AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AMENDED
AND RESTATED EMPLOYMENT AGREEMENT
This
AMENDED AND RESTATED EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
as of the 31st day of December, 2008, by and between The Dime Savings Bank of
Williamsburgh, a mutual savings bank organized and operating under the federal
laws of the United States and having an office at 000 Xxxxxxxxx Xxxxxx,
Xxxxxxxx, Xxx Xxxx 00000 ("Bank") and Xxxxxxx X. Xxxxxxxxx, residing at 00
Xxxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxx Xxxx 00000 and amends and restates the Amended
and Restated Employment Agreement made as of June 26, 1996 between the Bank and
Xx. Xxxxxxxxx.
W I T N E
S S E T H :
WHEREAS,
Xx. Xxxxxxxxx currently serves the Bank in the capacity of Chairman of the Board
and Chief Executive Officer; and
WHEREAS,
the Bank is a wholly owned subsidiary of Dime Community Bancshares, Inc., a
savings and loan holding company organized and operating under the laws of the
State of Delaware and having an office at 000 Xxxxxxxxx Xxxxxx, Xxxxxxxx, Xxx
Xxxx 00000 (“Company”); and
WHEREAS,
the Bank and Xx. Xxxxxxxxx are parties to an Employment Agreement made and
entered into as of the 1st day of January, 1992 (the “Initial Effective Date”)
and amended and restated as of the 1st day of October, 1995, and further amended
on the 26th day of June, 1996 ("Prior Agreement"); and
WHEREAS,
the Bank and Xx. Xxxxxxxxx desire to amend and restate the Prior Agreement for
the purpose, among others, of compliance with the applicable requirements of
Section 409A of the Internal Revenue Code of 1986 (“the Code”); and
WHEREAS,
for purposes of securing for the Bank Xx. Xxxxxxxxx'x continued services, the
Board of Directors of the Bank ("Board") has approved and authorized the
execution of this Agreement with Xx. Xxxxxxxxx; and
WHEREAS,
Xx. Xxxxxxxxx is willing to continue to make his services available to the Bank
on the terms and conditions set forth herein.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
obligations hereinafter set forth, the Bank and Xx. Xxxxxxxxx hereby agree as
follows:
1. Representations
and Warranties of the Parties.
(a) The
Bank hereby represents and warrants to Xx. Xxxxxxxxx that:
(i) it
has all requisite power and authority to execute, enter into and deliver this
Agreement and to perform each and every one of its obligations hereunder;
and
(ii) the
execution, delivery and performance of this Agreement have been duly authorized
by all requisite corporate action on the part of the Bank; and
(iii) neither
the execution or delivery of this Agreement, nor the performance of or
compliance with any of the terms and conditions hereof, is prevented or in any
way limited by (A) any agreement or instrument to which the Bank is a party or
by which it is bound, or (B) any provision of law, including, without
limitation, any statute, rule or regulation or any order of any order of any
court or administrative agency, applicable to the Bank or its
business.
(b) Xx.
Xxxxxxxxx hereby represents and warrants to the Bank that:
(i) he
has all requisite power and authority to execute, enter into and deliver this
Agreement and to perform each and every one of his obligations hereunder;
and
(ii) neither
the execution or delivery of this Agreement, nor the performance of or
compliance with any of the terms and conditions hereof, is prevented or in any
way limited by (A) any agreement or instrument to which he is a party or by
which he is bound, or (B) including, without limitation, any statute, rule or
regulation or any order of any court or administrative agency, applicable to
him.
2. Employment.
The Bank
hereby continues the employment of Xx. Xxxxxxxxx, and Xx. Xxxxxxxxx hereby
accepts such continued employment, during the period and upon the terms and
conditions set forth in this Agreement.
3. Employment
Period.
(a) The
terms and conditions of this Agreement shall be and remain in effect during the
period of employment established under this section 3 ("Employment Period"). The
Employment Period shall be for an initial term of three years beginning on the
Initial Effective Date and ending on the third anniversary date of the Initial
Effective Date, plus such extensions, if any, as are provided by the Board
pursuant to section 3(b).
(b) Prior
to the first anniversary of the Initial Effective Date and each anniversary date
thereafter (each, an "Anniversary Date"), the Board shall review the terms of
this Agreement and Xx. Xxxxxxxxx'x performance of services hereunder and may, in
the absence of objection from Xx. Xxxxxxxxx, approve an extension of the
Employment Period. In such event, the Employment Period shall be extended to the
third anniversary of the relevant Anniversary Date.
(c) If,
prior to the date on which the Employment Period would end pursuant to section
3(a) or (b) of this Agreement, a Change in Control (as defined in section 13 of
this Agreement) occurs and the Bank is not subject to rules and regulations of
the Office of Thrift Supervision, then the Employment Period shall be extended
through and including the third anniversary of the earliest date after the
effective date of such Change of Control on which either the Bank or Xx.
Xxxxxxxxx elects, by written notice pursuant to section 3(d) of this Agreement
to the non-electing party, to discontinue the Employment Period; provided,
however, that this section shall not apply in the event that, prior to the
Change of Control (as defined in section 13 of this Agreement), Xx. Xxxxxxxxx
has provided written notice to the Bank of his intent to discontinue the
Employment Period.
(d) The
Bank or Xx. Xxxxxxxxx may, at any time by written notice given to the other,
elect to terminate this Agreement. Any such notice given by the Bank shall be
accompanied by a certified copy of a resolution, adopted by the affirmative vote
of a majority of the entire membership of the Board at a meeting of the Board
duly called and held, authorizing the giving of such notice.
(e) Notwithstanding
anything herein contained to the contrary: (i) Xx. Xxxxxxxxx'x employment with
the Bank may be terminated during the Employment Period, in accordance with the
terms and conditions of this Agreement; and (ii) nothing in this Agreement shall
mandate or prohibit a continuation of Xx. Xxxxxxxxx'x employment following the
expiration of the Employment Period upon such terms and conditions as the Bank
and Xx. Xxxxxxxxx may mutually agree upon.
(f) For
all purposes of this Agreement, any reference to the "Remaining Unexpired
Employment Period" as of any specified date shall mean a period commencing on
the date specified and ending on the last day of the third (3rd) year from the
date specified, or, if neither party has given notice electing a discontinuance
of the Employment Period, on the third (3rd) anniversary of the date
specified.
