MFB FINANCIAL
EXECUTIVE GROUP LIFE PLAN
Pursuant to due authorization by its Board of Directors, the
undersigned, MFB FINANCIAL, a savings association located in Mishawaka, Indiana
(the "Bank"), did constitute, establish and adopt the following EXECUTIVE GROUP
LIFE PLAN (the "Plan"), effective September 18, 2007.
The purpose of this Plan is to attract, retain, and reward Employees,
by dividing the death proceeds of certain life insurance policies which are
owned by the Bank on the lives of the participating Employees with the
designated beneficiary of each insured participating Employee. The Bank will pay
the life insurance premiums due under this Plan from its general assets.
Article 1
Definitions
Whenever used in this Plan, the following terms shall have the meanings
specified:
1.1 "Bank's Interest" means the benefit set forth in Section 3.1.
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1.2 "Beneficiary" means each designated person, or the estate of a deceased
Participant, entitled to benefits, if any, upon the death of a
Participant.
1.3 "Beneficiary Designation Form" means the form established from time to
time by the Plan Administrator that a Participant completes, signs and
returns to the Plan Administrator to designate one or more
Beneficiaries.
1.4 "Board" means the Board of Directors of the Bank as from time to time
constituted.
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1.5 "Code" means the Internal Revenue Code of 1986, as amended.
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1.6 "Election Form" means the form required by the Plan Administrator of an
eligible Employee to indicate acceptance of participation in this Plan.
1.7 "Employee" means an active employee of the Bank.
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1.8 "Insured" means the individual Participant whose life is insured.
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1.9 "Insurer" means the insurance company issuing the Policy on the life of
the Insured.
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1.10 "Net Death Proceeds" means the total death proceeds of the
Participant's Policy or Policies minus the greater of (i) cash
surrender value or (ii) the aggregate premiums paid.
1.11 "Participant" means an Employee (i) who is selected to participate in
the Plan, (ii) who elects to participate in the Plan, (iii) who signs
an Election Form and a Beneficiary Designation Form, (iv) whose signed
Election Form and Beneficiary Designation Form are accepted by the Plan
Administrator, (v) who commences participation in the Plan, and (vi)
whose Participation has not terminated.
1.12 "Participant's Interest" means the benefit set forth in Section 3.2.
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1.13 "Plan Administrator" means the plan administrator described in
Article 12.
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1.14 "Policy" or "Policies" means the individual life insurance policy or
policies adopted by the Plan Administrator for purposes of insuring a
Participant's life under this Plan.
1.15 "Separation from Service" means termination of the Participant's
employment with the Bank for reasons other than death. Whether a
termination of employment has occurred is determined based on whether
the facts and circumstances indicate that the Bank and the Participant
reasonably anticipated that no further services would be performed
after a certain date or that the level of bona fide services the
Participant would perform after such date (whether as an employee or as
an independent contractor) would permanently decrease to no more than
twenty percent (20%) of the average level of bona fide services
performed (whether as an employee or an independent contractor) over
the immediately preceding thirty-six (36) month period (or the full
period of services to the Bank if the Participant has been providing
services to the Bank less than thirty-six (36) months).
Article 2
Participation
2.1 Selection by Plan Administrator. Participation in the Plan shall be
limited to those Employees of the
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Bank selected by the Plan Administrator, in its sole discretion, to
participate in the Plan.
2.2 Enrollment Requirements. As a condition to participation, each selected
Employee shall complete, execute and return to the Plan Administrator
(i) an Election Form, and (ii) a Beneficiary Designation Form. In
addition, the Plan Administrator shall establish from time to time such
other enrollment requirements as it determines in its sole discretion
are necessary.
2.3 Eligibility; Commencement of Participation. Provided an Employee
selected to participate in the Plan has met all enrollment requirements
set forth in this Plan and required by the Plan Administrator, and
provided that the Policy or Policies on a such Employee have been
issued by the Insurer(s), that Employee will become a Participant, be
covered by the Plan and will be eligible to receive benefits at the
time and in the manner provided hereunder, subject to the provisions of
the Plan. A Participant's participation is limited to only issued
Policies where the Participant is the Insured.
