UNION CENTER NATIONAL BANK
DIRECTORS' RETIREMENT PLAN
TABLE OF CONTENTS
ARTICLE 1 - PURPOSE AND SCOPE
1.1 ESTABLISHMENT ....................................................... 1
1.2 PURPOSE ............................................................. 1
1.3 APPLICATION OF THE PLAN ............................................. 1
1.4 SCOPE ............................................................... 1
ARTICLE II - DEFINITIONS ................................................... 1
ARTICLE III - PARTICIPATION
3.1 ELIGIBILITY FOR PARTICIPATION ....................................... 3
3.2 DURATION OF PARTICIPATION ........................................... 3
ARTICLE IV - BENEFITS
4.1 ELIGIBILITY TO RECEIVE BENEFITS ..................................... 3
4.2 AMOUNT AND FORM OF BENEFIT .......................................... 3
4.3 FORFEITURE FOR CAUSE ................................................ 3
ARTICLE V - ADMINISTRATION
5.1 DUTIES OF THE COMMITTEE ............................................. 4
5.2 LIABILITIES OF THE COMMITTEE ........................................ 4
5.3 EXPENSES ............................................................ 4
5.4 UNFUNDED CHARACTER OF THE PLAN ...................................... 4
ARTICLE VI - AMENDMENT AND TERMINATION
6.1 AMENDMENT AND TERMINATION ........................................... 4
6.2 PRESERVATION OF BENEFITS ON
TERMINATION OR AMENDMENT ............................................ 5
6.3 DISTRIBUTION OF BENEFITS ON TERMINATION ............................. 5
ARTICLE VII - MISCELLANEOUS PROVISIONS
7.1 NO RIGHT TO CONTINUED EMPLOYMENT .................................... 5
7.2 CONSTRUCTION OF LANGUAGE ............................................ 5
7.3 NON-ALIENATION OF BENEFITS .......................................... 5
7.4 SEPARABILITY ........................................................ 5
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7.5 AUTHORIZED OFFICERS ................................................. 6
7.6 CONSTRUCTION ........................................................ 6
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ARTICLE I - PURPOSE AND SCOPE
1.1 ESTABLISHMENT
Union Center National Bank hereby establishes effective as of July 1, 1998 an
unfunded retirement plan for its eligible Directors and their beneficiaries as
described herein which shall be known as the "Union Center National Bank
Directors' Retirement Plan."
1.2 PURPOSE
The purpose of this Plan is to provide benefits for eligible Directors of the
Bank in recognition of their service to the Bank.
1.3 APPLICATION OF THE PLAN
The terms of the Plan are applicable only to eligible Directors who serve on the
Board of Directors of the Bank on or after July 1, 1998. Any Director who
retired or whose relationship as Director with the Bank was otherwise terminated
prior to such date shall not be eligible to participate in the Plan.
1.4 SCOPE
This Plan is designed to provide Directors of the Bank certain retirement
benefits. Nothing herein contained, and no action taken pursuant to the
provisions of this Plan, shall create or be construed to create a fiduciary
relationship between the Bank and any Director of the Bank, their surviving
spouse or dependents, their estate or their beneficiaries or any other person.
Any reserves or liabilities set upon the Bank's books of account with respect to
any benefits to be paid under this Plan shall continue for all purposes to be a
part of the general funds or assets of the Bank. To the extent that any person
acquires right to receive payments from the Bank under this Plan, such right
shall be no greater than the right of any unsecured general creditor of the
Bank.
ARTICLE II - DEFINITIONS
2.1 "BOARD" means the Board of Directors of the Bank,
2.2 "CODE" means the Internal Revenue Code of 1986, as amended.
2.3 "COMMITTEE" means such person, committee or entity as shall be designated by
the Board to perform the duties set forth in Article V; provided, however, that
if no such person, committee or entity is designated by the Board, then the
Board shall serve as the Committee.
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2.4 "BANK" means Union Center National Bank, a national bank chartered under the
laws of Congress, and its successors and assigns whether by merger,
consolidation, sale of assets, statutory receivership, operation of law or
otherwise.
2.5 "DIRECTOR" means any individual who serves as a director of the Board on or
after the Effective Date.
2.6 "INSIDE DIRECTOR" means a Director who also serves as an employee or officer
of the Bank.
2.7 "EFFECTIVE DATE" means July 1, 1998.
2.8 "OUTSIDE DIRECTOR" means a Director who is not an Inside Director.
2.9 "PARTICIPANT" means any Director who is participating in the Plan in
accordance with its terms.
