Document:

Ex-10(b) Amendment Number Two to the Harris Corpor

 

Exhibit 10(b)

AMENDMENT NUMBER TWO

TO THE

HARRIS CORPORATION RETIREMENT PLAN

     WHEREAS, Harris Corporation, a Delaware corporation (the “Corporation”), heretofore has
adopted and maintains the Harris Corporation Retirement Plan, as amended and restated effective
October 1, 2005 (the “Plan”);

     WHEREAS, pursuant to Section 17.1 of the Plan, the Management Development and Compensation
Committee of the Corporation’s Board of Directors (the “Compensation Committee”) has the authority
to amend the Plan;

     WHEREAS, pursuant to Section 13.3 of the Plan, the Compensation Committee has delegated to the
Employee Benefits Committee of the Corporation (the “Employee Benefits Committee”) the authority to
adopt non-material amendments to the Plan;

     WHEREAS, the Corporation’s Board of Directors further has delegated to the Employee Benefits
Committee the authority to amend the Plan in the manner that the Employee Benefits Committee shall
deem necessary, advisable or appropriate in connection with the transactions contemplated by a
Formation, Contribution and Merger Agreement between the Corporation and Stratex Networks, Inc.
dated September 5, 2006 (as such agreement may be amended from time to time) (the “Formation
Agreement”); and

     WHEREAS, the Employee Benefits Committee desires to amend the Plan (i) to allow for designated
Roth contributions pursuant to section 402A of the Internal Revenue Code of 1986, as amended (the
“Code”), (ii) to permit all categories of eligible employees under the Plan to commence
participation in the Plan on the date such an employee first performs an hour of service and (iii)
to reflect the transfer of MCD Employees (as defined in the Formation Agreement) to Harris Stratex
Networks, Inc.

     NOW, THEREFORE, BE IT RESOLVED, that the Plan hereby is amended, effective as of January 1,
2007 or as of such other date set forth herein, as follows:

     1. Article 2 hereby is amended to add the following new definition thereto:

 

 

Designated Roth Account. The account established pursuant to Section 8.1 to
which any designated Roth contributions made for the benefit of a Participant
pursuant to Section 4.1, and earnings and losses thereon, are credited.

     2. Section 3.1 hereby is amended in its entirety to read as follows:

Section 3.1 Eligibility for Participation. Each Eligible
Employee who was a Participant immediately before the Effective Date shall continue
to be a Participant as of the Effective Date. Each other Eligible Employee shall
become a Participant on the day he or she first performs an Hour of Service.

     3. Section 3.2 hereby is amended to insert the words “, Designated Roth Contributions”
immediately after the words “Pre-Tax Contributions” appearing in the section heading thereof.

     4. Section 3.2(a) hereby is amended (i) to insert the words “, designated Roth contributions”
immediately after the words “pre-tax contributions” appearing in the first sentence thereof and
(ii) to insert the words “and designated Roth contributions” immediately after the words “pre-tax
contributions” appearing in the second sentence thereof.

     5. Section 3.3 hereby is amended to insert the words “designated Roth contributions,”
immediately after the words “pre-tax contributions,” appearing in the second sentence thereof.

     6. Article 4 hereby is amended to insert the words “DESIGNATED ROTH,” immediately after the
word “PRE-TAX,” appearing in the article heading thereof.

     7. Section 4.1 hereby is amended to insert the words “and Designated Roth Contributions”
immediately after the words “Pre-Tax Contributions” appearing in the section heading thereof.

     8. Section 4.1(a) hereby is amended (i) to insert the words “and a designated Roth
contribution” immediately after the words “pre-tax contribution” appearing in the first sentence
thereof and (ii) to insert the words “and designated Roth contributions” immediately after the
words “pre-tax contributions” appearing in the last sentence thereof.

     9. Section 4.1(b) hereby is amended (i) to insert the words “and Designated Roth
Contributions” immediately after the words “Pre-Tax Contributions” appearing in the section heading
thereof, (ii) to insert the words “and designated Roth contributions” immediately after the words
“pre-tax contributions” appearing in the first sentence thereof, (iii) to insert the words “or
designated Roth contributions” immediately after the words “pre-tax contributions” each time they
appear in the last sentence thereof.

     10. Section 4.1(c) hereby is amended (i) to insert the words “or designated Roth
contributions” immediately after the words “pre-tax contributions” each place they appear in the
first sentence thereof.

