Exhibit 10(b)
PROVIDENT COMMUNITY BANK, NATIONAL ASSOCIATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
THIS SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (the "Agreement") is adopted
this 1st day of January, 2007, by and between Provident Community Bank, National
Association, a nationally-chartered commercial bank located in Union, South
Carolina (the "Bank"), and Lud Vaughn (the "Executive").
The purpose of this Agreement is to provide specified benefits to the
Executive, a member of a select group of management or highly compensated
employees who contribute materially to the continued growth, development and
future business success of the Bank. This Agreement shall be unfunded for tax
purposes and for purposes of Title I of the Employee Retirement Income Security
Act of 1974 ("ERISA"), as amended from time to time.
Article 1
Definitions
Whenever used in this Agreement, the following words and phrases shall have
the meanings specified:
1.1 "Accrual Balance" means the liability that should be accrued by the Bank,
under Generally Accepted Accounting Principles ("GAAP"), for the Bank's
obligation to the Executive under this Agreement, by applying Accounting
Principles Board Opinion Number 12 ("APB 12") as amended by Statement of
Financial Accounting Standards Number 106 ("FAS 106") and the Discount
Rate. Any one of a variety of amortization methods may be used to determine
the Accrual Balance. However, once chosen, the method must be consistently
applied.
1.2 "Beneficiary" means each designated person or entity, or the estate of the
deceased Executive, entitled to any benefits upon the death of the
Executive pursuant to Article 4.
1.3 "Beneficiary Designation Form" means the form established from time to time
by the Plan Administrator that the Executive completes, signs and returns
to the Plan Administrator to designate one or more Beneficiaries.
1.4 "Board" means the Board of Directors of the Bank as from time to time
constituted.
1.5 "Change in Control" means an event deemed to occur if and when (a) an
offeror other than the Company purchases shares of the common stock of the
Company or the Bank pursuant to a tender or exchange offer for such shares,
(b) any person (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934) is or becomes the beneficial owner,
directly or indirectly, of securities of the Company or the Bank
representing twenty five percent (25%) or more of the combined voting power
of the Company's of the Bank's then outstanding securities, (c) the
membership of the board of directors of the Company or the Bank changes as
the result of a contested election, such that individuals who were
directors at the beginning of any twenty-four (24) month period (whether
commencing before or after the date of adoption of this Agreement) do not
constitute a majority of the Board at the end of such period, or (d)
shareholders of the Company or the Bank approve a merger, consolidation,
sale or disposition of all or substantially all of the Company's or Bank's
assets, or a plan of partial or complete liquidation.
1.6 "Code" means the Internal Revenue Code of 1986, as amended, and all
regulations and guidance thereunder, including such regulations and
guidance as may be promulgated after the Effective Date of this Agreement.
1.7 "Company" means Union Financial Bancshares, Inc., a Delaware corporation.
1.8 "Disability" means the Executive suffering a sickness, accident or injury
which has been determined by the carrier of any individual or group
disability insurance policy covering the Executive, or by the Social
Security Administration, to be a disability rendering the Executive totally
and permanently disabled. The Executive must submit proof to the Company of
the carrier's or Social Security Administration's determination upon the
request of the Company.
1.9 "Discount Rate" means the rate used by the Plan Administrator for
determining the Accrual Balance. The initial Discount Rate is six percent
(6%). However, the Plan Administrator, in its discretion, may adjust the
Discount Rate to maintain the rate within reasonable standards according to
GAAP and/or applicable bank regulatory guidance.
1.10 "Early Retirement" means Separation from Service before Normal Retirement
Age except when such Separation from Service occurs: (i) following a Change
in Control; or (ii) due to death, Disability or Termination for Cause.
1.11 "Effective Date" means January 1, 2007.
1.12 "Normal Retirement Age" means the Executive attaining age sixty-five (65).
1.13 "Normal Retirement Date" means the later of Normal Retirement Age or
Separation from Service.
1.14 "Plan Administrator" means the Board or such committee or person as the
Board shall appoint.
1.15 "Plan Year" means each twelve (12) month period commencing on October 1 and
ending on September 30 of each year. The initial Plan Year shall commence
on the Effective Date of this Agreement and end on the following September
30.
