CHANGE IN CONTROL AGREEMENT
(two years)
This CHANGE IN CONTROL AGREEMENT (this "Agreement") is dated as of
January 19, 1999, by and among BRIDGEHAMPTON NATIONAL BANK (the "Bank"), BRIDGE
BANCORP, INC. (the "Company") (the Bank and the Company, collectively, the
"Employers") and Xxxxxxxxxxx Xxxxxx (the "Employee").
WHEREAS, the Employee is currently serving as the Executive Vice
President/Chief Financial Officer;
WHEREAS, the Company and the Employee have entered into a Change in Control
Agreement dated as of January 13, 1998 (the "Prior Agreement");
WHEREAS, the respective Board of Directors of the Employers (the "Boards")
have approved and authorized the entry into this Agreement with the Employee;
WHEREAS, the Boards believe that it is in the best interests of the
Employers to encourage the Employee's continued employment with and dedication
to the Bank in the face of potentially distracting circumstances arising from
the possibility of a change in control of the Company or the Bank; and
WHEREAS, the parties desire to enter into this Agreement setting forth the
terms and conditions for the payment of special compensation to the Employee in
the event of a termination of the Employee's employment in connection with or as
the result of a change in control of the Company or of the Bank and to replace
and supersede the Prior Agreement;
NOW, THEREFORE, it is AGREED as follows:
1. Term.
The initial term of this Agreement shall be for a period
commencing on the date hereof and ending on December 31, 2003.
The Employers may renew this Agreement by written notice to the
Employee for one additional year on January 1, 2000 and each
subsequent January 1 during the term of this Agreement unless the
Employee gives contrary written notice to the Employers before
any such renewal date. If at any time during the term of this
Agreement, there is a "Change in Control" as defined in Section
2(b) hereof, the provisions of this Agreement shall continue to
apply for two years from the date of such Change in Control
regardless of whether the term of this Agreement is subsequently
renewed under this Section 1. References herein to the "Term of
this Agreement" shall include the initial term and any additional
years for which this Agreement is renewed.
2. Change in Control.
(a)(i) If during the term of this Agreement there is a Change in
Control (as defined below) and the Employee's employment by the
Employers is terminated in accordance with Section 2(a)(iv), the
Employee shall be entitled to receive as a severance payment for
services
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previously rendered to the Employers a lump sum cash payment
equal to 2.99 times the sum of the Employee's base salary in
effect as of date of the Change in Control or the date of
termination, whichever is greater, plus the amount of bonuses
paid to the Employee during the 12 months preceding the Change in
Control. (Subject to Section 2(c) and 2(d) below). Payment under
this Section 2(a) shall not be reduced by any compensation that
the Employee may receive from other employment with another
employer after termination of the Employee's employment. Payment
to the Employee of severance under this Section 2(a) shall be
made on or before the Employee's last day of employment with the
Employers.
(ii) In addition to the liquidated damages that are payable to
the Employee, the following shall apply in the event of any
termination without Cause or in the event of any termination
subject to Section 2(a)(i) hereof: (1) the Employee shall
continue to participate in, and accrue benefits under, all
retirement, pension, profit-sharing, employee stock ownership,
and other deferred compensation plans of the Company or the Bank
for the remaining term of this Agreement (or following a "Change
in Control" as defined below, if longer, three years) as if the
termination of employment of the Employee had not occurred (with
the Employee being deemed to receive annually for the purposes of
such plans the Employee's base salary as of the date of
termination or, if applicable, Change in Control, whichever is
greater), except to the extent that such continued participation
and accrual is expressly prohibited by law, or to the extend such
plan constitutes a "qualified plan" under Section 401 of the
Internal Revenue Code of 1986, as amended (the "Code"), in which
case the Employers shall provide substantially equivalent
benefits to the Employee under a non-qualified plan; (2) the
Employee shall be entitled to continue to receive all other
employee benefits for the remaining term of this Agreement (or
following a "Change in Control," if longer, three years) as if
the termination of employment had not occurred; and (3) all
insurance or other provisions for indemnification, defense or
hold-harmless of officers or directors of the Company or the Bank
that are in effect on the date the notice of termination is sent
to the Employee shall continue for the benefit of the Employee
with respect to all of his acts and omissions while an officer as
fully and completely as if such termination had not occurred, and
until the final expiration or running of all periods of
limitation against action that may be applicable to such acts or
omissions; provided, however, that the Employers shall not be
required to provide the benefits described in clause (1) or (2)
of this Section 2(a)(ii) to the extent that the Employee has the
right to receive substantially identical benefits by reason of
his employment by another employer following the termination of
his employment hereunder.
