Exhibit 10.1
FIRST UNITED BANK AND TRUST
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
RECITALS:
WHEREAS, The Employer hereby establishes the First United Bank and
Trust Supplemental Executive Retirement Plan on the terms and conditions
hereinafter set forth; and
WHEREAS, The Plan is intended to qualify as a "top hat" plan maintained
primarily for purposes of providing benefits for a select group of management
and highly compensated employees within the meaning of Sections 201(2),
301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974,
as amended.
NOW THEREFORE, the following shall constitute the Plan.
ARTICLE I
GENERAL
1.1 Purpose of the Plan. The purpose of this Plan is to reward certain
management and highly compensated employees of the Employer who have
contributed to the Employer's success and are expected to continue to
contribute to such success in the future.
1.2 Plan Benefits Generally. Pursuant to the Plan, the Employer may provide
to each Participant, such benefit as provided on the terms and
conditions contained in the Participant's Participation Agreement.
1.3 Effective Date. The effective date of the Plan is November 1, 2001.
ARTICLE II
DEFINITIONS
2.1 Administrator. Administrator shall mean the Corporate Executive
Committee as defined herein.
2.2 Beneficiary. Beneficiary means the person or persons designated by a
Participant as his beneficiary hereunder in accordance with the
provisions of Article V and subject to the Participation Agreement.
2.3 Board. Board means the Board of Directors of the Employer.
2.3a Cause. See Section 4.2.
2.4 Change of Control. Change of Control shall mean the happening of any of
the following:
(a) any person or entity, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of
1934, other than the Employer or a wholly-owned
subsidiary thereof or any employee benefit plan of the
Employer or any Subsidiary, becomes the beneficial
owner of the Employer's securities having 20% or more
of the combined voting power of the then outstanding
securities of the Employer that may be cast for the
election of directors of the Employer (other than as a
result of an issuance of securities initiated by the
Employer in the ordinary course of business); or
(b) as the result of, or in connection with, any cash
tender or exchange offer, merger or other business
combination, sale of assets or contested election, or
any combination of the foregoing transactions less than
a majority of the combined voting power of the then
outstanding securities of the Employer or any successor
corporation or entity entitled to vote generally in the
election of the directors of the Employer or such other
corporation or entity after such transaction are
held in the aggregate by the holders of the Employer's
securities entitled to vote generally in the election
of directors of the Employer immediately prior to such
transaction; or
(c) during any period of two consecutive years, individuals
who at the beginning of any such period constitute the
Board cease for any reason to constitute at least a
majority thereof, unless the election, or the
nomination for election by the Employer's stockholders,
of each director of the Employer first elected during
such period was approved by a vote of at least
two-thirds of the directors of the Employer then still
in office who were directors of the Employer at the
beginning of any such period.
2.5 Corporate Executive Committee. For the initial Plan year, and for
subsequent Plan Years until amended, the Corporate Executive Committee
shall consist of those Board members elected annually.
2.6 Employer. First United Bank and Trust.
2.7 Executive. Executive means a management or highly compensated employee
of the Employer designated by the Administrator as eligible to
participate in the Plan.
2.8 Normal Retirement. Normal Retirement means termination of a
Participant's employment with the Employer for any reason other than
for Cause after such Participant has attained his Normal Retirement
Age. If a Participant terminates employment with the Employer for any
reason other than for Cause after becoming vested but before reaching
his Normal Retirement Age, then he may take Normal Retirement upon
reaching his Normal Retirement Age.
2.9 Normal Retirement Age. Normal Retirement Age means the normal
retirement age set forth in the Participation Agreement.
2.10 Participant. Participant means any Executive who elects to participate
in the Plan by entering into a Participation Agreement in accordance
herewith. The Administrator may from time to time, in its sole
discretion with or without cause, revoke a Participant's participation
in the Plan upon ninety (90) days' written notice; provided, however,
that such revocation shall not reduce any benefits to which the
Participant may have already become entitled at the time of such
revocation.