2.4 Termination of Participation. A Participant's rights under this Plan
shall automatically cease and his or her participation in this Plan
shall automatically terminate if the Plan or any Participant's rights
under the Plan are terminated in accordance with Section 3.1, 6.1, or
Article 11. In the event that the Bank decides to maintain the Policy
after the Participant's termination of participation in the Plan, the
Bank shall be the direct beneficiary of the entire death proceeds of
the Policy.
Article 3
Policy Ownership/Interests
3.1 Bank's Interest. The Bank shall own the Policies and shall have the
right to exercise all incidents of ownership and, subject to Article 6,
the Bank may terminate a Policy without the consent of the Insured. The
Bank shall be the beneficiary of the remaining death proceeds of the
Policies after the Participant's Interest is determined according to
Section 3.2.
3.2 Participant's Interest. The Participant, or the Participant's assignee,
shall have the right to designate the Beneficiary of an amount of death
proceeds as specified in Section 3.2.1. The Participant shall also have
the right to elect and change settlement options with respect to the
Participant's Interest by providing written notice to the Bank and the
Insurer.
3.2.1 Death Prior to Separation from Service. If the Participant
dies prior to Separation from Service, the Participant's
Beneficiary shall be entitled to a benefit equal to One
Hundred Thousand Dollars ($100,000), provided that such
benefit shall not exceed the Net Death Proceeds.
3.2.2 Death After Separation from Service. If the Participant dies
after Separation from Service, the Participant's Beneficiary
will not be entitled to a benefit under this Plan.
Article 4
Premiums And Imputed Income
4.1 Premium Payment. The Bank shall pay all premiums due on all Policies.
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4.2 Economic Benefit. The Plan Administrator shall determine the economic
benefit attributable to any Participant based on the life insurance
premium factor for the Participant's age multiplied by the aggregate
death benefit payable to the Participant's Beneficiary. The "life
insurance premium factor" is the minimum amount required to be imputed
under IRS Reg. ss.1.61-22(d)(3)(ii) or any subsequent applicable
authority.
4.3 Imputed Income. The Bank shall impute the economic benefit to the
Participant on an annual basis, by adding the economic benefit to the
Participant's W-2, or if applicable, Form 1099.
Article 5
Comparable Coverage
5.1 Insurance Policies. The Bank may provide such benefit through the
Policies purchased at the commencement of this Plan, or, if later, the
Participant's commencement of participation in the Plan, or may provide
comparable insurance coverage to the Participant through whatever means
the Bank deems appropriate. If the Participant waives or forfeits his
or her right to the insurance benefit, the Bank shall choose to cancel
the Policy or Policies on the Participant, or may continue such
coverage and become the direct beneficiary of the entire death
proceeds.
5.2 Offer to Purchase. If the Bank discontinues a Policy on a Participant
who is employed by the Bank at the date of discontinuance, the Bank
shall give the Participant at least thirty (30) days to purchase such
Policy. The purchase price shall be the fair market value of the
Policy, as determined under Treasury Reg. ss.1.61-22(g)(2) or any
subsequent applicable authority. Such notification shall be in writing.
Article 6
General Limitations
6.1 Termination for Cause. Notwithstanding any provision of this Plan to
the contrary, the Participant shall forfeit any right to a benefit
under this Plan if the Bank terminates the Participant's employment for
cause. Termination of the Participant's employment for "Cause" shall
mean termination because of personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any
law, rule or regulation (other than traffic violations or similar
offenses) or final cease-and-desist order or material breach of any
provision of the Plan. For purposes of this paragraph, no act or
failure to act on the Participant's part shall be considered "willful"
unless done, or omitted to be done, by the Participant not in good
faith and without reasonable belief that the Participant's action or
omission was in the best interest of the Bank.
6.2 Removal. Notwithstanding any provision of this Plan to the contrary,
the Participant's rights in the Plan shall terminate if the Participant
is subject to a final removal or prohibition order issued by an
appropriate federal banking agency pursuant to Section 8(e) of the
Federal Deposit Insurance Act ("FDIA").
6.3 Suicide or Misstatement. No benefits shall be payable if the
Participant commits suicide within two years after the date of this
Plan, or if the insurance company denies coverage (i) for material
misstatements of fact made by the Participant on any application for
life insurance purchased by the Bank, or (ii) for any other reason;
provided, however that the Bank shall evaluate the reason for the
denial, and upon advice of legal counsel and in its sole discretion,
consider judicially challenging any denial.
