1
Exhibit 10.21
DEFERRED COMPENSATION PLAN FOR BOARD MEMBERS
OF
THE DIME SAVINGS BANK OF NEW YORK, FSB
-----------------------------------------------
Adopted As of August 28, 1981
As Amended and Restated Effective as of July 24, 1997
2
TABLE OF CONTENTS
ARTICLE I
Definitions
Section 1.1 Administrative Committee.........................................1
Section 1.2 Bank.............................................................1
Section 1.3 Board............................................................1
Section 1.4 Board Member.....................................................1
Section 1.5 Discretionary Account(s).........................................1
Section 1.6 Dividend Equivalent..............................................1
Section 1.7 Fair Market Value................................................1
Section 1.8 Fees.............................................................2
Section 1.9 Foregone Fees....................................................2
Section 1.10 Interest Bearing
Memorandum Account...............................................2
Section 1.11 OTS Restriction..................................................2
Section 1.12 Participant......................................................2
Section 1.13 Phantom Right....................................................2
Section 1.14 Phantom Share....................................................2
Section 1.15 Phantom II Account...............................................3
Section 1.16 Plan.............................................................3
Section 1.17 Share............................................................3
Section 1.18 Stock Memorandum Account.........................................3
Section 1.19 Trading Day......................................................3
Section 1.20 Trust Account....................................................3
Section 1.21 Trust Agreement..................................................3
Section 1.22 Trustee..........................................................4
ARTICLE II
Participation
Section 2.1 Election to Participate..........................................4
Section 2.2 Changes in Participation.........................................4
Section 2.3 Mandatory Participation
with Respect to Foregone Fees ...................................4
Section 2.4 Continued Crediting
of Earnings......................................................4
-i-
3
ARTICLE III
Deferred Amounts
Section 3.1 In General...................................................... 5
Section 3.2 Amounts Credited to the
Interest Bearing Memorandum
Account......................................................... 6
Section 3.3 Amounts Credited to the
Trust Account................................................... 6
Section 3.4 Amounts Credited to the
Stock Memorandum Account........................................ 7
Section 3.5 Amounts Credited to
the Phantom II Account...........................................8
Section 3.6 Amounts Credited Pursuant
to Phantom Rights................................................9
Section 3.7 Amounts Credited to the
Discretionary Accounts...........................................9
Section 3.8 Transfers Between Accounts......................................10
Section 3.9 Special Phantom Stock Valuation.................................12
Section 3.10 Change in Control...............................................12
ARTICLE IV
Distributions
Section 4.1 Distributions to Participants...................................14
Section 4.2 Distributions to Beneficiaries..................................16
Section 4.3 Hardship Distributions..........................................16
Section 4.4 Additional Payment Elections....................................17
Section 4.5 Change in Control Distributions.................................17
ARTICLE V
Administration
Section 5.1 Administrative Committee........................................18
Section 5.2 Committee Action................................................18
Section 5.3 Committee Responsibilities......................................18
-ii-
4
ARTICLE VI
Miscellaneous Provisions
Section 6.1 Notice and Election.............................................19
Section 6.2 Unfunded Arrangements...........................................19
Section 6.3 Construction of Language........................................19
Section 6.4 Non-Alienation of Benefits......................................20
Section 6.5 Indemnification.................................................20
Section 6.6 Severability....................................................20
Section 6.7 Waiver..........................................................20
Section 6.8 Notices.........................................................20
Section 6.9 Governing Law...................................................21
-iii-
5
DEFERRED COMPENSATION PLAN FOR BOARD MEMBERS
OF
THE DIME SAVINGS BANK OF NEW YORK, FSB
ARTICLE I
Definitions
The following definitions shall apply for the purposes of this Plan
unless a different meaning is clearly indicated by the context:
Section 1.1 Administrative Committee means the Administrative
Committee referred to in section 5.1.
Section 1.2 Bank means The Dime Savings Bank of New York, FSB, and
any successor thereto.
Section 1.3 Board means (a) for the period during which the Bank is
a mutual institution, the Board of Trustees of the Bank, and (b) for any period
during which the Bank is a stock institution, the Board of Directors of the
Bank.
Section 1.4 Board Member means any member of the Bank's Board,
Divisional Boards or Committees thereof.
Section 1.5 Discretionary Account(s) means, with respect to a
Participant, one or more accounts maintained by the Bank to which is credited
such amount of the Participant's deferred Fees as the Participant shall
designate, together with amounts attributable to dividends with respect to
Phantom Shares directed to such account pursuant to section 3.1(b), and any
earnings or appreciation thereon, and against which are charged any
distributions of amounts credited to such account(s) and any losses or
depreciation thereon.
Section 1.6 Dividend Equivalent means an amount credited with
respect to a Phantom Share which is equal in amount to the dividend declared
with respect to a Share.
Section 1.7 Fair Market Value means, with respect to a Share on a
specified date:
(a) at the commencement of the Public Offering, as such term is
defined in the Bank's Plan of Conversion, the Actual Purchase
Price, as such term is defined in the Bank's Plan of
Conversion; or
-1-
6
(b) the closing sales price of a Share on the date in question
(or, if there is no reported sale on such date, on the last
preceding date on which any reported sale occurred) on the
principal United States securities exchange on which the
Shares are listed or admitted to trading; or
(c) if the Shares are not listed or admitted to trading on any
such exchange, the closing bid quotation with respect to a
Share on such date on the National Association of Securities
Dealers, Inc. Automated Quotation System, or, if no such
quotation is provided, on another similar system, selected by
the Administrative Committee, then in use; or
(d) if Section 1.7(a), (b) and (c) are not applicable, the fair
market value of a Share on such date, determined in such
manner as the Administrative Committee may, in its discretion,
prescribe.
Section 1.8 Fees means the compensation paid to Board Members for
service on the Bank's Board, Divisional Boards and Committees thereof.
Section 1.9 Foregone Fees means any Fees payable to Board Members
for 1991, 1992, and 1993 which are foregone pursuant to an OTS Restriction.