2.11 Participation Agreement. Participation Agreement means a written
agreement between the Employer and a Participant, pursuant to which the
Employer agrees to make SERP Benefit payments in accordance with the
Plan. Each Participation Agreement shall contain such information,
terms and conditions as the Administrator in its discretion may
specify, including without limitation, the following:
(a) the effective date of the Participant's participation
in the Plan;
(b) the Participant's Normal Retirement Age;
(c) the SERP Benefits to which the Participant is entitled
under the Plan and, the form such benefits are to be
paid in (i.e. installments or lump sum);
(e) the identity of the Participant's Beneficiary; and
(f) any other provisions which alter or supplement the
terms and conditions contained in the Plan.
2.12 Plan. Plan means the First United Bank and Trust Supplemental Executive
Retirement Plan, as the same may be altered or supplemented in any
validly executed Participation Agreement.
2.13 Plan Year. Plan Year means calendar year; January 1 through December
31, provided that the initial plan year shall be November 1, 2001, to
December 31, 2001.
2.14 SERP. Supplemental Executive Retirement Plan of the Employer.
2.15 SERP Benefit. SERP Benefit means, with respect to each Participant, an
amount determined pursuant to Section 8 of the Participant's
Participation Agreement, minus any offset amounts specified therein.
2.16 Vesting. The Participant's ownership rights in the SERP Benefit shall
arise, or vest, with the occurrence of those conditions precedent to
Vesting as contained in the Participation Agreement.
2.17 Years of Service. Years of Service shall have the meaning as set forth
in the Participant's Participation Agreement.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.1 Eligibility. The Administrator, in its sole discretion, shall from time
to time determine those Executive(s) who shall be eligible to
participate in the Plan.
3.2 Participation. Each Executive who is eligible to participate in the
Plan shall enroll in the Plan by entering into a Participation
Agreement and completing such other forms and furnishing such other
information as the Administrator may request. An Executive's
participation in the Plan shall commence as of the date specified in
the Participation Agreement.
ARTICLE IV
BENEFITS
4.1 SERP Benefit. Each Participant, subject to the terms and conditions of
his Participation Agreement, shall become entitled to receive such SERP
Benefit as set forth in the executed Participation Agreement.
4.2 No Benefits Payable Upon Termination for Cause. Notwithstanding
anything herein to the contrary, no benefits shall be payable to any
Participant who is terminated from his or her employment with the
Employer for Cause, regardless of whether the Participant has attained
Normal Retirement Age or is vested. For purposes hereof, a Participant
whose employment is terminated for any of the following reasons shall
be regarded as having been terminated for Cause:
(a) engaging in willful or grossly negligent misconduct
that is materially injurious to the Employer;
(b) embezzlement or misappropriation of funds or property
of the Employer;
(c) conviction of a felony or the entrance of a plea of
guilty or nolo contendere to a felony;
(d) conviction of any crime involving fraud, dishonesty,
moral turpitude or breach of trust or the entrance of a
plea of guilty or nolo contendere to such a crime;
(e) failure or refusal by the Participant to devote full
business time and attention to the performance of his
or her duties and responsibilities if such breach has
not been cured within fifteen (15) days after notice is
given to the Participant; or
(f) issuance of a final non-appealable order or other
direction by a Federal or state regulatory agency
prohibiting the Participant's employment in the
business of banking.
ARTICLE V
BENEFICIARIES
5.1 Beneficiary. The Participant's executed Participation Agreement shall
dictate the Participant's rights and responsibilities regarding the
Participant's Beneficiary(s).
