Exhibit 10.4
------------
Execution Copy
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AGREEMENT made as of the 9th day of October, 1997, by and among FIRST
ESSEX BANCORP, INC., a Delaware corporation (the "Holding Company") and the
parent company for FIRST ESSEX BANK, FSB, a federal saving bank, with its
executive offices in Andover, Massachusetts (the "Bank") (the Bank and the
Holding Company shall be hereinafter collectively referred to as the
"Employers"), and Xxxxxxx X. Xxxxxx of Andover, Massachusetts (the "Executive").
WITNESSETH
WHEREAS, the Holding Company desires to continue to provide for the
Executive's employment by the Holding Company and in connection therewith
desires to amend and restate the existing employment agreement among the Bank,
the Holding Company, and the Executive;
NOW THEREFORE, in consideration of the mutual covenants contained
herein, the Holding Company and the Executive agree as follows:
1. Employment The Executive shall serve the Bank and the Holding
Company as President and Chief Executive Officer. In such positions, the
Executive shall have the duties, responsibilities and authorities and authority
as determined and designated from time to time by the Boards of Directors,
including, without limitation, complete management authority with respect to,
and total responsibility for, the overall operations and day-to-day business and
affairs of the Bank and the Holding Company. The Executive shall serve under the
direction and supervision of, and report only to, the Board. Notwithstanding the
above, the Executive shall not be required to perform any duties and
responsibilities (a) which would result in a noncompliance with or violation of
any applicable law or regulation or (b) on a regular basis in any locations
outside the counties in which the Bank now has branch offices, unless agreed
upon by the Executive. During the pendency of any temporary or permanent
suspension or termination from the Bank, the Executive shall not perform, in any
respect, directly or indirectly, duties and responsibilities formerly performed
at the Bank as part of his duties and responsibilities as an officer of the
Holding Company.
2. Effective Date and Term. The commencement date (the "Commencement
Date") of this Agreement shall be January 1, 1997. The initial term of the
Executive's employment hereunder shall be for three years from the Commencement
Date. The parties intend that, at any point in time during the Executive's
employment hereunder, the then-remaining term of his employment under this
Agreement shall be three years. Accordingly, the term of employment shall be
automatically extended by one day for each day that the Executive remains
employed by the Bank or the Holding Company, unless the Executive elects not to
continue to extend the term of this Agreement by giving written notice in
accordance with
Section 7.2 of this Agreement, or the Board elects not to continue to extend the
term of this Agreement (in which event the provisions of Section 7.1 shall
apply). The last day of such term as so extended from time to time, is herein
sometimes referred to as the "Expiration Date" and the time period from the
Commencement Date through the Expiration Date shall be the "Term of Employment".
At least once in each calendar year the Board will review the Agreement and
Executive's performance annually for purposes of determining whether to continue
to extend the Agreement and the rationale and results thereof shall be included
in the minutes of the Board's meeting. The Board shall give notice to the
Executive as soon as possible after such review as to whether the Agreement is
to continue to be extended.
3. Compensation and Benefits. The compensation and benefits payable to
the Executive under this Agreement shall be as follows:
3.1 Salary. For all services rendered by the Executive to the
Holding Company and its Subsidiaries, the Executive shall be entitled to receive
a base salary at the rate of $__________ per year, subject to increase from time
to time in accordance with the usual practices of the Holding Company with
respect to review of compensation of its senior executives. In addition, if the
Board increases the Executive's annual base salary at any time before the
Expiration Date, such increased annual base salary shall become a floor below
which such annual base salary shall not fall (other than concurrently with
across-the-board salary reductions based on the Employers' financial performance
similarly affecting all senior management personnel of the Holding Company) at
any future time during the Term of Employment without the Executive's written
consent. The Executive's salary shall be payable in periodic installments in
accordance with the Holding Company's usual practice for its senior executives.
