RIGGS NATIONAL CORPORATION
and
RIGGS BANK N.A.
DEFERRED COMPENSATION PLAN FOR DIRECTORS
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(As Revised April 12, 2000)
ARTICLE I
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INTRODUCTION
This Deferred Compensation Plan (the "Plan") is established by Riggs
National Corporation (the "Company") and Riggs Bank N.A. (the "Bank") for the
benefit of their Directors and their Beneficiaries, and it shall be maintained
according to the terms hereof. The Plan allows Directors to defer receipt and
taxation of Director's Fees and to invest deferred fees in Shares of the
Company.
ARTICLE II
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DEFINITIONS
2.1 DEFINITIONS. When used herein, the following words and
phrases shall have the meanings assigned to them, unless the context clearly
indicates otherwise:
(a) "Bank" means Riggs Bank N.A. (formerly known as The Riggs National
Bank of Washington, D.C.).
(b) "Beneficiary" means the person or persons, natural or otherwise,
designated by a Director under section 8.1 to receive any death benefit payable
under section 7.3.
(c) "Board of Directors" means the board of directors of the Company
unless otherwise stated.
(d) "Cash Deferred Fee Account" means an account established in the
name of a Director to which is credited any Director's Fees that are deferred by
the Director under section 3.1(a) and directed into the Cash Deferred Fee
Account under section 3.1(c), any Prior Deferred Fees which the Director elected
to have transferred to the Plan, any interest that is credited under section
5.1, any dividends that are credited under sections 6.1(c) and 7.2(b) and from
which is debited payments made under Article VII.
(e) "Common Stock" means the common shares, $2.50 par value per share,
of the Company.
(f) "Company" means the Riggs National Corporation.
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(g) "Deferred Fee Accounts" means a Director's Cash Deferred Fee
Account and Stock Deferred Fee Account.
(h) "Deferred Fee Agreement" means the written agreement, substantially
in the form of Exhibit A hereto, between the Director and the Company or the
Bank, as appropriate, that together with the Plan, governs the Director's rights
to payment of deferred Director's Fees (adjusted for investment performance)
under the Plan.
(i) "Director" means a non-employee member of the board of directors of
the Company, the Bank or any subsidiaries or affiliates whose participation is
approved by the board of directors of the Company.
(j) "Director's Fees" means the retainer paid to a Director, any fees
paid to a Director for attending meetings of the board of directors or any
committee of the board of directors and any fees paid to a Director for serving
as chairman of a committee of the board of directors.
(k) "Fair Market Value" means, with respect to a share of the Common
Stock, (i) if the Common Stock is listed on a national securities exchange or
traded on the National Market System, the closing price of the Common Stock on
the determination date or if there are no sales on such date, then on the next
preceding date on which there were sales of Common Stock, all as published in
the Eastern Edition of The Wall Street Journal, (ii) if the Common Stock is not
listed on a national securities exchange or traded on the National Market
System, the closing price last reported by the National Association of
Securities Dealers, Inc. for the over-the-counter market on the determination
date or, if no sales are reported on such date, then on the next preceding date
on which there were such quotations, or (iii) if the Common Stock is not listed
on a national securities exchange or traded on the National Market System and
quotations for the Common Stock are not reported by the National Association of
Securities Dealers, Inc., the fair market value determined by Board of
Directors. In no case, however, shall the Fair Market Value be less than the par
value of the Common Stock.
(l) "Interest" means the amount of interest credited to a Director's
Cash Deferred Fee Account at an annual rate determined in accordance with
section 5.2.
(m) "Plan" means the Riggs National Corporation and Riggs Bank N.A.
Deferred Compensation Plan for Directors set forth in this document, as amended
from time to time.
(n) "Plan Year" means the twelve-month period beginning January 1
and ending the following December 31 (February 1 through January 31 for
periods prior to January 1, 1998).
(o) "Prior Deferred Fees" means Director's Fees earned prior to June
30, 1994, and deferred under a previous deferred compensation arrangement
sponsored by the Company or the Bank.
(p) "Quarterly Payment Period" means each quarterly period for which
Directors Fees are paid to a Director.