ARTICLE VI
Plan Administration
6.1 Administration.
(a) General. The Plan shall be administered by the
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Administrator. The Administrator shall have sole and
absolute discretion to interpret where necessary all
provisions of the Plan (including, without limitation,
by supplying omissions from, correcting deficiencies
in, or resolving inconsistencies or ambiguities in, the
language of the Plan), to determine the rights and
status under the Plan of Participants or other persons,
to resolve questions or disputes arising under the Plan
and to make any determinations with respect to the
benefits payable under the Plan and the persons
entitled thereto as may be necessary for the purposes
of the Plan. The Administrator's determination of the
rights of any employee or former employee hereunder
shall be final and binding on all persons, subject only
to the claims procedures outlined in Article 7 hereof.
(b) Delegation of Duties. The Administrator may delegate
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any of its administrative duties, including, without
limitation, duties with respect to the processing,
review, investigation, approval and payment of benefits
payable hereunder, to a named administrator or
administrators.
6.2 Regulations. The Administrator may promulgate any rules and regulations
it deems necessary in order to carry out the purposes of the Plan or to
interpret the provisions of the Plan; provided, however, that no rule,
regulation or interpretation shall be contrary to the provisions of the
Plan. The rules, regulations and interpretations made by the
Administrator shall, subject only to the claims procedure outlined in
Article 7 hereof, be final and binding on all persons.
6.3 Revocability of Administrator/Employer Action. Any action taken by the
Administrator with respect to the rights or benefits under the Plan of
any employee or former employee shall be revocable by the Administrator
or the Employer as to payments not yet made to such person. Acceptance
of any benefits under the Plan constitutes acceptance of, and agreement
to, the Administrator's or the Employer's making any appropriate
adjustments in future payments to such person (or to recover from such
person) any excess payment or underpayment previously made to such
person.
6.4 Amendment. The Board may at any time amend any or all of the provisions
of this Plan. Any amendment shall be in the form of a written
instrument executed by an officer of the Employer pursuant to a
resolution adopted by the Board. Subject to the foregoing provisions of
this Section 6.4, such amendment shall become effective as of the date
specified in such instrument or, if no such date is specified, on the
date of its execution. Notwithstanding the preceding, no amendment
shall reduce any vested benefits which the Participant has already
become entitled to at the time of the amendment, including benefits to
which the Participant became entitled due to a Change of Control.
6.5 Termination. The Board, in its discretion, may terminate this Plan at
any time and for any reason whatsoever, except that no such termination
may (i) reduce the amount of the Participant's vested benefit as of the
date of such termination, including benefits to which the Participant
became entitled due to a Change of Control or (ii) change the time or
form of distribution of the amount of the Participant's benefit as of
the date of such termination, without the prior written consent of such
Participant. Any such termination shall be expressed in the form of a
written instrument executed by an officer of the Employer pursuant to a
resolution adopted by the Board. Subject to the foregoing provisions of
this Section 6.5, such termination shall become effective as of the
date specified in such instrument or, if no such date is specified, on
the date of its execution. Written notice of any termination shall be
given to the Participants as soon as practicable after the instrument
is executed.
6.6 Withholding. The Employer shall deduct from any distributions hereunder
any taxes or other amounts required by law to be withheld therefrom.
Article VII
Claims Administration
7.1 General. If a Participant, Beneficiary, or Participant's representative
is denied all or a portion of an expected Plan benefit for any reason
and the Participant, Beneficiary, or Participant's representative
desires to dispute the decision of the Administrator, he must file a
written notification of his claim with the Administrator.
7.2 Claim Review. Upon receipt of any written claim for benefits, the
Administrator shall be notified and shall give due consideration to the
claim presented. If the claim is denied to any extent by the
Administrator, the Administrator shall furnish the claimant with a
written notice within 90 days after receipt of the claim (which period
may be extended for 90 days for special circumstances) setting forth:
(a) the specific reason or reasons for denial of the claim;
(b) a specific reference to the Plan provisions on which
the denial is based;
(c) a description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is
necessary; and
(d) an explanation of the provisions of this Article
appropriate information as to the steps to be taken if
the Participant or Beneficiary wishes to submit his
claim for review.
