determined by multiplying the Participant’s Account by a fraction, the denominator of which in the first year of payment equals the number of years over which benefits are to be paid, and the numerator of which is one (1).  The amounts of the payments for each succeeding year shall be determined by multiplying the Participant’s Account as of the applicable anniversary of the payout by a fraction, the denominator of which equals the number of remaining years over which benefits are to be paid, and the numerator of which is one (1). Installment payments made pursuant to this Section 6.3 shall be made as soon as administratively feasible, but no later than ninety (90) days following the anniversary of the distribution event.  

 

(b)For purposes of the Plan pursuant to Code Section 409A and regulations thereunder, a series of annual installments from a particular account shall be considered a single payment. 

 

6.4Distributions due to other Separation from Service

Upon a Participant’s Separation from Service for any reason other than Retirement, death or Disability, all vested amounts credited to his or her Account shall be paid to the Participant in a lump-sum, as soon as administratively feasible, but no later than ninety (90) days, following the date of Separation from Service, subject to Section 6.8 (Distributions to Specified Employees).

 

6.5Distributions upon Separation from Service due to Disability

Upon a Participant’s Separation from Service due to Disability, all amounts credited to his or her Account shall be paid to the Participant in a lump sum, as soon as administratively feasible but no later than ninety (90) days following the date of Separation from Service due to Disability, subject to Section 6.8 (Distributions to Specified Employees).

 

6.6Distributions upon Death

Upon the death of a Participant, all amounts credited to his or her Account shall be paid, as soon as administratively feasible but no later than ninety (90) days following Participant’s date of death, to his or her beneficiary or beneficiaries, as determined under Article 7 hereof, in a lump sum.

 

6.7Changes to Distribution Elections

A Participant will be permitted to elect to change the form or timing of the distribution of the balance of his or her Account to the extent permitted and in accordance with the requirements of Code Section 409A(a)(4)(C), including the requirement that (i) a redeferral election may not take effect until at least twelve (12) months after such election is filed with the Employer, (ii) an election to further defer a distribution (other than a 

8

 

distribution upon death, Disability or an unforeseeable emergency) must  result in the first distribution subject to the election being made at least five (5) years after the previously elected date of distribution, and (iii) any redeferral election affecting a distribution at a fixed date must be filed with the Employer at least twelve (12) months before the first scheduled payment under the previous fixed date distribution election.  Once an account begins distribution, no such changes to distributions shall be permitted.  

 

6.8Distributions to Specified Employee

Notwithstanding anything herein to the contrary, if any Participant is a Specified Employee upon a Separation from Service for any reason other than death, distributions to such Participant shall not commence until the first day of the seventh month following the date of Separation from Service (or, if earlier, the date of death of the Participant).  If distributions are to be made in annual installments, the second installment and all those thereafter will be made on the applicable anniversaries of the Participant’s Separation from Service.

 

6.9Domestic Relations Orders

The Administrator may permit such acceleration of the time or schedule of a payment under the arrangement to an individual other than a Participant as may be necessary to fulfill a domestic relations order (as defined in Code Section 414(p)(1)(B)).

 

6.10Minimum Distribution

Notwithstanding any provision to the contrary, if the balance of a Participant’s Account at the time of a distribution event or at the time of a scheduled installment payment is $25,000 or less, then the Participant shall be paid his or her Account or sub-account as a single lump sum.

 

6.11Form of Payment

All distributions shall be made in the form of cash, with the exception of Stock Units and related earnings, which shall be paid in the form of Shares (with any fractional Shares paid in cash). Distribution of real property (real estate or assets other than cash or securities).will be made by transfer of title.

 

6.12Distributions Upon a Change-in-Control

Notwithstanding any distribution election to the contrary, if a Change-in-Control occurs and a Participant incurs a Separation from Service during the period beginning on the date of the Change-in-Control and ending on the second anniversary of the Change-in-Control, then the remaining amount of the Participant’s vested Account shall be paid to the Participant or his  or her beneficiary in a single lump-sum payment as soon as administratively possible, but no earlier than the first business day of the seventh month following the Participant’s Separation from Service (or, if earlier, upon the Participant’s death). 

