TRANSITION, CONSULTING AND NON-COMPETITION AGREEMENT
EXHIBIT 10.22(a)
This Transition, Consulting and Noncompetition Agreement (this
“Agreement”) by and between North Fork Bancorporation,
Inc., a Delaware corporation (the “Company”), and Xxxx
X. Xxxxxx (the “Executive”), is entered into effective
August 18, 2004 (the “Effective Date”).
WHEREAS, the Executive is currently employed in the positions of
Executive Vice President of the Company and North Fork Bank
(“NFB”); and
WHEREAS, the Executive currently serves on the Company’s
Board of Directors (the “Board”); and
WHEREAS, the Executive and the Company are parties to an
Employment Agreement dated as of December 16, 2003 (the
“Employment Agreement”); and
WHEREAS, the Executive and the Company have agreed that
effective as of December 1, 2004 the Executive will cease
employment with the Company and each of it subsidiaries and
affiliates (collectively, the “Company
Group”); and
WHEREAS, the Company desires to obtain the benefit of the
Executive’s knowledge and experience by retaining the
Executive to provide transition and consulting services and the
Executive desires to provide such services; and
WHEREAS, the Company wishes to ensure that the Executive shall
be prevented from competing with the Company Group;
NOW, THEREFORE, in order to effect the foregoing, the Company
and the Executive wish to enter into this Agreement upon the
terms and subject to the conditions set forth below.
Accordingly, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and
intending to be legally bound hereby, the parties hereto agree
as follows:
1. Termination of Employment. Effective as of
December 1, 2004 (the “Termination Date”), the
Executive’s employment with each member of the Company
Group shall terminate. Although, his employment shall terminate,
the Executive shall continue to serve as a member of the Board
for so long as he shall be duly elected. The Company in good
faith shall submit the Executive’s name to the Nominating
and Governance Committee of the Board for consideration in
connection with nominations for director at the Company’s
2005 Annual Meeting in recognition of his service to the Company
and the Board. On the Termination Date, the Executive shall be
entitled to Accrued Compensation and Other Benefits under the
Employment Agreement (each as defined in Section 7(b) of
the Employment Agreement).
2. Employment Agreement. On the Effective Date, the
Employment Agreement and each other employment or similar
agreement the Executive shall have entered into with any member
of the Company Group shall terminate and shall thereafter be of
no force and effect; provided, however, that
(1) Section 5(e) of the Employment Agreement,
(2) Section 3 of your Employment Agreement, to the
extent it relates to Section 15 of the employment
agreement, dated September 25, 2002, between the Executive
and the Trust Company of New Jersey (“TCNJ”), as
amended by the First Amendment, dated as of September, 2003, and
the Second Amendment, dated November 12, 2003, (3) the
letter agreement dated December 31, 2003 between the
Executive and TCNJ and (4) this Agreement shall each
survive such termination and continue to be in full force and
effect; and further provided, however, that Sections 4 and
5 of the Employment Agreement shall survive until the expiration
of the Transition Period (as defined below).
3. Transition Period Duties. From the Effective Date
until the Termination Date (the “Transition Period”)
(1) the Executive’s duties and responsibilities will
be to assist (a) the Company with respect to transition and
integration matters arising out of the merger of TCNJ into NFB
(the “Merger”) and the transition of TCNJ’s
customers to NFB and (b) Xxxxxxx Xxxxxxx’x transition
to President of the Company’s New Jersey operations, and
(2) the Executive shall make himself reasonably available
to the Company during
the Transition Period to fulfill his Transition Period duties
and responsibilities (with the expectation that the time he will
be required to devote to such duties will decrease over the
Transition Period).
4. Transition Period Compensation and Benefits; 2004
Bonus. During the Transition Period, the Executive shall be
provided with the compensation and benefits provided for in
Section 4(a) and Section 5 of the Employment
Agreement. In respect of his service in 2004, the Executive will
be paid, in a lump sum in cash, a bonus of $713,325 at the same
time as bonuses are paid to other senior executives of the
Company, provided, however, that such bonus shall be paid prior
to January 31, 2005.