(iii) In the event the employment of the Employee is terminated
by the Employers in accordance with Section 2(a)(ii) hereof and
the Bank fails to make timely payment of any amount then payable
to or for the benefit of the Employee under this Agreement and
such failure continues for more than 30 days, the Employee shall
be entitled to reimbursement for all reasonable costs, including
attorneys' fees, incurred by the Employee in taking action to
collect such amounts or otherwise to enforce this Agreement, plus
interest on such amounts at the prime rate (defined as the base
rate on corporate loans at large U.S. money center commercial
banks as published by The Wall Street Journal), compounded
monthly, for the period from the date the payment is due until
the payment is made. Such reimbursement and interest shall be in
addition to all rights that the Employee is otherwise entitled to
under this Agreement.
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(iv) For purposes of this Agreement, the Employee's employment by
the Employers shall be considered terminated "in accordance with
Section 2(a)(iv)" if a Change in Control shall occur, and in
connection with such Change in Control or within two years
thereafter either (x) the Employee's employment with the
Employers shall be terminated as a result of an Actual
Termination (as defined below), or (y) the Employee's employment
with the Employers shall terminate after an event that would
constitute Good Reason (as defined below); and the following
terms shall have the meanings set out below:
(A) "Actual Termination" means involuntary termination of the
Employee's employment with the Employers for any reason other
than Willful Misconduct, Disability, death or Retirement.
(B) "Willful Misconduct" means (I) the continued willful failure by
the Employee to substantially perform his duties with the
Employers or either of them (other than any such failure
resulting from the Employee's incapacity due to physical or
mental illness) after a written demand for substantial
performance is delivered to the Employee by the Boards (or either
of the Boards) that specifically identifies the manner in which
the Employee has not substantially performed his duties and after
a reasonable time period has run to allow the Employee to
perform, (II) willful conduct that is a material violation of the
Bank's written ethics policy or applicable law and that is
materially injurious to the Employers or either of them, (III)
other willful and wrongful conduct by the Employee that causes
substantial and material injury to the business and operations of
the Employers or either of them, the continuation of which, in
the reasonable judgment of the Boards (or either of the Boards),
will continue to substantially and materially injure the business
and operations of the Employers (or either of them) in the
future, or (IV) conviction of the Employee of a felony involving
moral turpitude; provided, that an act or failure to act shall
not be considered "willful" unless done, or omitted to be done,
in bad faith and without reasonable belief that the Employee's
action or omission was in the best interests of the Employers;
(C) "Good Reason" For purposes of this Agreement, a termination of
employment by the Employee for "Good Reason" shall be treated as
an involuntary termination of the Employee's employment by the
Employers without Cause. "Good Reason" shall mean: (A) a material
breach by the Employers or either of them of this Agreement or
(B) a reduction, without the prior written consent of the
Employee, in his base salary under Section 2 hereof or benefits
provided to him under Section 3 hereof (or both).
(D) "Retirement" means termination of the Employee based on the
Employee's having reached the earlier of age 65 or the normal
retirement age as defined under Bank's employee's pension plan,
if permissible under applicable law.
(E) "Date of Termination" means the date specified in the notice of
termination.
(b) For purposes of this Agreement, a "Change in Control" shall
be deemed to have taken place if: (i) any person becomes the
beneficial owner of more that 50 percent of the total number of
voting shares of the Company; (ii) any person (other than the
persons named as proxies solicited on behalf of the Board of
Directors of the Company) holds revocable or irrevocable proxies
as to the election or removal of members of the board of
directors of the Company, for more than 50 percent of the total
number of voting shares of the Company; (iii) any person
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(other than a person controlled directly or indirectly by the
Company) becomes the beneficial owner of more than 50 percent of
the total number of voting shares of the Bank; (iv) any person
has received all required approvals of applicable regulatory
authorities to acquire control of the Company or the Bank; or (v)
as the result of, or in connection with, any cash tender or
exchange offer, merger, or other business combination, sale of
assets or contested election, or any combination of the foregoing
transactions, the persons who were directors of the Company
immediately before such transaction shall cease to constitute at
least one-half of the members of the Board of Directors of the
Company or any successor corporation. For purposes of this
Section 2(b), a "person" includes an individual, corporation,
partnership, trust, association, joint venture, pool, syndicate,
unincorporated organization, joint-stock company or similar
organization or group acting in concert. A person for these
purposes shall be deemed to be a beneficial owner as that term is
used in Rule 13d-3 under the Securities Exchange Act of 1934.