1.16 "Separation from Service" means the termination of the Executive's
employment with the Bank for reasons other than death. Whether a Separation
from Service takes place is determined based on the facts and circumstances
surrounding the termination of the Executive's employment and whether the
Bank and the Executive intended for the Executive to provide significant
services for the Bank following such termination. A termination of
employment will not be considered a Separation from Service if:
(a) the Executive continues to provide services as an employee of the Bank
at an annual rate that is twenty percent (20%) or more of the services
rendered, on average, during the immediately preceding three full
calendar years of employment (or, if employed less than three years,
such lesser period) and the annual remuneration for such services is
twenty percent (20%) or more of the average annual remuneration earned
during the final three full calendar years of employment (or, if less,
such lesser period), or
(b) the Executive continues to provide services to the Bank in a capacity
other than as an employee of the Bank at an annual rate that is fifty
percent (50%) or more of the services rendered, on average, during the
immediately preceding three full calendar years of employment (or if
employed less than three years, such lesser period) and the annual
remuneration for such services is fifty percent (50%) or more of the
average annual remuneration earned during the final three full
calendar years of employment (or if less, such lesser period).
1.17 "Specified Employee" a key employee (as defined in Section 416(i) of the
Code without regard to paragraph 5 thereof) of the Bank if any stock of the
Bank is publicly traded on an established securities market or otherwise.
1.18 "Termination for Cause" shall have the meaning set forth in Article 5.
Article 2
Distributions During Lifetime
2.1 Normal Retirement Benefit. Upon the Normal Retirement Date, the Bank shall
distribute to the Executive the benefit described in this Section 2.1 in
lieu of any other benefit under this Article.
2.1.1 Amount of Benefit. The annual benefit under this Section 2.1 is Fifty
Thousand Dollars ($50,000).
2.1.2 Distribution of Benefit. The Bank shall distribute the annual benefit
to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Normal Retirement Date. The
annual benefit shall be distributed to the Executive for fifteen (15)
years.
2.2 Early Retirement Benefit. If Early Retirement occurs, the Bank shall
distribute to the Executive the benefit described in this Section 2.2 in
lieu of any other benefit under this Article.
2.2.1 Amount of Benefit. The benefit under this Section 2.2 is the Normal
Retirement Benefit multiplied by the applicable vesting amount. This
benefit is determined by vesting the Executive in ten percent (10%) of
the Normal Retirement Benefit for the first Plan Year, and an
additional ten percent (10%) of said amount for each succeeding year
thereafter. Upon the Executive reaching Normal Retirement Age, the
Executive becomes one hundred percent (100%) vested in the Normal
Retirement Benefit.
2.2.2 Distribution of Benefit. The Bank shall distribute the annual benefit
to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Normal Retirement Age. The
annual benefit shall be distributed to the Executive for fifteen (15)
years.
2.3 Disability Benefit. If the Executive experiences a Disability which results
in a Separation from Service prior to Normal Retirement Age, the Bank shall
distribute to the Executive the benefit described in this Section 2.3 in
lieu of any other benefit under this Article.
2.3.1 Amount of Benefit. The benefit under this Section 2.3 is one hundred
percent (100%) of the Accrual Balance determined as of the end of the
Plan Year preceding Separation from Service.
2.3.2 Distribution of Benefit. The Bank shall distribute the annual benefit
to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Separation from Service. The
annual benefit shall be distributed to the Executive for fifteen (15)
years. During the applicable installment period, interest will be
applied to the Accrual Balance at the Discount Rate in effect at
Separation from Service, compounded monthly.
2.4 Change in Control Benefit. If a Change in Control occurs followed by a
Separation from Service, the Bank shall distribute to the Executive the
benefit described in this Section 2.4 in lieu of any other benefit under
this Article.
2.4.1 Amount of Benefit. The benefit under this Section 2.4 is one hundred
percent (100%) of the Normal Retirement Benefit amount described in
Section 2.1.1.
2.4.2 Distribution of Benefit. The Bank shall distribute the annual benefit
to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Normal Retirement Age. The
annual benefit shall be distributed to the Executive for fifteen (15)
years.