4. Duties.
During
the Employment Period, Xx. Xxxxxxxxx shall:
(a) except
to the extent allowed under section 7 of this Agreement, devote his full
business time and attention to the business and affairs of the Bank and use his
best efforts to advance the Bank's interests;
(b) serve
as Chairman of the Board and Chief Executive Officer if duly appointed and/or
elected to serve in such position; and
(c) have
such functions, duties and responsibilities not inconsistent with his title and
office as may be assigned to him by or under the authority of the Board, in
accordance with organization Certificate, By-laws, Applicable Laws, Statutes and
Regulations, custom and practice of the Bank as in effect on the date first
above written. Xx. Xxxxxxxxx shall have such authority as is necessary or
appropriate to carry out his assigned duties. Xx. Xxxxxxxxx shall report to and
be subject to direction and supervision by the Board.
(d) none
of the functions, duties and responsibilities to be performed by Xx. Xxxxxxxxx
pursuant to this Agreement shall be deemed to include those functions, duties
and responsibilities performed by Xx. Xxxxxxxxx in his capacity as director of
the Bank.
5. Compensation
-- Salary and Bonus.
In
consideration for services rendered by Xx. Xxxxxxxxx under this Agreement, the
Bank shall pay to Xx. Xxxxxxxxx a salary at an annual rate equal
to:
(a) during
the period beginning on January 1, 2009 and ending on December 31, 2009, no less
than $686,000;
(b) during
each calendar year that begins after December 31, 2009, such amount as the Board
may, in its discretion, determine, but in no event less than the rate in effect
on December 31, 2009; or
(c) for
each calendar year that begins on or after a Change in Control, the product of
Xx. Xxxxxxxxx'x annual rate of salary in effect immediately prior to such
calendar year, multiplied by the greatest of:
(i) 1.06;
(ii) the
quotient of (A) the U.S. City Average All Items Consumer Price Index for All
Urban Consumers (or, if such index shall cease to be published, such other
measure of general consumer price levels as the Board may, in good faith,
prescribe) for October of the immediately preceding calendar year, divided by
(B) the U.S. City Average All Items Consumer Price Index for All Urban Consumers
(or, if such index shall cease to be published, such other measure of general
consumer price levels as the Board may, in good faith, prescribe) for October of
the second preceding calendar year; and
(iii) the
quotient of (A) the average annual rate of salary, determined as of the first
day of such calendar year, of the officers of the Bank (other than Xx.
Xxxxxxxxx) who are assistant vice presidents or more senior officers, divided by
(B) the average annual rate of salary, determined as of the first day of the
immediately preceding calendar year, of the officers of the Bank (other than Xx.
Xxxxxxxxx) who are assistant vice presidents or more senior
officers;
The
salary payable under this section 5 shall be paid in approximately equal
installments in accordance with the Bank's customary payroll practices. Nothing
in this section 5 shall be construed as prohibiting the payment to Xx. Xxxxxxxxx
of a salary in excess of that prescribed under this section 5 or of additional
cash or non-cash compensation in a form other than salary, to the extent that
such payment is duly authorized by or under the authority of the
Board.
(d) no
portion of the compensation paid to Xx. Xxxxxxxxx pursuant to this Agreement
shall be deemed to be compensation received by Xx. Xxxxxxxxx in his capacity as
director of the Bank.
6. Employee
Benefits Plans and Programs; Other Compensation.
Except as
otherwise provided in this Agreement, Xx. Xxxxxxxxx shall be treated as an
employee of the Bank and be entitled to participate in and receive benefits
under the Bank's Retirement Plan, Incentive Savings Plan, group life and health
(including medical and major medical) and disability insurance plans, and such
other employee benefit plans and programs, including but not limited to any
long-term or short-term incentive compensation plans or programs (whether or not
employee benefit plans or programs), as the Bank may maintain from time to time,
in accordance with the terms and conditions of such employee benefit plans and
programs and compensation plans and programs and with the Bank's customary
practices. Following a Change in Control, all such benefits to Xx. Xxxxxxxxx
shall be continued on terms and conditions substantially identical to, and in no
event less favorable than, those in effect prior to the Change in
Control.
In the
event of a conversion of the Bank from a mutual savings bank to a form of
organization owned by stockholders ("Conversion"), the Bank will provide, or
cause to be provided, to Xx. Xxxxxxxxx in connection with such Conversion,
stock-based compensation and benefits, including, without limitation, stock
options, restricted stock awards, and participation in tax-qualified stock bonus
plans which, in the aggregate, are either (A) accepted by Xx. Xxxxxxxxx in
writing as being satisfactory for purposes of this Agreement or (B) in the
written, good faith opinion of a nationally recognized executive compensation
consulting firm selected by the Bank and satisfactory to Xx. Xxxxxxxxx, whose
agreement shall not be unreasonably withheld, are no less favorable than the
stock-based compensation and benefits usually and customarily provided to
similarly situated executives of similar financial institutions in connection
with similar transactions.
7. Board
Memberships and Personal Activities.
Xx.
Xxxxxxxxx may serve as a member of the board of directors of such business,
community and charitable organizations as he may disclose to the Board from time
to time, and he may engage in personal business and investment activities for
his own account; provided, however, that such service and personal business and
investment activities shall not materially interfere with the performance of his
duties under this Agreement. Xx. Xxxxxxxxx may also serve as an officer or
director of any parent of the Bank on such terms and conditions as the Bank and
its parent may mutually agree upon, and such service shall not be deemed to
materially interfere with Xx. Xxxxxxxxx'x performance of his duties hereunder or
otherwise result in a material breach of this Agreement.
8. Working
Facilities and Expenses.
Xx.
Xxxxxxxxx'x principal place of employment shall be at the Bank's executive
offices at the address first above written, or at such other location in the New
York metropolitan area as determined by the Board. The Bank shall provide Xx.
Xxxxxxxxx, at his principal place of employment, with a private office,
stenographic services and other support services and facilities suitable to his
position with the Bank and necessary or appropriate in connection with the
performance of his assigned duties under this Agreement. The Bank shall provide
Xx. Xxxxxxxxx with an automobile suitable to his position with the Bank in
accordance with its prior practices, and such automobile shall be used by Xx.
Xxxxxxxxx in carrying out his duties under this Agreement, including commuting
between his residence and his principal place of employment. The Bank shall (i)
reimburse Xx. Xxxxxxxxx for the cost of maintenance and servicing such
automobile and, for instance, gasoline and oil for such automobile; (ii)
reimburse Xx. Xxxxxxxxx for his ordinary and necessary business expenses
incurred in the performance of his duties under this Agreement (including but
not limited to travel and entertainment expenses); and (iii) reimburse Xx.
Xxxxxxxxx for fees for memberships in such clubs and organizations as Xx.
