EXHIBIT 10.8
Death Benefits Agreement between NBT Bancorp Inc.,
NBT Bank, National Association
and Daryl R. Forsythe made August 22, 1995.
DEATH BENEFITS AGREEMENT
THIS AGREEMENT, made and entered into this 22nd day of August, 1995, by and
among NBT Bancorp Inc., a Delaware corporation and registered bank holding
company, and NBT Bank, National Association, a national banking association
organized under the laws of the United States (hereinafter referred to
collectively as the "Bank") and Daryl R. Forsythe, an individual residing at 13
Concord Street, Sidney, New York, NY 13838 (hereinafter referred to as the
"Employee").
WHEREAS, the Bank has retained the Employee as its president and chief executive
officer; and
WHEREAS, the Bank is desirous of retaining the services of the Employee; and
WHEREAS, the Bank is desirous of assisting the Employee in carrying life
insurance on his life; and
WHEREAS, the Bank has determined that its interests can best be served under a
"split-dollar" arrangement; and
WHEREAS, the Bank and the Employee have applied for Insurance Policy No. 8876212
(the "Policy") issued by the New England Mutual Life Insurance Company ("The New
England") in the face amount of $800,000 on the Employee's life; and
WHEREAS, the Bank and the Employee agree to make said insurance policy subject
to this split-dollar agreement; and
WHEREAS, it is now understood and agreed that this split-dollar agreement is to
be effective as of the date on which the Policy was issued by The New England.
NOW, THEREFORE, for value received and in consideration of the mutual covenants
contained herein, the parties agree as follows:
ARTICLE I - DEFINITIONS
For purposes of this Agreement, the following terms will have the meanings set
forth below:
1. "Cash Surrender Value of the Policy" will mean the Cash Value of the
Policy, plus the cash value of any paid-up additions, plus any dividend
accumulations and unpaid dividends, and less any Policy Loan Balance.
2. "Cash Value of the Policy" will mean the cash value as illustrated in the
table of values shown in the Policy.
3. "Bank's Interest in the Policy" will be defined in Article VII.
4. "Current Loan Value of the Policy" will mean the Loan Value of the Policy
reduced by any outstanding Policy Loan Balance.
5. "Loan Value of the Policy" will mean the amount which together with loan
interest will equal the Cash Value of the Policy and of any paid-up
additions on the next loan interest due date or on the next premium due
date, whichever is the smaller amount.
6. "Policy Loan Balance" at any time will mean policy loans outstanding plus
interest accrued to date.
ARTICLE II - ALLOCATION OF PREMIUMS
The Bank will pay all premiums on the Policy when due.
ARTICLE III - WAIVER OF PREMIUMS RIDER
The Bank has added a rider to the Policy providing for the waiver of premiums in
the event of the Employee's disability. Any additional premium attributable to
such rider will be payable by the Bank.
ARTICLE IV - OTHER RIDERS AND SUPPLEMENTAL AGREEMENTS
Should the parties to this Agreement deem it desirable, the Bank will add to
the Policy one or more of such other riders and supplemental agreements which
may be available from The New England from time to time. Any additional premium
attributable to any such rider or supplemental agreement will be payable by the
Bank. Notwithstanding the provisions of Article VIII, any additional death
benefits provided by such rider or supplemental agreement will be paid to the
Bank, unless otherwise agreed to by the parties at the time of the adoption of
the particular rider or supplemental agreement.
ARTICLE V - PAYMENT OF PREMIUMS
Any premium or portion thereof which is payable by the Employee under any
Article of this Agreement may at the election of the Employee be deducted from
the cash compensation otherwise payable to him, and the Bank agrees to transmit
that premium or portion, along with any premium or portion thereof payable by
it, to The New England on or before the premium due date.
ARTICLE VI - APPLICATION OF POLICY DIVIDENDS
All dividends attributable to the Policy will be to provide paid-up additional
insurance.
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ARTICLE VII - RIGHTS IN THE POLICY
The Employee will have the sole right to designate the beneficiary of the death
proceeds of the Policy in excess of the Bank's Interest in the Policy. The Bank
will have and may exercise, except as limited hereinafter, all ownership rights
in the Policy. The Bank will not surrender the policy for cancellation except
upon expiration of the thirty (30) day period described in Article X. The Bank
will not without the written consent of the Employee assign its rights in the
Policy, other than for the purposes of obtaining a loan against the Policy, to
anyone other than the Employee. The Bank will not take any action dealing with
The New England that would impair any right or interest of the Employee in the
Policy. The Bank will have the right to borrow from The New England and to
secure that loan by the Policy, an amount which, together with the unpaid
interest accrued thereon, will at no time exceed the lesser of (a) the Bank's
Interest in the Policy or (b) the Loan Value of the Policy. "Bank's Interest in
the Policy" will mean, at any time at which the value of such interest is to be
determined under this Agreement, the Cash Surrender Value of the Policy at such
time.
ARTICLE VIII - RIGHTS TO THE PROCEEDS AT DEATH
In the event of the Employee's death while this Agreement is in force, the
beneficiary designated by the Employee will receive $600,000 from the Policy
proceeds. The Bank will receive the remainder of the Policy proceeds.
ARTICLE IX - TERMINATION OF AGREEMENT
1. This Agreement may be terminated at any time while the Employee is living
by written notice thereof by either the Bank or the Employee to the other;
and, in any event, this Agreement will terminate upon termination of the
Employee's employment.