Section 1.10 Interest Bearing Memorandum Account means, with respect
to a Participant, an account maintained by the Bank to which is credited (i)
such amount of the Participant's deferred Fees as the Participant shall
designate, (ii) amounts transferred from the Participant's Stock Memorandum
Account and Phantom II Account, (iii) Dividend Equivalents directed to be
credited to such account, and (iv) interest thereon, and against which are
charged any distributions of amounts credited to such account and any transfers
from such account to the Participant's Discretionary Account(s) (or, prior to
July 1, 1994, to the Participant's Stock Memorandum Account or Trust Account).
Section 1.11 OTS Restriction means a restriction on the payment of
Fees as a result of an agreement with or directive from the Office of Thrift
Supervision.
Section 1.12 Participant means a Board Member or former Board Member
who has an Interest Bearing Memorandum Account, a Stock Memorandum Account, a
Phantom II Account, a Trust Account or a Discretionary Account under the Plan.
Section 1.13 Phantom Right means a unit of interest credited to a
Stock Memorandum Account representing the equivalent value of a transferable
subscription right issued pursuant to the Bank's Rights Offering to shareholders
of record on April 15, 1993.
Section 1.14 Phantom Share means a unit of interest credited to a
Stock Memorandum Account or a Phantom II Account representing the equivalent
value of a Share.
-2-
7
Section 1.15 Phantom II Account means, with respect to a
Participant, an account maintained by the Bank to which is credited (i) Phantom
Shares attributable to Foregone Fees, (ii) Phantom Shares attributable to the
exercise of Phantom Rights, (iii) Dividend Equivalents with respect to Phantom
Shares credited to such account, and (iv) any earnings or appreciation thereon,
and against which are charged any distributions of amounts credited to such
account, any losses or depreciation attributable thereto, and any transfers from
such account to the Participant's Interest Bearing Memorandum Account or
Discretionary Accounts.
Section 1.16 Plan means this Deferred Compensation Plan for Board
Members of The Dime Savings Bank of New York, FSB, as in effect from time to
time.
Section 1.17 Share means a share of the Bank's common stock or,
effective upon the reorganization whereupon the common stock of the Bank was
converted into the common stock of Dime Bancorp., Inc., a share of the common
stock of Dime Bancorp, Inc.
Section 1.18 Stock Memorandum Account means, with respect to a
Participant, an account maintained by the Bank to which is credited (i) Phantom
Shares attributable to such amount of his deferred Fees as the Participant shall
have designated, (ii) Dividend Equivalents directed to be credited to such
account, (iii) any earnings or appreciation thereon, (iv) Phantom Rights with
respect to Phantom Shares credited to such account, and (v) Phantom Shares
attributable to unexercised Phantom Rights, and against which are charged any
distributions of amounts credited to such account, any losses or depreciation
attributable thereto, and any transfers from such account to the Participant's
Interest Bearing Memorandum Account or Discretionary Account(s) (or, prior to
July 1, 1994, to the Participant's Trust Account).
Section 1.19 Trading Day means a day on which the exchange or other
market referred to in the applicable section of the definition of Fair Market
Value is open for trading (whether or not any sales or Shares occur on such
day).
Section 1.20 Trust Account means, with respect to a Participant, an
account maintained by the Bank to which is credited the amount of the
Participant's deferred Fees prior to July 1, 1994 that are contributed by the
Bank to the Trustee pursuant to the Trust Agreement, together with amounts
attributable to dividends with respect to Phantom Shares directed to such
account pursuant to section 3.1(b), and any earnings or appreciation thereon,
and against which are charged any distributions of amounts credited to the Trust
Account and any losses, depreciation or expenses attributable thereto and any
transfers from such account to the Participant's Interest Bearing Memorandum
Account or Discretionary Account(s) (or, prior to July 1, 1994, to the
Participant's Stock Memorandum Account).
Section 1.21 Trust Agreement means the revocable trust agreement
established for each Board Member, as applicable, between the Bank and the
Trustee or its successor pursuant to which the Trust Account is held in trust.
-3-
8
Section 1.22 Trustee means the trustee designated pursuant to the
Trust Agreement. The Trustee shall be Nationar, until it is removed or resigns
from office and is replaced by a successor Trustee.
ARTICLE II
Participation
Section 2.1 Election to Participate.
Any Board Member may elect to become a Participant in the Plan by
submitting to the Administrative Committee a written election to defer receipt
of all or a specified part of his Fees. Such election shall be made on or before
the last day of any calendar year, shall be effective for the calendar year
following the year in which such election is made, and shall continue in effect
for all succeeding calendar years until the Board Member ceases to be a Board
Member or such earlier time as the election is changed or revoked pursuant to
section 2.2. Notwithstanding the foregoing, or any other provision of this Plan,
no deferrals shall be permitted hereunder with respect to any Fees earned after
December 31, 1994.
Section 2.2 Changes in Participation.
A Board Member may, by written direction filed with the
Administrative Committee prior to the end of any calendar year, increase or
decrease, or eliminate altogether, the portion of his Fees to be deferred. Such
change will be effective with respect to Fees earned after the calendar year in
which the direction for such change is filed with the Administrative Committee.
A Board Member who has filed a written direction to cease deferring receipt of
his Fees may thereafter again file an election to defer receipt of all or any
portion of his Fees pursuant to section 2.1, effective for the calendar year
subsequent to the calendar year in which he files a new election.
Section 2.3 Mandatory Participation with Respect to Foregone Fees.
Notwithstanding any election to participate or failure to so elect,
all Board Members shall be Participants with respect to amounts credited in lieu
of payment of Foregone Fees.
Section 2.4 Continued Crediting of Earnings.
In the event that a Participant ceases to be a Board Member or
ceases to defer receipt of his Fees, the amounts already accumulated in his
Interest Bearing Memorandum Account, Stock Memorandum Account, Trust Account,
Phantom II Account and Discretionary
-4-
9
Account(s) shall continue to be credited with interest, Dividend Equivalents,
earnings and appreciation in accordance with the applicable provisions of
Article III until such time as they are paid out in accordance with Article IV.
ARTICLE III
Deferred Amounts
Section 3.1 In General.
