United States

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

  

FORM 8-K

 

Current Report

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

  

Date of Report (Date of earliest event reported)

 

December 18, 2015

  

FNB BANCORP

(Exact name of registrant as specified in its charter)

 

California

(State or other jurisdiction of incorporation)

   

000-49693   92-2115369
(Commission File Number)   (IRS Employer Identification No.)

 

975 El Camino Real, South San Francisco, California   94080
(Address of principal executive offices)   (Zip Code)

  

Registrant’s telephone number, including area code: (650) 588-6800

  

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

 

FNB Bancorp (CA) (OTCQB:FNBG), today announced that the Bank's sole operating subsidiary, First National Bank of Northern California ("the Bank), had entered into a "Memorandum of Mutual Agreement To Amend Certain Salary Continuation Agreements" with four named executives of both the Bank and FNB Bancorp. Under the terms of this agreement, the existing Salary Continuation Agreements for the President, Chief Operating Officer, Chief Financial Officer and Chief Lending Officer will be amended and the amendments signed no later than January 31, 2016, in order to incorporate changes in the timing of accounting for and the vesting of benefits under the existing Salary Continuation Agreements, as currently amended, and the date(s) upon which benefits are to be paid, without changing the amount of actual benefits payable under the agreements.

 

The effect of these changes to the agreements will be an acceleration of expense recognition under the agreements. During 2015, the additional pretax salary and benefits expense related to this agreement will be approximately $1.3 million. On an after tax basis, net income is expected to decline by approximately $0.8 million.

Item 8.01 Other Events.

 

A copy of the Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements is attached to this report as Exhibit 2.1 and is incorporated here by reference.

 

A copy of the Press Release issued by the registrant on December 18, 2015 is attached to this report as Exhibit 2.2 and is incorporated here by reference.

 

Item 9.01. Financial Statements and Exhibits.

 

(c)      Exhibits

 

2.1 Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements dated December 18, 2015

 

2.2 News release of December 18, 2105, announcing the signing of the Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements dated December 18, 2015

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

     
  FNB BANCORP  (Registrant)
     
Dated: December 18, 2015. By:   /s/  Dave A. Curtis  
    Dave A. Curtis
    Senior Vice President and
    Chief Financial Officer
 
 

Exhibit 2.1

 

MEMORANDUM

OF

MUTUAL AGREEMENT TO AMEND

CERTAIN SALARY CONTINUATION AGREEMENTS

 

This Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements is entered into by First National Bank of Northern California (hereafter referred to as “Employer”) and Jim Black, Anthony Clifford, Dave Curtis, and Randy Brugioni (collectively hereafter referred to as “Participant(s)”) as of December 18, 2015.

 

Whereas, Employer and each Participant previously entered into the First National Bank of Northern California Salary Continuation Agreement (hereafter referred to as “Agreement”) at various dates, including amendments to include the requisite provisions of Section 409A of the Internal Revenue Code of 1986, as amended;

 

Whereas, Employer and Participant have determined that the provisions of that Agreement do not provide the anticipated salary continuation benefits payable to the Participant(s) under the Agreement; and

 

Whereas, Employer and Participant(s) have reached certain agreements for amending the provisions of the Agreement;

 

Therefore, Employer and Participant want to memorialize those agreements for amending or restating the Agreement. Those agreed upon amendments shall include the following:

 

A. Section 2.5 (Change of Control Benefit) shall be eliminated.

 

B. Section 4.2 (Excess Parachute Payment) shall be amended to provide that should any benefit paid to Participant under the amended Agreement be construed as an excess parachute payment with respect to any event occurring prior to December 31, 2017, then Employer will reimburse Participant for any excise tax assessed under Section 280G of the Internal Revenue Code. Such reimbursement will include a gross up for income taxes payable by Participant on the excise tax reimbursement. This paragraph shall be null and void with respect to any event occurring after December 31, 2017.

 

C. As of December 31, 2015, the accrued benefit liability on Employer’s books will vest with each Participant.

 

D. The balance of the Participants’ salary continuation benefit will accrue and vest monthly over a three (3) year period beginning January 1, 2015. Accordingly, each Participant will be vested fully in his salary continuation benefit by December 31, 2017. The monthly accrual/vesting schedule will become an exhibit to the amended Agreement.
 
 
E. If a Participant voluntarily separates from service with the Bank, he or she would be entitled to a benefit equal to the amount accrued and vested as of the date of separation from service.

 

F. If a Participant is involuntarily separated from service, he/she would vest 100% in his or her full retirement benefit.

 

G. The amended Agreement will provide elections under which Participants may elect the date on which benefit payments would begin; the payment period over which the payments shall be paid; the frequency of payments (i.e. monthly, quarterly, etc.); and the amount of each periodic payment. Additionally, at least one year prior to the date that a Participant’s benefit payments are to begin, he/she would be able to make an election to defer payment of his/her benefit payments to a later date.

 

H. The other provisions in the Agreement as to payment of benefits under other payment events (such as disability or death) will remain substantially the same, but will be amended to conform vesting and payments to the above terms.

 

I. The amended Agreement will include all the requisite Section 409A provisions to make sure that the amended Agreement does not accelerate the taxability of the benefits payments to be made under it.

 

J. Since time is of the essence, both Employer and Participant(s) will use their best efforts to execute amended Agreements by January 31, 2016.

 

This Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements only may be amended by the written consent of Employer and Participant(s).

 

This Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements is executed this 18 th day of December 2015, by –

 

First National Bank of Northern California

 

/s/ Tom McGraw    
By: Tom McGraw, Chief Executive Officer    
     
/s/ Jim Black   /s/ Anthony Clifford
Jim Black, Participant   Anthony Clifford, Participant
     
/s/ Dave Curtis   /s/ Randy Brugioni
Dave Curtis, Participant   Randy Brugioni, Participant
 
 

Exhibit 2.2

 

Press Release

Available for Immediate Publication: December 18, 2015

 

First National Bank of Northern California Reports Entering into a Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements

 

Source:FNB Bancorp (CA) (QTCQB:FNBG)

South San Francisco, California

Website: www.fnbnorcal.com

 

Contacts:

Tom McGraw, Chief Executive Officer (650) 875-4864

Dave Curtis, Chief Financial Officer (650) 875-4862

 

 

 

FNB Bancorp (QTCQB: FNBG), parent company of First National Bank of Northern California (the “Bank”), today announced the signing of a “Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements.” This agreement will affect certain Amendments that are currently being drafted into the existing Salary Continuation Agreements for the Bank’s President, Chief Operating Officer, Chief Financial Officer, and Chief Lending Officer.

 

“The signing of the Memorandum of Mutual Agreement to Amend Certain Salary Continuation Agreements for four executive officers of the Bank was completed in order to: (1) insure the Salary Continuation agreements are tax compliant with all tax regulations, including IRS code section 409A and 280g; (2) provide a better matching of benefit vesting to the service provided to the Bank by the four named executives; (3) provide the Bank with services of the four named executives for a time certain into the future; and (4) insure the actual benefits stated in the existing Salary Continuation Agreements for the four named executives did not change. These changes provide additional incentives to the executives to maintain their employment with the Bank during the revised vesting period which will allow the Bank to continue to grow organically and through thoughtful acquisitions. We look forward with anticipation to the upcoming 2016 calendar year,” stated Tom McGraw, CEO.

 

Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management's assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.