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(q) "Shares" means the phantom shares of Common Stock credited to a
Director's Stock Deferred Fee Account.
(r) "Stock Deferred Fee Account" means an account established in the
name of a Director to which is credited Shares for any Director's Fees that are
deferred by the Director under section 3.1(a) and directed into the Stock
Deferred Fee Account under section 3.1(c), any Prior Deferred Fees that the
Director elected to have transferred to the Stock Deferred Fee Account and any
additional Shares that are credited under section 6.1(b) and from which are
debited payments made under Article VII. Payment of Shares credited to the Stock
Deferred Fee Account prior to April 12. 2000, is made by distribution of shares
of Common Stock and payment of Shares credited after such date is made by cash
distribution.
ARTICLE III
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DEFERRAL OF DIRECTOR'S FEES
3.1 ELECTION TO DEFER FEES. (a) For periods prior to April 12, 2000,
before the beginning of a Quarterly Payment Period, a Director may elect to
defer all or part of his or her Director's Fees to be earned in such Quarterly
Payment Period and following Quarterly Payment Periods. For periods commencing
after April 12, 2000, before the beginning of a calendar year, a Director may
elect to defer all or a part of his or her Director's Fees to be paid in the
following calendar year. For a new Director, the election to defer Director's
Fees earned during his or her initial quarter of service shall be made within
thirty (30) days following the Director's election or appointment and shall be
effective for Director's Fees earned as of the first day of the month after the
election is made.
(b) Any election to defer shall continue in effect for subsequent
Quarterly Payment Periods or calendar years, in the case of periods after April
12, 2000, unless modified or revoked in accordance with section 3.4.
(c) When a Director elects to defer Director's Fees under section
3.1(a) the Director shall also elect whether amounts deferred should be credited
to his or her Cash Deferred Fee Account, to his or her Stock Deferred Fee
Account, or both, in the percentages authorized in the Director's Deferred Fee
Agreement.
3.2 LIMITATION ON STOCK DEFERRED FEES. (a) A Director cannot elect to
credit more than $10,000 of Director's Fees each Plan Year to the Director's
Stock Deferred Fee Account beginning February 1, 1997 and ending December 31,
1997, and each subsequent Plan Year beginning on January 1 thereafter through
April 11, 2000. The $10,000 limit shall not apply to dividends credited to the
Director's Stock Deferred Fee Account under section 6.1(b).
(b) There is no limit on the amount of Director's Fees that can be
credited to the Director's Stock Deferred Fee Account after April 12, 2000.
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(c) In the event that prior to April 12, 2000, a Director or Directors
elect to defer Director's Fees in the form of Shares and the total number of
Shares to be credited to all Directors' Stock Deferred Fee Accounts at such time
exceeds the number of shares of Common Stock then available under the Plan, the
number of Shares credited to each Director's Stock Deferred Fee Account shall be
reduced on a pro rata basis and the remaining Director's Fees shall be credited
to the Director's Cash Deferred Fee Account. The excess Director's Fees credited
to the Director's Cash Deferred Fee Account cannot thereafter be transferred to
the Director's Stock Deferred Fee Account.
(d) There is no limit on the amount of Director's Fees that can be
credited to the Director's Cash Deferred Fee Account.
3.3 CREDITING TO DEFERRED FEE ACCOUNTS. (a) When a Director elects
under section 3.1(c) to have Director's Fees credited to his or her Cash
Deferred Fee Account, the Director's Cash Deferred Fee Account shall be credited
with the amount of such Director's Fees as of the day such Director's Fees would
have been paid to the Director were they not deferred under the Plan.
(b) When a Director elects under section 3.1(c) to have Director's Fees
credited to his or her Stock Deferred Fee Account, the Director's Stock Deferred
Fee Account shall be credited with a number of Shares as of the day such
Director's Fees would have been paid to the Director were they not deferred
under the Plan. Subject to sections 3.2(a) and 3.2(b), the number of Shares
credited to the Stock Deferred Fee Account shall be the quotient of the amount
of Director's Fees to be credited to the Stock Deferred Fee Account divided by
the Fair Market Value of the Common Stock on such date.