(a) Except as provided in section 3.1(c), a Participant shall direct
that the amount of a Participant's Fees deferred pursuant to section 2.1 shall
be credited to his Interest Bearing Memorandum Account or, to the extent offered
by the Administrative Committee, one or more Discretionary Accounts, in such
proportions as he shall designate in writing. If a Participant does not give
such a direction, the entire amount of his deferred Fees shall be credited to
his Interest Bearing Memorandum Account. The amount of a participant's Foregone
Fees credited pursuant to section 2.3 shall be credited to his Phantom II
Account. Amounts credited with respect to Phantom Rights shall be credited as
provided in section 3.5.
(b) At the time a dividend is paid on Shares, the Bank shall credit
Dividend Equivalents to a Participant's accounts under the Plan as follows:
(i) a Participant who maintains a Stock Memorandum Account may
direct that Dividend Equivalents credited with respect to Phantom Shares
attributed to his Stock Memorandum Account be credited to his Interest Bearing
Memorandum Account, one or more Discretionary Accounts, his Stock Memorandum
Account (or, prior to July 1, 1994, his Trust Account), as he shall designate in
writing to the Administrative Committee on or before the payment date of the
respective dividend. Such direction shall be effective for any dividend paid on
or after the day it is made and shall continue in effect for dividends
subsequently paid unless changed or revoked in writing. If a Participant does
not give such direction, Dividend Equivalents with respect to Phantom Shares
attributed to his Stock Memorandum Account shall be credited to his Interest
Bearing Memorandum Account.
(ii) Dividend Equivalents with respect to Phantom Shares
attributed to a Participant's Phantom II Account shall be credited to such
account.
(c) Prior to the commencement of the Public Offering, as such term
is defined in the Bank's Plan of Conversion, a Participant who was a member of
the Bank's Board had the right to direct that Fees deferred pursuant to section
2.1 be credited to his Interest Bearing Memorandum Account, Trust Account and
Stock Memorandum Account in such proportions as he designated in writing. In the
absence of such a designation, deferred Fees were credited to the Participant's
Interest Bearing Memorandum Account.
-5-
10
Section 3.2 Amounts Credited to the Interest Bearing Memorandum
Account.
(a) The Bank shall maintain a separate Interest Bearing Memorandum
Account for each Participant who has directed that all or part of his deferred
Fees be credited to or transferred to such account. A Participant's Interest
Bearing Memorandum Account shall be credited with such portion of his deferred
Fees as he shall direct in accordance with sections 3.1(a) and (c), as of the
date on which such Fees would have been paid if an election to defer were not in
effect.
(b) If a Participant directs that Dividend Equivalents be credited
to his Interest Bearing Memorandum Account (or fails to give a direction) in
accordance with section 3.1(b)(i), his Interest Bearing Memorandum Account shall
be credited, as of the date such dividends are paid, in an amount equal to the
product of (i) the number of Phantom Shares (and fraction thereof) credited to
such Participant's Stock Memorandum Account on the record date specified for
purposes of determining the identity of persons entitled to receive such
dividends, multiplied by (ii) the amount of the dividend per Share.
(c) A Participant's Interest Bearing Memorandum Account shall be
credited as of December 31st of each year with interest at an effective annual
rate or rates to be established by the Board; provided, however, that amounts
first credited to a Participant's Interest Bearing Memorandum Account after
January 1st of a year shall only be credited with interest for the portion of
that year during which such amounts are actually credited to the Interest
Bearing Memorandum Account; and provided, further, that when a distribution or a
transfer from an Interest Bearing Memorandum Account is made other than on the
first day of a calendar year, the Participant's Interest Bearing Memorandum
Account shall be credited with interest under this section 3.2(c) as of the last
day of the month prior to the month in which such distribution or transfer is
made for the portion of that year during which such amounts were actually
credited to the Interest Bearing Memorandum Account.
Section 3.3 Amounts Credited to the Trust Account.
(a) The Bank shall maintain a separate Trust Account for each
Participant who has directed, prior to July 1, 1994, that all or a portion of
his deferred Fees be credited to a Trust Account. A Participant's Trust Account
shall be credited with such portion of his deferred Fees as he shall direct in
accordance with section 3.1(a) or (c), as of the date on which such Fees would
have been paid if an election to defer were not in effect. If a Participant
directs that Dividend Equivalents be credited to his Trust Account in accordance
with section 3.1(b)(i), his Trust Account shall be credited, as of the date such
dividends are paid, in an amount equal to the product of (i) the number of
Phantom Shares (and fraction thereof) credited to such Participant's Stock
Memorandum Account on the record date specified for purposes of determining the
identity of persons entitled to receive such dividends, multiplied by (ii) the
amount of the dividend
-6-
11
per share. In addition, a Participant's Trust Account shall be adjusted to
reflect any deemed appreciation or depreciation in the value of the trust fund
established pursuant to the Trust Agreement, at the same time or times as the
Trustee performs valuations of such trust fund.
(b) The Bank shall contribute to the Trustee under the Trust
Agreement an amount equal to (i) the amount of Fees deferred by a Participant
and credited to his Trust account, as of the date on which such Fees would have
been paid if an election to defer were not in effect plus (ii) the amount of
dividends on Phantom Shares that a Participant diverted to be credited to his
Trust Account, as of the date such dividends are paid. The Administrative
Committee shall direct the Trustee to invest all amounts contributed to the
Trustee pursuant to the Trust Agreement in such deposit accounts of the Bank as
the Administrative Committee shall specify.
Section 3.4 Amounts Credited to the Stock Memorandum Account.
(a) The Bank shall maintain a separate Stock Memorandum Account for
each Participant who has directed that all or part of his deferred Fees be
credited to his Stock Memorandum Account. As of the date on which such deferred
Fees would have been paid if an election to defer were not in effect, a
Participant's Stock Memorandum Account shall be credited with a number of
Phantom Shares (and fraction thereof) equal in number to the quotient of (i)
such portion of his deferred Fees as he shall direct in accordance with section
3.1(c), divided by (ii) the Fair Market Value of a Share on such date.
(b) If a Participant directs that Dividend Equivalents be credited
to his Stock Memorandum Account in accordance with section 3.1(b)(i), his Stock
Memorandum Account shall be credited, as of the date such dividends are paid,
with a number of Phantom Shares (and fraction thereof) equal to the result
obtained by multiplying (i) the number of Phantom Shares (and fraction thereof)
credited to such Participant's Stock Memorandum Account on the record date
specified for purposes of determining the identity of persons entitled to
receive such dividends by (ii) the amount of the dividend per Share, and
dividing such product by (iii) the Fair Market Value of a Share on the date the
dividend is paid.