 

Article 7 - Beneficiaries

 

9

 

7.1Beneficiaries

Each Participant may from time to time designate one or more persons (who may be any one or more members of such person’s family or other persons, administrators, trusts, foundations or other entities) as his or her beneficiary under the Plan.  Such designation shall be made in a form prescribed by the Administrator.  Each Participant may at any time and from time to time, change any previous beneficiary designation, without notice to or consent of any previously designated beneficiary, by amending his or her previous designation in a form prescribed by the Administrator.  If the beneficiary does not survive the Participant (or is otherwise unavailable to receive payment), or if no beneficiary is validly designated, then the amounts payable under this Plan shall be paid to the Participant’s estate.  If more than one person is the beneficiary of a deceased Participant, each such person shall receive a pro rata share of any death benefit payable unless otherwise designated in the applicable form.  If a beneficiary who is receiving benefits dies, all benefits that were payable to such beneficiary shall then be payable to the estate of that beneficiary.

 

7.2Lost Beneficiary

All Participants and beneficiaries shall have the obligation to keep the Administrator informed of their current address until such time as all benefits due have been paid.  If a Participant or beneficiary cannot be located by the Administrator exercising due diligence, then, in its sole discretion, the Administrator may presume that the Participant or beneficiary is deceased for purposes of the Plan and all unpaid amounts (net of due diligence expenses) owed to the Participant or beneficiary shall be paid accordingly or, if a beneficiary cannot be so located, then such amounts may be forfeited.  Any such presumption of death shall be final, conclusive and binding on all parties.

 

Article 8 - Funding

 

8.1Prohibition Against Funding

Should any investment be acquired in connection with the liabilities assumed under this Plan, it is expressly understood and agreed that the Participants and beneficiaries shall not have any right with respect to, or claim against, such assets nor shall any such purchase be construed to create a trust of any kind or a fiduciary relationship between the Employer and the Participants, their beneficiaries or any other person.  Any such assets shall be and remain a part of the general, unpledged, unrestricted assets of the Employer, subject to the claims of its general creditors.  It is the express intention of the parties hereto that this arrangement shall be unfunded for tax purposes and for purposes of Title I of the ERISA.  Each Participant and beneficiary shall be required to look to the provisions of this Plan and to the Employer itself for enforcement of any and all benefits due under this Plan, and to the extent any such person acquires a right to receive payment under this Plan, such right shall be no greater than the right of any unsecured general creditor of the Employer.  The Employer or the Trust shall be designated the owner and beneficiary of any investment acquired in connection with its obligation under this Plan.

 

8.2Deposits in Trust

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Notwithstanding Section 8.1, or any other provision of this Plan to the contrary, the Employer may deposit into the Trust any amounts it deems appropriate to pay the benefits under this Plan.  The amounts so deposited may include all contributions made pursuant to Employer Supplemental Contributions and any Employer Discretionary Contributions.

 

 

Article 9 - Claims Administration

 

9.1General

If a Participant, beneficiary or his or her representative is denied all or a portion of an expected Plan benefit for any reason and the Participant, 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 Administrator. 

 

9.2Claims Procedure

Upon receipt of any written claim for benefits, the Administrator shall be notified and shall give due consideration to the claim presented.  If any Participant or beneficiary claims to be entitled to benefits under the Plan and the Administrator determines that the claim should be denied in whole or in part, the Administrator shall, in writing, notify such claimant within ninety (90) days (forty-five (45) days if the claim is on account of Disability) of receipt of the claim that the claim has been denied.  The 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 (thirty (30) days if claim is on account of Disability), provided that the 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 (or forty-five (45) day) period, of the circumstances requiring the extension of time and the date by which the Plan expects to render a decision.  If the claim is denied to any extent by the Administrator, the Administrator shall furnish the claimant with a written notice setting forth:

 

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

 

(b)a specific reference to the Plan 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 Administrator to comply with the provisions of this Section 9.2 be considered to constitute an allowance of the claimant’s claim.

 

11

 

9.3Right of Appeal

A claimant who has a claim denied wholly or partially under Section 9.2 may appeal to the Administrator for reconsideration of that claim.  A request for reconsideration under this Section must be filed by written notice within sixty (60) days (one-hundred and eighty (180) days if the claim is on account of Disability) after receipt by the claimant of the notice of denial under Section 9.2.