(c) Notwithstanding any other provisions of this Agreement or of
any other agreement, contract, or understanding heretofore or
hereafter entered into by the Employee with the Company, the Bank
or any other entity controlled by the Company, except an
agreement, contract, or understanding hereafter entered into that
expressly modifies or excludes application of this Section 2(c)
(the "Other Agreements"), and notwithstanding any formal or
informal plan or other arrangement heretofore or hereafter
adopted by the Company or the Bank for the direct or indirect
provision of compensation to the Employee is a member), whether
or not such compensation is deferred, is in cash, or is in the
form of a benefit to or for the Employee (a "Benefit Plan"), the
Employee shall not have any right to receive any payment or other
benefit under this Agreement, any Other Agreement, or any Benefit
Plan if such payment or benefit, taking into account all other
payments or benefits to or for the Employee under this Agreement,
all Other Agreement, and all Benefit Plans, would cause any
payment to the Employee under this Agreement to be considered a
"parachute payment" within the meaning of Section 280G(b)(2) of
the Code (a "Parachute Payment"). In the event that the receipt
of any such payment or benefit under this Agreement, any Other
Agreement, or any Benefit Plan would cause the Employee to be
considered to have received a Parachute Payment under this
Agreement, then the Employee shall have the right, in the
Employee's sole discretion, to designate those payments or
benefits under this Agreement, any Other Agreements, and/or any
Benefit Plans, that should be reduced or eliminated so as to
avoid having the payment to the employee under this Agreement be
deemed to be a Parachute Payment.
(d) Notwithstanding any other provision in this Agreement, (i)
the Employers may terminate or suspend this Agreement and the
employment of the Employee hereunder, as if such termination were
for Cause under Section 7(a)(i) hereof and for Willful Misconduct
under Section 8(a)(ii) hereof, to the extent required by the laws
of the State of New York related to banking, by applicable
federal law relating to deposit insurance or bank holding
companies or by regulations or orders issued by the Banking
Commissioner of the State of New York, the Federal Deposit
Insurance Corporation or the Board of Governors of the Federal
Reserve System and (ii) no payment shall be required to be made
to the Employee under this Agreement to the extent such payment
is prohibited by applicable law, regulation or order issued by a
banking agency or a court of competent jurisdiction; provided,
that it shall be the Employers' burden to prove that any such
action was so required.
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3. Confidentially and Noninterference with Customers and Employees.
(a) Except as authorized or directed by the Employers, the
Employee shall not at any time during or subsequent to employment
with the Employers, directly or indirectly, publish or disclose
to any person or entity any confidential information of the
Employers or confidential information of others that has come
into the Employers' possession or the Employee's possession in
the course of employment with Employers, and the Employee will
not use such information for the Employee's personal gain or make
it available for others to use. All information, whether written
or not, regarding the business and finances of the Employers, or
their customers and contractors, including, without limitation,
information relating to existing and contemplated products,
services, software, systems, methods, business procedures,
construction, operational and marketing plans and programs,
prices, costs and revenues, prospective and existing contracts,
prospective and existing customers or other business arrangements
and any additional information acquired only because of
employment with the Employers, shall be presumed to be
confidential, except to the extent the same shall have been
lawfully and without breach of obligation made available to the
general public without restriction. All papers and records of
every kind, including all memoranda, notes, lists, plans,
reports, data (written or recorded) and documents, whether
originals or copies and whether prepared by the Employee or by
others, relating to the business and finances of the Employers or
their customers or contractors, shall be the sole and exclusive
property of the Employers. The Employee will return to the
Employers all of the above materials upon termination of
employment and will not at any time give or disclose such
materials to any unauthorized person or entity.
