EXHIBIT 10.1
ATLANTIC COAST FEDERAL
2005 AMENDED AND RESTATED DIRECTOR RETIREMENT PLAN
WHEREAS, Atlantic Coast Federal maintains the Atlantic Coast Federal
Director Retirement Plan (the "Plan"), originally effective July 1, 2001, for
the benefit of certain of its non-employee directors (the "Director(s)"); and
WHEREAS, Atlantic Coast Federal desires to revise the Plan effective
January 1, 2005, in order to bring the Plan into compliance with Section 409A of
the Internal Revenue Code of 1986 (the "Code").
NOW, THEREFORE, in consideration of the mutual promises contained
herein, Atlantic Coast Federal and the Directors hereby agree as follows:
ARTICLE I
PURPOSE
This Atlantic Coast Federal Director Retirement Plan (the "Plan") is
established for the purpose of providing retirement benefits to those
non-employee Directors (each a "Participant") who have contributed significantly
to the success and growth of Atlantic Coast Federal, and its predecessor
Atlantic Coast Federal Credit Union, whose services are vital to its continued
growth and success in the future and who are to be encouraged to remain a member
of the Board of Directors until retirement. The Plan was originally effective
July 1, 2001. The Plan is hereby amended and restated January 1, 2005, in order
to conform the Plan to Code Section 409A.
ARTICLE II
ESTABLISHMENT OF RABBI TRUST
Atlantic Coast Federal may establish a rabbi trust into which Atlantic
Coast Federal may contribute assets which shall be held therein, subject to the
claims of its creditors in the event of Atlantic Coast Federal's insolvency,
until the contributed assets are paid to the Directors and their beneficiaries
in such manner and at such times as specified in this Plan. In the event that a
rabbi trust is established, it is the intention of Atlantic Coast Federal to
make contributions to the rabbi trust to provide the Bank with a source of funds
to assist it in meeting the liabilities of this Plan. The rabbi trust and any
assets held therein shall conform to the terms of the rabbi trust agreement
which may be established in conjunction with this Plan. To the extent the
language in this Plan is modified by the language in the rabbi trust agreement,
the rabbi trust agreement shall supersede this Plan. Any contributions to the
rabbi trust shall be made during each Plan Year in accordance with the rabbi
trust agreement.
ARTICLE III
ELIGIBILITY
Each Participant who has attained 120 full months of service as a member
of the Board of Directors of Atlantic Coast Federal, whether continuous or
otherwise, shall be entitled to receive the retirement benefits as provided in
this Plan. Any Participant who resigns at the request of, or is removed from
service by, the Office of Thrift Supervision, Federal Deposit Insurance
Corporation or any other regulatory authority for Atlantic Coast Federal, shall
be ineligible for benefits under this Plan.
ARTICLE IV
RETIREMENT BENEFIT
A. NORMAL RETIREMENT. Commencing upon the Director's Separation
from Service (as defined below) after attaining age 65 ("Retirement Age"),
Atlantic Coast Federal shall pay to the Participant, an annual benefit of Ten
Thousand Dollars ($10,000) per year for Ten (10) years (the "Benefit Period"),
payable in equal monthly installments over a period of One Hundred and Twenty
(120) months, commencing on the first day of the month following the
Participant's Separation from Service. Notwithstanding the preceding sentence,
for Directors who are Specified Employees (defined below), payments shall not
begin until the first day of the seventh month following their Separation from
Service.
1. "Specified Employee" means a Director who also meets the
definition of key employee as defined under Internal Revenue Code Section 416(1)
because he: (i) is a key officer of Atlantic Coast Federal earning at least
$150,000 per year; (ii) is a 5% owner of Atlantic Coast Federal; or (iii) is a
1% owner of Atlantic Coast Federal and has compensation of at least $130,000 per
year.
2. "Separation from Service" means the Director's
retirement or termination of service or termination of employment with Atlantic
Coast Federal. No Separation from Service shall be deemed to occur due to
military leave, sick leave or other bona fide leave of absence if the period of
such leave does not exceed six months or, if longer, so long as the Director's
right to reemployment is provided by law or contract. If the leave exceeds six
months and the Director's right to reemployment is not provided by law or by
contract, then the Director shall be have a Separation from Service on the first
date immediately following such six-month period.
