Exhibit 10.5A
FIRST AMENDMENT
TO THE
FIRST UNITED SECURITY
BANK
SALARY CONTINUATION
AGREEMENT
DATED SEPTEMBER 20,
2002
FOR
WILLIAM D. MORGAN
THIS FIRST AMENDMENT is adopted this
20th day of November, 2008, effective as of January 1, 2005,
by and among United Security Bancshares, Inc., a Delaware
corporation (“USB”), First United Security Bank, a
state-chartered commercial bank located in Thomasville, Alabama
(“FUSB”) (USB and FUSB collectively are referred to
herein as the “Company”), and WILLIAM D. MORGAN (the
“Executive”).
The Company and the Executive
executed the First United Security Bank Salary Continuation
Agreement on September 20, 2002, effective as of
September 1, 2002 (the “Agreement”).
The undersigned hereby amend the
Agreement for the purpose of bringing the Agreement into compliance
with Section 409A of the Internal Revenue Code. Therefore, the
following changes shall be made:
1. Section 1.8 of the
Agreement shall be deleted in its entirety.
2. The following
Section 1.11a shall be added to the Agreement immediately
following Section 1.11:
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1.11a
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“
Specified Employee ” means a key employee (as defined
in Section 416(i) of the Code without regard to paragraph 5
thereof) of USB if any stock of USB is publicly traded on an
established securities market or otherwise. A Specified Employee
shall be specifically defined and determined in accordance with
Section 409A of the Code and any and all Treasury regulations
and guidance promulgated thereunder.
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3. Section 1.13 of the
Agreement shall be deleted in its entirety and replaced by the
following:
1.13 “ Termination of
Employment ” means the termination of the
Executive’s employment with the Company for reasons other
than death. Whether a Termination of Employment takes place is
determined based on the facts and circumstances surrounding the
termination of the Executive’s employment and whether the
Company and the Executive reasonably anticipated that no further
services would be performed after a certain date or that the level
of bona fide services the Executive would perform after such date
would permanently decrease to no more than twenty percent
(20%) of the average level of bona fide services performed
over the immediately preceding 36-month period (or the full period
of services if the Executive has been providing services less than
36 months).
Page 1 of 5
Notwithstanding the foregoing, a
determination of whether a Termination of Employment has occurred
shall be made in accordance with Section 409A of the Code any
and all Treasury regulations and guidance promulgated
thereunder.
4. The following
Section 1.13a shall be added to the Agreement immediately
following Section 1.13:
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1.13a
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“
Unforeseeable Emergency ” means a severe financial
hardship to the Executive resulting from an illness or accident of
the Executive, the Executive’s spouse, the Executive’s
beneficiary, or the Executive’s dependent (as defined in
Section 152 of the Code without regard to
Section 152(b)(1), (b)(2) and (d)(1)(B)), loss of the
Executive’s property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result
of events beyond the control of the Executive as defined in
Section 409A of the Code and any and all Treasury regulations
and guidance promulgated thereunder.
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5. The following Sections 2.5,
2.6 and 2.7 shall be added to the Agreement immediately following
Section 2.4.2:
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2.5
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Restriction
on Timing of Distributions . Notwithstanding any provision of the
Agreement to the contrary, if the Executive is considered a
Specified Employee at Termination of Employment under such
procedures as established by USB in accordance with
Section 409A of the Code, benefit distributions that are made
upon Termination of Employment may not commence earlier than six
(6) months after the date of such Termination of
Employment. Therefore, in the event this Section 2.5 is
applicable to the Executive, any distribution which would otherwise
be paid to the Executive within the first six (6) months
following the Termination of Employment shall be accumulated and
paid to the Executive in a lump sum on the first day of the seventh
month following the Termination of Employment. All subsequent
distributions shall be paid in the manner specified.
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2.6
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Distributions Upon Income Inclusion Under
Section 409A of the Code . Upon the inclusion of any amount in the
Executive’s income as a result of the failure of the
Agreement to comply with the requirements of Section 409A of
the Code, to the extent such tax liability can be covered by the
amount the Company has accrued with respect to the Company’s
obligations hereunder, a distribution shall be made as soon as is
administratively practicable following the discovery of such
failure.
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2.7
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Change in
Form or Timing of Distributions . All changes in the form or timing of
distributions hereunder must comply with the following
requirements. The changes:
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(a)
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may not
accelerate the time or schedule of any distribution, except as
provided in Section 409A of the Code and any and all Treasury
regulations and guidance promulgated thereunder;
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Page 2 of 5
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(b)
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must, for
benefits distributable under Sections 2.2, 2.3 and 2.4, be made at
least twelve (12) months prior to the first scheduled
distribution;
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(c)
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must, for
benefits distributable under Sections 2.1, 2.2, 2.3 and 2.4, delay
the commencement of distributions for a minimum of five
(5) years from the date the first distribution was originally
scheduled to be made; and
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(d)
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must take
effect not less than twelve (12) months after the election is
made.
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6. Article 7 of the Agreement
shall be deleted in its entirety and replaced by the
following:
Article 7
Amendments and
Termination
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7.1
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Amendments . This Agreement may be amended only by a
w
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