5. Post-Transition Period Benefits. Subject to the
Executive’s compliance with Sections 7 and 8 hereof,
then:
| (a) from the Termination Date until November 30, 2007, the Executive and his eligible dependents shall be provided with medical, dental, disability, accident and life insurance coverage on substantially the same basis and terms and conditions as is provided by the Company to its executive officers from time to time (at no greater cost to the Executive than the cost imposed on such executive officers); provided, however, that, the benefits otherwise receivable by the Executive pursuant to this Section 5(b) shall be reduced to the extent benefits of the same type are received by or made available to the Executive during the thirty-six (36) month period following December 1, 2004 by a subsequent employer (and any such benefits received by or made available to the Executive shall be reported to the Company by the Executive); | |
| (b) from the Termination Date until November 30, 2005, the Company shall provide the Executive with the use of a car and driver on substantially the same basis as currently provided to him on the date hereof (the Company shall not terminate the employment of the Executive’s current driver other than for cause, death or disability and the current driver shall continue to be made available to the Executive, so long as the driver continues his employment, on the same basis as currently made available); | |
| (c) from the Termination Date until November 30, 2005, the Company shall provide the Executive with continued secretarial support on substantially the same basis as currently provided to him (the Company shall not terminate the employment of the Executive’s current secretary other than for cause, death or disability and she shall continue to provide him with secretarial support while she continues her employment with the Company Group); and | |
| (d) from the Termination Date until the earlier of November 30, 2005 or the date that the Company Group no longer occupies 35 Journal Square, the Company shall provide the Executive and his secretary with their current office space. For any period after the Company Group no longer occupies 00 Xxxxxxx Xxxxxx prior to November 30, 2005, the Company and the Executive shall work in good faith to locate reasonably suitable office space in lower Manhattan. If the Company and the Executive cannot agree on suitable office space, the Executive may incur reasonable expenses to permit his secretary to work from home during the period. |
6. Severance for Secretary and Driver. If the
employment of the Executive’s current secretary, Xxxxx
Xxxxxxx, or current driver, Xxxx Xxxx, is terminated by the
Company or any member of the Company Group prior to
January 1, 2006 for any reason other than for cause,
death or disability or if such employee elects to voluntarily
terminate such employment after November 30, 2005 and prior
to January 1, 2006 then each will be provided, upon his or
her termination, with the severance benefits that would have
been provided under TCNJ’s severance plan if the
employee’s employment had been terminated without cause
within 18 months following the consummation of the Merger
under TCNJ’s severance plan (as in effect immediately prior
to the Merger).
7. Consulting Services. Subject to the
Company’s compliance with its obligations under
Sections 1, 2, 4, 5, 6, 7 and 9 of this Agreement, during
the period commencing on the Termination Date and until the
third anniversary thereof (the “Consulting Term”), the
Executive shall perform such services as the Company shall
reasonably request to assist the Company in effecting an orderly
and efficient transition and integration in respect of the
Merger (including the transition of TCNJ’s customers to
NFB). The Executive shall in no event be required to provide
consulting services to the Company hereunder in excess of
20 hours during any
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calendar month in the first year of the Consulting Term, in
excess of 15 hours during any calendar month in the second
year of the Consulting Term or in excess of 10 hours during
any calendar month in the third year of the Consulting Term. The
scheduling of such time shall be mutually agreeable to the
Executive and the Company. Subject to the Executive’s
obligations hereunder, the Company acknowledges that the
Executive is permitted to pursue other activities, whether of a
personal or business nature, and, accordingly, may not always be
immediately available to the Company. The Executive shall
perform his consulting duties at such locations as are
reasonably acceptable to him and the Company and the Company
shall reimburse the Executive for all reasonable business
expenses incurred by him in connection with his performance of
consulting services hereunder upon submission by the Executive
of receipts and other documentation in accordance with the
Company’s normal reimbursement procedures for executive
officers. The Executive shall be deemed to be in compliance with
this Section 7 if he is unable to perform his duties
hereunder as a result of his death or “Disability” (as
defined in the “Employment Agreement”).
8. Restrictive Covenants.
(a) Subject to the Company’s compliance with its
obligations under Sections 1, 2, 4, 5, 6, 7 and 9 of this
Agreement, the Executive shall not, while employed and during
the three years commencing on the Termination Date (the
“Restrictive Covenant Period”), without the prior
written approval of the Board, directly or indirectly, own,
control, become an officer, employee, agent, partner or director
of, or serve as a consultant for, any other depository
institution with assets of $1 billion or more that is
headquartered in the New York metropolitan area or that accepts
deposits in the New York metropolitan area; provided, however,
that this Section 8(a) shall not proscribe the
Executive’s ownership, either directly or indirectly, of up
to three percent of any class of securities which are listed on
a national securities exchange or quoted on the automated
quotation system of the National Association of Securities
Dealers, Inc.
