Exhibit 10.2
EXECUTIVE SUPPLEMENTAL COMPENSATION
AGREEMENT
RICHARD B. COLLINS
AGREEMENT made as of the 25
th
day of January 2002, by
and between UNITED CO-OPERATIVE BANK, a banking corporation
chartered under the Laws of the Commonwealth of Massachusetts and
having a principal place of business in West Springfield,
Massachusetts (hereinafter called the “Corporation”)
and RICHARD B. COLLINS of Longmeadow, Massachusetts (hereinafter
called the “Employee”).
WHEREAS, the Employee is a valued employee of
the Corporation;
WHEREAS, it is anticipated that the Employee
will render valuable services to the Corporation in the
future;
NOW THEREFORE, in consideration of the mutual
covenants contained herein, it is agreed between the parties hereto
as follows:
The Employee agrees to use his best
efforts on behalf of the Corporation and to perform all the work
required by the Corporation promptly and to the best of his ability
while he is in the employ of the Corporation. The Employee agrees
that, during the period of his employment, he will not have any
other business affiliations without the specific approval of the
Board of Directors of the Corporation.
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2.
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Compensation
After Retirement
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A. The Corporation agrees that, if
the Employee is employed by the Corporation upon the date the
Employee becomes age sixty-seven (67), the Employee may retire
from
the Corporation as of the first day
of the next month following his sixty-seventh (67) birthday and
receive a benefit set forth in Section 2 (B). The Corporation
further agrees that if the Employee chooses to retire at some point
in time after attaining the age of sixty-seven (67), the Employee
will have the option of receiving the same benefit set forth in
Section 2 (B) beginning at age sixty-seven (67).
B. Commencing upon such date of the
Employee’s retirement or upon the date of his first payment
hereunder, whichever comes first, the Corporation will pay the
Employee supplemental compensation for his services rendered prior
to his first payment date. The annual amount of this supplemental
compensation shall be sixty percent (60%) of his highest three (3)
years average base salary reduced by (i) his annual benefit on a
single life income basis from the Corporation’s defined
benefit plan, (ii) his annual benefit on a single life income basis
as calculated by the plan actuary from the Corporation’s
contribution and earnings thereon from the Corporation’s
401(k) plan, (iii) the annual benefit on a single life income basis
resulting from participation in a qualified plan with prior
employers (total employer contributions as of the date of
termination of his employment with prior employer(s) plus all
imputed earnings thereon) and (iv) one half of his primary Social
Security benefit. The parties agree that the annual benefit under
(iii) above shall be determined as shown on Exhibit B attached
hereto and made a part hereof.
The benefit payable hereunder shall
be paid on a monthly basis for a period of one hundred eighty (180)
months from the date of the first payment or for the life of the
Employee, whichever is longer. In the event the Employee dies after
receiving the first payment hereunder and prior to receiving all of
the payments due him under Section 2 or Section 3, the remaining
payments shall be made as they become due to the beneficiary
designated by the Employee on Exhibit A attached hereto and made a
part hereof. In the
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absence or default of a designated
or contingent beneficiary, such payments shall be made to the
Employee’s estate.
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3.
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Compensation
Upon Early Retirement
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The Corporation agrees that, if the
Employee is employed by the Corporation upon the date the Employee
becomes age sixty-five (65), he may retire from the employment of
the Corporation at any time after the first day of the next month
following his sixty-fifth (65th) birthday and receive a benefit
hereunder. However, retirement before the date of his sixty-seventh
(67 th ) birthday will result in a
reduction of the benefit provided in Section 2 (B) hereof. The
early retirement benefit shall be determined by multiplying the
benefit determined in Section 2 (B) by the appropriate percentage
in the following table (or a pro rata portion thereof if part of a
year is involved):
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Attained
Age
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Percentage of Age 67
Benefit Payable
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65
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90
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%
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66
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95
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%
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67
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100
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%
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Said early retirement supplemental
compensation shall be payable monthly in accordance with the above
schedule and for the period of time established in Section 2 (B)
hereof commencing at the date of his early retirement.
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4.
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Death
Benefit Before First Payment Date
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Corporation contemplates funding its
obligations under this agreement by purchasing a so-called
“split dollar” Flexible Premium Adjustable Life policy
(the “Insurance Policy”) on the life of the Employee
from Security Life of Denver Insurance Company (the
“Insurer”). If the Employee dies (other than by suicide
within two (2) years from the date of this Agreement) while
employed by the Corporation and prior to his attainment of age
sixty-seven (67), the beneficiary, who shall be named by the
Corporation with the
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Employee’s consent
(hereinafter called the Employee’s Beneficiary), designated
in writing and filed with the Insurer shall be entitled to receive
in a lump sum that portion of the proceeds of the Insurance Policy
that exceeds the amount paid to the Corporation. The Corporation
agrees to use its best efforts to purchase and keep in force an
Insurance Policy that will pay a lump sum death benefit of at
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