(c) Phantom Rights and Phantom Shares attributable to unexercised
Phantom Rights shall be credited to a Participant's Stock Memorandum Account as
provided in section 3.6.
(d) If any amount represented by Phantom Shares credited to a
Participant's Stock Memorandum Account is transferred to his Interest Bearing
Memorandum Account or Discretionary Accounts (or, prior to July 1, 1994, a
Participant's Trust Account) or distributed in accordance with Article IV, the
number of Phantom Shares (and fraction thereof) credited to such Stock
Memorandum Account shall be reduced by a number equal to the quotient of (i) the
dollar amount transferred or distributed, divided by (ii) the Fair Market Value
of a Share on the date as of which the transfer or distribution is effected.
-7-
12
(e) The amount credited to a Participant's Stock Memorandum Account
as of any date shall be equal to the product of (i) the number of Phantom Shares
(and fraction thereof) credited to his Stock Memorandum Account as of such date,
multiplied by (ii) the Fair Market Value of a Share on such date.
Section 3.5 Amounts Credited to the Phantom II Account.
(a) The Bank shall maintain a separate Phantom II Account for each
Board Member or former Board Member who is or was entitled to Foregone Fees
and/or each Participant who has exercised Phantom Rights. A Participant's
Phantom II Account shall be credited with all Phantom Shares (and fraction
thereof) attributable to the exercise of his Phantom Rights, as described in
section 3.6. In addition, a Participant's Phantom II Account shall be credited,
with respect to each date on which his Foregone Fees would have been paid but
for the OTS Restriction (i.e., the first business day of each calendar quarter
in advance, with respect to the annual retainer; and the last business day of
each month in which meetings were attended, with respect to meeting fees), with
a number of Phantom Shares (and fraction thereof) equal to the result obtained
by dividing the amount of the Participant's Foregone Fees that would have been
paid on such date by the greater of $6 or the Fair Market Value of a Share on
the date the Foregone Fees would have been paid. Such Phantom Shares shall be
credited on the later of October 1, 1993 or the date on which the Foregone Fees
would have been paid but for the OTS Restriction.
(b) Before any amounts are credited to a Participant's Phantom II
Account, the Participant shall elect, pursuant to written election forms
provided by the Bank, a fixed date or series of dates on which the Phantom
Shares credited to his Phantom II Account shall be converted to his Interest
Bearing Memorandum Account, or that such conversion shall occur at termination
of service as a Board Member. With respect to Phantom Shares credited on account
of the OTS Restriction (and related Dividend Equivalents), such conversion shall
occur on a single date, which shall be no earlier than the first Trading Day of
1995. The conversion date or schedule elected with respect to Phantom Shares
credited on account of the exercise of Phantom Rights may be different from the
conversion date elected with respect to Phantom Shares credited on account of
Foregone Fees; however, in each case the conversion date or schedule elected
shall apply to all Phantom Shares credited for the same purpose and related
Dividend Equivalents. If a Participant fails to specify a conversion date before
the date on which Phantom Shares on account of Foregone Fees are credited, such
Phantom Shares shall be deemed to have a conversion date of the first Trading
Day of 1995. Notwithstanding the foregoing, at or prior to such date prior to
each conversion date for a Participant that is designated by the Administrative
Committee, a Participant may direct that Phantom Shares be converted to one or
more Discretionary Accounts rather than his Interest Bearing Memorandum Account.
(c) In the event dividends are declared by the Bank with respect to
Shares, the Participant's Phantom II Account shall be credited, as of the date
such dividends are paid, with a
-8-
13
number of Phantom Shares (and fraction thereof) equal to the result obtained by
multiplying (i) the number of Phantom Shares (and fraction thereof) credited to
such Participant's Phantom II Account on the record date specified by the Bank
for purposes of determining the identity of persons entitled to receive such
dividends by (ii) the dollar amount of the dividend per Share, and dividing such
product by (iii) the Fair Market Value of a Share on the date the dividend is
paid.
(d) If any amount represented by Phantom Shares credited to a
Participant's Phantom II Account is converted to his Interest Bearing Memorandum
Account or his Discretionary Account(s) or distributed in accordance with
Article IV, the number of Phantom Shares (and fraction thereof) credited to such
Phantom II Account shall be reduced by a number equal to the quotient of (i) the
dollar amount converted or distributed, divided by (ii) the Fair Market Value of
a Share on the date as of which the conversion or distribution is effected.
(e) The amount credited to a Participant's Phantom II Account as of
any date shall be equal to the product of (i) the number of Phantom Shares (and
fraction thereof) credited to his Phantom II Account as of such date, multiplied
by (ii) the Fair Market Value of a Share on such date.
Section 3.6 Amounts Credited Pursuant to Phantom Rights.
(a) Notwithstanding a Participant's direction (or failure to give a
direction) in accordance with section 3.1(b)(i), a Participant's Stock
Memorandum Account shall be credited with 1.1 Phantom Rights for each Phantom
Share credited to such Account as of April 15, 1993. A Participant may
constructively exercise such Phantom Rights, pursuant to written election forms
provided by the Bank, by transferring the exercise price therefor from his
Interest Bearing Memorandum Account. Phantom Shares acquired upon such exercise
shall be credited to the Participant's Phantom II Account.
(b) Any Phantom Rights which have not been exercised as of the
expiration date of the actual subscription rights to which they relate shall be
deemed sold and invested in additional Phantom Shares in the Participant's Stock
Memorandum Account at the respective closing market prices of the rights and the
Shares on the first day on which the rights and the Shares traded separately.
Section 3.7 Amounts Credited to the Discretionary Accounts.
(a) The Administrative Committee may, from time to time, authorize
the establishment of one or more Discretionary Accounts that are designed to
provide one or more of the same deemed investment options as are offered under
the Dime Bancorp, Inc. Voluntary Deferred Compensation Plan for Directors. If
and to the extent any Discretionary Accounts are offered hereunder, the Bank
shall maintain one or more separate Discretionary Accounts for each
-9-
14
Participant who has directed that all or part of his deferred Fees be credited
to such account(s). A Participant's Discretionary Accounts shall be credited
with such portion of his deferred Fees as he shall direct in accordance with
section 3.1(a), as of the date on which such Fees would have been paid if an
election to defer were not in effect.