Xxxxxxxxx and the Bank, and such other expenses as Xx. Xxxxxxxxx and the Bank,
shall mutually agree are necessary and appropriate for business purposes, upon
presentation to the Bank of an itemized account of such expenses in such form as
the Bank may reasonably require, each such reimbursement payment to be made
promptly following receipt of the itemized account and in any event not later
than the last day of the year following the year in which the expense was
incurred. Xx. Xxxxxxxxx shall be entitled to no less than four (4) weeks of paid
vacation during each year in the Employment Period. Xx. Xxxxxxxxx shall be
responsible for the payment of any taxes on account of his personal use of the
automobile provided by the Bank and on account of any other benefit provided
herein.
9. Termination
Giving Rise to Severance Benefits.
(a) In
the event that Xx. Xxxxxxxxx'x employment with the Bank shall terminate during
the Employment Period on account of the termination of Xx. Xxxxxxxxx'x
employment with the Bank other than:
(i) a
Termination for Cause (within the meaning of section 12(a) of this
Agreement);
(ii) a
voluntary resignation by Xx. Xxxxxxxxx other than a Resignation for Good Reason
(within the meaning of section 12(b) of this Agreement);
(iii) a
termination on account of Xx. Xxxxxxxxx'x death; or
(iv) a
termination after both of the following conditions exist: (A) Xx. Xxxxxxxxx has
been absent from the full-time service of the Bank on account of his Disability
(as defined in section 11(b) of this Agreement) for at least six (6) consecutive
months; and (B) Xx. Xxxxxxxxx shall have failed to return to work in the
full-time service of the Bank within thirty (30) days after written notice
requesting such return is given to Xx. Xxxxxxxxx by the Bank; then the Bank
shall provide to Xx. Xxxxxxxxx the benefits and pay to Xx. Xxxxxxxxx the amounts
provided under section 9(b) of this Agreement.
(b) In
the event that Xx. Xxxxxxxxx'x employment with the Bank shall terminate under
circumstances described in section 9(a) of this Agreement or if the Bank
terminates this Agreement pursuant to section 3(d), the following benefits and
amounts shall be paid or provided to Xx. Xxxxxxxxx (or, in the event of his
death, to his estate), in accordance with section 26, on his termination of
employment:
(i) his
earned but unpaid salary as of the date of the termination of his employment
with the Bank, payable when due but in no event later than thirty (30) days
following his termination of employment with the Bank;
(ii) (A)
the benefits, if any, to which Xx. Xxxxxxxxx and his family and dependents are
entitled as a former employee, or family or dependents of a former employee,
under the employee benefit plans and programs and compensation plans and
programs maintained for the benefit of the Bank's officers and employees, in
accordance with the terms of such plans and programs in effect on the date of
his termination of employment, or if his termination of employment occurs after
a Change in Control, on the date of his termination of employment or on the date
of such Change in Control, whichever results in more favorable benefits as
determined by Xx. Xxxxxxxxx, where credit is given for three additional years of
service and age in determining eligibility and benefits for any plan and program
where age and service are relevant factors, and (B) payment for all unused
vacation days and floating holidays in the year in which his employment is
terminated, at his highest annual rate of salary for such year;
(iii) continued
group life, health (including hospitalization, medical and major medical,
dental, accident and long-term disability insurance benefits), in addition to
that provided pursuant to section 9(b)(ii) of this Agreement and after taking
into account the coverage provided by any subsequent employer, if and to the
extent necessary to provide Xx. Xxxxxxxxx and his family and dependents for the
Remaining Unexpired Employment Period, coverage identical to and in any event no
less favorable than the coverage to which they would have been entitled under
such plans (as in effect on the date of his termination of employment, or, if
his termination of employment occurs after a Change in Control, on the date of
his termination of employment or during the one-year period ending on the date
of such Change in Control, whichever results in more favorable benefits as
determined by Xx. Xxxxxxxxx) if he had continued working for the Bank during the
Remaining Unexpired Employment Period at the highest annual rate of compensation
(assuming, if a Change in Control has occurred, that the annual increases under
section 5(c) would apply) under the Agreement;
(iv) a
lump sum payment in an amount equal to the present value of the salary and the
bonus that Xx. Xxxxxxxxx would have earned if he had worked for the Bank during
the Remaining Unexpired Employment Period at the highest annual rate of salary
(assuming, if a Change in Control has occurred, that the annual increases under
section 5(c) would apply) and the highest bonus as a percentage of the rate of
salary provided for under this Agreement, where such present value is to be
determined using a discount rate of six percent (6%) per annum, compounded, in
the case of salary, with the frequency corresponding to the Bank's regular
payroll periods with respect to its officers, and, in the case of bonus,
annually;
(v) a
lump sum payment in an amount equal to the excess, if any, of: (A) the present
value of the benefits to which he would be entitled under any defined benefit
plans maintained by, or covering employees of, the Bank (including any "excess
benefit plan" within the meaning of section 3(36) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or other special or
supplemental plan) as in effect on the date of his termination, if he had worked
for the Bank during the Remaining Unexpired Employment Period at the highest
annual rate of compensation (assuming, if a Change in Control has occurred, that
the annual increases under section 5(c) would apply) under the Agreement and
been fully vested in such plan or plans and had continued working for the Bank
during the Remaining Unexpired Employment Period, such benefits to be determined
as of the date of termination of employment by adding to the service actually
recognized under such plans an additional period equal to the Remaining
Unexpired Employment Period and by adding to the compensation recognized under
such plans for the year in which termination of employment occurs all amounts
payable under sections 9(b)(i), (iv) and (vii), over (B) the present value of
the benefits to which he is actually entitled under any such plans maintained
by, or covering employees of, the Bank as of the date of his termination where
such present values are to be determined using a discount rate of six percent
(6%) per annum, compounded monthly, and the mortality tables prescribed under
section 72 of the Internal Revenue Code of 1986 ("Code"); provided, however,
that if payments are made under this section 9(b)(v) as a result of this section
deeming otherwise unvested amounts under such defined benefit plans to be
vested, the payments, if any, attributable to such deemed vesting shall be paid
in the same form, and paid at the same time, and in the same manner, as benefits
under the corresponding non-qualified plan;
(vi) a
lump sum payment in an amount equal to the excess, if any, of (A) the present
value of the benefits attributable to the Bank's contribution to which he would
be entitled under any defined contribution plans maintained by, or covering
employees of, the Bank (including any "excess benefit plan" within the meaning
of section 3(36) of ERISA, or other special or supplemental plan) as in effect
on the date of his termination, if he had worked for the Bank during the
Remaining Unexpired Employment Period at the highest annual rate of compensation
(assuming, if a Change in Control has occurred, that the annual increases under
section 5(c) would apply) under the Agreement, and made the maximum amount of
employee contributions, if any, required or permitted under such plan or plans,
and been eligible for the highest rate in matching contributions under such plan
or plans during the Remaining Unexpired Employment Period which is prior to Xx.
