Exhibit 10.8
AMENDED AND RESTATED
EXECUTIVE SALARY CONTINUATION AGREEMENT
THIS
AMENDED AND RESTATED AGREEMENT, made and entered into this 17th day
of
June, 2008, by and between American Bank of New Jersey, a savings
bank organized
and existing under the laws of the United States (hereinafter
referred to as the
"Bank"), and Joseph Kliminski, an Executive of the Bank
(hereinafter referred to
as the "Executive").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the
Executive and the Bank have previously entered into an
Executive Salary Continuation Agreement; and
WHEREAS, since the execution of the original agreement,
certain changes to
Section 409A of the Internal Revenue Code of 1986, as amended (the
"Code"), have
been enacted; and
WHEREAS, it is
necessary to revise the original agreement to reflect these
changes to the Code;
ACCORDINGLY, it is the
desire of the Bank and the Executive to enter into
this agreement
(sometimes
referred to herein as
the "Executive
Plan") under
which the Bank will agree to make certain payments to the Executive at
retirement or the Executive's beneficiary(ies) in the event of the
Executive's
death pursuant to this agreement;
FURTHERMORE, it is the
intent of the parties
hereto that this
Executive
Plan be considered
an unfunded
arrangement
maintained
primarily to provide
supplemental
retirement benefits
for the Executive, and be considered a
non-qualified benefit
plan for purposes of the Employee Retirement Security Act
of 1974, as amended
("ERISA").
The Executive is fully advised of the Bank's
financial status and
has had substantial
input in the design
and operation of
this benefit plan; and
NOW,
THEREFORE, in
consideration of services to be performed in the future
as well as of the mutual promises and covenants herein contained it
is agreed as
follows:
I. EMPLOYMENT
The
Bank agrees to employ the Executive in such capacity as the Bank may
from
time to time
determine. The
Executive will continue in the employ of
the
Bank in such capacity and with such duties and responsibilities as may
be
assigned to him, and with such compensation as may be determined from
time
to time by the Board of Directors of the Bank.
II. FRINGE BENEFITS
The
salary continuation
benefits provided by this agreement are granted by
the
Bank as a fringe benefit to the Executive and are not part of any
salary reduction
plan or an
arrangement
deferring a bonus or a salary
increase. The
Executive has no option to take any current payment or bonus
1
<PAGE>
in
lieu of these salary continuation benefits except as set forth
hereinafter.
III. NORMAL RETIREMENT AGE
Normal Retirement
Age shall mean the
date on which the Executive attains
age
sixty-five (65).
IV. RETIREMENT BENEFIT
Provided said
retirement constitutes
a Separation
from Service (as
that
phrase is defined
under Section 409A of the Code and the regulations and
guidance of general
applicability issued thereunder (referred to herein as
"Section 409A")),
the Bank, commencing with the first day of the
month
following the later of the date the Executive actually retires or the date
the
Executive attains his
Normal Retirement
Age, shall pay Executive an
annual benefit equal to fifty percent (50%) of the Executive's
average base
salary (with each year's base salary determined on an annualized basis,
taking into
account any base salary adjustments occurring during the
applicable year) based upon the average of the highest three (3)
out of the
last
five (5) years of employment (including the year in which the
Separation from
Service occurs). Said benefit shall be paid in equal
monthly installments
(1/12 of the annual
benefit) until the
death of the
Executive.
Notwithstanding the
foregoing, if the
Executive is, as of the date of his
Separation from
Service, a "Specified Employee" (as defined in Section
409A), then the
retirement
benefits described in this Section IV shall
commence to be paid on
the first day of the month that next follows the
six-month anniversary
of the date the
Executive experiences
a Separation
from
Service, or his death,
if earlier, with the
first payment
including
all
monthly retirement
benefits that would
have been previously
paid but
for
this sentence.
V. DEATH OF THE EXECUTIVE
In
the event of the death of the Executive, this agreement shall terminate
and,
if applicable, the Executive's beneficiary(ies) shall be paid a
death
benefit under the terms of the Endorsement Method Split Dollar Agreement
between the Executive and the Bank and not this agreement.
VI. BENEFIT ACCOUNTING
The
Bank shall account for this benefit using GAAP accounting principles.