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     11. Section 4.1 hereby is amended to add the following new subsection (d) thereto:

(d) Designation of Contributions as Pre-Tax Contributions or Designated Roth
Contributions. Effective for elections made by Participants on or after January
1, 2007 to commence, change, suspend or resume contributions made pursuant to this
Section 4.1, such elections shall designate (i) the portion of such contributions
that are to be designated Roth contributions includable in the Participant’s gross
income when made pursuant to section 402A of the Code and (ii) the portion of such
contributions that are to be pre-tax contributions excludable from the Participant’s
gross income pursuant to section 402(g) of the Code. Such designations shall be
irrevocable with respect to contributions made pursuant to such elections.

     12. Section 4.2(a) hereby is amended to insert the words “and designated Roth contribution”
immediately after the words “pre-tax contribution” appearing in the first sentence thereof.

     13. Section 4.2(b) hereby is amended to insert the words “or designated Roth contribution”
immediately after the words “pre-tax contribution” appearing in the first sentence thereof.

     14. Section 4.4 hereby is amended (i) to insert the words “and designated Roth contributions”
immediately after the words “pre-tax contributions” appearing in the first sentence thereof and
(ii) to insert the words “, designated Roth contributions” immediately after the words “pre-tax
contributions” appearing in the second sentence thereof.

     15. Section 4.5 hereby is amended (i) to insert the words “designated Roth contributions,”
immediately after the words “pre-tax contributions,” appearing in the first clause of the first
sentence thereof, (ii) to insert the words “, designated Roth contributions” immediately after the
words “pre-tax contributions” appearing in the second clause of the first sentence thereof, and
(iii) to insert the words “and designated Roth contributions” immediately after the words “pre-tax
contributions” each place they appear in the second sentence thereof.

     16. Section 5.1(a) hereby is amended to insert the words “and designated Roth contributions”
immediately after the words “pre-tax contributions” appearing in the third sentence thereof.

     17. The second to last sentence of Section 5.2(a) hereby is amended in its entirety to read as
follows:

Notwithstanding the foregoing, rollover contributions to the Plan may not include
any portion of an eligible rollover distribution that consists of (i) after-tax
employee contributions or (ii) designated Roth contributions described in section
402A of the Code or any related earnings with respect to such contributions.

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     18. Section 6.1 hereby is amended to insert the words “and Designated Roth Contributions”
immediately after the words “Pre-Tax Contributions” appearing in the section heading thereof.

     19. Section 6.1(a) hereby is amended to insert the words “and designated Roth contributions”
immediately after the words “pre-tax contributions” appearing in the first sentence thereof.

     20. Section 6.1(b) hereby is amended to insert the words “and Designated Roth Contributions”
immediately after the words “Pre-Tax Contributions” appearing in the section heading thereof.

     21. Section 6.1(b)(1) hereby is amended (i) to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” each place they appear therein
and (ii) to add the following sentence to the end thereof to read as follows:

The Participant for whom any contributions are recharacterized as after-tax
contributions pursuant to this paragraph shall designate the extent to which such
recharacterized contributions are pre-tax contributions or designated Roth
contributions (but only up to the extent that such types of contributions were made
by the Participant to the Plan for the Plan Year) and, in the event that any such
designation is not made or is incomplete, the Participant’s pre-tax contributions
shall be recharacterized up to the extent pre-tax contributions were made to the
Plan for the Plan Year and, to the extent that the Participant’s excess deferrals
exceed such pre-tax contributions, the Participant’s designated Roth contributions
made to the Plan for the Plan Year shall be recharacterized.

     22. Section 6.1(b)(2) hereby is amended to add the following sentence to the end thereof to
read as follows:

The Participant to whom any excess deferrals are distributed pursuant to this
paragraph shall designate the extent to which such distributed excess deferrals are
treated as pre-tax contributions or designated Roth contributions (but only up to
the extent that such types of contributions were made by the Participant to the Plan
for the Plan Year) and, in the event that any such designation is not made or is
incomplete, such distributed excess deferrals shall be treated as pre-tax
contributions up to the extent pre-tax contributions were made to the Plan for the
Plan Year and, to the extent that such distributed excess deferrals exceed such
pre-tax contributions, such excess deferrals shall be treated as distributions of
designated Roth contributions made to the Plan for the Plan Year.

     23. Section 6.2(a) hereby is amended (i) to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first sentence
thereof and (ii) to insert the words “or designated Roth contributions” immediately after the words
“pre-tax contributions” each place they appear in the second sentence thereof.

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     24. Section 6.2(c)(1) hereby is amended to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first sentence
thereof.