7.3 Right of Appeal. A claimant who has a claim denied under Section 7.2
may appeal to the Administrator for reconsideration of that claim. A
request for reconsideration under this section must be filed by written
notice within sixty (60) days after receipt by the claimant of the
notice of denial. A claimant or his duly authorized representative may
(i) request a review upon written application to the Plan; (ii) review
pertinent documents; and (iii) submit issues and comments in writing.
7.4 Review of Appeal. Upon receipt of an appeal, the Administrator shall
promptly take action to give due consideration to the appeal. Such
consideration may include a hearing of the parties involved, if the
Administrator believes such a hearing is necessary. After consideration
of the merits of the appeal the Administrator shall issue a written
decision, which shall be binding on all parties subject to Section 7.6
below. The decision shall be written in a manner calculated to be
understood by the claimant and shall specifically state its reasons and
pertinent Plan provisions on which it relies. The Administrator's
decision shall be issued within sixty (60) days after the appeal is
filed, except that if a hearing is held the decision may be issued
within one hundred twenty (120) days after the appeal is filed.
7.5 Designation. The Administrator may designate any other person of its
choosing to make any determination otherwise required under this
Article.
ARTICLE VIII
MISCELLANEOUS
8.1 Administrator. The Administrator:
(a) is expressly empowered to interpret the Plan and to
determine all questions arising in the administration,
interpretation, and application of the Plan; to employ
actuaries, accountants, counsel, and other persons it
deems necessary in connection with the administration
of the Plan; to request any information from the
Employer it deems necessary to determine whether the
Employer would be considered insolvent or subject to a
proceeding in bankruptcy; and to take all other
necessary and proper actions to fulfill its duties as
Administrator;
(b) shall not be liable for any actions by it hereunder
unless due to its own gross negligence or willful
misconduct; and
(c) shall be indemnified and saved harmless by the Employer
from and against all personal liability to which it may
be subject by reason of any act done or omitted to be
done in its official capacity as Administrator in good
faith in the administration of the Plan, including all
expenses reasonably incurred in its defense in the
event the Employer fails to provide such defense upon
the request of the Administrator. The Administrator is
relieved of all responsibility in connection with its
duties hereunder to the fullest extent permitted by
law, except any breach of duty to the Participants or
Beneficiaries.
8.2 No Assignment. No benefit under the Plan shall be subject in any manner
to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge, and any such action shall be void for all
purposes of the Plan. No benefit shall in any manner be subject to the
debts, contracts, liabilities, engagements, or torts of any person, nor
shall it be subject to attachments or other legal process for or
against any person, except to such extent as may be required by law.
8.3 No Employment Rights. Participation in this Plan shall not be construed
to confer upon any Participant the legal right to be retained in the
employ of the Employer, or give a Participant or Beneficiary, or any
other person, any right to any payment whatsoever, except to the extent
of the benefits provided for hereunder. Each Participant shall remain
subject to discharge to the same extent as if this Plan had never been
adopted.
8.4 Incompetence. If the Administrator determines that any person to whom a
benefit is payable under this Plan is incompetent by reason of physical
or mental disability, the Administrator shall have the power to cause
the payments becoming due to such person to be made to another
individual for the Participant's benefit without responsibility of the
Administrator or the Employer to see to the application of such
payments. Any payment made pursuant to such power shall, as to such
payment, operate as a complete discharge of the Employer, the
Administrator, the Trustee, and their representatives.
8.5 Identity. If, at any time, any doubt exists as to the identity of any
person entitled to any payment hereunder or the amount or time of such
payment, the Administrator shall be entitled to hold such sum until
such identity or amount or time is determined or until an order of a
court of competent jurisdiction is obtained. The Administrator shall
also be entitled to pay such sum into court in accordance with the
appropriate rules of law. Any expenses incurred by the Employer or
Administrator incident to such proceeding or litigation shall be
charged against the SERP Benefit of the affected Participant.