3.4 MODIFICATION OR REVOCATION OF DEFERRAL. A Director may, on a
prospective basis for future Quarterly Payment Periods or calendar years for
periods after April 12, 2000, change the amount of Director's Fees to be
deferred by executing a new Deferred Fee Agreement or revoke his or her election
to defer Director's Fees by executing a written revocation to the Secretary of
the Company, but no new Deferred Fee Agreement or revocation of an election to
defer Director's Fees shall be effective in the Quarterly Payment Period or
calendar year, as appropriate, in which it is executed.
3.5 MODIFICATION OF INVESTMENT DIRECTION. A Director may, on a
prospective basis for future Director's Fees, modify his or her election
regarding the Deferred Fee Accounts to which his or her deferred Director's Fees
are credited, but no modification of such an election shall affect amounts
previously deferred. Modifications must be made prior to the first day of the
month of the Quarterly Payment Period or calendar year for periods after April
12, 2000, for which such election is effective.
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ARTICLE IV
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CHANGE IN CAPITAL STRUCTURE
4.1 CHANGE IN CAPITAL STRUCTURE. If the Company shall effect a
subdivision or consolidation of shares or other capital readjustment, the
payment of a stock dividend, or other increase or reduction of the number of
shares of the Common Stock outstanding, without receiving compensation therefore
in money, services or property (a "Capital Adjustment"), then (i) the number,
class, and per share price of Shares credited to the Director's Stock Deferred
Fee Account shall be appropriately adjusted to account for the Capital
Adjustment; and (ii) the number and class of shares then reserved for issuance
under the Plan shall be adjusted by substituting for the total number and class
of shares of Common Stock then reserved the number and class of shares of Common
Stock that would have been received by the owner of an equal number of
outstanding shares of each class of Common Stock as the result of the event
requiring the adjustment.
ARTICLE V
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INTEREST
5.1 INTEREST. Interest shall be credited to each Director's Cash
Deferred Fee Account, as of the end of each quarter, at an annual rate
determined pursuant to section 5.2. Interest shall be credited during each
quarter that a Director has any amount credited to his or her Cash Deferred Fee
Account under the Plan.
5.2 RATE OF INTEREST. Interest shall be credited during the Plan Year
at a rate equal to the interest rate paid by the Bank on its certificates of
deposit having a one-year maturity as of February 1 of that Plan Year for
periods prior to January 1, 1998 and as of January 1 of that Plan Year for
periods after December 31, 1997.
ARTICLE VI
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DIVIDENDS
6.1 CREDITING OF DIVIDENDS. (a) Each Director with Shares credited to
his or her Stock Deferred Fee Account on the record date of a dividend on the
Common Stock shall be credited on the payment date of the dividend with an
amount determined by the product of the number of Shares credited to the
Director's Stock Deferred Fee Account on the dividend record date and the
dividend per share on the Common Stock.
(b) If the Director is currently deferring all or a portion of his or
her Director's Fees to the Director's Stock Deferred Fee Account, the Director's
Stock Deferred Fee Account shall be credited on the dividend payment date with a
number of Shares determined by dividing the amount of the dividends for the
Director as determined under section 6.1(a) by the Fair Market Value of the
Common Stock on the dividend payment date.
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(c) If the Director is not currently deferring all or a portion of his
or her Director's Fees to the Director's Stock Deferred Fee Account, the amount
of dividends determined under section 6.1(a) shall be credited on the dividend
payment date to the Director's Cash Deferred Fee Account.
ARTICLE VII
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PAYMENT OF DEFERRED FEES
7.1 FORM OF PAYMENT OF DEFERRED FEES. A Director shall be entitled to
receive a benefit equal to the amounts credited to his or her Deferred Fee
Accounts at the time or times specified in such Director's Deferred Fee
Agreement. Amounts credited to a Director's Cash Deferred Fee Account shall be
paid in cash. Subject to adjustment or provided in Section 4.1, Shares credited
to a Director's Stock Deferred Fee Account prior to April 12, 2000, shall be
paid by the delivery by the Company of certificates representing a like number
of shares of the Common Stock while Shares credited to a Director's Stock
Deferred Fee Account after such date shall be paid only in cash in an amount
equal to the then Fair Market Value of the Shares.