     25. Section 6.2(c)(2) hereby is amended (i) to insert the words “or designated Roth
contributions” immediately after the words “pre-tax contributions” in the first sentence thereof
and (ii) to insert the words “and designated Roth contributions” immediately after the words
“pre-tax contributions” appearing in the second sentence thereof.

     26. Section 6.2(c)(3) hereby is amended (i) to insert the words “or designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first sentence
thereof and (ii) to insert the words “and designated Roth contributions” immediately after the
words “pre-tax contributions” appearing in the second sentence thereof.

     27. Section 6.2(c)(5) hereby is amended to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first and
second sentences thereof.

     28. Section 6.2(c)(6) hereby is amended to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first and
second sentences thereof.

     29. Section 6.2(c)(8) hereby is amended to insert the words “designated Roth contributions,”
immediately after the words “pre-tax contributions,” appearing in the first sentence thereof.

     30. Section 6.2(c)(9) hereby is amended to insert the words “or designated Roth contribution”
immediately after the words “pre-tax contribution” appearing therein.

     31. Section 6.2(d)(1) hereby is amended (i) to insert the words “and designated Roth
contributions” immediately after the words “pre-tax contributions” each place they appear therein
and (ii) to add the following new sentence to the end thereof to read as follows:

The Participant for whom any contributions are recharacterized as after-tax
contributions pursuant to this paragraph shall designate the extent to which such
recharacterized contributions are pre-tax contributions or designated Roth
contributions (but only up to the extent that such types of contributions were made
by the Participant to the Plan for the Plan Year) and, in the event that any such
designation is not made or is incomplete, the Participant’s pre-tax contributions
shall be recharacterized up to the extent pre-tax contributions were made to the
Plan for the Plan Year and, to the extent that the Participant’s excess
contributions exceed such pre-tax contributions, the Participant’s designated Roth
contributions made to the Plan for the Plan Year shall be recharacterized.

     32. Effective as of July 1, 2005, the second paragraph of Section 6.3 hereby is amended in its
entirety to read as follows:

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     If the annual additions to a Participant’s Account exceed the limitations set
forth above for any limitation year (i) as a result of a reasonable error in
estimating a Participant’s annual compensation, (ii) as a result of a reasonable
error in determining the amount of pre-tax contributions that may be made by a
Participant under section 415 of the Code or (iii) under other limited facts and
circumstances as determined by the Commissioner of Internal Revenue, the amounts to
be allocated to such Participant’s Account for such year shall be reduced to the
extent of the excess in the following order:

     (1) After-tax contributions in excess of 6% of the Participant’s Compensation;

     (2) Pre-tax contributions in excess of 6% of the Participant’s Compensation;

     (3) Remaining after-tax contributions and any matching contributions
attributable thereto on a pro-rata basis;

     (4) Remaining pre-tax contributions and any matching contributions attributable
thereto on a pro rata basis; and

     (5) Profit sharing contributions.

Any after-tax contributions or pre-tax contributions so reduced, plus earnings
thereon, shall be distributed to the Participant. Any matching contributions or
profit sharing contributions so reduced, plus earnings thereon, shall be held in a
segregated suspense account and shall be treated in the next limitation year as
matching contributions or profit sharing contributions, as the case may be, thereby
reducing amounts actually contributed by the Employers for such year. Upon
termination of the Plan, any balance in such suspense account shall be returned to
each Employer in the amount determined by the Administrative Committee, but only if
the allocation upon Plan termination of such amount to Participants would cause all
Participants to receive annual additions in excess of the limitations of section 415
of the Code. For purposes of determining whether any matching contributions are
attributable to any amounts distributed pursuant to this paragraph, matching
contributions shall be deemed to relate first to pre-tax contributions up to 6% of
the Participant’s Compensation and second to after-tax contributions up to 6% of the
Participant’s Compensation.

     33. Effective as of January 1, 2007, the second paragraph of Section 6.3 hereby is amended in
its entirety to read as follows:

     If the annual additions to a Participant’s Account exceed the limitations set
forth above for any limitation year (i) as a result of a reasonable error in
estimating a Participant’s annual compensation, (ii) as a result of a reasonable
error in determining the amount of pre-tax contributions and designated Roth

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contributions that may be made by a Participant under section 415 of the Code or
(iii) under other limited facts and circumstances as determined by the Commissioner
of Internal Revenue, the amounts to be allocated to such Participant’s Account for
such year shall be reduced to the extent of the excess in the following order:

     (1) After-tax contributions in excess of 6% of the Participant’s Compensation;

     (2) Pre-tax contributions in excess of 6% of the Participant’s Compensation;

     (3) Designated Roth contributions in excess of 6% of the Participant’s
Compensation;

     (4) Remaining after-tax contributions and any matching contributions
attributable thereto on a pro-rata basis;

     (5) Remaining pre-tax contributions and any matching contributions attributable
thereto on a pro rata basis;

     (6) Remaining designated Roth contributions and any matching contributions
attributable thereto on a pro rata basis; and

     (7) Profit sharing contributions.