(b) During the Restrictive Covenant Period, the Executive
shall not (i) solicit (other than pursuant to general
non-targeted advertisements) any employee of the Company Group
(other than his secretary and driver) to leave the employ of the
Company or any member of the Company Group or to accept any
other employment or position, or (ii) assist any other
person in hiring any such employee, provided, however, this
provision shall not apply to any unsolicited contact by an
employee of the Company or contact which is otherwise initiated
by the employee and nothing shall prevent the Executive from
providing a personal reference to any officer, employee or
consultant upon the unsolicited request of such individual.
(c) The Executive shall not, whether directly or
indirectly, communicate or divulge to, or use for his benefit or
for the benefit of any other person, or entity, any of the
Company Group’s trade secrets, proprietary data and
confidential information communicated to or otherwise learned or
acquired by the Executive, including, without limitation, in the
course of (1) his employment with the Company or any other
member of the Company Group, (2) his employment with TCNJ
(including any subsidiary or affiliate thereof and predecessors
thereto), (3) his provision of services hereunder or
(4) his service on the Board or the Board of Directors of
any other entity referred to in this Section 8(c).
(d) The Executive agrees that, in addition to any other
remedies available to the Company, the Company shall be entitled
to injunctive relief in the event of any actual or threatened
breach of this Section 8 without the necessity of posting
any bond, it being acknowledged and agreed that any breach or
threatened breach of this Section 7 hereof will cause
irreparable injury to the Company and that money damages alone
will not provide an adequate remedy to the Company.
9. Compensation. In consideration of the consulting
services to be rendered by the Executive pursuant to
Section 7 hereof and the Executive’s covenants
contained in Section 8 hereof, but subject to the
Executive’s continued compliance with Sections 7 and 8
hereof, the Company shall
| (a) cause NFB to pay the Executive $2,193,150 during the first year of the Consulting Term, $1,335,890 during the second year of the Consulting Term and $907,260 during the third year of the Consulting Term. The foregoing amounts shall be paid in equal quarterly installments, with the first payment to be made on the 90th day following the Termination Date and each subsequent payment to be made on the 90th day of each calendar quarter thereafter during the Consulting Term (if any payment |
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| falls on a Saturday, Sunday or a holiday, the payment will be made on the first business day following such date). During the first year of the Consulting Term, each quarterly installment shall be $548,287.50, during the second year of the Consulting Term, each quarterly installment shall be $333,972.50 ,and during the third year of the Consulting Term, each quarterly installment shall be $226,815; | |
| (b) grant the Executive, on the Termination Date, 40,000 shares of restricted stock pursuant to the Company’s 2003 Stock Compensation Plan, pursuant to the Company’s standard form of restricted stock agreement attached as Exhibit 10.6(a) to the Company’s Form 10-K for 2003; provided however that such agreement shall provide for cliff vesting after 3 years subject to the Executive’s compliance with Sections 7 and 8 hereof. | |
| (c) cause each Company stock option held by the Executive immediately prior to his termination of employment hereunder by the Company to remain outstanding until the earlier to occur of (1) the scheduled expiration date of such option or (2) 90 days following the later of the expiration of the Consulting Term or the date on which the Executive ceases to serve on the Board. Thereafter, each such option shall automatically terminate. Each such stock option shall, while outstanding, be exercisable in accordance with its terms (subject to any blackout period affecting all other similarly situated optionees). |
In the event of the Executive’s death or Disability (as
defined in the Employment Agreement), payments required under
this Section 9 shall be made to the Executive or his
estate, beneficiary or legal representative, as applicable.
10. Material Breach. The Executive shall be deemed
to be continued compliance with Sections 7 and 8 hereof
unless the Executive materially fails to comply after express
written notice of such failure and a 30-day opportunity to cure
such failure (if curable). The Company shall be deemed to be in
continued compliance with Sections 1, 2, 4, 5, 6, 7 and 9
of this Agreement unless (1) the Company fails to make the
payments provided in those Sections, other than any
insubstantial or inadvertent actions not taken in bad faith
which are remedied by the Company promptly after express notice
of such failure to perform, or (2) the Company materially
fails to comply with any other term of those Sections after
express written notice of such failure and a 30-day opportunity
to cure such failure(if curable).