(b) If a Participant directs that Dividend Equivalents be credited
to his Discretionary Accounts in accordance with section 3.1(b)(i), his
Discretionary Accounts (in the proportion so designated), shall be credited, as
of the date such dividends are paid, in an amount equal to the product of (i)
the number of Phantom Shares (and fraction thereof) credited to such
Participant's Stock Memorandum Account on the record date specified for purposes
of determining the identity of persons entitled to receive such dividends
multiplied by (ii) the amount of the dividend per Share. In addition, a
Participant's Discretionary Accounts shall be adjusted to reflect any deemed
appreciation or depreciation in the value of such Accounts, in the same manner
that such appreciation or depreciation is credited under the Dime Bancorp, Inc.
Voluntary Deferred Compensation Plan for Directors.
Section 3.8 Transfers Between Accounts.
(a) Effective July 1, 1994, and subject to Sections 3.8(d) and
3.8(e), only the following transfers between accounts are permitted under the
Plan:
(i) Transfers from a Participant's Stock Memorandum Account,
his Trust Account or his Interest Bearing Memorandum Account to his
Discretionary Accounts or Interest Bearing Memorandum Account;
(ii) Transfers from any of a Participant's Discretionary
Accounts to another of the Participant's Discretionary Accounts;
(iii) Transfers related to the exercise of Phantom Rights, as
provided in section 3.6; and
(iv) Transfers from a Participant's Phantom II Account to his
Discretionary Accounts or his Interest Bearing Memorandum Account on the
conversion date or dates elected by the Participant pursuant to section 3.5(b).
(b) Prior to July 1, 1994, transfers between accounts were subject
to different limitations.
(c) In the event of any transfer permitted under the Plan, the
Account to which the transfer is made shall be credited with the amount
transferred.
(d) In accordance with the provisions of this section 3.8, a
Participant may, by filing a notice in the form and manner prescribed by the
Administrative Committee, elect to
-10-
15
change his or her investment direction with respect to all or a portion of the
amounts then held in such Participant's accounts, with such election and the new
investment direction becoming effective as of the first day of any calendar
quarter (i.e., January 1, April 1, July 1 or October 1), provided such
investment direction election is made, and not revoked, prior to 10:00 a.m. on
the first day of such calendar quarter. Such direction shall relate solely to
amounts already allocated to the Participant's accounts, in which event it shall
constitute a direction to transfer amounts in the Participant's accounts among
the various available deemed investments. Any investment direction election made
by a Participant shall remain in effect until changed, to the extent such change
is permitted under the Plan.
(e) Securities Law Limitations. Notwithstanding anything in the Plan
to the contrary, if at any time a Participant who is an Insider (as defined
below) is prohibited by the Section 16 Rules (as defined below) from directing
that his or her accounts be (i) deemed invested in an investment fund that
invests in common stock of Dime Bancorp, Inc. (the "Company"), (ii) deemed
transferred to a deemed investment in common stock of the Company, or (iii) to
the extent of any deemed investment in common stock of the Company, deemed
redeemed for whatever reason, any such direction shall be disregarded and not
given effect. For purposes of this subsection (e), an Insider shall mean, with
respect to the Company or any of its subsidiaries, (i) any Participant who is
subject to the Section 16 Rules, determined in accordance with Rule 16a-2
thereof, and (ii) solely with respect to certain trading restrictions with
respect to common stock of the Company imposed from time to time by the Company
or any of its subsidiaries, any Participant who is subject to such trading
restrictions. For purposes of this subsection (e), the Section 16 Rules mean
those rules (as from time to time amended) promulgated by the Securities and
Exchange Commission ("SEC") under Section 16 of the Securities Exchange Act of
1934, as amended (the "Act"). For purposes of the Plan, an action shall be
deemed to be prohibited by the Section 16 Rules, if it could, if permitted or
occurring, result in a transaction not being exempt from the provisions of
Section 16(b) of the Act. An action in violation of certain trading restrictions
with respect to common stock of the Company imposed from time to time by the
Company or any of its subsidiaries shall be deemed to be prohibited by the
Section 16 Rules solely for purposes of the Plan.
(f) Notwithstanding anything herein to the contrary, if, following a
Change in Control (as defined in Section 3.10) or a Corporate Event (as defined
below), one or more of the investment options under the Plan are eliminated, the
Administrative Committee shall make available an investment option or have all
accounts credited with earnings based on a single deemed investment (or, if the
Administrative Committee fails to so act, an investment option or single deemed
investment, as described in this sentence, shall automatically be made available
under the Plan) providing for a monthly investment return equal to no less than
the published fixed rate return for 30-year U.S. Treasury securities as in
effect on the last business day of each month (or, in the event such a return on
30-year U.S. Treasury securities is not then available, there shall be provided
an investment return as shall be determined by the "Committee" under the
Umbrella Trust Agreement among the Company, the Bank and Marine Midland Bank
with respect to the Covered Arrangements for Outside Directors of the Bank and
Related Entities). For
-11-
16
purposes of this subsection (f), a "Corporate Event" shall mean the execution of
a binding agreement that, if consummated, would result in a Change in Control of
a type specified in clause (i) or (iii) of Section 3.10 (an "Acquisition
Agreement") or of a binding agreement for the sale or disposition of assets
that, if consummated, would result in a Change in Control of a type specified in
clause (iv) of Section 3.10 (an "Asset Sale Agreement") or the adoption by the
Board of Directors of the Company or the Bank of a plan of complete liquidation
or dissolution of the Company or the Bank that, if consummated, would result in
a Change in Control of a type specified in clause (iv) of Section 3.10 (a "Plan
of Liquidation"); provided, however, that a Corporate Event shall not be deemed
to exist after the Abandonment Date. As used in this subsection (f), the term
"Abandonment Date" shall mean the date on which (A) an Acquisition Agreement,
Asset Sale Agreement or Plan of Liquidation is terminated (pursuant to its terms
or otherwise) without having been consummated, (B) the parties to an Acquisition
Agreement or Asset Sale Agreement abandon the transactions contemplated thereby,
(C) the Bank or the Company abandons a Plan of Liquidation or (D) a court or
regulatory body having competent jurisdiction enjoins or issues a cease and
desist or stop order with respect to or otherwise prevents the consummation of,
or a regulatory body notifies the Bank or the Company that it will not approve,
an Acquisition Agreement, Asset Sale Agreement or Plan of Liquidation or the
transactions contemplated thereby and such injunction, order or notice has
become final and not subject to appeal.