Any after-tax contributions, pre-tax contributions or designated Roth contributions,
plus earnings thereon, shall be distributed to the Participant. Any matching
contributions or profit sharing contributions so reduced, plus earnings thereon,
shall be held in a segregated suspense account and shall be treated in the next
limitation year as matching contributions or profit sharing contributions, as the
case may be, thereby reducing amounts actually contributed by the Employers for such
year. Upon termination of the Plan, any balance in such suspense account shall be
returned to each Employer in the amount determined by the Administrative Committee,
but only if the allocation upon Plan termination of such amount to Participants
would cause all Participants to receive annual additions in excess of the
limitations of section 415 of the Code. For purposes of determining whether any
matching contributions are attributable to any amounts distributed pursuant to this
paragraph, matching contributions shall be deemed to relate first to designated Roth
contributions up to 6% of the Participant’s Compensation, second to pre-tax
contributions up to 6% of the Participant’s Compensation and third to after-tax
contributions up to 6% of the Participant’s Compensation.

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     34. The third paragraph of Section 6.3 hereby is amended to insert the words “and designated
Roth contributions” immediately after the words “pre-tax contributions” each place they appear in
clause (a) thereof.

     35. The first paragraph of Section 8.1 hereby is amended to add the following new subsection
(b) thereto, and by renumbering all subsequent subsections thereof:

(b) if designated Roth contributions have been made for the benefit of a participant
pursuant to Section 4.1 on or after January 1, 2007, a Designated Roth Account to
which shall be credited such amounts and subsequent earnings and losses thereon;

     36. Section 8.2(c)(1) hereby is amended (i) to insert the words “designated Roth
contributions,” immediately after the words “pre-tax contributions,” appearing in the first
sentence thereof, (ii) to insert the words “, designated Roth contribution” immediately after the
words “pre-tax contribution” each place they appear in the second sentence thereof, (iii) to insert
the words “, designated Roth contribution” immediately after the words “pre-tax contribution”
appearing in the first clause of the third sentence thereof, (iv) to insert the words “, designated
Roth contributions” immediately after the words “pre-tax contributions” appearing in the second
clause of the third sentence thereof, (v) to insert the words “, designated Roth contribution”
immediately after the words “pre-tax contribution” appearing in the second clause of the third
sentence thereof, (vi) to insert the words “, designated Roth contribution” immediately after the
words “pre-tax contribution” appearing in the fourth sentence thereof and (vii) to insert the words
“, designated Roth contributions” immediately after the words “pre-tax contributions” appearing in
the last sentence thereof.

     37. Section 8.5 hereby is amended (i) to insert the words “designated Roth contribution,”
immediately after the words “pre-tax contribution,” appearing in the first sentence thereof, (ii)
to insert the words “Designated Roth Account,” immediately after the words “Pre-Tax Account,”
appearing in the first sentence thereof and (iii) to add the following new paragraph to the end
thereof to read as follows:

Notwithstanding any provision of this Article 8, any Designated Roth Account shall
be maintained in a manner that satisfies the separate accounting requirement, and
any Regulations or other requirements promulgated, under section 402A of the Code.
Accordingly, gains, losses and other credits and charges shall be separately
allocated on a reasonable basis to such account and other accounts under the Plan,
the Plan shall keep a record of each Participant’s designated Roth contributions
that have not been withdrawn, and contributions and withdrawals of designated Roth
contributions, and related earnings, shall be accounted for with respect to
Designated Roth Accounts. Forfeitures shall not be allocated to any Designated Roth
Account. These separate accounting requirements apply with respect to a Participant
from the time the Participant makes his or her first designated Roth contribution
until the time the Participant’s Designated Roth Account is distributed.

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     38. Section 9.1(b) hereby is amended to replace the phrase “(i) pre-tax contributions and (ii)
vested Profit Sharing Account” appearing in the first sentence thereof with the phrase “(i) pre-tax
contributions, (ii) designated Roth contributions and (iii) vested Profit Sharing Account”.