The
Bank shall establish an accrued liability retirement account for the
Executive into which appropriate reserves shall be accrued.
VII. VESTING
The
Executive shall be one
hundred percent
(100%) vested in the
benefits
provided herein.
2
<PAGE>
VIII. OTHER TERMINATION OF EMPLOYMENT AND DISABILITY
A.
Other Termination of Employment:
Subject to Subsection
VIII.A(i) hereinbelow,
in the event that
the employment
of the Executive shall terminate prior to Normal
Retirement Age, as
provided in Section
III, for reasons
other than
"disability" (as
defined in Section
VIII.B) or Change of Control (as
defined in Section IX), but including by the Executive's voluntary
action or by the Executive's discharge by the Bank without
cause, and
such termination of employment constitutes a Separation of Service
(as
defined in Section IV), then this agreement shall terminate upon the
date of such
termination of
employment and the Bank shall pay to the
Executive as severance compensation an amount of money equal to
the
accrued balance of the Executive's liability reserve account. This
severance compensation shall be paid in a lump sum no later than 2
1/2
months following
the date of the Executive's termination of
employment.
Notwithstanding the foregoing, if the Executive is as of
the date of Separation from Service a "Specified Employee" (as herein
defined), then
payment under this Article VIII shall not be paid
earlier than the 183rd day following the date the Executive
incurs a
Separation from Service, or his death, if earlier.
(i) Discharge
for Cause: In the event the Executive shall be
discharged for cause
at any time, all benefits provided herein
shall be forfeited.
The term "for cause"
shall be as defined in
the Executive's
Employment Agreement
between the Executive
and
the Bank in effect at the time of said termination (or if no
such
agreement exists,
the Employment Agreement most recently in
effect between the Bank and the Executive). If a dispute arises
as to
discharge "for
cause," such dispute
shall be resolved
by
arbitration as set forth in this Executive Plan.
B.
Disability:
In the event the Executive becomes disabled prior to his
Separation from
Service
(as defined in Section IV), and the
Executive's Separation
from Service is on account of such disability,
the Executive shall be
entitled to receive one hundred percent (100%)
of the Executive's accrued liability balance at the time of
Separation
from Service for said disability. Except as otherwise provided
herein,
said accrued liability
balance at
termination
shall be paid to
the
Executive in a lump sum no later than 2 1/2 months following the date
of the Executive's Separation from Service.
Disability shall be defined in the Executive's Employment Agreement
in
effect at the time of his Separation from Service or, if no
Employment
Agreement is then in
effect, then as
defined in the Bank's long term
disability policy in effect at the time of said disability. If
neither
definition exists at
the time of
termination and there
is a dispute
regarding whether the
Executive is disabled,
such dispute
shall be
resolved by a physician selected by the Bank, a physician
selected by
3
<PAGE>
the Executive, and a third physician selected by each of the other
two
(2) physicians. Such
resolution shall be
binding upon all parties to
this agreement.
Notwithstanding the
foregoing, if the
disability that gives
rise to
the Executive's
Separation from
Service does not cause the Executive
to be "disabled" within the meaning of Section 409A, and if, as of
the
date of such
Separation from
Service, the Executive
is a "Specified
Employee" (as defined in Section 409A), then his disability benefits
payable pursuant to
this Section VIII.B
shall commence to be paid on
the first day of the month that next follows the six-month
anniversary
of the date the Executive incurs a Separation from Service, or his
death, if earlier.
IX. CHANGE OF CONTROL
Change of Control shall be as defined in the Executive's Employment
Agreement between the
Executive and the Bank in effect at the time of said
Change of Control, or if no such agreement is then in effect, by the
regulations of the OTS in 12 CFR ss.574. Upon a Change of Control,
if the
Executive subsequently
suffers an
involuntary
termination
of service,
except for cause, and such termination of service constitutes a Separation
from
Service (as defined in Section IV), or, upon a voluntary
termination
of
service within twelve
(12) months after such Change of Control, if any
of
the following events, which have not been consented to in advance
by the
Executive in writing, occur: (i) if the Executive would be required
to move
his
personal residence or
perform his principal
executive functions
more
than
forty (40) miles from the Executive's primary
