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Exhibit 10.1
OREGON PACIFIC BANCORP 2006
NON-EMPLOYEE DIRECTOR
DEFERRED COMPENSATION PLAN
This Oregon Pacific Bancorp Director Non-Employee
Deferred Compensation Plan (the "Plan"), is hereby established on
and as of the date of adoption of the Plan by the Board of
Directors. The Plan, as structured, is designed to provide
non-employee directors with the opportunity to defer payment of
their directors' fees in accordance with the provisions of this
Plan. It is the intention of Oregon Pacific Bancorp and it is
the understanding of the Directors participating in the Plan, that
the Plan constitutes a nonqualified deferred compensation plan
under the provisions of Section 409A of the Code and applicable
regulations issued thereunder.
ARTICLE I - DEFINITIONS
For the purposes hereof, the following words and
phrases shall have the meanings indicated.
1.1 "ACCOUNT" shall mean
the bookkeeping account established in accordance with Article II
hereof, including the Interest Bearing Account, the Common Stock
Account, and the Dividend Account.
1.2 "BENEFICIARY" shall
mean any person designated by a Participant in accordance with the
Plan to receive payment of all or a portion of the remaining
balance of the Participant's Account in the event of the death of
the Participant prior to receipt by the Participant of the entire
amount credited to the Participant's Account.
1.3 "CHANGE OF CONTROL"
shall be deemed to have occurred in accordance with the
requirements of Section 409A of the Code and applicable regulations
issued thereunder, if a change in the ownership or the effective
control of the Corporation occurs, or if there occurs a change in
the ownership of a substantial portion of the assets of the
Corporation.
1.4 "CODE" means the U. S.
Internal Revenue Code of 1986, as amended.
1.5 "CORPORATION" shall
mean Oregon Pacific Bancorp, a bank holding company and its
corporate successors, including the surviving corporation resulting
from any merger of Oregon Pacific Bancorp with any other
corporation or corporations.
1.6 "COMMON STOCK" shall
mean the common stock of Oregon Pacific Bancorp.
1.7 "DIRECTOR" shall mean
(i) any non-employee member of the Board of Directors of the
Corporation and (ii) any non-employee member of the Board of
Directors of a Subsidiary.
1.8 "ELECTION AGREEMENT"
shall mean the written election to defer Fees signed in writing by
the Director and in the form provided by the
Corporation.
1.91 "FEES" shall
mean the fees earned as a Director.
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1.10 "PARTICIPANT"
shall mean any Director who has at any time elected to defer the
receipt of Fees in accordance with the Plan.
1.11 "PLAN" shall
mean this Director Deferred Compensation Plan, together with all
amendments hereto.
1.12 "SUBSIDIARY" shall mean
a corporation organized and existing under the laws of the United
States or of any state of which more than 50% percent of the issued
and outstanding stock is owned by the Corporation or by a
Subsidiary of the Corporation, and which has been designated by the
Board of Directors or the Chief Executive Officer of the
Corporation as a Subsidiary eligible to participate in the
Plan.
1.13 "YEAR" shall
mean the calendar year.
ARTICLE II - ELECTION TO
DEFER
2.1 ELIGIBILITY. Any
Director may elect to defer receipt of all or a specified portion
of his or her Fees for any Year in accordance with Article
II.
2.2 ELECTION TO
DEFER. A Director who desires to defer the payment of all or
a portion of his or her Fees for any Year must complete and deliver
an Election Agreement to the Corporation no later than the last day
of the Year prior to the Year for which the Fees are earned by the
Director; provided, however, that any Director hereafter elected to
the Board of Directors of the Corporation or a Subsidiary who was
not a Director on the preceding December 31 may make an election to
defer payment of Fees for the Year in which he or she is elected to
the Board of Directors by delivering the Election Agreement to the
Corporation within 30 days of first becoming eligible to
participate in the Plan. A Director who timely delivers the
Election Agreement to the Corporation shall be a Participant in the
Plan upon the Corporation's acceptance of such Election
Agreement.
2.3 AMOUNT DEFERRED; DATE
OF DEFERRAL. A Participant shall designate on the Election
Agreement (a) the amount of his or her Fees that are to be deferred
to the Plan for any Year, (b) the date on which the Participant's
Fees shall be distributed, (c) whether the distribution of deferred
Fees is to be paid in its entirety or whether such Fees shall be
paid in installments, and (d) if in installments, the number of
quarterly installments. Deferrals shall be until the earlier
to occur: (i) the date specified by the Participant which may be
not later than the date on which the Participant would attain age
72, or (ii) the date of death of the Participant, at which time
payment of the amount deferred shall be made in accordance with
Section 2.8 or 2.11 of this Article. A Participant may select
not more than one date in each Election Agreement upon which
distribution shall be made or when installments shall begin.
Distribution dates shall be the first business day of a calendar
quarter.