     39. Section 9.1(b)(6) hereby is amended in its entirety to read as follows:

(6) Amounts distributed to a Participant pursuant to this Section 9.1(b) shall be
withdrawn first from the Participant’s pre-tax contributions, second from the vested
portion of the Participant’s Profit Sharing Account and third from the Participant’s
designated Roth contributions and shall not be taken from the next source until the
previous source has been depleted.

     40. Section 9.1(b)(7) hereby is amended (i) to insert the words “, designated Roth
contributions” immediately after the words “pre-tax contributions” appearing in the first sentence
thereof and (ii) to insert the words “and designated Roth contributions” immediately after the
words “pre-tax contributions” appearing in the second sentence thereof.

     41. Section 9.2(b) hereby is amended to insert the words “Designated Roth Account,”
immediately after the words “Pre-Tax Account,” appearing in the first sentence thereof.

     42. Section 9.4 hereby is amended to insert the following clause immediately after the words
“Administrative Committee” appearing at the end thereof:

provided, however, that any such distribution that is from the Participant’s
Designated Roth Account will only be made to a Roth individual retirement account
described in section 408A of the Code, and only to the extent the rollover is
permitted by the rules of section 402(c) of the Code

     43. The last sentence of Section 9.6 hereby is amended in its entirety to read as follows:

Notwithstanding the foregoing, any portion of an eligible rollover distribution that
consists of (i) after-tax contributions which are not includible in gross income may
be transferred only to an individual retirement account or annuity described in
section 408(a) or (b) of the Code or to a qualified defined contribution plan
described in section 401(a) or 403(a) of the Code that agrees to account separately
for amounts so transferred and (ii) all or a portion of a Participant’s Designated
Roth Account may be transferred only to another designated Roth contributions
account under an applicable retirement plan described in section 402A(e)(1) of the
Code or to a Roth individual retirement account described in section 408A of the
Code, and only to the extent the rollover is permitted by the rules of section
402(c) of the Code.

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     44. Section 10.1 hereby is amended to insert the words “Designated Roth Account,” immediately
after the words “Pre-Tax Account,” appearing in the first sentence thereof.

     45. Section 10.1(c) hereby is amended to insert the words “Designated Roth Account,”
immediately after the words “Pre-Tax Account,” appearing therein.

     46. Section 11.5(a) hereby is amended (i) to insert the words “, Designated Roth” immediately
after the words “Pre-Tax” appearing in the section heading thereof, (ii) to insert the words “,
designated Roth” immediately after the words “pre-tax” appearing in the first sentence thereof and
(iii) to insert the words “, designated Roth” immediately after the words “pre-tax” appearing in
clause (2) thereof.

     47. Section 11.5(b) hereby is amended to insert the words “, designated Roth” immediately
after the words “pre-tax” appearing in the first sentence thereof.

     48. Effective as of the Effective Time (as defined in the Formation Agreement), the Plan
hereby is amended to add the attached Schedule B at the end thereof.

     APPROVED by the HARRIS CORPORATION EMPLOYEE BENEFITS COMMITTEE on this 20th day of
December, 2006.

	 	 	 	 	 
	 	 	 
	 	                                   /s/ John D. Gronda
 	 
	 	Secretary 	 
	 	 	 

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Schedule B

Transfer of MCD Employees to Harris Stratex Networks, Inc.

	1.	 	In General. Pursuant to transactions contemplated by a
Formation, Contribution and Merger Agreement between the Company and Stratex
Networks, Inc. dated September 5, 2006 (as such agreement may be amended from
time to time) (the “Formation Agreement”), MCD Employees (as defined in the
Formation Agreement) will cease to be employed by the Company generally
effective as of the Effective Time (as defined in the Formation Agreement).

	2.	 	Vesting. Effective as of the Effective Time, the
Account of any MCD Employee who is employed by the Company immediately prior to
the Effective Time (a “Transferring Employee”) shall be 100% vested and
nonforfeitable.