Section 3.9 Special Phantom Stock Valuation. If amounts credited to
a Participant's accounts, and deemed invested in phantom stock of the Company on
the date of a Change in Control (as defined in Section 3.10) are, in accordance
with the election of the Participant, deemed redeemed and deemed reinvested in
any one or more of the deemed investment funds then made available under the
Plan and the deemed redemption occurs after the occurrence of a Change in
Control, but on or before the first day of the third calendar quarter following
the occurrence of the Change in Control, the deemed redemption of such phantom
stock shall be valued based on the greater of (A) the closing price of a Share,
as reported on the New York Stock Exchange, on the date on which the deemed
redemption occurs or (B) the highest closing price of a Share, as reported on
the New York Stock Exchange, during the 90-day period ending on, and including,
the date of the Change in Control. If amounts credited to a Participant's
accounts, and deemed invested in phantom stock of the Company, are deemed
redeemed after the occurrence of a Change in Control (as defined in Section
3.10), but on or before the first day of the third calendar quarter following
the occurrence of the Change in Control, and, in accordance with Section 4, are
paid to the Participant (or his or her Beneficiary) as a distribution under the
Plan, the deemed redemption of such phantom stock shall be valued based on the
greater of (A) the closing price of a Share, as reported on the New York Stock
Exchange, on the date on which the deemed redemption occurs or (B) the highest
closing price of a Share, as reported on the New York Stock Exchange, during the
90-day period ending on, and including, the date of the Change in Control.
"Section 3.10 Change in Control. For purposes of the Plan, a "Change
in Control" shall mean the occurrence of any of the following events:
-12-
17
(i) any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired directly from the
Company or its Affiliates) representing 35% or more of the combined voting power
of the Company's then outstanding securities;
(ii) the following individuals cease for any reason to constitute a
majority of the number of directors then serving as directors of the Company:
individuals who, on July 24, 1997, constitute the Board of Directors of the
Company and any new director (other than a director whose initial assumption of
office is in connection with the settlement of an actual or threatened election
contest, including but not limited to a consent solicitation, relating to the
election of directors of the Company) whose appointment or election by the Board
of Directors of the Company or nomination for election by the Company's
stockholders was approved or recommended by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors on July 24, 1997
or whose appointment, election or nomination for election was previously so
approved or recommended;
(iii) there is consummated a merger or consolidation of the Company
or any direct or indirect subsidiary of the Company with any other corporation
or entity, other than (i) a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or any Parent
thereof), in combination with the ownership of any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
subsidiary of the Company, at least 65% of the combined voting power of the
securities of the Company, such surviving entity or any Parent thereof
outstanding immediately after such merger or consolidation or (ii) a merger or
consolidation effected solely to implement a recapitalization of the Company or
the Bank (or similar transaction) in which no Person is or becomes the
Beneficial Owner, directly or indirectly, of securities of the Company or the
Bank (not including in the securities beneficially owned by such Person any
securities acquired directly from the Company or its Affiliates) representing
35% or more of the combined voting power of the Company's or the Bank's then
outstanding securities; or
(iv) the stockholders of the Company or the Bank approve a plan of
complete liquidation or dissolution of the Company or the Bank, respectively, or
there is consummated a sale or disposition by the Company or any of its
subsidiaries of any assets which individually or as part of a series of related
transactions constitute all or substantially all of the Company's consolidated
assets (provided that, for these purposes, a sale of all or substantially all of
the voting securities of the Bank or a Parent of the Bank shall be deemed to
constitute a sale of substantially all of the Company's consolidated assets),
other than any such sale or disposition to an entity at least 65% of the
combined
-13-
18
voting power of the voting securities of which are owned by stockholders of the
Company in substantially the same proportions as their ownership of the voting
securities of the Company immediately prior to such sale or disposition.
As used in connection with the foregoing definition of Change in
Control, "Affiliate" shall have the meaning set forth in Rule 12b-2 promulgated
under Section 12 of the Act; "Beneficial Owner" shall have the meaning set forth
in Rule 13d-3 under the Act; "Parent" shall mean any entity that becomes the
Beneficial Owner of at least 80% of the voting power of the outstanding voting
securities of the Company or of an entity that survives any merger or
consolidation of the Company or any direct or indirect subsidiary of the
Company; and "Person" shall have the meaning given in Section 3(a)(9) of the
Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such
term shall not include (i) the Company or any of its subsidiaries, (ii) a
trustee or other fiduciary holding securities under an employee benefit plan of
the Company or any of its Affiliates, (iii) an underwriter temporarily holding
securities pursuant to an offering of such securities, or (iv) a corporation or
entity owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company.
ARTICLE IV
Distributions
Section 4.1 Distributions to Participants.
(a) Except as otherwise provided in Section 4.4, the amounts
credited to a participant's Interest Bearing Memorandum Account, Stock
Memorandum Account, Phantom II Account, Trust Account and Discretionary Accounts
shall be paid to the Participant commencing on one of the following dates, as
elected by the Participant prior to the crediting of the respective amounts to
his accounts:
(i) on the first Trading Day of the calendar year following
the year in which the Participant ceases to be a Board Member of the
Bank for any reason, including death;
(ii) on the first Trading Day of the calendar year following
the later of the year in which the Participant ceases to be a Board
Member or attains age 70; or
(iii) on the fixed date or dates elected by the Participant.
If a Participant fails to make an election with respect to the distribution of
any amount before it is credited to his account, such amount shall be
distributed in accordance with
-14-
19
clause (i) of this section 4.1(a). Any distribution election made by a
Participant shall remain in effect for all amounts subsequently credited to his
account until he makes a new election; such new election shall apply only to
Fees deferred subsequent to the calendar year in which he files the new
election. A payment date elected with respect to any amount credited to a
Participant's Phantom II Account shall be on or after the conversion date
elected by the Participant with respect to such amount. In the event the
Participant has elected a distribution date which precedes the applicable
conversion date for any amount credited to his Phantom II Account, the
applicable conversion date shall be treated as the distribution date for such
amount.