2.10 "PLAN" means the Union Center National Bank Directors' Retirement Plan.
2.11 "NORMAL RETIREMENT DATE" means with respect to a Director, the first day of
the calendar month following the Director's Termination of Service occurring
after (1) May 1, 2000, and (2) his attainment of age 70 and completion of 15
Years of Service.
2.12 "YEARS OF SERVICE" means each 12 month period for which a Director serves
as a member of the Board. A Year of Service shall initially commence on the date
on which a Director is appointed or elected to the Board and shall thereafter
commence on each successive yearly anniversary of such date. A Director shall be
deemed to have served as a member of the Board for a full month if he serves as
a member of the Board for any portion of such month. Non-consecutive periods of
service as a Director shall be aggregated for purposes of determining a
Director's total Years of Service. Years of Service shall include service as a
Director prior to the Effective Date.
2.13 "TERMINATION OF SERVICE" means a Director's termination of service as a
member of the Board, whether by removal, resignation, death, disability or
otherwise.
2.14 "VESTED PARTICIPANT" means a Participant who (1) is an Outside Director on
or after July 1, 1999, (2) has completed fifteen (15) Years of Service, and (3)
attains age 70 prior to incurring a Termination of Service.
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ARTICLE III - PARTICIPATION
3.1 ELIGIBILITY FOR PARTICIPATION
Each Outside Director who has completed 15 Years of Service as of the Effective
Date shall become a Participant on the Effective Date. Each other Director shall
become a Participant upon completion of 15 Years of Service; provided he is at
such time an Outside Director.
3.2 DURATION OF PARTICIPATION
A Director who becomes a Participant shall continue to be a Participant until
the later of his Termination of Service or the date he or she is no longer
entitled to benefits under the Plan.
ARTICLE IV - BENEFITS
4.1 ELIGIBILITY TO RECEIVE BENEFITS
A Vested Participant shall be paid a retirement benefit under the Plan in
accordance with Section 4.2.
4.2 AMOUNT AND FORM OF BENEFIT
A Vested Participant shall be paid an annual retirement benefit of $8,500.00
payable in substantially equal monthly installments for one hundred eighty (180)
months commencing upon his Normal Retirement Date. In the event of the Vested
Participant's death after payments have commenced but prior to the payment all
such monthly installments, such installments shall continue to be paid to the
Participant's surviving spouse, if any, until the earlier of (i) such spouse's
death or (ii) the aggregate number of monthly payments to both the Participant
and such spouse total one hundred eighty (180). In the event a Vested
Participant and his surviving spouse both die before one hundred eighty (180)
monthly payments have been paid, benefits shall cease as of the date of the
second to die and no further benefits under the Plan shall be payable.
In the event of the death of a Vested Participant after July 1, 1998 and after
his completion of fifteen (15) Years of Service, but prior to the commencement
of payment of benefits hereunder, his surviving spouse, if any, shall be paid an
annual retirement benefit of $8,500.00 payable in substantially equal monthly
installments until the earlier of (i) such spouse's death, or (ii) the payment
of one hundred eighty (180) such installments.
4.3 FORFEITURE FOR CAUSE
Notwithstanding any other provisions of this Plan, if a Director shall be
terminated for reason of acts of fraud, dishonesty, larceny, misappropriation or
embezzlement committed against the Company, all of such Director's rights to
benefits under this Plan shall be forfeited.
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ARTICLE V - ADMINISTRATION
5.1 DUTIES OF THE COMMITTEE
The Committee shall have full responsibility for the management, operation,
interpretation and administration of the Plan in accordance with its terms, and
shall have such authority as is necessary or appropriate in carrying out its
responsibilities. The Committee is expressly authorized to exercise discretion
in carrying out its responsibilities and deciding any question of fact or law
in connection therewith. Actions taken by the Committee pursuant to this Section
5.1 shall be conclusive and binding upon the Bank, Participants and any other
interested parties.
5.2 LIABILITIES OF THE COMMITTEE
Neither the Committee nor its individual members shall be deemed to be a
fiduciary or fiduciaries with respect to this Plan; nor shall any of the
foregoing individuals or entities be liable to any Participant or beneficiary in
connection with the management, operation, interpretation or administration of
the Plan, any such liability being solely that of the Bank.
5.3 EXPENSES
Any expenses incurred in the management, operation, interpretation or
administration of the Plan shall be paid by the Bank. In no event shall the
benefits otherwise payable under this Plan be reduced to offset the expenses
incurred in managing, operating, interpreting or administering the Plan.