	3.	 	Profit Sharing Contribution. Effective as of the
Effective Time, any Transferring Employee who would not be an Eligible Profit
Sharing Participant for the Plan Year commencing on July 1, 2006 solely due to
his or her failure to be actively employed as an Eligible Employee as of June
30, 2007 shall be treated as an Eligible Profit Sharing Participant for
purposes of any profit sharing contribution allocation made pursuant to Section
4.3 of the Plan for such Plan Year, provided that such Transferring Employee
(a) is actively employed by Harris Stratex Networks, Inc. or an affiliate
thereof (“Harris Stratex”) as of June 30, 2007 or (b) ceases to be actively
employed by Harris Stratex prior to June 30, 2007 as a result of leave of
absence, Qualified Military Service, retirement on or after attainment of age
55, death, Disability or reduction in force.EX-10.1

 

Exhibit 10.1

Cumberland Bank

Endorsement Split Dollar Agreement

     This Endorsement Split Dollar Agreement (this “Agreement”) is entered into as of this
____ day of ______________, 200___ by and between
Cumberland Bank (the “Bank”), and ___, its
___ (the “Executive”). This
Agreement shall append the Split Dollar Policy Endorsement entered into on even date herewith or as
subsequently amended, by and between the aforementioned parties.

     Whereas, to encourage the Executive to remain a Bank employee, the Bank is willing to
divide the death proceeds of a life insurance policy or policies on the Executive’s life, and

     Whereas, the Bank will pay premiums on the life insurance policy or policies from the
Bank’s general assets.

     Now Therefore, in consideration of these premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Executive and the
Bank hereby agree as follows.

Article 1

General Definitions

     The following terms shall have the meanings specified —

     1.1 Administrator means the administrator described in Article 7.

     1.2 Executive’s Interest means the benefit set forth in Section 2.2(a).

     1.3 Insured means the Executive.

     1.4 Insurer means each life insurance carrier in which there is a Split Dollar Policy
Endorsement attached to this Agreement.

     1.5 Net Death Proceeds means the total death proceeds of the Policy minus the cash
surrender value.

     1.6 Policy means the specific life insurance policy or policies issued by the
Insurers.

     1.7 Split Dollar Policy Endorsement means the form required by the Administrator or
the Insurer to indicate the Executive’s interest, if any, in a Policy on such Executive’s life.

 

 

Article 2

Policy Ownership/Interests

     2.1 Bank Ownership. The Bank is the sole owner of the Policy and shall have the right
to exercise all incidents of ownership. The Bank shall be the beneficiary of the remaining death
proceeds of the Policy after the Executive’s Interest is paid according to Section 2.2 below.

     2.2 Death Benefit. (a) Executive’s Interest If the Policy Is Not Cancelled. The
Executive shall have the right to designate the beneficiary of the Executive’s Interest. Provided
the Policy is not cancelled, surrendered, terminated, or allowed to lapse and the Executive’s
employment with the Bank is terminated by reason of death, then the Executive’s beneficiary
designated in accordance with the Split Dollar Policy Endorsement
shall be entitled to ___% of the Net Death Proceeds (the “Executive’s Interest”).

          (b) If the Policy Is Cancelled. If the Policy is cancelled, surrendered, terminated, or
allowed to lapse, in any such case without replacement prior to the termination of Executive
employment with the Bank by reason of death, then no benefit is payable under this agreement.

     2.3 Option to Purchase. Upon termination of this Agreement, the Bank shall not sell,
surrender, or transfer ownership of the Policy without first giving the Executive or the
Executive’s transferee the option to purchase the Policy for a period of 60 days from written
notice of such intention. The purchase price shall be an amount equal to the cash surrender value
of the Policy.

     2.4 Comparable Coverage. The Bank may in its sole discretion replace the Policy with
a comparable insurance policy to cover the benefit provided under this Agreement, in which case the
Bank and the Executive shall execute a new Split Dollar Policy Endorsement for the comparable
insurance policy.

     2.5 Internal Revenue Code Section 1035 Exchanges. The Executive recognizes and agrees
that the Bank may after this Split Dollar Agreement is adopted wish to exchange the Policy of life
insurance on the Executive’s life for another contract of life insurance insuring the Executive’s
life. Provided that the Policy is replaced (or intended to be replaced) with a comparable policy
of life insurance, the Executive agrees to provide medical information and cooperate with medical
insurance-related testing required by a prospective insurer for implementing the Policy or, if
necessary, for modifying or updating to a comparable insurer.

Article 3

Premiums

     3.1 Premium Payment. The Bank shall pay any premiums due on the Policy.

 

 

     3.2 Economic Benefit. The Administrator shall determine the economic benefit
attributable to the Executive based on the life insurance premium factor for the Executive’s age
multiplied by the aggregate death benefit payable to the Executive’s Beneficiary. The life
insurance premium factor is the minimum amount required to be imputed under Internal Revenue
Service Regulations, section 1.61-22(d)(3)(ii), or any subsequent applicable authority.

