1
DEFERRED INVESTMENT PLAN FOR OUTSIDE DIRECTORS
November 28, 1990
As amended and
restated on
April 27, 1992
1. PURPOSE. The purpose of the Plan is to provide Directors of
Medford Savings Bank (the "Bank") and Regional Bancorp, Inc. ("Regional") with
deferred benefits upon retirement and to allow Directors to participate in the
growth of Regional and the Bank through the acquisition of a beneficial interest
in Regional common stock, par value $0.10 per share (the "Common Stock").
2. ADMINISTRATION. The Plan shall be administered by an
Administrative Committee consisting of three or more persons appointed by the
Board of Directors of Regional and the Bank. The Administrative Committee shall
have the authority to adopt rules and regulations for carrying out the Plan, and
to interpret, construe and implement the provisions of the Plan.
3. ELIGIBILITY; EFFECTIVE DATE. Each member of the Board of Directors
of Regional and the Bank who is not an employee of Regional or the Bank (a
"Director") shall be entitled to participate in the Plan. The effective date of
the Plan is December 17, 1990 (the "Effective Date"). The Plan Year for the
initial period following adoption shall begin on the Effective Date and shall
end on January 31, 1991. Thereafter each Plan Year shall be the twelve-month
period beginning on February 1 and ending on January 31.
4. DIRECTORS' DEFERRAL. Each Director may elect to defer payment of
all or any part of the annual retainer fees, meeting fees, committee fees and
other payments for services rendered by the Director to Regional or the Bank on
or after the Effective Date (the "Fees")
2
pursuant to the provisions of this Plan. A Director's election to defer Fees
shall be in writing and shall be effective upon receipt and acceptance by
Regional and the Bank. For the initial Plan Year, such election shall be made
not later than the Effective Date. In succeeding Plan Years, such election shall
be made not later than six (6) months prior to the commencement of the next
succeeding Plan Year. Any election may be revoked or changed if it is made in
writing not later than six (6) months prior to the commencement of the next Plan
Year, but only as to Fees to be earned at and after commencement of the next
succeeding Plan Year. For the initial Plan Year, a Director also may elect, on
or before the Effective Date, to transfer to an account which will be
established under Section 5 of the Plan any or all of the money which has been
credited to such Director's deferred compensation account ("Transferred Fees")
pursuant to the Medford Savings Bank Director's Deferred Compensation Plan.
5. ESTABLISHMENT OF TRUST; DIRECTORS' ACCOUNTS. In connection with
the adoption of the Plan, Regional and the Bank shall establish a nonqualified
trust (the "Rabbi Trust"). All Fees and Transferred Fees shall be deposited in
the Rabbi Trust on behalf of the participating Directors. Regional, the Bank and
the Trustee of the Rabbi Trust shall maintain a book account for each Director
to which such Fees and Transferred Fees shall be credited (the "Account"). Fees
shall be deposited in the Rabbi Trust and credited to a Director's Account on a
quarterly basis within five (5) business days after the end of the fiscal
quarter during which the compensation constituting such Fees was earned.
In accordance with the terms of the Rabbi Trust, all Fees and
Transferred Fees shall be invested by the Trustee of the Rabbi Trust in shares
of Common Stock. Each Director's Account shall indicate the number of shares of
Common Stock which have been purchased and
2
3
are being held in the Trust on behalf of each Director. Cash dividends paid on
shares of Common Stock held in the Rabbi Trust shall be used to purchase
additional shares of Common Stock and shall be credited to the Directors'
Accounts. Stock dividends, stock splits and other distributions payable on
Common Stock also will be held in the Rabbi Trust and shall be credited to the
Directors' Accounts. The Trustee may acquire up to 350,000 shares of Common
Stock under the Plan, subject to adjustment in the event of a stock dividend,
stock split, recapitalization or similar event.
6. UNSECURED GENERAL CREDITOR. Notwithstanding anything to the
contrary contained herein, neither the Directors nor any beneficiaries
designated by them, nor any of their respective representatives or estates,
shall have any right, other than the right of an unsecured general creditor,
against the Bank with respect to the Directors' Accounts, the Rabbi Trust and
the shares of Common Stock held in the Rabbi Trust. Notwithstanding anything to
the contrary contained herein, to the extent Regional or the Bank contributes
amounts representing Fees and Transferred Fees on behalf of Directors to the
Rabbi Trust, Regional or the Bank, as the case may be, shall be relieved and
released of any and all liability to Directors with respect to such
contributions.
7. DISTRIBUTION.
(a) No withdrawals may be made from an Account by a Director
except as set forth in this Section. Subject to the discretion of the Trustee to
accelerate a distribution in the case of unforeseeable financial need or
hardship, the number of shares of Common Stock allocated to a Director's Account
shall be distributed in annual installments (as nearly equal in amount as
possible) over a three (3) year period after a Director ceases to be a Director
of
3
4
Regional and the Bank; PROVIDED, HOWEVER, that under no circumstances shall a
Director receive any distributions of shares of Common Stock until six months
after he ceases to be a Director. In lieu of distributing fractional shares of
Common Stock, a Director will receive cash equal to the fair market value of
such fractional shares at the close of business on the day preceding the day on
which such distribution is made.
(b) In the event of the Director's death prior to the time at
which distributions have been made pursuant to Section 7(a), the beneficiary or
beneficiaries designated by the Director in writing to Regional and the Bank
prior to the Director's death or, failing such designation, the Director's
estate shall receive the distributions from the Director's Account in the same
manner provided in Section 7(a).
8. NON-ASSIGNABLE. The right to receive shares of Common Stock under
this Plan shall not be subject to alienation, assignment, garnishment,
execution, levy, pledge, sale or transfer of any kind, except by will or by the
laws of decent and distribution, and any attempt to cause any such right to
receive shares of Common Stock to be so subjected, except by will or by the laws
of descent and distribution, shall not be recognized.
9. EXPENSES. Regional and the Bank shall pay all expenses and taxes
in connection with the Plan and the Rabbi Trust.
10. PARTIES. The terms of this Plan shall be binding upon Regional,
the Bank and their successors or assigns and each Director participating herein
and his beneficiaries, heirs, executors and administrators.
11. LIABILITY OF REGIONAL AND THE BANK. Neither Regional, the Bank nor
any person acting on behalf of Regional or the Bank shall be liable for any act
performed or the failure to
4
5
perform any act with respect to this Plan, except in the event that there has
been a judicial determination of willful misconduct on the part of Regional or
the Bank or such person.
12. TERMINATION; AMENDMENT. Regional and the Bank may terminate this
Plan on ninety (90) days' written notice to each Director participating herein.
A termination of the Plan shall have no effect other than to eliminate the right
of each Director to defer further compensation under this Plan. The Board of
Directors of Regional and the Bank may amend the Plan at any time and from time
to time; provided that any such amendments that require stockholder approval
under applicable laws and regulations shall also be approved by stockholders of
Regional at an annual or special meeting of such stockholders to the extent
required by and in accordance with any such laws or regulations. No amendment
shall, without the consent of a Director, adversely affect such Director's
rights under the Plan.
13. NOTICES; GOVERNING LAW.
(a) Notices, elections or designations by a Director to Regional
or the Bank hereunder shall be addressed to the attention of the Treasurer of
Regional or the Bank, as the case may be.
(b) This Agreement shall be construed and enforced in accordance
with, and governed by, the laws of the State of Delaware.
5