Exhibit 10.5
WALDEN FEDERAL SAVINGS AND LOAN
ASSOCIATION
AMENDED AND
RESTATED
DIRECTORS’ RETIREMENT
PLAN
This Amended
and Restated Walden Federal Savings and Loan Association
Directors’ Retirement Plan (the “Plan”) is hereby
adopted as of March 9, 2007 by the Board of Directors (the
“Board of Directors” or the “Board”) of
Walden Federal Savings and Loan Association (the
“Bank”), to provide members of the Board (each a
“Director”) with retirement income
benefits. The Plan is intended to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986,
as amended (the “Code”).
WHEREAS, the Bank wishes to reward the years of extensive
service provided by the current members of the Board of Directors
and to continue to attract and to retain the best talent available
to serve on its Board of Directors, and
WHEREAS , the Plan is intended to comply with Code
Section 409A and the Final Regulations published thereunder in
April 2007, and any regulatory or other guidance issued under such
Section; and
WHEREAS , Code Section 409A requires that certain types
of nonqualified deferred compensation arrangements comply with its
terms or subject the recipients of such compensation to current
taxes and penalties.
NOW, THEREFORE, in consideration of the premises and mutual
promises herein contained, the Bank and the directors agree as
follows:
ARTICLE I
DEFINITIONS
Administrator means the Board of Directors of the Bank, which
shall have the authority to manage and control the operation of
this Plan as set forth in Article III of the Plan.
Bank means Walden Federal Savings and Loan
Association, Walden, New York.
Beneficiary means the individual or individuals designated
by a Director to receive benefits in the event of death.
Benefit Accrual Fraction
means A divided by B, whereby:
A = Completed Years of Service Following the
Effective Date (maximum of 5 years); and
For purposes of
this definition, a “Year of Service” shall mean each
12-month period of service completed by a Director after the
Effective Date, or, for Directors who commence service after the
Effective Date, each 12-month period of service completed after
designation as a Director.
Benefit Payment means the benefit payment amount used to
calculate a Director’s benefit under Section 2.1 as
determined under the following schedule:
Years of
Service as a Director
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$500 per
completed Year of Service
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For purposes of
this definition, a “Year of Service” shall mean each
12-month period of service completed by a Director, beginning with
the date the Director commenced service as a member of the Board of
Directors.
Cause means, with respect to a Director’s
termination for Cause, removal as a result of the Director’s
personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure to
perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar infractions)
or a final cease-and-desist order.
Change in
Control means a
change in the ownership or effective control of the Bank, or a
change in the ownership of a substantial portion of the assets of
the Bank, as defined in Code Section 409A and applicable Treasury
Regulations issued thereunder, provided, however, that in no event
shall the conversion of the Bank to the full stock holding company
form of organization constitute a “Change in Control”
for purposes of this Plan.
Director means a member of the Board of Directors of the
Bank serving as of the Effective Date. The Board may, in
its sole discretion, designate any new member of the Board of
Directors as a Director for purposes of this Plan.
Effective Date means March 9, 2007.
Normal Retirement Age
shall mean age 65.
Plan means this Walden Federal Savings and Loan
Association Directors’ Retirement Plan.
Separation from Service
means “Separation from
Service” as set forth under the Treasury Regulations
promulgated under Code Section 409A.
ARTICLE II
BENEFITS
2.1
Director Benefits . Upon a
Director’s Separation from Service (the “Termination
Date”) on or after Normal Retirement Age, other than upon
removal for Cause, the Director shall be entitled to receive an
annual benefit in an amount determined by applying the following
formula:
Annual Director Benefit =
(Benefit Payment x Director Benefit Accrual
Fraction)
Except as
otherwise provided for herein, the annual benefit, if any, payable
under this Section 2.1 shall be paid to the Director (or, if
applicable, the Director’s designated Beneficiary) for ten
(10) consecutive years, commencing within sixty (60) days following
the Termination Date and continuing on each anniversary of the
payment date thereafter. Upon the death of a Director
after the commencement of annual benefit payments, any remaining
installments shall be paid to the Director’s designated
Beneficiary(ies). In the event the Director’s death occurs
after attainment of Normal Retirement Age, but prior to
commencement of annual benefit payments under the Plan, the
Director’s designated Beneficiary
shall be paid
in a lump sum amount that is actuarially equivalent to the
Director’s total annual benefit, determined as of the
Director’s date of death, and payable within sixty (60) days
following the date of death. Notwithstanding anything in
this Plan to the contrary, in the event a Director’s
Separation from Service (other than termination for Cause) occurs
on or within two years after the effective date of a Change in
Control, the