The Director shall not be treated as having a Separation from Service if
the Director provides more than insignificant services for Atlantic Coast
Federal following the Director's actual or purported termination of service or
employment with Atlantic Coast Federal. Services shall be treated as not being
insignificant if such services are performed at an annual rate that is at least
equal to 20% of the services rendered by the Director for Atlantic Coast
Federal, on average, during the immediately preceding three full calendar years
of service or employment (or if employed less than three years, such shorter
period of employment) and the annual base compensation for such services is at
least equal to 20% of the average base compensation earned during the final
three full calendar years of service or employment (or if employed less than
three
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years, such shorter period of employment).
Where the Director continues to provide services to Atlantic Coast
Federal in a capacity other than as an employee, a Separation from Service will
not be deemed to have occurred if the Director is providing services at an
annual rate that is 50% or more of the services rendered, on average, during the
immediate preceding three full calendar years of employment (or if employed less
than three years, such lesser period) and the annual base compensation for such
services is 50% or more of the annual base compensation earned during the final
three full calendar years of employment (or if less, such lesser period).
B. DEATH AFTER RETIREMENT. If the Participant dies within the
Benefit Period, the remaining monthly payments due the Participant shall be paid
to the Participant's designated beneficiary (including any contingent
beneficiary) on file with Atlantic Coast Federal or if no designation is on
file, the spouse shall be the designated beneficiary. In the absence of any
surviving beneficiary or spouse, the benefits shall be paid to the personal
representative of the estate of the Participant. Participants may designate
their beneficiary by completing the beneficiary designation form set forth as
Exhibit A hereto.
If the Participant's designated beneficiary begins to receive the
monthly payments and thereafter dies without receiving the remaining monthly
payments, Atlantic Coast Federal shall pay the installments remaining to the
contingent beneficiary, if any, and then to the personal representative of the
estate of the designated beneficiary.
C. DEATH OF PARTICIPANT PRIOR TO RETIREMENT. In the event the
Participant should die prior to attaining Retirement Age, Atlantic Coast Federal
agrees to pay to the Participant's designated beneficiary the retirement benefit
the Participant would have otherwise received commencing on the first day of the
month following the Participant's death. If the designated beneficiary
(including any contingent beneficiary) dies before receiving all the monthly
installments, Atlantic Coast Federal shall pay the remaining installments to the
personal representative of the estate of the designated beneficiary. If the
Participant dies prior to retirement with no surviving designated beneficiary
(including any spouse or contingent beneficiary), Atlantic Coast Federal shall
pay the installments to the personal representative of the estate of the
Participant. Notwithstanding any other terms of this Plan, no death benefit
shall be payable under this Plan if it is determined that the Participant's
death was caused by suicide.
D. DEATH OR DISABILITY PRIOR TO RETIREMENT. In the event a Director
who has completed at least 60 full months of service (whether continuous or
otherwise), dies or becomes Disabled (as defined below) while serving as a
Director, such person shall be eligible for benefits as a Participant in this
Plan whether or not the Director has met the Retirement Age. The amount of the
annual benefits payable to such person or his or her designated beneficiary, as
the case may be, over the Benefit Period shall be equal to the product of
$10,000 multiplied by a fraction the denominator of which is 120 and the
numerator of which is the number of full months of service as a Director. Such
benefits shall be paid in equal monthly installments over the Benefit Period. A
Director shall be considered "Disabled" if the Director: (i) is unable to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment
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which can be expected to result in death, or last for a continuous period of not
less than 12 months; (ii) by reason of any medically determinable physical or
mental impairment which can be expected to result in death, or last for a
continuous period of not less than 12 months, is receiving income replacement
benefits for a period of not less than three months under an accident and health
plan covering Atlantic Coast Federal's employees; or (iii) is determined to be
totally disabled by the Social Security Administration.
ARTICLE V
STATUS OF PLAN
This Plan does not constitute a contract of employment for any Director,
nor shall any provision of this Plan be construed as giving the Director the
right to continued service on the Board of Directors.