5.4 UNFUNDED CHARACTER OF THE PLAN
The benefits payable under the Plan shall be paid by the Bank out of its general
assets; provided, however, that the Bank may establish a separate account, an
escrow account or a trust or may purchase an annuity or insurance contract,
which account, trust or contract shall be subject to the claims of the Bank's
general unsecured creditors. Any liability of the Bank to any person with
respect to benefits payable under the Plan shall be based solely upon such
contractual obligations, if any, as shall be created by the Plan, and shall give
rise only to a claim against the general assets of the Bank. No such liability
shall be deemed to be secured by any pledge or any other encumbrance on any
specific property of the Bank.
Subject to the foregoing, in the event of a Change of Control (as defined below)
or threatened Change in Control, the Bank may contribute to any such account,
trust or contract an amount that the Board determines to be sufficient to pay
each Plan participant or beneficiary the benefits to which such participants and
beneficiaries would be entitled pursuant to the terms of the Plan as of the date
on which the Change of Control occurs. A "Change in Control" shall mean:
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(1) the consummation of an acquisition by a third party of a majority of
the voting capital stock of the Bank or Center Bancorp Inc. or substantially all
of the assets of the Bank or Center Bancorp Inc., or
(2) a change in the composition of the Board of Directors of the Bank or
Center Bancorp such that "Continuing Directors" (as defined herein) no longer
constitute a majority of the Board. For purposes of this Agreement, the term
"Continuing Director" shall mean (i) each current member of the Center Bancorp
Inc. Board of Directors and (ii) each person who is hereinafter first nominated
to such board by unanimous vote of the persons who then constitute Continuing
Directors.
ARTICLE VI - AMENDMENT AND TERMINATION
6.1 AMENDMENT AND TERMINATION
Subject to the provisions of Section 6.2, the Board shall have the right to
amend or terminate the Plan, in whole or in part.
6.2 PRESERVATION OF BENEFITS ON TERMINATION OR AMENDMENT
Neither the termination nor amendment of the Plan shall reduce the benefits
accrued by a Participant under this Plan.
6.3 DISTRIBUTION OF BENEFITS ON TERMINATION
In the event of termination of the Plan, the retirement benefits, if any, to
which recipients are entitled, or may become entitled, under Article IV shall
continue to be payable as provided in Article IV.
ARTICLE VII - MISCELLANEOUS PROVISIONS
7.1 NO RIGHT TO CONTINUED EMPLOYMENT
Neither the establishment of the Plan nor any provisions of the Plan, nor any
action of the Committee shall be held or construed to confer upon any Director
the right to continue to serve on the board.
7.2 CONSTRUCTION OF LANGUAGE
Wherever appropriate in the Plan, words used in the singular may be read in the
plural, words in the plural may be read in the singular, and words importing the
masculine gender shall be
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deemed equally to refer to the feminine and the neuter. Any reference to any
Article or Section shall be to an Article or Section of this Plan, unless
otherwise indicated.
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7.3 NON-ALIENATION OF BENEFITS
The right to receive a benefit under the Plan shall not be subject in any manner
to anticipation, alienation, or assignment, nor shall such right be liable for
or subject to debts, contracts, liabilities or torts. Should any Participant,
beneficiary or other person attempt to anticipate, alienate or assign his
interest in or right to a benefit, or should any person claiming against him
seek to subject such interest or right to legal or equitable process, all the
interest or right of such Participant or beneficiary or other person entitled to
benefits under the Plan shall cease, and in that event, such interest or right
shall be held or applied, at the direction of the Committee, to or for the
benefit of such Participant, beneficiary or other person or his spouse, children
or other dependents in such manner and in such proportion as the Committee may
deem proper.
7.4 SEPARABILITY
If any term or provision of this Plan as presently in effect or as amended from
time to time, or the application thereof to any payments or circumstances, shall
to any extent be invalid or unenforceable, the remainder of the Plan, and the
application of such term or provision to payments or circumstances other than
those as to which it is invalid or unenforceable, shall not be affected thereby,
and each term or provision of the Plan shall be valid and enforced to the
fullest extent permitted by law.
7.5 AUTHORIZED OFFICERS
Whenever the Bank under the terms of the Plan is permitted or required to do or
to perform any act or matter or thing, it shall be done and performed by a duly
authorized officer of the Bank.
7.6 CONSTRUCTION
The provisions of the plan shall be construed, administered and enforced
according to the laws of the State of New Jersey.
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