Xxxxxxxxx'x termination of employment with the Bank, and been fully vested in
such plan or plans, over (B) the present value of the benefits attributable to
the Bank's contributions to which he is actually entitled under such plans as of
the date of his termination of employment with the Bank, where such present
values are to be determined using a discount rate of six percent (6%) per annum,
compounded with the frequency corresponding to the Bank's regular payroll
periods with respect to its officers; provided, however, that if payments are
made under this section 9(b)(vi) as a result of this section deeming otherwise
unvested amounts under such defined contribution plans to be vested, the
payments, if any, attributable to such deemed vesting shall be paid in the same
form, and paid at the same time, and in the same manner, as benefits under the
corresponding non-qualified plan;
(vii) the
payments that would have been made to Xx. Xxxxxxxxx under any incentive
compensation plan maintained by, or covering employees of, the Bank (other than
bonus payments to which section 9(b)(iv) of this Agreement is applicable) if he
had continued working for the Bank during the Remaining Unexpired Employment
Period and had earned an incentive award in each calendar year that ends during
the Remaining Unexpired Employment Period in an amount equal to the product of
(A) the maximum percentage rate of compensation at which an award was ever
available to Xx. Xxxxxxxxx under such incentive compensation plan, multiplied by
(B) the compensation that would have been paid to Xx. Xxxxxxxxx during each
calendar year at the highest annual rate of compensation (assuming, if a Change
in Control has occurred, that the annual increases under section 5(c) would
apply) under the Agreement, such payments to be made at the same time and in the
same manner as payments are made to other officers of the Bank pursuant to the
terms of such incentive compensation plan; provided, however, that payments
under this section 9(b)(vii) shall not be made to Xx. Xxxxxxxxx for any year on
account of which no payments are made to any of the Bank's officers under any
such incentive compensation plan; and
(viii) the
benefits to which Xx. Xxxxxxxxx is entitled under the Bank's Supplemental
Executive Retirement Plan (or other excess benefits plan with the meaning of
section 3(36) of ERISA or other special or supplemental plan) shall be paid to
him in a lump sum, where such lump sum is computed using the mortality tables
under the Bank's tax-qualified pension plan and a discount rate of 6% per annum.
If the amount may be increased by a subsequent Change in Control, any additional
payment shall be made at the time and in the form provided under the relevant
plan, or, if no such time or form is provided, upon the first of the following
events to occur on or after the date of such Change in Control: a change in
control event (within the meaning of Treasury Regulation section 1.409A-3(i)(5))
with respect to Xx. Xxxxxxxxx, Xx. Xxxxxxxxx’x separation from service (within
the meaning of section 1.409A-1(h)), Xx. Xxxxxxxxx’x death or Xx. Xxxxxxxxx’x
disability (within the meaning of Treasury Regulation section 1.409A-3(i)(4)).
From the date of such Change of Control until the date of payment, any
additional payment so deferred shall be held in trust for Xx. Xxxxxxxxx, the
terms of which trust shall be those set forth in section 26.
(c) Xx.
Xxxxxxxxx shall not be required to mitigate the amount of any payment provided
for in this section 9 by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this section 9 be reduced by
any compensation earned by Xx. Xxxxxxxxx as the result of employment by another
employer, by retirement benefits, by offset against any amount claimed to be
owed by Xx. Xxxxxxxxx to the Bank, or otherwise except as specifically provided
in section 9(b)(iii) of this Agreement. The Bank and Xx. Xxxxxxxxx hereby
stipulate that the damages which may be incurred by Xx. Xxxxxxxxx as a
consequence of any such termination of employment are not capable of accurate
measurement as of the date first above written and that the benefits and
payments provided for in this Agreement constitute a reasonable estimate under
the circumstances of all damages sustained as a consequence of any such
termination of employment, other than damages arising under or out of any stock
option, restricted stock or other non- qualified stock acquisition or investment
plan or program, it being understood and agreed that this Agreement shall not
determine the measurement of damages under any such plan or program in respect
of any termination of employment.
10. Termination
Without Severance Benefits.
In the
event that Xx. Xxxxxxxxx'x employment with the Bank shall terminate during the
Employment Period on account of:
(a) Termination
for Cause (within the meaning of section 12(a) of this Agreement);
(b) voluntary
resignation by Xx. Xxxxxxxxx other than a Resignation for Good Reason (within
the meaning of section 12(b) of this Agreement); or
(c) Xx.
Xxxxxxxxx'x death;
then the
Bank shall have no further obligations under this Agreement, other than the
payment to Xx. Xxxxxxxxx (or, in the event of his death, to his estate) of his
earned but unpaid salary as of the date of the termination of his employment,
and the provision of such other benefits, if any, to which he is entitled as a
former employee under the Bank's employee benefit plans and programs and
compensation plans and programs and payment for all unused vacation days and
floating holidays in the year in which his employment is terminated, at his
highest annual salary for such year.
11. Death
and Disability.
(a) Death.
If Xx. Xxxxxxxxx'x employment is terminated by reason of Xx. Xxxxxxxxx'x death
during the Employment Period, this Agreement shall terminate without further
obligations to Xx. Xxxxxxxxx'x legal representatives under this Agreement, other
than for payment of amounts and provision of benefits under sections 9(b) (i)
and (ii); provided, however, that if Xx. Xxxxxxxxx dies while in the employment
of the Bank, his designated beneficiary(ies) shall receive a death benefit,
payable through life insurance or otherwise, which is the equivalent on a net
after-tax basis of the death benefit payable under a term life insurance policy,
with a stated death benefit of three times Xx. Xxxxxxxxx'x then Annual Base
Salary.
(b) Disability.
If Xx. Xxxxxxxxx'x employment is terminated by reason of Xx. Xxxxxxxxx'x
Disability as defined in section 11(c) during the Employment Period, this
Agreement shall terminate without further obligations to Xx. Xxxxxxxxx, other
than for payment of amounts and provision of benefits under section 9(b) (i) and
(ii); provided, however, that in the event of Xx. Xxxxxxxxx'x Disability while
in the employment of the Bank, the Bank will pay to him, in accordance with
section 26, a lump sum amount equal to three times his then Annual Base
Salary.