3.2 Regular Benefits. The Executive shall also be entitled to
participate in any and all employee benefit plans, medical insurance plans,
disability income plans, retirement plans, bonus incentive plans, and other
benefit plans from time to time in effect for senior executives of the Holding
Company. Such participation shall be subject to (i) the terms of the applicable
plan documents, (ii) generally applicable policies of the Holding Company and
(iii) the discretion of the Board of Directors of the Holding Company or any
administrative or other committee provided for in or contemplated by such plan.
3.3 Other Benefits.
(a) Automobile. The Executive shall be also be provided with the
use of an automobile at the Employers' expense. The Executive shall
comply with such reasonable reporting and expense limitations on the
use of the automobile as may be established from time to time by the
Holding Company. The Holding Company shall include annually on the
Executive's Form W-2 any amount attributable to his personal use of
such automobile.
(b) Business Memberships. The Executive shall also be reimbursed
for the reasonable annual membership fees for the dinner club and
country club of the Executive's choice.
2
(c) Supplemental Life Insurance. The Executive shall be entitled
to continue to receive the supplemental life insurance now being
maintained on his behalf by the Employers.
3.4 Business Expenses. The Holding Company shall reimburse the
Executive for all reasonable travel and other business expenses incurred by him
in the performance of his duties and responsibilities, subject to such
reasonable requirements with respect to substantiation and documentation as may
be specified by the Holding Company.
3.5 Vacation. The Executive shall be entitled to not less than
five (5) weeks of vacation per year, to be taken at such times and intervals as
shall be determined by the Executive with the approval of the Holding Company,
which approval shall not be unreasonably withheld.
3.6 General. Nothing paid to the Executive under any plan, policy
or arrangement currently in effect or made available in the future shall be
deemed to be in lieu of other compensation to the Executive as described in this
Agreement.
4. Extent of Service. During the Term of Employment, the Executive
shall, subject to the direction and supervision of the Board of Directors of the
Holding Company, devote his full time, best efforts and business judgment, skill
and knowledge to the advancement of the Employers' interests and to the
discharge of his duties and responsibilities hereunder. He shall not engage in
any other business activity, except as may be approved by the Board of
Directors; provided, however, that nothing herein shall be construed as
preventing the Executive from:
(a) investing his assets in such form or manner as shall not
require any material services on his part in the operations or affairs
of the companies or the other entities in which such investments are
made;
(b) serving on the board of directors of any company, provided
that he shall not be required to render any material services with
respect to the operations or affairs of any such company; or
(c) engaging in religious, charitable or other community or
non-profit activities which do not impair his ability to fulfill his
duties and responsibilities under this Agreement.
5. Termination Upon Death. In the event of the Executive's death during
the Term of Employment, the Executive's employment shall terminate on the date
of his death; provided, however, that the Holding Company shall pay to the
Executive's beneficiary designated in writing to the Holding Company prior to
his death (or to his estate, if he fails to make such designation), (i) any base
salary or other compensation earned (together with a pro rata portion of the
bonus payable with respect to the year in which death occurred) but not paid to
Executive prior to the date of death, plus (ii) the base salary that Executive
would have earned for a period of one year following his death, plus (iii) an
amount equal to any bonuses or other incentive compensation that Executive would
have earned if he had been employed for a full year after his death, plus (iv)
any death benefits that Executive is entitled to under the
3
Holding Company's policies in effect on Executive's date of death. The foregoing
bonus payments shall be payable at the time of payment of similar bonus payments
made to other executives of the Holding Company and shall be computed on the
assumption that all the Executive's individual goals (if any) under any
applicable bonus plans were achieved. In addition, the Holding Company shall
continue in effect the medical benefits of the Executive and Executive's
dependents, or any of the same, at the level in effect on, and at the same
out-of-pocket cost to the Executive as of, the date of death for a one year
period commencing on the date of death (or, if such continuation is not
permitted by applicable law or if the Board so determines in its sole
discretion, the Holding Company shall provide the economic equivalent in lieu
thereof). Such medical benefits shall be deemed to have been provided under the
provisions of COBRA.