     3.3 Imputed Income. The Bank shall impute the economic benefit to the Executive on an
annual basis by adding the economic benefit to the Executive’s Form W-2 or, if applicable, Form
1099.

Article 4

Assignment

     The Executive may irrevocably assign without consideration all of the Executive’s rights and
interest in this Agreement to any person, entity, or trust established by the Executive or the
Executive’s spouse, including but not limited to a life insurance trust. If the Executive
transfers all of the Executive’s rights and interest in this Agreement, then all of the Executive’s
rights and interest in the Agreement shall be vested in the Executive’s transferee, who shall be
substituted as a party hereunder and the Executive shall have no further interest in this
Agreement.

Article 5

Insurer

     The Insurer shall be bound only by the terms of the Policy. Any payments the Insurer makes or
actions it takes in accordance with the Policy shall fully discharge it from all claims, suits and
demands of all entities or persons. The Insurer shall not be bound by or be deemed to have notice
of the provisions of this Agreement.

Article 6

Claims and Review Procedures

     6.1 Claims Procedure. Any person or entity who has not received benefits under this
Agreement that he or she believes should be paid (the “claimant”) shall make a claim for such
benefits as follows —

     6.1.1 Initiation — Written Claim. The claimant initiates a claim by
submitting to the Administrator a written claim for the benefits.

     6.1.2 Timing of Administrator Response. The Administrator shall respond to
such claimant within 90 days after receiving the claim. If the Administrator determines
that special circumstances require additional time for processing the claim, the
Administrator can extend the response period by an additional 90 days by notifying the
claimant in writing, prior to the end of the initial 90-day period that an additional period
is required. The notice of extension must set forth the special circumstances and the date
by which the Administrator expects to render its decision.

     6.1.3 Notice of Decision. If the Administrator denies part or all of the
claim, the Administrator shall notify the claimant in writing of such denial. The
Administrator shall

 

 

  write the notification in a manner calculated to be understood by the claimant. The
notification shall set forth —

	 	(a)	 	The specific reasons for the denial,
	 
	 	(b)	 	A reference to the specific provisions of this Agreement on which the
denial is based,
	 
	 	(c)	 	A description of any additional information or material necessary for
the claimant to perfect the claim and an explanation of why it is needed,
	 
	 	(d)	 	An explanation of the Agreement’s review procedures and the time limits
applicable to such procedures, and
	 
	 	(e)	 	A statement of the claimant’s right to bring a civil action under ERISA
section 502(a) following an adverse benefit determination on review.

     6.2 Review Procedure. If the Administrator denies part or all of the claim, the
claimant shall have the opportunity for a full and fair review by the Administrator of the denial,
as follows —

     6.2.1 Initiation — Written Request. To initiate the review, the claimant,
within 60 days after receiving the Administrator’s notice of denial, must file with the
Administrator a written request for review.

     6.2.2 Additional Submissions — Information Access. The claimant shall then
have the opportunity to submit written comments, documents, records and other information
relating to the claim. The Administrator shall also provide the claimant, upon request and
free of charge, reasonable access to, and copies of, all documents, records and other
information relevant (as defined in applicable ERISA regulations) to the claimant’s claim
for benefits.

     6.2.3 Considerations on Review. In considering the review, the Administrator
shall take into account all materials and information the claimant submits relating to the
claim, without regard to whether such information was submitted or considered in the initial
benefit determination.

     6.2.4 Timing of Administrator Response. The Administrator shall respond in
writing to such claimant within 60 days after receiving the request for review. If the
Administrator determines that special circumstances require additional time for processing
the claim, the Administrator can extend the response period by an additional 60 days by
notifying the claimant in writing, prior to the end of the initial 60-day period, that an
additional period is required. The notice of extension must set forth the special
circumstances and the date by which the Administrator expects to render its decision.

     6.2.5 Notice of Decision. The Administrator shall notify the claimant in
writing of its decision on review. The Administrator shall write the notification in a
manner calculated to be understood by the claimant. The notification shall set forth —

	 	(a)	 	The specific reasons for the denial,
	 
	 	(b)	 	A reference to the specific provisions of the Agreement on which the
denial is based,
	 
	 	(c)	 	A statement that the claimant is entitled to receive, upon request and
free of charge, reasonable access to, and copies of, all documents, records and

 

 

	 		 	other information relevant (as defined in applicable ERISA regulations) to
the claimant’s claim for benefits, and

	 	(d)	 	A statement of the claimant’s right to bring a civil action under ERISA
section 502(a).