(c) For
purposes of this Agreement, "Disability" shall be defined in accordance with the
terms of the Bank's long term disability policy.
(d) Payments
under this section 11 shall be made upon Xx. Xxxxxxxxx'x death or
disability.
12. Definition
of Termination for Cause and Resignation for Good Reason.
(a) Xx.
Xxxxxxxxx'x termination of employment with the Bank shall be deemed a
"Termination for Cause" if such termination occurs for "cause," which, for
purposes of this Agreement shall mean personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses) or final cease
and desist order, or any material breach of this Agreement, in each case as
measured against standards generally prevailing at the relevant time in the
savings and community banking industry; provided, however, that Xx. Xxxxxxxxx
shall not be deemed to have been discharged for cause unless and until he shall
have received a written notice of termination from the Board, accompanied by a
resolution duly adopted by affirmative vote of a majority of the entire Board at
a meeting called and held for such purpose (after reasonable notice to Xx.
Xxxxxxxxx and a reasonable opportunity for Xx. Xxxxxxxxx to make oral and
written presentations to the members of the Board, on his own behalf, or through
a representative, who may be his legal counsel, to refute the grounds for the
proposed determination) finding that in the good faith opinion of the Board
grounds exist for discharging Xx. Xxxxxxxxx for cause.
(b) Xx.
Xxxxxxxxx'x termination of employment with the Bank shall be deemed a
Resignation for Good Reason if such termination occurs following any one or more
of the following events:
(i) (A)
the assignment to Xx. Xxxxxxxxx of any duties inconsistent with Xx. Xxxxxxxxx'x
status as Chairman of the Board and Chief Executive Officer of the Bank or (B) a
substantial adverse alteration in the nature or status of Xx. Xxxxxxxxx'x
responsibilities from those in effect immediately prior to the alteration; or
(C) any Change in Control described in section 13(b);
(ii) a
reduction by the Bank in Xx. Xxxxxxxxx'x annual base salary as in effect on the
date first above written or as the same may be increased from time to time,
unless such reduction was mandated at the initiation of any regulatory authority
having jurisdiction over the Bank;
(iii) the
relocation of the Bank's principal executive offices to a location outside the
New York metropolitan area or the Bank's requiring Xx. Xxxxxxxxx to be based
anywhere other than the Bank's principal executive offices except for required
travel on the Bank's business to an extent substantially consistent with Xx.
Xxxxxxxxx'x business travel obligations at the date first above
written;
(iv) the
failure by the Bank, without Xx. Xxxxxxxxx'x consent, to pay to Xx. Xxxxxxxxx,
within seven (7) days of the date when due, (A) any portion of his compensation,
or (B) any portion of an installment of deferred compensation under any deferred
compensation program of the Bank, which failure is not inadvertent and
immaterial and which is not promptly cured by the Bank after notice of such
failure is given to the Bank by the Executive;
(v) the
failure by the Bank to continue in effect any compensation plan in which Xx.
Xxxxxxxxx participates which is material to his total compensation, including
but not limited to the Retirement Plan and the Bank's Incentive Savings Plan or
any substitute plans unless an equitable arrangement (embodied in an ongoing
substitute or alternative plan) has been made with respect to such plan, or the
failure by the Bank to continue his participation therein (or in such substitute
or alternative plan) on a basis not materially less favorable, both in terms of
the amount of benefits provided and the level of his participation relative to
other participants, unless such failure is the result of action mandated at the
initiation of any regulatory authority having jurisdiction over the
Bank;
(vi) the
failure by the Bank to continue to provide Xx. Xxxxxxxxx with benefits
substantially similar to those enjoyed by Xx. Xxxxxxxxx under the Retirement
Plan and the Bank's Incentive Savings Plan or under any of the Bank's life,
health (including hospitalization, medical and major medical), dental, accident,
and long-term disability insurance benefits, in which Xx. Xxxxxxxxx is
participating, or the taking of any action by the Bank which would directly or
indirectly materially reduce any of such benefits or deprive Xx. Xxxxxxxxx of
the number of paid vacation days to which he is entitled, on the basis of years
of service with the Bank, rank or otherwise, in accordance with the Bank's
normal vacation policy, unless such failure is the result of action mandated at
the initiation of any regulatory authority having jurisdiction over the
Bank;
(vii) the
failure of the Bank to obtain a satisfactory agreement from any successor to
assume and agree to perform this Agreement, as contemplated in section 15(a) of
this Agreement;
(viii) any
purported termination of employment by the Bank which is not effected pursuant
the provisions of section 12(a) regarding Termination for Cause or on account of
Disability;
(ix) a
material breach of this Agreement by the Bank, which the Bank fails to cure
within thirty (30) days following written notice thereof from Xx.
Xxxxxxxxx;
(x) in
the event of a Change in Control described in section 13(b) of this Agreement, a
failure of the Bank to provide, or cause to be provided, to Xx. Xxxxxxxxx in
connection with such Change in Control, stock-based compensation and benefits,
including, without limitation, stock options, restricted stock awards, and
participation in tax-qualified stock bonus plans which, in the aggregate, are
either (A) accepted by Xx. Xxxxxxxxx in writing as being satisfactory for
purposes of this Agreement or (B) in the written, good faith opinion of a
nationally recognized executive compensation consulting firm selected by the
Bank and satisfactory to Xx. Xxxxxxxxx, whose agreement shall not be
unreasonably withheld, are no less favorable than the stock-based compensation
and benefits usually and customarily provided to similarly situated executives
of similar financial institutions in connection with similar transactions;
or
(xi) a
requirement that Xx. Xxxxxxxxx report to any person or group other than the
Board;
(xii) in
the event of a Change in Control described in section 13(a) of this Agreement,
termination of employment for any or no reason whatsoever during the period of
sixty (60) days beginning on the first anniversary of the effective date of such
Change in Control.
13. Definition
of Change in Control.