6. Termination by the Holding Company for Cause.
6.1 Termination by Holding Company. The Executive's employment
hereunder may be terminated by the Holding Company without further liability on
the part of the Holding Company, effective immediately, by a two-thirds vote of
all of the members of the Board of Directors of the Holding Company for Cause
(as such term is defined in Section 6.2) by written notice to the Executive
setting forth in reasonable detail the nature of such Cause, provided that the
Board has complied with the provisions of Section 6.3.
6.2 Cause. Termination for "Cause" shall mean
(a) willful or gross neglect of duties for which employed (other
than on account of a medically determinable disability which renders
the Executive incapable of performing such services);
(b) committing fraud, misappropriation or embezzlement in the
performance of duties as an employee of the Bank or the Holding
Company;
(c) conviction of a felony involving a crime of moral turpitude;
(d) willfully engaging in violations of material banking
regulations; or
(e) willfully engaging in conduct materially injurious to the
Bank or the Holding Company in violation of the covenants contained in
this Agreement.
6.3 Board Termination Procedure. In each case, in determining
Cause the alleged acts or omissions of the Executive shall be measured against
standards prevailing in the banking industry generally and the ultimate
existence of Cause must be confirmed by not less than two-thirds of the Board at
a meeting prior to any termination therefor; provided, however, that it shall be
the Holding Company's burden to prove the alleged facts and omissions and the
prevailing nature of the standards the Holding Company shall have alleged are
violated by such acts or omissions of the Executive. In the event of such a
confirmation by two-thirds or more of the Board, the Holding Company shall
notify the Executive that the Holding Company intends to terminate the
Executive's employment for Cause under this Section 6 (the "Confirmation
Notice"). The Confirmation Notice shall specify the acts or omissions upon the
4
basis of which the Board has confirmed the existence of Cause and must be
delivered to the Executive within ninety (90) days after a majority of the Board
(excluding, if applicable, the Executive) has actual knowledge of the events
giving rise to such purported termination. If the Executive notifies the Holding
Company in writing (the "Opportunity Notice") within thirty (30) days after the
Executive has received the Confirmation Notice, the Executive (together with
counsel) shall be provided one opportunity to meet with the Board (or a
sufficient quorum thereof) to discuss such act or acts. Such opportunity to meet
with the Board shall be fixed and shall occur on a date selected by the Board
(such date being not less than ten (10) nor more than forty-five (45) days after
the Holding Company receives the Opportunity Notice from the Executive). Such
meeting shall take place at the principal offices of the Holding Company or such
other location as agreed to by the Executive and the Holding Company. During the
period commencing on the date the Holding Company receives the Opportunity
Notice and ending on the date next succeeding the date on which such meeting
between the Board (or a sufficient quorum thereof) and the Executive is
scheduled to occur and not withstanding anything to the contrary in this
Agreement, the Executive shall be suspended from employment with the Holding
Company (with pay to the extent not prohibited by applicable law). If the Board
properly sets the date of such meeting and if the Board (or a sufficient quorum
thereof) attends such meeting and in good faith does not rescind its
confirmation of Cause at such meeting or if the Executive fails to attend such
meeting for any reason, the Executive's employment by the Holding Company shall,
immediately upon the closing for such meeting and the delivery to the Executive
of the Notice of Termination, be terminated for Cause. If the Executive does not
respond in writing to the Confirmation Notice in the manner and within the time
period specified in this Section 4, the Executive's employment with the Holding
Company shall, on the thirty-first day after the receipt by the Executive of the
Confirmation Notice, be terminated for Cause under this Section 6.
6.4 Termination of Obligations. In the event of termination
pursuant to Section 6, all obligations of the Holding Company under this
Agreement shall terminate as of the date indicated, but vested rights of the
parties hereunder shall not be affected.
7. Termination by the Executive
7.1 Termination by the Executive for Good Reason. The Executive
shall be entitled to terminate his employment hereunder for Good Reason (as
defined in Section 7.4) effective immediately by giving written notice to the
Board of Directors. Upon any such termination, the Executive shall be entitled
to receive the benefits set forth in Section 9.