11. Dispute Resolution. Except for the
Company’s right to seek injunctive relief as set forth in
Section 8(d), all disputes arising out of relating to or
concerning this Agreement or any aspect of the Executive’s
employment with the Company or termination of that employment
(each, a “Covered Matter”) shall be settled by
arbitration in the County of New York administered by the
American Arbitration Association under its Employment
Arbitration Rules then in effect. However, the rules will be
modified in the following ways: (1) the decision must not
be a compromise but must be the adoption of the submission by
one of the parties, (2) each arbitrator will agree to treat
as confidential evidence and other information presented,
(3) there will be no authority to amend or modify the terms
of this Agreement except as provided in Section 14 hereof
(and the Executive and the Company agree not to request any such
amendment or modification), (4) a decision must be rendered
within 30 business days of the parties’ closing statements
or submission of post-hearing briefs and (4) the
arbitration will be conducted before a panel of three
arbitrators, one selected by the Executive within 10 days
of the commencement of arbitration, one selected by the Company
in the same period and the third selected jointly by these
arbitrators (or, if they are unable to agree on an arbitrator
within 30 days of the commencement of arbitration, the
third arbitrator will be appointed by the American Arbitration
Association). The Company shall indemnify the Executive from and
against all legal fees and expenses necessarily and reasonably
incurred by the Executive in connection with any Covered Matter
that is arbitrated, unless the Executive shall have been wholly
unsuccessful, on the merits or otherwise, in the dispute. Upon
obtaining appropriate assurances of repayment, where
appropriate, the Company may advance such fees and expenses to
the Executive to the extent permitted by applicable law.
12. Notices. All notices and other communications
hereunder shall be in writing; shall be delivered by hand
delivery to the other party or dispatched by private courier
such as Federal Express, provided that in each
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case confirmation of receipt is obtained, or mailed by
registered or certified mail, return receipt requested, postage
prepaid; shall be deemed delivered upon actual receipt; and
shall be addressed as follows:
| If to the Executive: | |
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Xxxx X. Xxxxxx At his primary residential address on file with the Company |
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| With a copy to: | |
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Xxxxxxxx & Xxxxxxxx LLP 000 Xxxxx Xxxxxx Xxx Xxxx, XX 00000-0000 |
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| Attention: Xxxx X. Xxxxxxx, Esq. | |
| If to the Company: | |
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North Fork Bancorporation, Inc. 000 Xxxxx Xxxxxx Xxxx Xxxxxxxx, XX 00000 |
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| Attention: General Counsel | |
| With a copy to: | |
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Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP Xxxx Xxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 |
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| Attention: Xxxxxxx X. Xxxxxxxxxx, Esq. |
or to such other address as either party shall have furnished to
the other in writing in accordance herewith.
13. Tax Withholding. Notwithstanding any other
provision of this Agreement, the Company may withhold from any
amounts payable under this Agreement, or any other benefits
received pursuant hereto, such minimum Federal, state and/or
local taxes as shall be required to be withheld under any
applicable law or regulation. During the Consulting Term the
Executive shall not be an employee of the Company but shall be
an independent contractor and shall be responsible for payment
of all taxes for remuneration received under this Agreement,
including Federal and State income tax, Social Security tax,
Unemployment Insurance tax, and any other taxes or business
license fees as required.
14. Counterparts. This Agreement may be executed in
one or more counterparts, including by facsimile, each of which
shall be deemed to be an original but all of which together will
constitute one and the same instrument.
15. Modification; Waiver; Discharge. No provisions
of this Agreement may be modified, waived or discharged unless
such waiver, modification or discharge is agreed to in writing
signed by the parties hereto. No waiver by a party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at
any prior or subsequent time.
16. Binding Effect; Assignment. This Agreement shall
inure to the benefit of and be binding upon the parties hereto
and their respective heirs, executors, personal representatives,
estates, successors (including, without limitation, by way of
merger) and assigns. Notwithstanding the provisions of the
immediately preceding sentence, the Executive shall not assign
all or any portion of this Agreement without the prior written
consent of the Company.
17. Entire Agreement. This Agreement, including the
Exhibits hereto, sets forth the entire understanding of the
parties hereto with respect to the subject matter hereof and
supersedes all prior agreements, written or oral, between them
as to such subject matter, provided, that nothing herein shall
be construed to enlarge or
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constrict any other rights that the Company or the Executive may
have under any agreement between the parties hereto other than
this Agreement.
18. Each Party the Drafter. This Agreement
(including the Exhibits hereto) and the provisions contained in
it shall not be construed or interpreted for or against any
party to this Agreement because that party drafted or caused
that party’s legal representative to draft any of its
provisions.
IN WITNESS WHEREOF, each of the parties hereto has duly executed
this Agreement as of the date first set forth above.
| North Fork Bancorporation, Inc. |
| By: | /s/ Xxxxxx X. Xxxxx |
|
|
|
| Name: Xxxxxx X. Xxxxx |
| Title: | Executive Vice President |
| /s/ Xxxx X. Xxxxxx |
|
|
|
| Xxxx X. Xxxxxx |
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