ARTICLE VI
BINDING EFFECT
This Plan shall be binding upon the parties hereto and upon the
successors and assigns of Atlantic Coast Federal, and upon the heirs and legal
representatives of the Participant.
ARTICLE VII
ASSIGNMENT OF RIGHTS
Neither the Participant nor the any beneficiary or personal
representative of the Participant can assign any of the rights to benefits under
this Plan. Any attempt to anticipate, sell, transfer, assign, pledge, encumber
or change the Participant's right to receive benefits shall be void. The rights
to benefits are not subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment or garnishment by
creditors.
ARTICLE VIII
CHOICE OF LAW
This Plan shall be construed under and governed by the laws of the State
of Georgia, except to the extent preempted by the laws of the United States of
America.
ARTICLE IX
UNFUNDED ARRANGEMENT
The Participant and any beneficiary are general unsecured creditors of
Atlantic Coast Federal for the payment of benefits under the Plan. The benefits
represent the mere promise by Atlantic Coast Federal to pay such benefits.
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ARTICLE X
ADMINSTRATION
A. COMMITTEE; DUTIES. The Plan shall be administered by the
Committee, which shall be appointed by the Board. The Committee shall have the
authority to make, amend, interpret, and enforce all appropriate rules and
regulations for the administration of the Plan and decide or resolve any and all
questions, including interpretations of the Plan, as may arise in connection
with the Plan. A majority vote of the Committee members shall control any
decision.
B. AGENTS. The Committee may, from time to time, employ other
agents and delegate to them such administrative duties as it sees fit, and may
from time to time consult with counsel who may be counsel to Atlantic Coast
Federal.
C. BINDING EFFECT OF DECISIONS. The decision or action of the
Committee in respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the rules of
regulations promulgated hereunder shall be final, conclusive and binding upon
all persons having any interest in the Plan.
D. INDEMNITY OF COMMITTEE. Atlantic Coast Federal shall indemnify
and hold harmless the members of the Committee against any and all claims, loss,
damage, expense or liability arising from any action or failure to act with
respect to the Plan, except in the case of gross negligence or willful
misconduct.
ARTICLE XI
AMENDMENT; TERMINATION
A. AMENDMENT. This Plan may be amended by Atlantic Coast Federal
any time, but no such amendment shall affect the vested rights of, or reduce the
benefits to, any Participant without their written consent.
B. TERMINATION. The Board may at any time partially or completely
terminate the Plan if, in its judgment, the tax, accounting, or other effects of
the continuance of the Plan, or potential payments thereunder, would not be in
the best interests of Atlantic Coast Federal.
1. PARTIAL TERMINATION. The Board may partially terminate
the Plan, in which case, the Plan shall continue to operate and be effective
with regard to benefits accrued prior to the effective date of such partial
termination, but no further benefits shall accrue after the termination date.
2. COMPLETE TERMINATION. The Board may completely terminate
the Plan by immediately ceasing all benefit accruals and paying out all promised
benefits. Subject to the requirements of Code Section 409A, in the event of
complete termination, the Plan shall cease to operate and Atlantic Coast Federal
shall pay each Director his accrued benefit as if that Director had terminated
service as of the effective date of the complete termination. Such complete
termination of the Plan shall occur only under the following circumstances and
conditions.
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(a) The Board may terminate the Plan within 12
months of a corporate dissolution taxed under Code section 331, or with approval
of a bankruptcy court pursuant to 11 U.S.C. ss.503(b)(1)(A), provided that the
accrued benefit under the Plan is included in each Director's gross income in
the latest of (i) the calendar year in which the Plan 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 payment is
administratively practicable.
(b) The Board may terminate the Plan within the 30
days preceding a Change in Control (but not following a Change in Control),
provided that the Plan shall only be treated as terminated if all substantially
similar arrangements sponsored by Atlantic Coast Federal are terminated so that
the Directors and all participants under substantially similar arrangements are
required to receive all amounts of compensation deferred under the terminated
arrangements within 12 months of the date of the termination of the
arrangements.