7.2 Other Voluntary Termination by the Executive. During the Term
of Employment, the Executive may effect, upon sixty (60) days prior written
notice to the Holding Company, a Voluntary Termination of his employment
hereunder and thereupon the Term of Employment (if not already expired) shall
end. A "Voluntary Termination" shall mean a termination of employment by the
Executive on his own initiative other than (a) a termination due to death or
becoming Disabled (as defined in Section 11), (b) a termination for Good Reason,
(c) a termination due to Retirement (as defined in Section 7.3), or (d) a
termination as a result of the normal expiration of the full Term of Employment.
If, during the
5
Term of Employment, the Executive's employment is so terminated due to Voluntary
Termination, the Term of Employment shall thereupon end and the Executive shall
be entitled to continuation of the Executive's medical benefits at the level in
effect on, and at the same out-of-pocket cost to the Executive as of, the date
of termination for the six month period following the termination of the
Executive's employment due to Voluntary Termination and (ii) any other
compensation and benefits as may be provided in accordance with the terms and
provisions of any applicable plans and programs, if any, of the Holding Company.
Such medical benefits shall be deemed to have been provided under the provisions
of COBRA.
7.3 Termination Due to Retirement. "Retirement" means the
termination of the Executive's employment with the Holding Company for any
reason by the Executive at any time after the Executive attains "Retirement Age"
(as hereinafter defined). "Retirement Age" shall mean the earliest to occur of
(X) age 65, (Y) (if applicable) any lesser age at which the Executive is
entitled to retire from the Employers and receive retirement benefits under the
Employers' qualified pension plan, and (Z) an age of 62 or greater at which the
Employers permit the Executive to retire. The Executive may terminate the
Executive's employment hereunder due to Retirement upon thirty (30) days prior
written notice to the Holding Company. If, during the Term of Employment, the
Executive's employment is so terminated due to Retirement, the Term of
Employment shall thereupon end and the Executive shall be entitled to (i)
continuation of the Executive's medical benefits at the level in effect on, and
at the same out-of-pocket cost to the Executive as of, the date of termination
for the one-year period following the termination of the Executive's employment
due to Retirement (or, if such continuation is not permitted by applicable law
or if the Board so determines in its sole discretion, the Holding Company shall
provide the economic equivalent in lieu thereof), and (ii) any other
compensation and benefits as may be provided in accordance with the terms and
provisions of any applicable plans and programs, if any, of the Holding Company.
Such medical benefits shall be deemed to have been provided under the provisions
of COBRA.
7.4 Good Reason. For purposes of this Agreement, the term "Good
Reason" shall mean any of the following:
(a) the failure of the Board of Directors of the Holding Company
to elect the Executive to the office of President and Chief Executive
Officer, or to continue the Executive in such offices;
(b) the failure by the Holding Company to comply with the
provisions of Section 3.1;
(c) any failure by the Holding Company to timely pay the amounts
(other than base salary) or provide the benefits described in this
Agreement, other than an isolated failure not occurring in bad faith
and which is remedied promptly after receipt of written notice thereof
given by Executive;
(d) any action by the Holding Company which results in a
diminution in the Executive's authority;
6
(e) there occurs any reduction of base salary or material
reduction in other benefits or any material change by the Holding
Company to the Executive's function, duties, or responsibilities in
effect on the date hereof or as set forth in this Agreement, which
change would cause the Executive's position with the Holding Company to
become one of lesser responsibility, importance, or scope from the
position and attributes thereof in effect on the date hereof or as set
forth in this Agreement (and any such material change shall be deemed a
continuing breach of this Agreement);
(f) a material breach by the Holding Company of any of the
provisions of this Agreement which failure or breach shall have
continued for thirty (30) days after written notice from the Executive
to the Holding Company specifying the nature of such failure or breach;
and
(g) a determination by the Board not to continue to extend the
term of this Agreement as provided in Section 2.