2.5 Restriction on Timing of Distribution. Notwithstanding any provision of
this Agreement to the contrary, if the Executive is considered a Specified
Employee at Separation from Service under such procedures as established by
the Bank in accordance with Section 409A of the Code, benefit distributions
that are made upon Separation from Service may not commence earlier than
six (6) months after the date of such Separation from Service. Therefore,
in the event this Section 2.5 is applicable to the Executive, any
distribution which would otherwise be paid to the Executive within the
first six months following the Separation from Service shall be accumulated
and paid to the Executive in a lump sum on the first day of the seventh
month following the date of Separation from Service. All subsequent
distributions shall be paid in the manner specified.
2.6 Distributions Upon Income Inclusion Under Code Section 409A. Upon the
inclusion of any amount into the Executive's income as a result of the
failure of this non-qualified deferred compensation plan to comply with the
requirements of Section 409A of the Code, to the extent such tax liability
can be covered by the Executive's Accrual Balance, a distribution shall be
made as soon as is administratively practicable following the discovery of
the plan failure.
2.7 Change in Form or Timing of Distributions. For distribution of benefits
under this Article 2, the Executive and the Bank may, subject to the terms
of Section 8.1, amend the Agreement to delay the timing or change the form
of distributions. Any such amendment:
(a) may not accelerate the time or schedule of any distribution,
except as provided in Code Section 409A and the regulations
thereunder;
(b) must, for benefits distributable under Sections 2.2 and 2.4 be
made at least twelve (12) months prior to the first scheduled
distribution;
(c) must, for benefits distributable under Article 2 delay the
commencement of distributions for a minimum of five (5) years
from the date the first distribution was originally scheduled to
be made; and
(d) must take effect not less than twelve (12) months after the
amendment is made.
Article 3
Distribution at Death
3.1 Death During Active Service. If the Executive dies prior to Separation from
Service, the Bank shall distribute to the Beneficiary the benefit described
in this Section 3.1. This benefit shall be distributed in lieu of any
benefits under Article 2.
3.1.1 Amount of Benefit. The benefit under this Section 3.1 is the Normal
Retirement Benefit in Section 2.1.1.
3.1.2 Distribution of Benefit. The Bank shall distribute the annual benefit
to the Beneficiary in twelve (12) equal monthly installments for
fifteen (15) years commencing within sixty (60) days following receipt
by the Bank of the Executive's death certificate.
3.2 Death During Distribution of a Benefit. If the Executive dies after any
benefit distributions have commenced under this Agreement but before
receiving all such distributions, the Bank shall distribute to the
Beneficiary the remaining benefits at the same time and in the same amounts
they would have been distributed to the Executive had the Executive
survived.
3.3 Death After Early Retirement. If the Executive dies after Separation from
Service for Early Retirement under Section 2.2 but prior to commencement of
benefit payments under this Agreement, the Bank shall pay to the
Beneficiary the benefit described in Section 3.3.
3.3.1 Amount of Benefit. The benefit under this Section 3.3 is the lifetime
benefits that would have been paid to the Executive under Section 2.2.
3.3.2 Payment of Benefit. The Bank shall distribute the annual benefit to
the Beneficiary in twelve (12) equal monthly installments commencing
on the first day of the month following the Executive's death. The
annual benefit shall be distributed to the Executive for fifteen (15)
years.
Article 4
Beneficiaries
4.1 In General. The Executive shall have the right, at any time, to designate a
Beneficiary to receive any benefit distributions under this Agreement upon
the death of the Executive. The Beneficiary designated under this Agreement
may be the same as or different from the beneficiary designation under any
other plan of the Bank in which the Executive participates.