Article 7
Beneficiaries
7.1 Beneficiary. Each Participant shall have the right, at any time, to
designate a Beneficiary to receive any benefits payable under the Plan
upon the death of a Participant. The Beneficiary designated under this
Plan may be the same as or different from the beneficiary designated
under any other plan of the Bank in which the Participant participates.
7.2 Beneficiary Designation; Change; Spousal Consent. A Participant shall
designate a Beneficiary by completing and signing the Beneficiary
Designation Form, and delivering it to the Plan Administrator or its
designated agent. If the Participant names someone other than his or
her spouse as a Beneficiary, a spousal consent, in the form designated
by the Plan Administrator, must be signed by the Participant's spouse
and returned to the Plan Administrator. The Participant's beneficiary
designation shall be deemed automatically revoked if the Beneficiary
predeceases the Participant or if the Participant names a spouse as
Beneficiary and the marriage is subsequently dissolved. A Participant
shall have the right to change a Beneficiary by completing, signing and
otherwise complying with the terms of the Beneficiary Designation Form
and the Plan Administrator's rules and procedures, as in effect from
time to time. Upon the acceptance by the Plan Administrator of a new
Beneficiary Designation Form, all Beneficiary designations previously
filed shall be cancelled. The Plan Administrator shall be entitled to
rely on the last Beneficiary Designation Form filed by the Participant
and accepted by the Plan Administrator prior to the Participant's
death.
7.3 Acknowledgment. No designation or change in designation of a
Beneficiary shall be effective until received, accepted and
acknowledged in writing by the Plan Administrator or its designated
agent.
7.4 No Beneficiary Designation. If the Participant dies without a valid
designation of beneficiary, or if all designated Beneficiaries
predecease the Participant, then the Participant's surviving spouse
shall be the designated Beneficiary. If the Participant has no
surviving spouse, the benefits shall be made payable to the personal
representative of the Participant's estate.
7.5 Facility of Payment. If the Plan Administrator determines in its
discretion that a benefit is to be paid to a minor, to a person
declared incompetent, or to a person incapable of handling the
disposition of that person's property, the Plan Administrator may
direct payment of such benefit to the guardian, legal representative or
person having the care or custody of such minor, incompetent person or
incapable person. The Plan Administrator may require proof of
incompetence, minority or guardianship as it may deem appropriate prior
to distribution of the benefit. Any payment of a benefit shall be a
payment for the account of the Participant and the Participant's
Beneficiary, as the case may be, and shall be a complete discharge of
any liability under the Plan for such payment amount.
Article 8
Assignment
Participant may assign without consideration all of such Participant's
Interest in this Plan to any person, entity or trust. In the event a Participant
shall transfer all of such Participant's Interest, then all of that
Participant's Interest in this Plan shall be vested in his or her transferee,
subject to such transferee executing agreements binding them to the provisions
of this Plan, who shall be substituted as a party hereunder, and that
Participant shall have no further interest in this Plan.
Article 9
Insurer
The Insurer shall be bound only by the terms of its given Policy. The
Insurer shall not be bound by or deemed to have notice of the provisions of this
Plan. The Insurer shall have the right to rely on the Plan Administrator's
representations with regard to any definitions, interpretations or Policy
interests as specified under this Plan.
Article 10
Claims And Review Procedure
10.1 Claims Procedure. A Participant or Beneficiary ("claimant") who
has not received benefits under the
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Plan that he or she believes should be paid shall make a claim for such
benefits as follows:
10.1.1 Initiation - Written Claim. The claimant initiates a claim by
submitting to the Plan Administrator a written claim for the
benefits. If such a claim relates to the contents of a notice
received by the claimant, the claim must be made within sixty
(60) days after such notice was received by the claimant. All
other claims must be made within one hundred eighty (180) days
of the date on which the event that caused the claim to arise
occurred. The claim must state with particularity the
determination desired by the claimant.
10.1.2 Timing of Plan Administrator Response. The Plan Administrator
shall respond to such claimant within 90 days after receiving
the claim. If the Plan Administrator determines that special
circumstances require additional time for processing the
claim, the Plan 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
Plan Administrator expects to render its decision.
10.1.3 Notice of Decision. If the Plan Administrator denies part or
all of the claim, the Plan Administrator shall notify the
claimant in writing of such denial. The Plan 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 Plan 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 Plan'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.