In addition,"Good Reason" shall include the following events but only if they
shall occur within two years following a "Change in Control" (which term shall
have the meaning defined in the Special Termination Agreement between the
Executive and the Holding Company):
(h) the failure by the Holding Company to continue to provide the
Executive with benefits substantially similar to those available to the
Executive under any of the life insurance, medical, health and
accident, or disability plans or any other material benefit plans in
which the Executive was participating at the time of the Change in
Control, or the taking of any action by the Holding Company which would
directly or indirectly materially reduce any of such benefits, or the
failure by the Bank to provide the Executive with the number of paid
vacation days to which the Executive is entitled on the basis of years
of service with the Holding Company in accordance with the Holding
Company's normal vacation policy in effect at the time of the Change in
Control;
(i) A reasonable determination by the Executive that, as a result
of a Change in Control, he is unable to exercise the responsibilities,
authorities, powers, functions or duties exercised by the Executive
immediately prior to such Change in Control; or
(j) A reasonable determination by the Executive that, as a result
of a Change in Control, his working conditions have significantly
worsened.
8. Termination by the Holding Company Without Cause. The Executive's
employment with the Holding Company may be terminated without cause by a
two-thirds vote of all of the members of the Board of Directors of the Holding
Company on written notice to the Executive, provided, however, that the Holding
Company shall have the obligation upon any such termination to make the payments
to the Executive provided for under Section 9 of this Agreement.
9. Certain Termination Benefits. In the event of termination pursuant
to Section 7.1 or 8, the Executive shall be entitled to each of the following
benefits:
7
9.1 Earnings to Date of Termination. An amount equal to the sum
of (a) base salary or other compensation earned through the date of termination,
plus (b) the Executive's pro rata share (based on the portion of the fiscal year
during which the Executive was employed) of the highest annual bonus paid during
the three fiscal years preceding the termination of employment, plus (c) all
accrued vacation and deferred compensation.
9.2 Lump Sum Payment of Remaining Salary Obligation. A lump sum
severance benefit equal to three times the sum of (a) the Executive's annual
base salary and (b) the highest annual bonus paid to the Executive during the
three fiscal years preceding the termination of employment.
9.3 Benefit Continuation. For the period subsequent to the date
of termination until the Expiration Date, the Executive shall continue to
receive the disability and medical benefits described in Section 3.2 existing on
the date of termination at the level in effect on, and at the same out-of-pocket
cost to the Executive as of, the date of termination. Any cash bonus plans shall
be prorated through the date of termination.
9.4 Pension Adjustment. An amount equal to the excess of (a) the
actuarial value of the benefits which the Executive would have accrued under the
Employers' qualified defined benefit pension plan and non-qualified supplemental
retirement plan if the Executive's employment had continued for a period of
three years following his date of termination, over (b) the actuarial equivalent
of the Executive's actual benefit under the defined benefit pension plan and the
non-qualified supplemental retirement plan.
10. Adjustment for Unavailability of Benefits. If, in spite of the
provisions of Section 9, benefits or service credits under any benefit plan
provided by a third party shall not be payable or provided under any such plan
to the Executive, or to the Executive's dependents, beneficiaries or estate,
because the Executive is no longer deemed to be an employee of the Holding
Company, the Holding Company shall pay or provide for payment of such benefits
and service credits for such benefits to the Executive, or to the Executive's
dependents, beneficiaries or estate.