(b) Except as otherwise provided in Section 4.4, payments made
pursuant to section 4.1(a) shall be made in (i) fifteen annual installments, or
(ii) if elected by the Participant prior to the earlier of his election to defer
or crediting of such amounts to his account, in such lesser number of
installments as shall be specified by the Participant in such election, or in a
lump sum. If installment payments are to be made, the amount of the first annual
installment shall be equal to the sum of the amounts credited to the
Participant's Interest Bearing Memorandum Account, Stock Memorandum Account,
Phantom II Account, Trust Account and Discretionary Accounts with respect to
which the particular installment schedule applies at the start of the year
divided by the total number of installments to be made. For each subsequent
year, the annual installment shall be equal to the sum of the amounts credited
to the Participant's accounts with respect to which the particular installment
schedule applies at the start of the year divided by the number of installments
that have not been paid, including the installment for which the calculation is
being made.
(c) Notwithstanding any other provisions of Article IV, a special
election shall be made with respect to the conversion date and payment date of
Phantom Shares credited to a Participant's Phantom II Account with respect to
Foregone Fees and related Dividend Equivalents. The payment of such amounts
shall be made on a single date, which shall be on or after the conversion date
elected for such Phantom Shares and no earlier than the date payment is
permitted by the Office of Thrift Supervision. In the event a Participant has
failed to elect a payment date with respect to such Phantom Shares, the payment
date shall be the later of (i) the first Trading Day of 1995, (ii) the first
date payment is permitted by the Office of Thrift Supervision, and (iii) the
conversion date elected (or deemed elected) by the Participant with respect to
such Phantom Shares.
(d) Notwithstanding anything in the Plan to the contrary, no amount
shall be distributed from a Participant's Stock Memorandum Account on or before
the first anniversary of the commencement of the Public Offering, as such term
is defined in the Bank's Plan of Conversion.
(e) To the extent otherwise necessary to enable the transactions
relating to a distribution under this Section 4 to qualify for exemption under
Section 16(b)
-15-
20
of the Act, the distribution of a Participant's accounts under this Section 4
shall occur on the earliest date such distribution may be made whereby the
transactions relating to the distribution qualify for exemption under Section
16(b) of the Act, provided that, with the consent of the Participant, the
Administrative Committee may direct that any such distribution be made on any
earlier date.
Section 4.2 Distribution to Beneficiaries.
(a) In the event that a Participant dies prior to the receipt of all
amounts payable to him pursuant to the Plan, all remaining amounts credited to
his Interest Bearing Memorandum Account, Stock Memorandum Account, Phantom II
Account, Trust Account and Discretionary Accounts shall be paid to such one or
more beneficiaries and in such proportions as the Participant may designate on
such form and in such manner as the Administrative Committee may require. A
beneficiary designation pursuant to this section 4.2 shall not be effective
unless it is in writing and is received by the Administrative Committee prior to
the death of the Participant making the designation.
(b) If, at the time of the Participant's death, payments have
commenced to be made in accordance with section 4.1, payments to his beneficiary
shall be made at the same times and in the same manner as such payments would
have been made to the Participant if he had lived. If, at the time of the
Participant's death, payments to the Participant have not commenced to be made
in accordance with section 4.1, payments from the Interest Bearing Memorandum
Account, Stock Memorandum Account, Phantom II Account, Trust Account and
Discretionary Accounts to the Participant's beneficiary shall commence as of the
first Trading Day of the calendar year following the year in which the
Participant's death occurs and shall be made in the number of installments
specified by the Participant in accordance with section 4.1.
(c) If no beneficiary shall have been designated, or to the extent
that any such designation shall be ineffective, all amounts credited to the
Participant's Interest Bearing Memorandum Account, Stock Memorandum Account,
Phantom II Account, Trust Account and Discretionary Accounts upon his death
shall be paid to his personal representatives in a lump sum as of the first
Trading Day of the month following the month in which the 6-month anniversary of
his death occurs, and the amount of such lump sum payment shall be equal to the
sum of the amounts credited to the Participant's Interest Bearing Memorandum
Account, Stock Memorandum Account, Phantom II Account, Trust Account and
Discretionary Accounts as of the date of payment.
Section 4.3 Hardship Distributions.
In the event of Hardship (as defined below), a Participant or
beneficiary may request the Administrative Committee to pay the amount credited
to the Participant's Interest Bearing Memorandum Account, Stock Memorandum
Account, Trust Account
-16-
21
and Discretionary Accounts (and a beneficiary may request the Administrative
Committee to pay the amounts credited to such accounts as well as the
Participant's Phantom II Account) prior to the time provided for payment in
sections 4.1 and 4.2. For these purposes, Hardship shall mean substantial
financial hardship caused by an unanticipated emergency or unanticipated
necessity outside the control of the Participant or beneficiary, affecting his
personal or family affairs. The Participant or beneficiary shall provide written
evidence demonstrating the existence and extent of the Hardship. The
Administrative Committee, in its sole discretion, shall determine the date and
amount of any distribution on account of Hardship, but in no event shall the
amount of any such distribution exceed the amount necessary to alleviate the
Hardship. Any amounts credited to the Participant's Interest Bearing Memorandum
Account, Stock Memorandum Account, Phantom II Account, Trust Account and
Discretionary Accounts which are not distributed on account of Hardship shall
continue to be governed by the provisions of sections 4.1 and 4.2.
Section 4.4 Additional Payment Elections.
Notwithstanding the preceding provisions of this Article IV to the
contrary, a Participant may subsequently elect, in such form and manner as may
be prescribed by the Administrative Committee, that the amounts credited to his
or her accounts be distributed commencing on one of the dates described in
section 4.1(a)(i), (ii) or (iii) above in lieu of the date(s) initially
selected, provided that any such election is made at least twenty-four (24)
months prior to the earlier of the date payments would otherwise commence (other
than on account of Hardship or a Change in Control (as defined in Section 3.10))
or the Participant's termination of service for any reason as a member of the
Board and, as applicable, as a member of the boards of directors of all
subsidiaries of Dime Bancorp, Inc. Further, notwithstanding the preceding
provisions of this Article IV to the contrary, a Participant may also
subsequently elect, in such form and manner as may be prescribed by the
Administrative Committee, that the amounts credited to his or her accounts be
paid in any one of the forms of benefit payment provided under this section
4.1(b) in lieu of the form of payment initially selected, provided that any such
election is made at least twenty-four (24) months prior to the earlier of the
date payments would otherwise commence (other than on account of Hardship or a
Change in Control) or the Participant's termination of service for any reason as
a member of the Board and, as applicable, as a member of the boards of directors
of all subsidiaries of Dime Bancorp, Inc.