4.2 Designation. The Executive shall designate a Beneficiary by completing and
signing the Beneficiary Designation Form and delivering it to the Plan
Administrator or its designated agent. If the Executive names someone other
than the Executive's spouse as a Beneficiary, the Plan Administrator may,
in its sole discretion, determine that spousal consent is required to be
provided in a form designated by the Plan Administrator, executed by the
Executive's spouse and returned to the Plan Administrator. The Executive's
beneficiary designation shall be deemed automatically revoked if the
Beneficiary predeceases the Executive or if the Executive names a spouse as
Beneficiary and the marriage is subsequently dissolved. The Executive shall
have the right to change a Beneficiary by completing, signing and otherwise
complying with the terms of the Beneficiary Designation Form and the Plan
Administrator's rules and procedures. Upon the acceptance by the Plan
Administrator of a new Beneficiary Designation Form, all Beneficiary
designations previously filed shall be cancelled. The Plan Administrator
shall be entitled to rely on the last Beneficiary Designation Form filed by
the Executive and accepted by the Plan Administrator prior to the
Executive's death.
4.3 Acknowledgment. No designation or change in designation of a Beneficiary
shall be effective until received, accepted and acknowledged in writing by
the Plan Administrator or its designated agent.
4.4 No Beneficiary Designation. If the Executive dies without a valid
beneficiary designation, or if all designated Beneficiaries predecease the
Executive, then the Executive's spouse shall be the designated Beneficiary.
If the Executive has no surviving spouse, any benefits shall be paid to the
Executive's estate.
4.5 Facility of Distribution. If the Plan Administrator determines in its
discretion that a benefit is to be distributed to a minor, to a person
declared incompetent, or to a person incapable of handling the disposition
of that person's property, the Plan Administrator may direct distribution
of such benefit to the guardian, legal representative or person having the
care or custody of such minor, incompetent person or incapable person. The
Plan Administrator may require proof of incompetence, minority or
guardianship as it may deem appropriate prior to distribution of the
benefit. Any distribution of a benefit shall be a distribution for the
account of the Executive and the Beneficiary, as the case may be, and shall
be completely discharge of any liability under the Agreement for such
distribution amount.
Article 5
General Limitations
Notwithstanding any provisions of this Agreement to the contrary, the Bank
shall not pay any benefit under this Agreement:
5.1 Termination for Cause. If the Bank terminates the Executive's employment
for:
(a) Gross negligence or gross neglect of duties to the Bank; or
(b) Conviction of a felony or of a gross misdemeanor involving moral
turpitude in connection with the Executive's employment with the Bank;
or
(c) Fraud, disloyalty, dishonesty or willful violation of any law or
significant Bank policy committed in connection with the Executive's
employment and resulting in a material adverse effect on the Bank.
5.2 Suicide or Misstatement. No benefit shall be distributed if the Executive
commits suicide within two (2) years after the Effective Date of this
Agreement, or if an insurance company which issued a life insurance policy
covering the Executive and owned by the Bank denies coverage (i) for
material misstatements of fact made by the Executive on an application for
such life insurance, or (ii) for any other reason.
5.3 Removal. Notwithstanding any provision of this Agreement to the contrary,
the Bank shall not distribute any benefit under this Agreement if the
Executive is subject to a final removal or prohibition order issued by an
appropriate federal banking agency pursuant to Section 8(e) of the Federal
Deposit Insurance Act.
Article 6
Claims And Review Procedures
6.1 Claims Procedure. An Executive or Beneficiary ("claimant") who has not
received benefits under the Agreement that he or she believes should be
distributed shall make a claim for such benefits as follows:
6.1.1 Initiation - Written Claim. The claimant initiates a claim by
submitting to the Plan Administrator a written claim for the benefits.
If such a claim relates to the contents of a notice received by the
claimant, the claim must be made within sixty (60) days after such
notice was received by the claimant. All other claims must be made
within one hundred eighty (180) days of the date on which the event
that caused the claim to arise occurred. The claim must state with
particularity the determination desired by the claimant.
6.1.2 Timing of Plan Administrator Response. The Plan Administrator shall
respond to such claimant within ninety (90) days after receiving the
claim. If the Plan Administrator determines that special circumstances
require additional time for processing the claim, the Plan
Administrator can extend the response period by an additional ninety
(90) days by notifying the claimant in writing, prior to the end of
the initial ninety (90) day period that an additional period is
required. The notice of extension must set forth the special
circumstances and the date by which the Plan Administrator expects to
render its decision.