For
purposes of this Agreement, a Change in Control of the Bank shall
mean:
(a) the
occurrence of any event upon which any "person" (as such term is used in
sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
("Exchange Act")), other than (A) a trustee or other fiduciary holding
securities under an employee benefit plan maintained for the benefit of
employees of the Bank; (B) a corporation owned, directly or indirectly, by the
stockholders of the Bank in substantially the same proportions as their
ownership of stock of the Bank; or (C) Xx. Xxxxxxxxx, or any group otherwise
constituting a person in which Xx. Xxxxxxxxx is a member, becomes the
"beneficial owner" (as defined in Rule 13d-3 promulgated under the Exchange
Act), directly or indirectly, of securities issued by the Bank representing 25%
or more of the combined voting power of all of the Bank's then outstanding
securities; or
(b) the
occurrence of any event upon which the individuals who on the Initial Effective
Date are members of the Board, together with individuals (other than any
individual designated by a person who has entered into an agreement with the
Bank to effect a transaction described in section 13(a) or 13(c) of this
Agreement) whose election by the Board or nomination for election by the Bank's
stockholders was approved by the affirmative vote of at least two-thirds of the
members of Board then in office who were either members of the Board on the
Initial Effective Date or whose nomination or election was previously so
approved cease for any reason to constitute a majority of the members of the
Board, but excluding, for this purpose, any such individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of directors of the Bank (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act);
or
(c)
(i) the
consummation of a merger or consolidation of the Bank with any other
corporation, other than a merger or consolidation following which both of the
following conditions are satisfied:
(A) either
(A) the members of the Board of the Bank immediately prior to such merger or
consolidation constitute at least a majority of the members of the governing
body of the institution resulting from such merger or consolidation; or (B) the
shareholders of the Bank own securities of the institution resulting from such
merger or consolidation representing 80% or more of the combined voting power of
all such securities then outstanding in substantially the same proportions as
their ownership of voting securities of the Bank before such merger or
consolidation; and
(B) the
entity which results from such merger or consolidation expressly agrees in
writing to assume and perform the Bank's obligations under this Agreement;
or
(ii) the
shareholders of the Bank approve either a plan of complete liquidation of the
Bank or an agreement for the sale or disposition by the Bank of all or
substantially all of its assets; and
(d) any
event which would be described in section 13(a), (b) or (c) if the term
"Company" were substituted for the term "Bank" therein. Such an event shall be
deemed to be a Change in Control under the relevant provision of section 13(a),
(b) or (c).
It is
understood and agreed that more than one Change in Control may occur at the same
or different times during the Employment Period and that the provisions of this
Agreement shall apply with equal force and effect with respect to each such
Change in Control.
14. No
Effect on Employee Benefit Plans or Programs.
Except as
expressly provided in this Agreement, the termination of Xx. Xxxxxxxxx'x
employment during the Employment Period or thereafter, whether by the Bank or by
Xx. Xxxxxxxxx, shall have no effect on the rights and obligations of the parties
hereto under the Bank's the Retirement Plan and the Bank's Incentive Savings
Plan, group life, health (including hospitalization, medical and major medical),
dental, accident and long term disability insurance plans or such other employee
benefit plans or programs, or compensation plans or programs (whether or not
employee benefit plans or programs) and, following the conversion of the Bank to
stock form, any stock option and appreciation rights plan, employee stock
ownership plan and restricted stock plan, as may be maintained by, or cover
employees of, the Bank from time to time.
15. Successors
and Assigns.
(a) The
Bank shall require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Bank to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Bank would be
required to perform it if no such succession had taken place. Failure of the
Bank to obtain such assumption and agreement prior to the effectiveness of any
such succession shall be deemed to constitute a material breach of the Bank's
obligations under this Agreement.
(b) This
Agreement will inure to the benefit of and be binding upon Xx. Xxxxxxxxx, his
legal representatives and testate or intestate distributees, and the Bank, their
respective successors and assigns, including any successor by merger or
consolidation or a statutory receiver or any other person or firm or corporation
to which all or substantially all of the respective assets and business of the
Bank may be sold or otherwise transferred.
16. Notices.
Any
communication required or permitted to be given under this Agreement, including
any notice, direction, designation, consent, instruction, objection or waiver,
shall be in writing and shall be deemed to have been given at such time as it is
delivered personally, or five (5) days after mailing if mailed, postage prepaid,
by registered or certified mail, return receipt requested, addressed to such
party at the address listed below or at such other address as one such party may
by written notice specify to the other party:
If to Xx.
Xxxxxxxxx:
00
Xxxxxxx Xxxxx Xxxxxx Xxxxxx, Xxx Xxxx 00000
If to the
Bank:
The Dime
Savings Bank of Williamsburgh
000
Xxxxxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxx 00000
Attention:
Corporate Secretary
With a
copy to:
Xxxxxxx
Xxxxxxxx & Xxxx LLP
Two World
Financial Center
Attention:
W. Xxxxxx Xxxxxx
17. Indemnification
and Attorneys' Fees.
The Bank
shall pay to or on behalf of Xx. Xxxxxxxxx all reasonable costs, including legal
fees, incurred by him in connection with or arising out of his consultation with
legal counsel or in connection with or arising out of any action, suit or
proceeding in which he may be involved, as a result of his efforts, in good
faith, to defend or enforce the terms of this Agreement; provided, however, that
Xx. Xxxxxxxxx shall have substantially prevailed on the merits pursuant to a
judgment, decree or order of a court of competent jurisdiction or of an
arbitrator in an arbitration proceeding, or in a settlement; provided, further,
that this section 17 shall not obligate the Bank to pay costs and legal fees on
behalf of Xx. Xxxxxxxxx under this Agreement in excess of $50,000. Any payment
or reimbursement to effect such indemnification shall be made no later than the
last day of the calendar year following the calendar year in which Xx. Xxxxxxxxx
incurs the expense or, if later, within sixty (60) days after the settlement or
resolution that gives rise to Xx. Xxxxxxxxx’x right to reimbursement; provided,
however, that Xx. Xxxxxxxxx shall have submitted to the Bank documentation
supporting such expenses at such time and in such manner as the Bank may
reasonably require. For purposes of this Agreement, any settlement agreement
which provides for payment of any amounts in settlement of the Bank's
obligations hereunder shall be conclusive evidence of Xx. Xxxxxxxxx'x
entitlement to indemnification hereunder, and any such indemnification payments
shall be in addition to amounts payable pursuant to such settlement agreement,
unless such settlement agreement expressly provides otherwise.
18. Severability.
A
determination that any provision of this Agreement is invalid or unenforceable
shall not affect the validity or enforceability of any other provision
hereof.
19. Waiver.
Failure
to insist upon strict compliance with any of the terms, covenants or conditions
hereof shall not be deemed a waiver of such term, covenant, or condition. A
waiver of any provision of this Agreement must be made in writing, designated as
a waiver, and signed by the party against who its enforcement is sought. Any
waiver or relinquishment of such right or power at any one or more times shall
not be deemed a waiver or relinquishment of such right or power at any other
time or times.
20. Counterparts.
This
Agreement may be executed in two (2) or more counterparts, each of which shall
be deemed an original, and all of which shall constitute one and the same
Agreement.
21. Governing
Law.