7.2 TIMING OF PAYMENT OF DEFERRED FEES. (a) At the election of a
Director, the amount credited to the Director's Cash Deferred Fee Account shall
be paid in a lump sum or in installments in accordance with the terms of such
Director's Deferred Fee Agreement. Amounts credited to a Director's Cash
Deferred Fee Account shall bear interest at the rate specified in section 5.2
during the installment payout period.
(b) The Shares credited to the Director's Stock Deferred Fee Account
shall be issued or paid in cash (as the case may be) to the Director in a lump
sum or, in the case of amounts credited with respect to Director's Fees deferred
after April 12, 2000, in installments in accordance with the terms of such
Director's Deferred Fee Agreement provided that except in the case of
termination of service, such date shall be at least six months following the
date the Director files his or her Deferred Fees Agreement with the Company or
the Bank, as appropriate. The Director's Cash Deferred Fee Account shall be
credited with dividends for Shares credited to a Director's Stock Deferred Fee
Account from the date on which the Director ceases to be a Director until such
payment is made.
(c) Notwithstanding the foregoing, no payment of shares of Common Stock
from a Director's Stock Deferred Fee Account shall be made until at least six
months and one day that an individual ceases to be a Director. Furthermore, no
payment of Shares from a Director's Stock Deferred Fee Account shall be made by
issuing Common Stock unless the Company may validly issue Common Stock at such
time pursuant to all applicable rules and regulations, including but not limited
to corporate law, securities law and stock exchange rules. If Common Stock may
not be issued, subject to compliance with applicable securities laws
requirements, the Fair Market Value of the Shares credited to a Director's Stock
Deferred Fee Account which would otherwise be paid by delivery of shares shall
instead be distributed in cash.
7.3 DEATH OF A DIRECTOR. If a Director dies with any amount credited to
his or her Deferred Fee Accounts, then his or her Beneficiary shall be entitled
to receive the entire amount in a lump sum in cash and/or shares of common
stock, as appropriate. Such payment shall be made as soon as practicable after
the end of the calendar quarter in which the Director's death occurred.
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ARTICLE VIII
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BENEFICIARIES
8.1 DESIGNATION OF BENEFICIARY. Each Director may designate from time
to time any person or persons, natural or otherwise, as his or her Beneficiary
or Beneficiaries to whom benefits under section 7.3 are to be paid if he or she
dies while entitled to benefits. Each Beneficiary designation shall be made
either in the Deferred Fee Agreement or on a form prescribed by the Secretary of
the Company and shall be effective only when filed with the Secretary during the
Director's lifetime. Each Beneficiary designation filed with the Secretary shall
revoke all Beneficiary designations previously made by the Director. The
revocation of a Beneficiary designation shall not require the consent of any
designated Beneficiary.
ARTICLE IX
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ADMINISTRATION
9.1 SHARES AVAILABLE UNDER THE PLAN. (a) As of the effective date of
the Plan, 25,000 shares of Common Stock may be issued to Directors in the form
of shares of Common Stock under the Plan; provided that Shares payable in the
form of cash shall not be subject to the share limit of this Section.
(b) The number of shares of Common Stock available to be issued under
the Plan may be increased upon the approval of the Shareholders of the Company.
9.2 RIGHT TO AMEND OR TERMINATE THE PLAN. The Company may amend or
terminate the Plan at any time in whole or in part. No amendment or termination
of the Plan shall reduce any amounts credited to a Director's Deferred Fee
Accounts, any amount owed to him or her as of the date of amendment or
termination, or the amount of Interest accrued or number of Shares to be
credited, as of such date, to his or her account.
9.3 NO FUNDING OBLIGATION. Obligations to pay any benefits under the
Plan shall be unfunded and unsecured, and any payments under the Plan shall be
made from the general assets of the Company or the Bank, as appropriate. The
Company or the Bank, as appropriate, in its discretion, may set aside assets or
purchase annuity or life insurance contracts to discharge all or part of the
obligations under the Plan. The assets set aside or the annuity or life
insurance contracts shall remain in the name of the Company or the Bank, as
appropriate, and no trust shall be created by setting aside the assets or
purchasing annuity or life insurance contracts. A Director's rights under the
Plan are not assignable or transferable other than by will or the laws of
descent and distribution, and such rights are exercisable during the Director's
lifetime only by him or her, or by his or her guardian or legal representative.