6.1.3 Notice of Decision. If the Plan Administrator denies part or the
entire claim, the Plan Administrator shall notify the claimant in
writing of such denial. The Plan Administrator shall write the
notification in a manner calculated to be understood by the claimant.
The notification shall set forth:
(a) The specific reasons for the denial;
(b) A reference to the specific provisions of the Agreement on which
the denial is based;
(c) A description of any additional information or material necessary
for the claimant to perfect the claim and an explanation of why
it is needed;
(d) An explanation of the Agreement's review procedures and the time
limits applicable to such procedures; and
(e) A statement of the claimant's right to bring a civil action under
ERISA Section 502(a) following an adverse benefit determination
on review.
6.2 Review Procedure. If the Plan Administrator denies part or the entire
claim, the claimant shall have the opportunity for a full and fair review
by the Plan Administrator of the denial as follows:
6.2.1 Initiation - Written Request. To initiate the review, the claimant,
within sixty (60) days after receiving the Plan Administrator's notice
of denial, must file with the Plan Administrator a written request for
review.
6.2.2 Additional Submissions - Information Access. The claimant shall then
have the opportunity to submit written comments, documents, records
and other information relating to the claim. The Plan Administrator
shall also provide the claimant, upon request and free of charge,
reasonable access to, and copies of, all documents, records and other
information relevant (as defined in applicable ERISA regulations) to
the claimant's claim for benefits.
6.2.3 Considerations on Review. In considering the review, the Plan
Administrator shall take into account all materials and information
the claimant submits relating to the claim, without regard to whether
such information was submitted or considered in the initial benefit
determination.
6.2.4 Timing of Plan Administrator Response. The Plan Administrator shall
respond in writing to such claimant within sixty (60) days after
receiving the request for review. If the Plan Administrator determines
that special circumstances require additional time for processing the
claim, the Plan Administrator can extend the response period by an
additional sixty (60) days by notifying the claimant in writing, prior
to the end of the initial sixty (60) day period that an additional
period is required. The notice of extension must set forth the special
circumstances and the date by which the Plan Administrator expects to
render its decision.
6.2.5 Notice of Decision. The Plan Administrator shall notify the claimant
in writing of its decision on review. The Plan Administrator shall
write the notification in a manner calculated to be understood by the
claimant. The notification shall set forth:
(a) The specific reasons for the denial;
(b) A reference to the specific provisions of the Agreement on which
the denial is based;
(c) A statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant (as defined
in applicable ERISA regulations) to the claimant's claim for
benefits; and
(d) A statement of the claimant's right to bring a civil action under
ERISA Section 502(a).
Article 7
Amendments and Termination
7.1 Amendments. This Agreement may be amended only by a written agreement
signed by the Bank and the Executive. However, the Bank may unilaterally
amend this Agreement to conform with written directives to the Bank from
its auditors or banking regulators or to comply with legislative or tax
law, including without limitation Code Section 409A of the Code and any and
all regulations and guidance promulgated thereunder.
7.2 Plan Termination Generally. The Bank may unilaterally terminate this
Agreement at any time. Except as provided in Section 7.3, the termination
of this Agreement shall not cause a distribution of benefits under this
Agreement. Rather, upon such termination benefit distributions will be made
at the earliest distribution event permitted under Article 2 or Article 3.
7.3 Plan Terminations Under Code Section 409A. Notwithstanding anything to the
contrary in Section 7.2, if the Bank terminates this Agreement in the
following circumstances:
(a) Within thirty (30) days before or twelve (12) months after a change in
the ownership or effective control of the corporation, or in the
ownership of a substantial portion of the assets of the corporation as
described in Section 409A(2)(A)(v) of the Code, provided that all
distributions are made no later than twelve (12) months following such
termination of the Agreement and further provided that all the Bank's
arrangements which are substantially similar to the Agreement are
terminated so the Executive and all participants in the similar
arrangements are required to receive all amounts of compensation
deferred under the terminated arrangements within twelve (12) months
of such terminations;
(b) Upon the Bank's dissolution or with the approval of a bankruptcy court
provided that the amounts deferred under the Agreement are included in
the Executive's gross income in the latest of (i) the calendar year in
which the Agreement terminates; (ii) the calendar year in which the
amount is no longer subject to a substantial risk of forfeiture; or
(iii) the first calendar year in which the distribution is
administratively practical; or
(c) Upon the Bank's termination of this and all other non-account balance
plans (as referenced in Code Section 409A of the Code or the
regulations thereunder), provided that all distributions are made no
earlier than twelve (12) months and no later than twenty-four (24)
months following such termination, and the Bank does not adopt any new
non-account balance plans for a minimum of five (5) years following
the date of such termination;
the Bank may distribute the Accrual Balance, determined as of the date of
the termination of the Agreement, to the Executive in a lump sum subject to
the above terms.