(b) The Employee acknowledges and agrees that, because
relationships with customers and prospective customers are
expected to constitute a large portion of the goodwill of the
Bank's business, it is of great importance to the Employers that
the Employee not solicit the Bank's customers and prospective
customers (other than on behalf of the Bank) during the period of
employment, and that the Employee not solicit such customers and
prospective customers after termination of the Employee's
employment while the Employee is receiving salary continuation
payments under Section 2(a) hereof, with respect to business or
contracts for any products or service of the type provided,
developed or under development by the Bank during the Employee's
employment by the Bank, so that another employee of the Bank will
have an opportunity to develop relationships with such clients
and prospective clients. The Employee agrees that, while the
Employee is employed by the Bank and while the Employee is
receiving salary continuation payments under Section 2(a) hereof,
the Employee shall not, within the area comprised of the Towns of
Southampton, East Hampton, Shelter Island, Southold and
Riverhead, New York, and any other town in which the Employee
performed material services for the Bank, directly or indirectly
solicit (other than on behalf of the Bank) business or contracts
for any products or services of the type provided, developed or
under development by the Bank during the Employee's employment by
the Bank, from or with (i) any person or entity that was a
customer of the Bank for such products or services as of, or
within one year before, the date of termination of the Employee's
employment with the Bank (the "Termination Date"), or (ii) any
prospective customer that the Bank was actively soliciting as of,
or within one year before, the Termination Date.
(c) While the Employee is employed by the Employers and
thereafter while the Employee is
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receiving salary continuation payments under Section 2(a) hereof,
the Employee shall not solicit any person who is then employed by
the Company, the Bank or any subsidiary of either of them or who
within 90 days before the Termination Date had been so employed,
to leave such employment or to become employed by any person or
entity other than the company, the Bank or any such subsidiary.
(d) The Employee acknowledges that the restrictions contained in
this Section 3 are reasonable and necessary to protect the
business and interest of the Employers and that any violation of
these restrictions would cause substantial irreparable injury.
Accordingly, the Employee agrees that a remedy at law for any
breach of the foregoing covenants would be inadequate and that
the Employers, in addition to any other remedies available, shall
be entitled to obtain preliminary and permanent injunctive relief
to secure specific performance of such covenants and to prevent a
breach or contemplated breach of this Section without the
necessity of proving actual damage. The Employee will provide the
Employers a full accounting of all proceeds and profits received
by the Employee as a result of or in connection with a breach of
this Section. Unless prohibited by law, the Employers shall have
the right to retain any amounts otherwise payable to the Employee
to satisfy any obligations of the Employee as a result of any
breach of this Section. The Employee hereby agrees to indemnify
and hold harmless the Employers from and against any costs and
expenses incurred by the Employers as a result of any breach of
this Section by the Employee and in enforcing and preserving the
Employers' rights under this Section.
4. No Assignments. This Agreement is personal to each of the parties
hereto. No party may assign or delegate any rights or obligations
hereunder without first obtaining the written consent of the
other party hereto. However, in the event of the death of the
Employee, all rights to receive payments hereunder shall become
rights of the Employee's estate.
5. Prior Agreement Superseded; Entire Agreement; Amendments. The
Prior Agreement is hereby replaced and superseded and the Prior
Agreement shall be of no further force or effect after the date
of this Agreement. This Agreement constitutes the entire
agreement among the parties hereto with respect to the matters
contemplated herein, and it supersedes all prior oral or written
agreements, commitments or understandings with respect to the
matters provided for herein. No amendment, modification or
discharge of this Agreement shall be valid or binding unless set
forth in writing and duly executed and delivered by the party
against whom enforcement of the amendment, modification, or
discharge is sought.
6. Section Headings. The section headings used in this Agreement are
included solely for convenience and shall not affect, or be used
in connection with, the interpretation of this Agreement.
7. Governing Law. This Agreement shall be governed by the laws of
the United States to the extent applicable and otherwise by the
laws of the State of New York, excluding the choice of law rules
thereof.
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Attest: BRIDGE BANCORP, INC.
/s/ Xxxxxxx Xxxxxxxxx By /s/ Xxxxxx X. Xxxxx
------------------------------------ -------------------------------------
Chairman of the Board President and Chief Executive Officer
Attest: BRIDGEHAMPTON NATIONAL BANK
/s/ Xxxxxxx Xxxxxxxxx By /s/ Xxxxxx X. Xxxxx
------------------------------------ -------------------------------------
Chairman of the Board President and Chief Executive Officer
EMPLOYEE
/s/ Xxxxxxxxxxx Xxxxxx
-------------------------------------
Xxxxxxxxxxx Xxxxxx
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