2.4 ACCOUNT. The
Corporation shall maintain an Account of the Fees deferred by each
Participant. A Participant shall designate on the Election
Agreement whether to have the Account valued on the basis of Oregon
Pacific Bancorp Common Stock in accordance with Section 2.5 of this
Article, or whether the Participant is to receive interest in
accordance with Section 2.6 of this Article. The Corporation
may, if necessary or desirable, establish separate Accounts for a
Participant to properly account for amounts deferred under the
different alternatives and Years; all such Accounts are
collectively referred to herein as the Account. The Account
based on Oregon Pacific Bancorp Common Stock shall be known as the
"Common Stock Account", and the interest bearing account shall be
known as the "Interest Bearing Account." A Participant may defer a
portion of his or her Fees into each type of Account. Each Account
shall reflect all investment income and gains from investments as
credits, and all losses and transaction costs as debits. The
Account shall not be debited for federal, state or local income or
other taxes attributable to net investment income or
gains.
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2.5 COMMON STOCK
ACCOUNT. If a Participant elects to have all or a portion of
his or her Fees deferred into the Common Stock Account, the
Corporation shall credit to the Common Stock Account that number of
whole shares of Common Stock that could be purchased with an amount
equal to the amount deferred in accordance with the following
procedure:
2.5.1 Beginning with fees
earned in the Year 2007, crediting to the Common Stock Account
shall occur on March 31, June 30, September 30 and December
31.
2.5.2 Crediting to the Common
Stock Account shall be at a price per share equal to a weighted
average, consisting of the average of the most recent aggregate
sales of no less than 1% of the Corporation’s issued and
outstanding stock determined as of crediting date.
2.5.3 There shall be no
credits in the Common Stock Account for fractional shares of Common
Stock. Any cash deferral amount not credited to the Common Stock
Account because such amount is insufficient to purchase a whole
share of Common Stock shall be credited to the Dividend Account
described in Section 2.5.4.
2.5.4 The Corporation
shall establish a Dividend Account to which it shall credit (I)
fractional deferral amounts as described in Section 2.5.3, and (ii)
"hypothetical dividends" on shares of Common Stock which have been
credited to a Participant’s Common Stock Account, in an
amount equal to actual cash dividends paid on shares of the
Corporation’s Common Stock from time to time. On the last day
of each quarter all sums in the Dividend Account shall be
credited to the Participant’s Common Stock Account at the
price determined under Section 2.5.2.
2.6 INTEREST BEARING
ACCOUNT. If a Participant elects to have all or a portion of
his or her Fees deferred into the Interest Bearing Account, there
shall be added to the Account on the first day of each month the
dollar amount of such Fees payable for such period plus all
interest payable on such Interest Bearing Account for such period
as follows: A Participant's Interest Bearing Account will be
credited with interest on the average daily balance in the Interest
Bearing Account during each month at a rate equal to the effective
annual yield of the average of the Moody's Average Corporate Bond
Yield Index for the preceding month, as published by Moody's
Investor Service, Inc. or any successor publisher thereto, or, if
such index is no longer published, a substantially similar index
selected by the Board.
2.7 STATUS OF ACCOUNT.
Neither Participant, nor Participant’s heirs, beneficiaries,
creditors, successors, assigns, probate estate or legal
representative, shall have any right, title or interest in any
Account established under the Plan, nor in the values, benefits or
proceeds of the Account. The Account and all cash, values,
benefits, holdings, funds and proceeds of the Account shall be and
remain part of the general assets of Bancorp. Nothing in the
Agreement shall create or be construed to create a trust of any
kind, or a fiduciary relationship between the Bank or Bancorp and
Participant, Participant’s beneficiaries or any other person.
Nothing in the Agreement shall give rise to a duty or obligation on
the part of the Bank or Bancorp toward Participant or
Participant’s heirs, beneficiaries, creditors, successors,
assigns, probate estate or legal representatives.
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2.8 PAYMENT OF ACCOUNT;
PERIOD OF DEFERRAL. The amount of a Participant's Account
shall be paid to the Participant in a single payment and/or in a
number of substantially equal consecutive quarterly installments
(not to exceed 40) payable March 31, June 30, September 30 and
December 31, as elected by the Participant in the Election
Agreement. Distributions from the Interest Bearing Account
shall be in cash. Distributions from the Common Stock Account shall
be in shares of Common Stock issued by the Corporation. The
amount of any Account remaining after payment of an installment
shall continue to be valued in accordance with Section 2.5 of this
Article or bear interest in accordance with Section 2.6 of this
Article. Full payment or the first quarterly installment, as
the case may be, shall be made as soon as administratively possible
after (i) the date specified in Section 2.3 of this Article, or
(ii) the date of the Participant's death. The election as to the
time for and method of payment of the amount of the Account
relating to Fees deferred for a particular Year shall be made on
the Election Agreement(s) and may not thereafter be altered except
as provided in Section 11 of this Article.
In the event that a Participant elects to receive
installment payments under this Section 2.8:
(a) The amount of the distribution of
shares from the Common Stock Account shall be valued based on a
price
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