8.6 No Liability. No liability shall attach to or be incurred by any
employee of the Employer or Administrator individually under or by
reason of the terms, conditions, and provisions contained in this Plan,
or for the acts or decisions taken or made hereunder or in connection
therewith; and, as a condition precedent to the establishment of this
Plan or the receipt of benefits hereunder, or both, such liability, if
any, is expressly waived and released by each Participant and by any
and all persons claiming under or through any Participant or any other
person. Such waiver and release shall be conclusively evidenced by any
act or participation in or the acceptance of benefits or the making of
any election under this Plan.
8.7 Expenses. Except as otherwise provided in the Plan, all expenses
incurred in the administration of the Plan, whether incurred by the
Employer or the Plan, shall be paid by the Employer.
8.8 Amendment and Termination. Except as otherwise provided in this
section, the Employer shall have the sole authority to modify, amend,
or terminate this Plan. Notwithstanding the preceding, no amendment
shall reduce any vested benefits which the Participant has already
become entitled to at the time of the amendment, including benefits to
which the Participant became entitled to due to a Change of Control.
8.9 Employer Determinations. Any determinations, actions, or decisions of
the Employer (including but not limited to, Plan amendments and Plan
termination) shall be made by the Board in accordance with its
established procedures or by such other individuals, groups, or
organizations that have been properly delegated by the Board to make
such determination or decision.
8.10 Construction. All questions of interpretation, construction or
application arising under or concerning the terms of this Plan shall be
decided by the Administrator, in its sole and final discretion, whose
decision shall be final, binding and conclusive upon all persons.
8.11 Governing Law. To the extent not preempted by federal law, this Plan
shall be governed by, construed and administered under the laws of the
State of Maryland, without regard to any principles of conflicts of law
of such State.
8.12 Severability. Should any provision of the Plan or any regulations
adopted hereunder be deemed or held to be unlawful or invalid for any
reason, such fact shall not adversely affect the other provisions or
regulations unless such invalidity shall render impossible or
impractical the functioning of the Plan and, in such case, the
appropriate parties shall immediately adopt a new provision or
regulation to take the place of the one held illegal or invalid.
8.13 Headings. The headings contained in the Plan are inserted only as a
matter of convenience and for reference and in no way define, limit,
enlarge, or describe the scope or intent of this Plan nor in any way
shall they affect this Plan or the construction of any provision
thereof.
8.14 Terms. Capitalized terms shall have meanings as defined herein.
Singular nouns shall be read as plural, masculine pronouns shall be
read as feminine, and vice versa, as appropriate.
8.15 Ownership of Assets; Relationship with Employer. Participants shall
have no right, title or interest whatsoever in or to any assets or
amounts which are used to pay benefits under the Plan. Nothing
contained in the Plan, and no action taken pursuant to its provisions,
shall create or be construed to create a trust of any kind or a
fiduciary relationship between the Employer and any Participant or any
other person. To the extent that any person acquires a right to receive
payments from the Employer under this Plan, such right shall be no
greater than the right of an unsecured general creditor of the
Employer.
8.16 Deposits in Trust. The Employer may, at its sole discretion, establish
with a corporate trustee a grantor rabbi trust under which all or a
portion of the assets of the Plan are to be held, administered and
managed. The trust agreement evidencing the trust shall conform with
the terms of Revenue Procedure 92-64. The trust may be a springing
trust. The Employer in its sole discretion may make deposits to augment
the principal of such trust.
8.17 Entire Agreement. This Agreement sets forth the entire agreement of the
parties with respect to the subject matter hereof. Any and all prior
agreements or understandings with respect to such matters are hereby
superseded.
Executed this 1st day of November, 2001.
FIRST UNITED BANK AND TRUST
By: /s/ William B. Grant
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Title: Chairman & CEO
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ATTESTED:
By: _____________________________________
Title: __________________________________