10.2 Review Procedure. If the Plan Administrator denies part or all of the
claim, the claimant shall have the opportunity for a full and fair
review by the Plan Administrator of the denial, as follows:
10.2.1 Initiation - Written Request. To initiate the review, the
claimant, within 60 days after receiving the Plan
Administrator's notice of denial, must file with the Plan
Administrator a written request for review.
10.2.2 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 Plan 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.
10.2.3 Considerations on Review. In considering the review, the Plan
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.
10.2.4 Timing of Plan Administrator's Response. The Plan
Administrator shall respond in writing to such claimant within
60 days after receiving the request for review. If the Plan
Administrator determines that special circumstances require
additional time for processing the claim, the Plan
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 Plan Administrator
expects to render its decision.
10.2.5 Notice of Decision. The Plan Administrator shall notify the
claimant in writing of its decision on review. The Plan
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 Plan 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 11
Amendments And Termination
The Bank may amend or terminate the Plan at any time, or may amend or
terminate a Participant's rights under the Plan at any time prior to a
Participant's death, by providing written notice of such to the Participant. In
the event that the Bank decides to maintain the Policy after the Participant's
termination of participation in the Plan, the Bank shall be the direct
beneficiary of the entire death proceeds of the Policy.
Article 12
Administration
12.1 Plan Administrator Duties. This Plan shall be administered by a Plan
Administrator which shall consist of the Board, or such committee or
persons as the Board may choose. The Plan Administrator shall also have
the discretion and authority to (i) make, amend, interpret and enforce
all appropriate rules and regulations for the administration of this
Plan and (ii) decide or resolve any and all questions including
interpretations of this Plan, as may arise in connection with the Plan.
12.2 Agents. In the administration of this Plan, the Plan 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.
12.3 Binding Effect of Decisions. The decision or action of the Plan
Administrator with respect to any question arising out of or in
connection with the administration, interpretation and application of
the Plan and the rules and regulations promulgated hereunder shall be
final and conclusive and binding upon all persons having any interest
in the Plan.
12.4 Indemnity of Plan Administrator. The Bank shall indemnify and hold
harmless the members of the Plan Administrator against any and all
claims, losses, damages, expenses or liabilities arising from any
action or failure to act with respect to this Plan, except in the case
of willful misconduct by the Plan Administrator or any of its members.
12.5 Information. To enable the Plan Administrator to perform its functions,
the Bank shall supply full and timely information to the Plan
Administrator on all matters relating to the its Participants, the date
and circumstances of the retirement or Separation from Service of its
Participants, and such other pertinent information as the Plan
Administrator may reasonably require.
Article 13
Miscellaneous
13.1 Binding Effect. This Plan shall bind each Participant and the Bank,
their beneficiaries, survivors,
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executors, administrators and transferees and any Beneficiary.
13.2 No Guarantee of Employment. This Plan is not an employment policy or
contract. It does not give a Participant the right to remain an
Employee of the Bank, nor does it interfere with the Bank's right to
discharge a Participant. It also does not require a Participant to
remain an Employee nor interfere with a Participant's right to
terminate employment at any time.
13.3 Applicable Law. The Plan and all rights hereunder shall be governed by
and construed according to the laws of the State of Indiana, except to
the extent preempted by the laws of the United States of America.
13.4 Notice. Any notice or filing required or permitted to be given to the
Plan Administrator under this Plan shall be sufficient if in writing
and hand-delivered, or sent by registered or certified mail, to the
address below:
Plan Administrator of Executive Group Life Plan
MFB Financial
4100 Edison Lakes Parkway, Suite 300
P.O. Box 528 Mishawaka, IN 46546-0528
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark or the
receipt for registration or certification.
Any notice or filing required or permitted to be given to a Participant
under this Plan shall be sufficient if in writing and hand-delivered,
or sent by mail, to the last known address of the Participant.
13.6 Entire Agreement. This Plan, along with a Participant's Election Form,
Beneficiary Designation Form and any agreement in writing between the
Bank and any Participant, constitute the entire agreement between the
Bank and the Participant as to the subject matter hereof. No rights are
granted to the Participant under this Plan other than those
specifically set forth herein.
IN WITNESS WHEREOF, the Bank executes this Plan as of the date indicated
above.
MFB FINANCIAL
By ______________________________________
Charles J. Viater, President
INDS01 CVS 978435v3