Article 7

Administration of Agreement

     7.1 Administrator Duties. This Agreement shall be administered by an Administrator,
which shall consist of the Bank’s board of directors or such committee or person(s) as the board
shall appoint. The Executive may be a member of the Administrator. The Administrator shall also
have the discretion and authority to (a) make, amend, interpret, and enforce all appropriate rules
and regulations for the administration of this Agreement and (b) decide or resolve any and all
questions, including interpretations of this Agreement, as may arise in connection with the
Agreement.

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

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

     7.4 Indemnity of Administrator. The Bank shall indemnify and hold harmless the
members of the Administrator against any and all claims, losses, damages, expenses, or liabilities
arising from any action or failure to act with respect to this Agreement, except in the case of
willful misconduct by the Administrator or any of its members.

     7.5 Information. To enable the Administrator to perform its functions, the Bank shall
supply full and timely information to the Administrator on all matters relating to the date and
circumstances of the retirement, death, or Separation from Service of the Executive and such other
pertinent information as the Administrator may reasonably require.

Article 8

Miscellaneous

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

     8.2 Amendment and Termination of Agreement. This Agreement may be amended solely by a
written agreement signed by the Bank and the Executive. This Agreement shall terminate upon
distribution of death benefits in accordance with Section 2.2 above or upon the cancellation,
surrender, termination or lapsing of the Policy.

     8.3 Successors; Binding Agreement. By an assumption agreement in form and substance
satisfactory to the Executive, the Bank shall require any successor (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to all or substantially all of the

 

 

business or assets of the Bank to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Bank would be required to perform this Agreement.

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

     8.5 Applicable Law. This Agreement and all rights hereunder shall be governed by and
construed according to the laws of the State of Tennessee except to the extent preempted by the
laws of the United States of America.

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

     8.7 Severability. If for any reason any provision of this Agreement is held invalid,
such invalidity shall not affect any other provision of this Agreement not held invalid, and each
such other provision shall continue in full force and effect to the full extent consistent with
law. If any provision of this Agreement is held invalid in part, such invalidity shall not affect
the remainder of the provision not held invalid, and the remainder of the provision together with
all other provisions of this Agreement shall continue in full force and effect to the full extent
consistent with law.

     8.8 Headings. Caption headings and subheadings herein are included solely for
convenience of reference and shall not affect the meaning or interpretation of any provision of
this Agreement.

     8.9 Notices. All notices, requests, demands, and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified
or registered mail, return receipt requested, with postage prepaid, to the following addresses or
to such other address as either party may designate by like notice. Unless otherwise changed by
notice, notice shall be properly addressed to the Executive if addressed to the address of the
Executive on the books and records of the Bank at the time of the delivery of such notice, and
properly addressed to the Bank if addressed to the ___.

     In Witness Whereof, the Executive and a duly authorized representative of the Bank
have executed this Agreement as of the date first written above.

	 	 	 
	Executive:	 	
Bank:
	 	 	
By:
	 

 
	 	
 

 

Its:

 

 

Split Dollar Policy Endorsement

	 	 	 
	Insured:

	 	Insurer:
	Policy No.
	 	 

     Pursuant
to the terms of Cumberland Bank Endorsement Split Dollar Agreement
dated as of ____________, 200___, the undersigned Owner requests that the above-referenced
policy issued by the Insurer provides for the following beneficiary designation and limited
contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its
successors or assigns, to the extent of its interest in the policy. It is hereby provided that the
Insurer may rely solely upon a statement from the Owner as to the amount of proceeds it is entitled
to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions
of the preceding paragraph shall be paid in one sum to:

Primary Beneficiary, Relationship/Social Security Number

Contingent Beneficiary, Relationship/Social Security Number

The exclusive right to change the beneficiary for the proceeds payable under this paragraph,
to elect any optional method of settlement for the proceeds paid under this paragraph which are
available under the terms of the policy and to assign all rights and interests granted under this
paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient
to exercise said rights. The Owner retains all contract rights not granted to the Insured under
this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights
shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the
Insurer, and such discharge shall be binding on all parties claiming any interest under the policy.

     The undersigned for the Owner is signing in a representative capacity and warrants that he or
she has the authority to bind the entity on whose behalf this document is being executed.

     Signed
at ___, ___, this ___ day of ___, 200___.

	 	 	 
	Insured:	 	
Owner: Cumberland Bank
	 	 	
By:
	 

 
	 	
 

 

Its:

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