 

9.4Review of Appeal

Upon receipt of an appeal the Administrator shall promptly take action to give due consideration to the appeal.  Such consideration may include a hearing of the parties involved, if the 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 Administrator shall issue a written decision which shall be binding on all parties.  The decision shall specifically state its reasons and pertinent Plan provisions on which it relies.  The Administrator’s decision shall be issued within sixty (60) days (forty-five (45) days if the claim is on account of Disability) after the appeal is filed, except that the 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 (ninety (90) days if the claim is on account of Disability), provided that the 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 (or, if the claim is on account of Disability, initial ninety (90) day) period, of the circumstances requiring the extension of time and the date by which the Plan expects to render a decision.  Under no circumstances shall any failure by the Administrator to comply with the provisions of this Section 9.4 be considered to constitute an allowance of the claimant’s claim.

 

In the case of a claim on account of Disability: (i) the review of the denied claim shall be conducted by an employee who is neither the individual who made the initial determination or a subordinate of such person; and (ii) no deference shall be given to the initial determination.  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. 

 

9.5Designation

The 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 Administrator hereunder.

 

Article 10 - General Provisions

 

10.1Administrator

(a)The Administrator is expressly empowered to limit the amount of Compensation that may be deferred; to deposit amounts into the Trust in accordance with Section 8.2 hereof; to interpret the Plan, and to determine all questions arising in the 

12

 

administration, interpretation and application of the Plan; to employ actuaries, accountants, counsel, and other persons it deems necessary in connection with the administration of the Plan; to request any information from the Employer it deems necessary to determine whether the Employer would be considered insolvent or subject to a proceeding in bankruptcy; and to take all other necessary and proper actions to fulfill its duties as Administrator.

 

(b)The Administrator shall not be liable for any actions by it hereunder, unless due to its own negligence, willful misconduct or lack of good faith.

 

(c)The Administrator shall be indemnified and saved harmless by the Employer from and against all personal liability to which it may be subject by reason of any act done or omitted to be done in its official capacity as Administrator in good faith in the administration of the Plan and Trust, including all expenses reasonably incurred in its defense in the event the Employer fails to provide such defense upon the request of the Administrator.  The Administrator is relieved of all responsibility in connection with its duties hereunder to the fullest extent permitted by law, short of breach of duty to the beneficiaries.

 

10.2No Assignment

Benefits or payments under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of the Participant or the Participant’s beneficiary, whether voluntary or involuntary, and any attempt to so anticipate, alienate, sell, transfer, assign, pledge, encumber, attach or garnish the same shall not be valid, nor shall any such benefit or payment be in any way liable for or subject to the debts, contracts, liabilities, engagement or torts of any Participant or beneficiary, or any other person entitled to such benefit or payment pursuant to the terms of this Plan, except to such extent as may be required by law.  If any Participant or beneficiary or any other person entitled to a benefit or payment pursuant to the terms of this Plan becomes bankrupt or attempts to anticipate, alienate, sell, transfer, assign, pledge, encumber, attach or garnish any benefit or payment under this Plan, in whole or in part, or if any attempt is made to subject any such benefit or payment, in whole or in part, to the debts, contracts, liabilities, engagements or torts of the Participant or beneficiary or any other person entitled to any such benefit or payment pursuant to the terms of this Plan, then such benefit or payment, in the discretion of the Administrator, shall cease and terminate with respect to such Participant or beneficiary, or any other such person.

 

10.3No Employment Rights

Participation in this Plan shall not be construed to confer upon any Participant the legal right to be retained in the employ of the Employer, or give a Participant or beneficiary, or any other person, any right to any payment whatsoever, except to the extent of the benefits provided for hereunder.  Each Participant shall remain subject to discharge to the same extent as if this Plan had never been adopted.

 

13

 

10.4Incompetence

If the Administrator determines that any person to whom a benefit is payable under this Plan is incompetent by reason of physical or mental disability, the Administrator shall have the power to cause the payments becoming due to such person to be made to another for his or her benefit without responsibility of the Administrator or the Employer to see to the application of such payments.  Any payment made pursuant to such power shall, as to such payment, operate as a complete discharge of the Employer, the Administrator and the Trustee.