(c) The Board may terminate the Plan provided that
(i) all arrangements sponsored by Atlantic Coast Federal that would be
aggregated with this Plan under Proposed Treasury regulations section
1.409A-1(c) if any Director covered by this Plan was also covered by any of
those other arrangements are also terminated; (ii) no payments other than
payments that would be payable under the terms of the arrangement if the
termination had not occurred are made within 12 months of the termination of the
arrangement; (iii) all payments are made within 24 months of the termination of
the arrangements; and (iv) Atlantic Coast Federal does not adopt a new
arrangement that would be aggregated with any terminated arrangement under
Proposed Treasury regulations section 1.409A-1(c) if the same Director
participated in both arrangements, at any time within five years following the
date of termination of the arrangement.
(d) The Board may terminate the Plan pursuant to
such other terms and conditions as the Internal Revenue Service may permit from
time to time.
ARTICLE XII
CLAIMS PROCEDURE
In the event that benefits under this Plan are not paid to the Director
(or to his beneficiary in the case of the Director's death) and such claimants
feel they are entitled to receive such benefits, then a written claim must be
made to the Plan Administrator within sixty (60) days from the date payments are
refused. Atlantic Coast Federal and its Board of Directors shall review the
written claim and, if the claim is denied, in whole or in part, they shall
provide in writing, within ninety (90) days of receipt of such claim, their
specific reasons for such denial, reference to the provisions of this Plan upon
which the denial is based, and any additional material or information necessary
to perfect the claim. Such writing by Atlantic Coast Federal and its Board of
Directors shall further indicate the additional steps which must be undertaken
by claimants if an additional review of the claim denial is desired.
If claimants desire a second review, they shall notify the Plan
Administrator in writing within sixty (60) days of the first claim denial.
Claimants may review this Plan or any documents relating thereto and submit any
issues and comments, in writing, they may feel appropriate. In its sole
discretion, the Plan Administrator shall then review the second claim and
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provide a written decision within sixty (60) days of receipt of such claim. This
decision shall state the specific reasons for the decision and shall include
reference to specific provisions of this Plan upon which the decision is based.
If claimants continue to dispute the benefit denial based upon completed
performance of this Plan or the meaning and effect of the terms and conditions
thereof, then claimants may submit the dispute to mediation, administered by a
legally recognized arbitration mediation association in accordance with its
rules. If mediation is not successful in resolving the dispute, it shall be
settled by binding arbitration administered by a legally recognized arbitration
association in accordance with its rules, and the judgment on the award rendered
by the arbitrator(s) may be entered in any court having jurisdiction thereof.
ARTICLE XIII
MISCELLANEOUS
A. SEVERABILITY. In the event that any of the provisions of this
Plan or portion thereof, are held to be inoperative or invalid by any court of
competent jurisdiction, then: (1) insofar as is reasonable, effect will be given
to the intent manifested in the provisions held invalid or inoperative, and (2)
the validity and enforceability of the remaining provisions will not be affected
thereby.
B. INCAPACITY OF RECIPIENT. In the event the Director is declared
incompetent and a conservator or other person legally charged with the care of
his person or estate is appointed, any benefits under the Plan to which such
Director is entitled shall be paid to such conservator or other person legally
charged with the care of his person or estate.
C. LIMITATIONS ON LIABILITY. Notwithstanding any of the preceding
provisions of the Plan, no individual acting as an employee or agent of Atlantic
Coast Federal, or as a member of the Board of Directors shall be personally
liable to the Director or any other person for any claim, loss, liability or
expense incurred in connection with the Plan.
D. INUREMENT. This Plan shall be binding upon and shall inure to
the benefit of Atlantic Coast Federal, its successors and assigns, and the
Director, his successors, heirs, executors, administrators, and beneficiaries.
E. COMPLIANCE WITH SECTION 409A OF THE CODE. This Plan is intended
to be a non-qualified, deferred compensation plan described in Section 409A of
the Code. The Plan shall be operated, administered and construed to give effect
to such intent. To the extent that a provision of the Plan fails to comply with
Code Section 409A and a construction consistent with Code Section 409A is not
possible, such provision shall be VOID ab INITIO. In addition, the Plan shall be
subject to amendment, with or without advance notice to Participants and other
interested parties, and on a prospective or retroactive basis, including but not
limited to amendment in a manner that adversely affects the rights of
Participants and other interest parties, to the extent necessary to effect such
compliance.
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