This
Agreement shall be governed by and construed and enforced in accordance with the
laws of the State of New York, without reference to conflicts of law
principles.
22. Headings
and Construction.
The
headings of sections in this Agreement are for convenience of reference only and
are not intended to qualify the meaning of any section. Any reference to a
section number shall refer to a section of this Agreement, unless otherwise
stated. Any reference to the term "Board" shall mean the Board of Trustees of
the Bank while the Bank is a mutual savings bank and the Board of Directors of
the Bank while the Bank is a stock savings bank. Any reference to the term
"Bank" shall mean the Bank in its mutual form prior to the conversion and in its
stock form on and after the conversion. If the Bank does not convert to stock
form, any reference to the Bank's being a stock savings bank shall have no
effect.
23. Entire
Agreement; Modifications.
This
instrument contains the entire agreement of the parties relating to the subject
matter hereof, and supersedes in its entirety any and all prior agreements,
understandings or representations relating to the subject matter hereof,
including the Amended and Restated Employment Agreement dated June 26th, 1996
between the Bank and Xx. Xxxxxxxxx. No modifications of this Agreement shall be
valid unless made in writing and signed by the parties hereto; provided,
however, that this Agreement shall be subject to amendment in the future in such
manner as the Bank shall reasonably deem necessary or appropriate to effect
compliance with Section 409A of the Code and the regulations thereunder, and to
avoid the imposition of penalties and additional taxes under Section 409A of the
Code, it being the express intent of the parties that any such amendment shall
not diminish the economic benefit of the Agreement to Xx. Xxxxxxxxx on a present
value basis.
24. Arbitration
Clause.
Any
dispute or controversy arising under or in connection with this Agreement shall
be settled exclusively by arbitration, conducted before a panel of three
arbitrators in New York, New York, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; the expense of such
arbitration shall be borne by the Bank.
25. Required
Regulatory Provisions.
The
following provisions are included for the purposes of complying with various
laws, rules and regulations applicable to the Association:
(a) Notwithstanding
anything herein contained to the contrary, in no event shall the aggregate
amount of compensation payable to the Executive under section 9(b) hereof
(exclusive of amounts described in section 9(b)(i) and (viii)) exceed the three
times the Executive's average annual total compensation for the last five
consecutive calendar years to end prior to his termination of employment with
the Association (or for his entire period of employment with the Association if
less than five calendar years).
(b) Notwithstanding
anything herein contained to the contrary, any payments to the Executive by the
Association, whether pursuant to this Agreement or otherwise, are subject to and
conditioned upon their compliance with section 18(k) of the Federal Deposit
Insurance Act ("FDI Act"), 12 U.S.C. Section 1828(k), and any regulations
promulgated thereunder.
(c) Notwithstanding
anything herein contained to the contrary, if the Executive is suspended from
office and/or temporarily prohibited from participating in the conduct of the
affairs of the Association pursuant to a notice served under section 8(e)(3) or
8(g)(1) of the FDI Act, 12 U.S.C. Section 1818(e)(3) or 1818(g)(1), the
Association's obligations under this Agreement shall be suspended as of the date
of service of such notice, unless stayed by appropriate proceedings. If the
charges in such notice are dismissed, the Association, in its discretion, may
(i) pay to the Executive all or part of the compensation withheld while the
Association's obligations hereunder were suspended and (ii) reinstate, in whole
or in part, any of the obligations which were suspended.
(d) Notwithstanding
anything herein contained to the contrary, if the Executive is removed and/or
permanently prohibited from participating in the conduct of the Association's
affairs by an order issued under section 8(e)(4) or 8(g)(1) of the FDI Act, 12
U.S.C. Section 1818(e)(4) or (g)(1), all prospective obligations of the
Association under this Agreement shall terminate as of the effective date of the
order, but vested rights and obligations of the Association and the Executive
shall not be affected.
(e) Notwithstanding
anything herein contained to the contrary, if the Association is in default
(within the meaning of section 3(x)(1) of the FDI Act, 12 U.S.C. Section
1813(x)(1), all prospective obligations of the Association under this Agreement
shall terminate as of the date of default, but vested rights and obligations of
the Association and the Executive shall not be affected.
(f) Notwithstanding
anything herein contained to the contrary, all prospective obligations of the
Association hereunder shall be terminated, except to the extent that a
continuation of this Agreement is necessary for the continued operation of the
Association: (i) by the Director of the OTS or his designee or the Federal
Deposit Insurance Corporation ("FDIC"), at the time the FDIC enters into an
agreement to provide assistance to or on behalf of the Association under the
authority contained in section 13(c) of the FDI Act, 12 U.S.C. Section 1823(c);
(ii) by the Director of the OTS or his designee at the time such Director or
designee approves a supervisory merger to resolve problems related to the
operation of the Association or when the Association is determined by such
Director to be in an unsafe or unsound condition. The vested rights and
obligations of the parties shall not be affected.
If and to
the extent that any of the foregoing provisions shall cease to be required or by
applicable law, rule or regulation, the same shall become inoperative as though
eliminated by formal amendment of this Agreement.
26. Compliance
with Section 409A of the Code.
Xx.
Xxxxxxxxx and the Bank acknowledge that each of the payments and benefits
promised to Xx. Xxxxxxxxx under this Agreement must either comply with the
requirements of Section 409A of the Code ("Section 409A") and the regulations
thereunder or qualify for an exception from compliance. To that end, Xx.
Xxxxxxxxx and the Bank agree that:
(a) the
expense reimbursements described in Section 8 and legal fee reimbursements
described in Section 17 are intended to satisfy the requirements for a
"reimbursement plan" described in Treasury Regulation section
1.409A-3(i)(1)(iv)(A) and shall be administered to satisfy such
requirements;
(b) the
payment described in Section 9(b)(i) is intended to be excepted from compliance
with Section 409A pursuant to Treasury Regulation section 1.409A-1(b)(3) as
payment made pursuant to the Bank’s customary payment timing
arrangement;
(c) the
benefits and payments described in Section 9(b)(ii) are expected to comply with
or be excepted from compliance with Section 409A on their own terms;
and
(d) the
welfare benefits provided in kind under section 9(b)(iii) are intended to be
excepted from compliance with Section 409A as welfare benefits pursuant to
Treasury Regulation Section 1.409A-1(a)(5) and/or as benefits not includible in
gross income;
In the
case of a payment that is not excepted from compliance with Section 409A, and
that is not otherwise designated to be paid immediately upon a permissible
payment event within the meaning of Treasury Regulation Section 1.409A-3(a), the
payment shall not be made prior to, and shall, if necessary, be deferred (with
interest at the annual rate of 6%, compounded monthly from the date of Xx.