Section 4.5 Change in Control Distributions.
In the event of a Change in Control (as defined in Section 3.10), a
Participant may, solely to the extent permitted by the Committee, direct that
all of the amounts then credited to the Participant's accounts (subject to any
distribution restrictions applicable to amounts held in the Participant's
Phantom II Account, if any) be distributable to the Participant upon a Change in
Control, in which event the amount of any further
-17-
22
scheduled distribution shall be reduced by the amount previously distributed on
account of such Change in Control.
ARTICLE V
Administration
Section 5.1 Administrative Committee.
The Plan shall be administered by an Administrative Committee
appointed by the Board. The Administrative Committee shall appoint a Chairman
and may appoint a secretary who may, but need not, be a member of the Committee.
Section 5.2 Committee Action.
The Administrative Committee shall hold meetings at such times and
may make such administrative rules and regulations as it may deem proper. A
majority of the members of the Administrative Committee shall constitute a
quorum, and the action of a majority of the members of the Administrative
Committee present at a meeting at which a quorum is present, as well as actions
taken pursuant to the written consent of a majority of the members of the
Administrative Committee without holding a meeting, shall be deemed to be
actions of the Administrative Committee. All actions of the Administrative
Committee shall be final and conclusive and shall be binding upon the Bank and
all other interested parties. Any person dealing with the Administrative
Committee shall be fully protected in relying upon any written notice,
instruction, direction or other communication signed by the secretary of the
Administrative Committee, by two members of the Administrative Committee or by a
representative of the Administrative Committee authorized to sign the same in
its behalf.
Section 5.3 Committee Responsibilities.
Subject to the terms and conditions of the Plan, the Administrative
Committee shall be responsible for the overall management and administration of
the Plan and shall have such authority as shall be necessary or appropriate in
order to carry out its responsibilities, including, without limitation, the
authority:
(a) to interpret and construe the Plan, and to determine all
questions that may arise under the Plan as to eligibility for participation in
the Plan and the amount of Fees and Foregone Fees which may be deferred under
the Plan;
(b) to adopt rules and regulations and to prescribe forms for the
operation and administration of the Plan;
-18-
23
(c) to determine the time, form and manner of any payment of
benefits made pursuant to Article IV in accordance with the Plan; and
(d) to take any other action not inconsistent with the provisions of
the Plan as it may deem necessary or appropriate.
ARTICLE VI
Miscellaneous Provisions
Section 6.1 Notice and Election.
The Secretary to the Board shall provide a copy of this Plan to each
Board Member, together with a form of letter which the Board Member may use to
make an election to defer all or part of his Fees and related elections required
or permitted by the Plan.
Section 6.2 Unfunded Arrangements.
The Interest Bearing Memorandum Accounts, Stock Memorandum Accounts,
Phantom II Accounts, Trust Accounts and Discretionary Accounts and all amounts
credited thereto shall constitute an unfunded obligation of the Bank and shall
not relate to any specific funds of the Bank. Payments due with respect to
balances in such accounts shall be made from the general assets of the Bank. The
Bank may, in its sole and absolute discretion, establish one or more accounts,
funds, or trusts to reflect its obligations under the Plan, and may make such
investments (including the purchase of insurance) as it may deem desirable to
assist it in meeting such obligations. Any assets held in such accounts, funds
or trusts and any such investments shall be subject to the claims of the Bank's
creditors, and no person eligible for a benefit under the Plan shall have any
right, title or interest in any such assets. This Plan shall constitute solely
an unsecured promise by the Bank to pay Plan benefits to Participants and their
beneficiaries to the extent provided herein.
Section 6.3 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 deemed equally to refer to the feminine
or the neuter. Any reference to an Article or section shall be to an Article or
section of the Plan, unless otherwise indicated.
-19-
24
Section 6.4 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 rights
be liable for or subject to debts, contracts, liabilities or torts.
Section 6.5 Indemnification.
The Bank shall indemnify, hold harmless and defend each Board Member
and Participant, and the beneficiaries of each, as well as each member of the
Administrative Committee against their reasonable costs, including legal fees,
incurred by them, or arising out of any action, suit or proceeding in which they
may be involved, as a result of their efforts, in good faith, to defend or
enforce the terms of the Plan.
Section 6.6 Severability.
A determination that any provision of the Plan is invalid or
unenforceable shall not affect the validity or enforceability of any other
provision hereof.
Section 6.7 Waiver.
Failure to insist upon strict compliance with any of the terms,
covenants or conditions of the Plan shall not be deemed a waiver of such term,
covenant or condition. A waiver of any provision of the Plan must be made in
writing, designated as a waiver, and signed by the party against whom its
enforcement is sought. Any waiver or relinquishment of any right or power
hereunder at any one or more times shall not be deemed a waiver or
relinquishment of such right or power at any other time or times.
Section 6.8 Notices.
Any notice or other communication required or permitted to be given
to a party under the Plan shall be deemed given if delivered personally or by
overnight delivery service, sent by facsimile transmission, or mailed (postage
pre-paid, by certified mail, return receipt requested) to the party at the
address listed below, or at such other address as one such party may by written
notice specify to the other:
(a) if to the Administrative Committee:
The Dime Savings Bank of New York, FSB
589 Fifth Avenue
New York, New York 10017
Fax: (212) 326-6194
-20-
25
Attention: Secretary to the Board
(b) if to any party other than the Administrative Committee, to
such party at the address last furnished by such party by
written notice to the Administrative Committee.
Section 6.9 Governing Law.
The Plan shall be construed, administered and enforced according to
the laws of the State of New York, except to the extent that such laws are
preempted by federal law.
-21-