Article 8
Administration of Agreement
8.1 Plan Administrator Duties. The Plan Administrator shall administer this
Agreement according to its express terms and shall also have the discretion
and authority to (i) make, amend, interpret and enforce all appropriate
rules and regulations for the administration of this Agreement and (ii)
decide or resolve any and all questions, including interpretations of this
Agreement, as may arise in connection with the Agreement to the extent the
exercise of such discretion and authority does not conflict with Code
Section 409A.
8.2 Agents. In the administration of this Agreement, the Plan Administrator may
employ agents and delegate to them such administrative duties as it sees
fit, including acting through a duly appointed representative, and may from
time to time consult with counsel who may be counsel to the Bank.
8.3 Binding Effect of Decisions. Any decision or action of the Plan
Administrator with respect to any question arising out of or in connection
with the administration, interpretation and application of the Agreement
and the rules and regulations promulgated hereunder shall be final and
conclusive and binding upon all persons having any interest in the
Agreement.
8.4 Indemnity of Plan Administrator. The Bank shall indemnify and hold harmless
the members of the Plan Administrator against any and all claims, losses,
damages, expenses or liabilities arising from any action or failure to act
with respect to this Agreement, except in the case of willful misconduct by
the Plan Administrator or any of its members.
8.5 Bank Information. To enable the Plan Administrator to perform its
functions, the Bank shall supply full and timely information to the Plan
Administrator on all matters relating to the date and circumstances of the
death, Disability or Separation from Service of the Executive, and such
other pertinent information as the Plan Administrator may reasonably
require.
8.6 Annual Statement. The Plan Administrator shall provide to the Executive,
within one hundred twenty (120) days after the end of each Plan Year, a
statement setting forth the benefits to be distributed under this
Agreement.
Article 9
Miscellaneous
9.1 Binding Effect. This Agreement shall bind the Executive and the Bank, and
their beneficiaries, survivors, executors, administrators and transferees.
9.2 No Guarantee of Employment. This Agreement is not a contract for
employment. It does not give the Executive the right to remain as an
employee of the Bank, nor interfere with the Bank's right to discharge the
Executive. It does not require the Executive to remain an employee nor
interfere with the Executive's right to terminate employment at any time.
9.3 Non-Transferability. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.
9.4 Tax Withholding and Reporting. The Bank shall withhold any taxes that are
required to be withheld, including but not limited to taxes owed under Code
Section 409A from the benefits provided under this Agreement. The Executive
acknowledges that the Bank's sole liability regarding taxes is to forward
any amounts withheld to the appropriate taxing authorities. The Bank shall
satisfy all applicable reporting requirements, including those under Code
Section 409A.
9.5 Applicable Law. The Agreement and all rights hereunder shall be governed by
the laws of the State of South Carolina, except to the extent preempted by
the laws of the United States of America.
9.6 Unfunded Arrangement. The Executive and the Beneficiary are general
unsecured creditors of the Bank for the distribution of benefits under this
Agreement. The benefits represent the mere promise by the Bank to
distribute such benefits. The rights to benefits are not subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment or garnishment by creditors. Any insurance on the
Executive's life or other informal funding asset is a general asset of the
Bank to which the Executive and Beneficiary have no preferred or secured
claim.
9.7 Reorganization. The Bank shall not merge or consolidate into or with
another bank, or reorganize, or sell substantially all of its assets to
another bank, firm or person unless such succeeding or continuing bank,
firm or person agrees to assume and discharge the obligations of the Bank
under this Agreement. Upon the occurrence of such an event, the term "Bank"
as used in this Agreement shall be deemed to refer to the successor or
survivor entity.