Xxxxxxxxx’x termination of employment to the date of actual payment) to and paid
on the later of the date sixty (60) days after Xx. Xxxxxxxxx’x earliest
separation from service (within the meaning of Treasury Regulation Section
1.409A-1(h)) and, if Xx. Xxxxxxxxx is a specified employee (within the meaning
of Treasury Regulation Section 1.409A-1(i)) on the date of his separation from
service, the first day of the seventh month following Xx. Xxxxxxxxx’x separation
from service. Each amount payable under this plan that is required to be
deferred beyond Xx. Xxxxxxxxx’x separation from service, shall be deposited on
the date on which, but for such deferral, the Bank would have paid such amount
to Xx. Xxxxxxxxx, in a grantor trust which meets the requirements of Revenue
Procedure 92-65 (as amended or superseded from time to time), the trustee of
which shall be a financial institution selected by the Bank with the approval of
Xx. Xxxxxxxxx (which approval shall not be unreasonably withheld or delayed),
pursuant to a trust agreement the terms of which are approved by Xx. Xxxxxxxxx
(which approval shall not be unreasonably withheld or delayed) (the “Rabbi
Trust”), and payments made shall include earnings on the investments made with
the assets of the Rabbi Trust, which investments shall consist of short-term
investment grade fixed income securities or units of interest in mutual funds or
other pooled investment vehicles designed to invest primarily in such
securities. Furthermore, this Agreement shall be construed and administered in
such manner as shall be necessary to effect compliance with Section
409A.
26. Compliance
with the Emergency Economic Stabilization Act of 2008.
In the
event the Company issues any debt or equity to the United States Treasury
("UST") pursuant to the Capital Purchase Program (the "CPP") implemented under
the Emergency Economic Stabilization Act of 2008 ("EESA"), the following
provisions shall take precedence over any contrary provisions of this Agreement
or any other compensation or benefit plan, program, agreement or arrangement in
which Xx. Xxxxxxxxx participates:
(a) Xx.
Xxxxxxxxx shall repay to the Company any bonus or incentive compensation paid to
Xx. Xxxxxxxxx while (i) Xx. Xxxxxxxxx is a senior executive officer (within the
meaning of 31 C.F.R. Part 30) ("Senior Executive Officer") and (ii) the UST
holds any debt or equity interest in the Company acquired under the CPP (such
period, the "CPP Compliance Period"), if and to the extent that such bonus or
incentive compensation was paid on the basis of a statement of earnings, gains,
or other criteria (each, a "Performance Criterion," and in the aggregate,
"Performance Criteria") that are later proven to be materially inaccurate. A
Performance Criterion shall be proven to be materially inaccurate if so
determined by a court of competent jurisdiction or in the written opinion of an
independent attorney or firm of certified public accountants selected by the
Company and approved by Xx. Xxxxxxxxx (which approval shall not be unreasonably
withheld or delayed), which determination shall both state the accurate
Performance Criterion and that the difference between the accurate Performance
Criterion and the Performance Criterion on which the payment was based is
material (a "Determination"). Upon receipt of a Determination, the Company may
supply to Xx. Xxxxxxxxx a copy of the Determination, a computation of the bonus
or other incentive compensation that would have been payable on the basis of the
accurate Performance Criterion set forth in the Determination (the
"Determination Amount") and a written demand for repayment of the amount (if
any) by which the bonus or incentive compensation actually paid exceeded the
Determination Amount.
(b) (i) If
Xx. Xxxxxxxxx'x employment terminates in an “applicable severance from
employment” (within the meaning of 31 C.F.R. Part 30) while (A) Xx. Xxxxxxxxx is
a Senior Executive Officer, and (B) the UST holds a debt or equity interest in
the Company issued under the CPP, then payments to Xx. Xxxxxxxxx that are
contingent on such applicable severance from employment and designated to be
paid during the CPP Compliance Period shall be limited, if necessary, to the
maximum amount which may be paid without causing any amount paid to be an
"excess parachute payment" within the meaning of section 280G(b)(1) of the Code,
as modified by section 280G(e) of the Code, referred to as a "golden parachute
payment" under 31 C.F.R. Part 30 (the "Maximum Payment Amount"). Any reduction
in payments required to achieve such limit shall be applied to all payments
otherwise due hereunder in the reverse chronological order of their payment
dates, and where multiple payments are due on the same date, the reduction shall
be apportioned ratably among the affected payments. The required reduction (if
any) shall be determined in writing by an independent attorney or firm of
certified public accountants selected by the Company and approved by Xx.
Xxxxxxxxx (which approval shall not be unreasonably withheld or
delayed).
(ii) To
the extent not prohibited by law, the aggregate amount by which payments
designated to be paid during the CPP Compliance Period are reduced pursuant to
section 26(b)(i) (the "Unpaid Amount") shall be delayed to and shall be
paid on the first business day following the last day of the CPP Compliance
Period. Pending payment, the Unpaid Amount shall be deposited in a Rabbi Trust.
Payment of the Unpaid Amount shall include any investment earnings on the assets
of the Rabbi Trust attributable to the Unpaid Amount.
This
section 26 shall be operated, administered and construed to comply with
section 111(b) of EESA as implemented by guidance or regulation thereunder that
has been issued and is in effect as of the closing date of the agreement, if
any, by and between the UST and the Company, under which the UST acquires equity
or debt securities of the Company under the CPP (such date, if any, the "Closing
Date," and such implementation, the "Relevant Implementation"). If after the
Closing Date the clawback requirement of section 26(a) shall not be
required by the Relevant Implementation of section 111(b) of EESA, such
requirement shall have no further effect. If after the Closing Date the
limitation on golden parachute payments under section 26(b)(i) shall not be
required by the Relevant Implementation of section 111(b) of EESA, such
limitation shall have no further effect and any Unpaid Amount delayed under
section 26(b)(ii) shall be paid on the earliest date on which the Company
reasonably anticipates that such amount may be paid without violating such
limitation.
IN
WITNESS WHEREOF, the Bank has caused this Agreement to be executed and Xx.
Xxxxxxxxx has hereto set his hand, all as of the day and year first above
written.
XXXXXXX X. XXXXXXXXX
|
ATTEST
|
THE
DIME SAVINGS BANK OF WILLIAMSBURGH
|
By: By:
XXXX
X. XXXXXXXXXX
Chairman,
Compensation
Committee Secretary Of the
Board of Directors
[Seal]
[TPW: NYLEGAL:791928.3]
16057-00010 12/30/2008 02:28 PM