 

10.5Identity

If, at any time, any doubt exists as to the identity of any person entitled to any payment hereunder or the amount or time of such payment, the Administrator shall be entitled to hold such sum until such identity or amount or time is determined or until an order of a court of competent jurisdiction is obtained.  The Administrator shall also be entitled to pay such sum into court in accordance with the appropriate rules of law.  Any expenses incurred by the Employer, Administrator, and Trust incident to such proceeding or litigation shall be charged against the Account of the affected Participant.

	

	
 

10.6Other Benefits

The benefits of each Participant or beneficiary hereunder shall be in addition to any benefits paid or payable to or on account of the Participant or beneficiary under any other pension, disability, annuity or retirement plan or policy whatsoever.

 

10.7Expenses

All expenses incurred in the administration of the Plan, whether incurred by the Employer or the Plan, shall be paid by the Employer.

 

10.8Insolvency

Should the Employer be considered insolvent (as defined by the Trust), the Employer, through its Board and chief executive officer, shall give immediate written notice of such to the Administrator of the Plan and the Trustee.  Upon receipt of such notice, the Administrator or Trustee shall cease to make any payments to Participants who were Employees of the Employer or their beneficiaries and shall hold any and all assets attributable to the Employer for the benefit of the general creditors of the Employer.

 

10.9Amendment or Modification

The Employer may, at any time, in its sole discretion, amend or modify the Plan in whole or in part, except that no such amendment or modification shall have any retroactive effect to reduce any amounts allocated to a Participant’s Accounts, and provided that such amendment or modification complies with Code Section 409A and related regulations thereunder.  

 

10.10Plan Suspension

The Employer further reserves the right to suspend the Plan in whole or in part, except that no such suspension shall have any retroactive effect to reduce any amounts 

14

 

allocated to a Participant’s Accounts, and provided that the distribution of the vested Participant Accounts shall not be accelerated but shall be paid at such time and in such manner as determined under the terms of the Plan immediately prior to suspension as if the Plan had not been suspended. 

 

10.11Plan Termination

The Employer further reserves the right to terminate the Plan in whole or in part, in the following manner, except that no such termination shall have any retroactive effect to reduce any amounts allocated to a Participant’s Accounts, and provided that such termination complies with Code Section 409A and related regulations thereunder:

 

(a)The Employer, in its sole discretion, may terminate the Plan and distribute all vested Participants’ Accounts no earlier than twelve (12) calendar months from the date of the Plan termination and no later than twenty-four (24) calendar months from the date of the Plan termination, provided however that all other similar arrangements are also terminated by the Employer for any affected Participant and no other similar arrangements are adopted by the Employer for any affected Participant within a three (3) year period from the date of termination; or

 

(b)The Employer may decide, in its sole discretion, to terminate the Plan in the event of a corporate dissolution taxed under Code Section 331, or with the approval of a bankruptcy court, provided that the Participants vested Account balances are distributed to Participants and are included in the Participants’ gross income in the latest of:  (i) the calendar year in which the termination occurs; (ii) the calendar year in which the amounts deferred are no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which payment is administratively practicable. 

 

10.12Plan Termination due to a Change-in-Control

The Employer may decide, in its discretion, to terminate the Plan in the event of a Change-in-Control and distribute all vested Participants Account balances no earlier than thirty (30) days prior to the Change-in-Control and no later than twelve (12) months after the effective date of the Change-in-Control, provided however that the Employer terminates all other similar arrangements for any affected Participant.  

 

10.13Construction

All questions of interpretation, construction or application arising under or concerning the terms of this Plan shall be decided by the Administrator, in its sole and final discretion, whose decision shall be final, binding and conclusive upon all persons.

 

10.14Governing Law

This Plan shall be governed by, construed and administered in accordance with the applicable provisions of ERISA, Code Section 409A, and any other applicable federal law, provided, however, that to the extent not preempted by federal law this Plan shall be governed by, construed and administered under the laws of the State of North Carolina, other than its laws respecting choice of law.