9.8 Entire Agreement. This Agreement constitutes the entire agreement between
the Bank and the Executive as to the subject matter hereof. No rights are
granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.
9.9 Interpretation. Wherever the fulfillment of the intent and purpose of this
Agreement requires and the context will permit, the use of the masculine
gender includes the feminine and use of the singular includes the plural.
9.10 Alternative Action. In the event it shall become impossible for the Bank or
the Plan Administrator to perform any act required by this Agreement due to
regulatory or other constraints, the Bank or Plan Administrator may perform
such alternative act as most nearly carries out the intent and purpose of
this Agreement and is in the best interests of the Bank, provided that such
alternative acts do not violate Code Section 409A of the Code.
9.11 Headings. Article and section headings are for convenient reference only
and shall not control or affect the meaning or construction of any
provision herein.
9.12 Validity. If any provision of this Agreement shall be illegal or invalid
for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Agreement shall be construed and enforced
as if such illegal or invalid provision had never been inserted herein.
9.13 Notice. Any notice or filing required or permitted to be given to the Bank
or Plan Administrator under this Agreement shall be sufficient if in
writing and hand-delivered or sent by registered or certified mail to the
address below:
Provident Community Bank, NA
----------------------------
203 West Main St
----------------------------
Union, SC 29379-2214
----------------------------
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the
receipt for registration or certification.
Any notice or filing required or permitted to be given to the Executive
under this Agreement shall be sufficient if in writing and hand-delivered
or sent by mail to the last known address of the Executive.
9.14 Deduction Limitation on Benefit Payments. If the Bank reasonably
anticipates that the Bank's deduction with respect to any distribution
under this Agreement would be limited or eliminated by application of Code
Section 162(m), then to the extent deemed necessary by the Bank to ensure
that the entire amount of any distribution from this Agreement is
deductible, the Bank may delay payment of any amount that would otherwise
be distributed under this Agreement. The delayed amounts shall be
distributed to the Executive (or the Beneficiary in the event of the
Executive's death) at the earliest date the Bank reasonably anticipates
that the deduction of the payment of the amount will not be limited or
eliminated by application of Code Section 162(m).
9.15 Compliance with Code Section 409A. This Agreement shall be interpreted and
administered consistent with Code Section 409A.
IN WITNESS WHEREOF, the Executive and a duly authorized representative of
the Bank have signed this Agreement.
Executive: BANK:
Provident Community Bank, National
Association
/s/ Lud Vaughn By: /s/ Dwight V. Neese
- ------------------- ------------------------------------
Lud Vaughn
Title: President & CEO
----------------------------------
Provident Community Bank, National Association
Supplemental Executive Retirement Plan
Beneficiary Designation Form
================================================================================
{ } New Designation
{ } Change in Designation
I, Lud Vaughn, designate the following as Beneficiary under the Agreement:
Primary:
- ----------------------------------------------------------- -----%
- ----------------------------------------------------------- -----%
Contingent:
- ----------------------------------------------------------- -----%
- ----------------------------------------------------------- -----%
Notes:
o Please PRINT CLEARLY or TYPE the names of the beneficiaries.
o To name a trust as Beneficiary, please provide the name of the
trustee(s) and the exact name and date of the trust agreement.
o To name your estate as Beneficiary, please write "Estate of [your
name]".
o Be aware that none of the contingent beneficiaries will receive
anything unless ALL of the primary beneficiaries predecease you.
I understand that I may change these beneficiary designations by delivering a
new written designation to the Plan Administrator, which shall be effective only
upon receipt and acknowledgment by the Plan Administrator prior to my death. I
further understand that the designations will be automatically revoked if the
Beneficiary predeceases me, or, if I have named my spouse as Beneficiary and our
marriage is subsequently dissolved.
Name: Lud Vaughn
Signature: Date:
------------------------------ -------
Received by the Plan Administrator this day of , 2
--------- ---------- -----
By:
--------------------------
Title: ----------------------