2. In the event of the Employee's total disability, as defined in the rider,
which begins while the Employee is employed, while the rider is in force,
and which continues for at least six months, the benefits provided under
this Agreement will continue until midnight before the Employee's 65th
birthday. If at any time following the initial six month period of
disability as defined in the rider The New England stops waiving premiums,
then Section 1 of this Article will again be applicable.
ARTICLE X - EMPLOYEE RIGHTS UPON TERMINATION
Upon termination of the Agreement, the Employee will transfer all of his right,
title and interest in the Policy to the Bank, by executing such documents as are
necessary to transfer such right, title and interest as of the date of
termination. The Bank will thereafter be able to deal with the Policy in any way
it may see fit.
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ARTICLE XI - PLAN MANAGEMENT
For purposes of the Employee Retirement Income Security Act of 1974 ("ERISA"),
the Bank will be the "Named Fiduciary" and "Plan Administrator" of the split
dollar life insurance plan (the "Plan") for which this Agreement is hereby
designated the written plan instrument. The Bank's board of directors may
authorize a person or group of persons to fulfill the responsibilities of the
Bank as Plan Administrator. The Named Fiduciary or the Plan Administrator may
employ others to render advice with regard to its responsibilities under this
Plan. The Named Fiduciary may also allocate fiduciary responsibilities to others
and may exercise any other powers necessary for the discharge of its duties to
the extent not in conflict with ERISA.
ARTICLE XII - CLAIMS PROCEDURE
1. Filing Claims: Any insured, beneficiary or other individual (hereinafter
"Claimant") entitled to benefits under the Plan or under the Policy will
file a claim request with the Plan Administrator with respect to benefits
under the Plan with The New England with respect to benefits under the
Policy. The Plan Administrator will, upon written request of the Claimant,
make available copies of any claim forms or instructions provided by The
New England or advise the Claimant where such forms or instructions may be
obtained.
2. Notification to Claimant: If a claim is wholly or partially denied, the
Plan Administrator will furnish to the Claimant a notice of the decision
within ninety (90) days in writing and in a manner calculated to be
understood by the Claimant, which notice will contain the following
information:
(a) The specific reason or reasons for the denial;
(b) Specific reference to pertinent Plan provisions upon 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 Plan's claims review procedure describing
the steps to be taken by a Claimant who wishes to submit his claim
for review.
In the case of benefits which are provided under the Policy, the initial
decision on the claims will be make by The New England.
3. Review Procedure: A Claimant or his authorized representative may with
respect to any denied claim:
(a) Request a review upon written application filed within sixty (60) days
after receipt by the Claimant of written notice of the denial of his
claim;
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(b) Review pertinent documents; and
(c) Submit issues and comments in writing.
Any request or submission will be in writing and will be directed to the Named
Fiduciary (or its designee). The Named Fiduciary (or its designee) will have the
sole responsibility for the review of any denied claim and will take all steps
appropriate in the light of its findings.
4. Decision on Review: The Named Fiduciary (or its designee). The Named
Fiduciary (or its designee) will render a decision upon review. If special
circumstances (such as the need to hold a hearing or any matter pertaining to
the denied claim) warrant additional time, the decision will be rendered as soon
as possible, but not later than one hundred twenty (120) days after receipt of
the request for review. Written notice of any such extension will be furnished
to the Claimant prior to the commencement of the extension. The decision on
review will be in writing and will include specific reasons for the decision,
written in a manner calculated to be understood by the Claimant, as well as
specific references to the pertinent provisions of the Plan on which the
decision is based. If the decision on review is not furnished to the Claimant
with the time limits prescribed above, the claim will be deemed denied on
review.
ARTICLE XIII - SATISFACTION OF CLAIM
The Employee agrees that his rights and interests, and the rights and interests
of any persons taking under or through him, will be completely satisfied upon
compliance by the Bank with the provisions of this Agreement.
ARTICLE XIV - AMENDMENT AND ASSIGNMENT
This Agreement may be altered, amended or modified, including the addition of
any extra policy provisions, by a written instrument signed by the Bank and the
Employee. Either party may, subject to the limitations of Article VII, assign
its interests and obligations under this Agreement, provided, however, that any
assignment will be subject to the terms of this Agreement.
ARTICLE XV - POSSESSION OF POLICY
The Bank will keep possession of the Policy. The Bank agrees from time to time
to make the Policy available to the Employee or to The New England for the
purpose of endorsing or filing any change of beneficiary on the Policy for that
portion of the death proceeds in excess of the Bank's Interest in the Policy as
provided in Article VII, but the Policy will promptly be returned to the Bank.
ARTICLE XVI - GOVERNING LAW
This Agreement sets forth the entire agreement of the parties hereto, and any
and all prior agreements, to the extent inconsistent herewith, are hereby
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superseded. This Agreement will be governed by the laws of the State of New
York.
ARTICLE XVII - INTERPRETATION
Where appropriate in this Agreement, words used in the singular will include the
plural and words used in the masculine will include the feminine.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals, the
Bank by its duly authorized officer, on the day and year first written above.
EMPLOYEE
/s/Daryl R. Forsythe (L.S.)
Daryl R. Forsythe
NBT Bancorp Inc.
/s/Everett A. Gilmour (L.S.)
By
Its Chairman of Board
NBT Bank, National Association
/s/Paul O. Stillman (L.S.)
By
Its Compensation Committee Chairman
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