 

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10.15Severability

If any provision of this Plan is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provision of this Plan and this Plan shall be construed and enforced as if such provision had not been included therein.  If the inclusion of any Employee (or Employees) as a Participant under this Plan would cause the Plan to fail to comply with the requirements of sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, or Code Section 409A, then the Plan shall be severed with respect to such Employee or Employees, who shall be considered to be participating in a separate arrangement.

 

10.16Headings

The Article headings contained herein are inserted only as a matter of convenience and for reference and in no way define, limit, enlarge or describe the scope or intent of this Plan nor in any way shall they affect this Plan or the construction of any provision thereof.

 

10.17Terms

Capitalized terms shall have meanings as defined herein.  Singular nouns shall be read as plural, masculine pronouns shall be read as feminine, and vice versa, as appropriate.

 

10.18Right of Setoff

The Employer may, to the extent permitted by applicable law, deduct from and setoff against any amounts payable to a Participant from this Plan such amounts as may be owed by a Participant to the Employer, although the Participant shall remain liable for any part of the Participant’s payment obligation not satisfied through such deduction and setoff; provided, however, that this setoff may occur only at the date on which the amount would otherwise be distributed to the Participant as required by Code Section 409A.  By electing to participate in the Plan and deferring compensation hereunder, the Participant agrees to any deduction or setoff under this Section 10.18 which is allowed by law. 

 

 

                                        Contribution Schedule

 

	
 
	
•
	
Employer Supplemental Contributions for the benefit of Roy David Beaver III will be credited as follows until attainment of the designated Retirement age of  67.

 

	
 
	
•
	
The elected Account Distribution upon Retirement will be (check one):

 

	
 x
	
Lump Sum

	

	
Installments over ___________ (# years)

 

	
 
	
•
	
Beneficiary designation as indicated on attached form.

 

16

 

	
 
	
•
	
Employer Supplemental Contributions:

 

12/31/2015End of year Age 3215,000.00

12/31/2016End of year Age 3320,000.00

12/31/2017End of year Age 3420,000.00

12/31/2018End of year Age 3520,000.00

12/31/2019End of year Age 3620,000.00

12/31/2020End of year Age 3720,000.00

12/31/2021End of year Age 3820,000.00

12/31/2022End of year Age 3920,000.00

12/31/2023End of year Age 4020,000.00

12/31/2024End of year Age 4120,000.00

12/31/2025End of year Age 4220,000.00

 

12/31/2026End of year Age 4320,000.00

12/31/2027End of year Age 4420,000.00

12/31/2028End of year Age 4520,000.00

12/31/2029End of year Age 4620,000.00

12/31/2030End of year Age 4720,000.00

12/31/2031End of year Age 4820,000.00

12/31/2032End of year Age 4920,000.00

12/31/2033End of year Age 5020,000.00

12/31/2034End of year Age 5120,000.00

12/31/2035End of year Age 5220,000.00

12/31/2036End of year Age 5320,000.00

12/31/2037End of year Age 5420,000.00

12/31/2038End of year Age 5520,000.00

12/31/2039End of year Age 5620,000.00

12/31/2040End of year Age 5720,000.00

12/31/2041End of year Age 5820,000.00

12/31/2042End of year Age 5920,000.00

12/31/2043End of year Age 6020,000.00

12/31/2044End of year Age 6120,000.00

12/31/2045End of year Age 6220,000.00

12/31/2046End of year Age 6320,000.00

12/31/2047End of year Age 6420,000.00

12/31/2048End of year Age 6520,000.00

12/31/2049End of year Age 6620,000.00

12/31/2050End of year Age 6720,000.00

 

 

 

 

 

IN WITNESS WHEREOF, Uwharrie Capital Corp has caused this instrument to be executed by its duly authorized officer, effective as of this  11th day of March, 2015.

17

 

 

 

Uwharrie Capital Corp

 

/s/ Roy David Beaver IIIBy: /s/ Mike Massey

Roy David Beaver IIITitle:  SVP Director of Administration

 

 

ATTEST:

 

By:  /s/ Susan B. Gibson

 

Title: VP, Human Resources

 

 

 

 

18

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