9.4 APPLICABLE LAW. This Plan shall be construed and enforced in
accordance with the laws of the District of Columbia, except to the extent
superseded by federal law.
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9.5 ADMINISTRATION AND INTERPRETATION. The President of the Company
shall have the authority and responsibility to administer and interpret the
Plan. Benefits due and owing to a Director or Beneficiary under the Plan shall
be paid when due without any requirement that a claim for benefits be filed.
However, any Director or Beneficiary who has not received the benefits to which
he or she believes himself or herself entitled may file a written claim with the
President, who shall act on the claim within thirty days, and such action on any
such claim shall be conclusive.
9.6 EFFECTIVE DATE. This amended Plan shall become effective as of
April 12, 2000, with respect to Directors of the Company and on the date the
amended Plan is approved by Directors of the Bank with respect to its Directors.
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EXHIBIT A
DEFERRED FEE AGREEMENT
This Agreement between ____________________ (the "Company/Bank") and
___________________________ (the "Director") is made the ___ day of ___________,
20__, under the Riggs National Corporation and Riggs Bank N.A. Deferred
Compensation Plan for Directors (the "Plan").
1. DEFERRED FEE PLAN. The Director agrees to the terms and conditions of the
Plan, a copy of which has been delivered to the Director and constitutes a part
of this Agreement. Capitalized words and phrases in this Agreement shall have
the meaning given to them in the Plan, unless the context clearly indicates
otherwise.
2. ELECTION TO DEFER FEES. The Director authorizes and directs the Company/Bank
to defer ________________________ [insert percentage or dollar amount] of the
Director's Fees earned on or after ____________ 20__ and in each subsequent Plan
Year. The Director may at any time change this election on a prospective basis
for Plan Years beginning after the date of such change or revocation by
executing a new Deferred Fee Agreement; the Director may at any time revoke this
election on a prospective basis for Plan Years beginning after the date of such
revocation by delivering to the Secretary of the Company a written revocation of
the election. No change or revocation shall be effective for the Plan Year in
which it is executed.
3. INVESTMENT OF DEFERRED FEES. The Director elects to have his or her deferred
Director's Fees apportioned between the Cash and Stock Deferred Fee Accounts as
follows: (circle appropriate percentages):
Cash Deferred Fee Account: 0% 25% 50% 75% 100%
Stock Deferred Fee Account: 0% 25% 50% 75% 100%
4. FORM OF PAYMENT. (a) Cash Deferred Fee Account. The Director elects to
receive the amount of Director's Fees credited to his or her Cash Deferred Fee
Account pursuant to this Agreement in (check one):
( ) a lump sum; or
( ) substantially equal annual installments over a period of ___
years (not to exceed ten).
Payments shall commence (check one):
( ) _________________, 20__ [must be at least six months from date
election is filed]; or
( ) upon termination of service as director.
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(b) Stock Deferred Fee Account. The Director shall receive the amount
of Director's Fees credited to his or her Stock Deferred Fee Account pursuant to
this Agreement (check one):
( ) a lump sum; or
( ) substantially equal annual installments over a period of ___
years (not to exceed ten).
Payments shall commence (check one):
( ) ____________, 20__ [must be at least six months from date
election is filed]; or
( ) upon termination of service as director.
5. BENEFICIARY. The Director requests that, upon his or her death, any
amounts remaining in his or her Deferred Fees Account be paid to the Beneficiary
or Beneficiaries he or she has designated in this Agreement or in a Notice of
Designation of Beneficiary filed with the Secretary of the Company. This
designation revokes all prior beneficiary designations.
Percentage of Deferred
Beneficiary Address Fees Accounts
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year written above.
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Witness Director
RIGGS NATIONAL CORPORATION
RIGGS BANK N.A.
By:____________________________
Name: _________________________
Title: ________________________
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