11. Disability. If, due to physical or mental illness, the Executive
shall be disabled so as to be unable to perform substantially all of his duties
and responsibilities hereunder, the Holding Company, acting through its Board of
Directors, may designate another executive to act in his place during the period
of his disability. Notwithstanding any such designation, the Executive shall
continue to receive his full salary and benefits under Section 3 of this
Agreement until the earlier of (X) the Expiration Date or (Y) the date on which
he becomes eligible for disability income under the Employer's disability income
plan (at which time the Executive shall be considered to be "Disabled"). While
receiving disability payments under such plan, the Executive shall receive a
salary from the Holding Company which when combined with the Executive's
disability income payments will equal eighty (80%) percent of the Executive's
prior salary from the Holding Company, and shall continue to participate in the
Employers' benefit plans and to receive other benefits as specified in Section
3.2 until the Expiration Date, with all such benefits to be at the level in
effect on, and at the same out-of-pocket cost to the
8
Executive as of, the date of disability. In the absence of a disability income
plan at the time of such disability, the Holding Company shall pay the Executive
benefits equal to those the Executive would have received if the Holding
Company's current disability plan were in effect at such time. Upon the
Executive being able to return to full-time employment after being Disabled but
before the expiration of the Term of Employment, the Executive shall be offered
an equivalent available position and otherwise be subject to the provisions of
this Agreement. Nothing contained in this Section 11 shall preclude the Holding
Company from terminating the Executive's employment without cause, subject to
its payment of benefits as provided in Section 9.
12. Excise Taxes. In the event that the Executive shall have imposed
upon him the tax which is imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended (the "Code") or by any successor provision, by reason of any
payment or benefit which the Executive has received from the Holding Company or
any Subsidiaries, the Holding Company shall pay as additional compensation to
the Executive that amount which, after taking into account all taxes (including
any tax which shall be imposed by Code Section 4999) imposed upon such amount by
any federal, state or local government, shall be equal to the amount of said tax
imposed by Code Section 4999.
13. Confidential Information. The Executive will not disclose to any
other Person (except as required by applicable law or in connection with the
performance of his duties and responsibilities hereunder), or use for his own
benefit or gain, any confidential information of either of the Holding Company
obtained by him incident to his employment with the Holding Company. The term
"confidential information" includes, without limitation, financial information,
business plans, prospects and opportunities (such as lending relationships,
financial product developments, or possible acquisitions or dispositions of
business or facilities) which have been discussed or considered by the
management of the Holding Company but does not include any information which has
become part of the public domain by means other than the Executive's
nonobservance of his obligations hereunder.
14. No Mitigation; No Offset. In the event of any termination of
employment under this Agreement, the Executive shall be under no obligation to
seek other employment or to mitigate damages, and there shall be no offset
against any amounts due to him under this Agreement for any reason, including,
without limitation, on account of any remuneration attributable to any
subsequent employment that the Executive may obtain. Any amounts due under this
Agreement are in the nature of severance payments or liquidated damages, or
both, and are not in the nature of a penalty.
15. Miscellaneous.
15.1 Conflicting Agreements. The Executive hereby represents and
warrants that the execution of this Agreement and the performance of his
obligations hereunder will not breach or be in conflict with any other agreement
to which he is a party or is bound, and that he is not now subject to any
covenants against competition or similar covenants which would affect the
performance of his obligations hereunder.
9
15.2 Definition of "Person". For purposes of this Agreement, the
term "Person" shall mean an individual, a corporation, an association, a
partnership, an estate, a trust and any other entity or organization.
15.3 Withholding. All payments made by the Holding Company under
this Agreement shall be net of any tax or other amounts required to be withheld
by the Holding Company under applicable law.
15.4 Arbitration of Disputes. Any controversy or claim arising
out of or relating to this Agreement or the breach thereof shall be settled by
arbitration in accordance with the laws of the Commonwealth of Massachusetts by
three arbitrators, one of whom shall be appointed by the Holding Company, one by
the Executive and the third by the first two arbitrators. If the first two
arbitrators cannot agree on the appointment of a third arbitrator, then the
third arbitrator shall be appointed by the American Arbitration Association in
the City of Boston. Such arbitration shall be conducted in the City of Boston in
accordance with the rules of the American Arbitration Association, except with
respect to the selection of arbitrators which shall be as provided in this
Section 15.4. Judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof. In the event that it shall be
necessary or desirable for the Executive to retain legal counsel or incur other
costs and expenses in connection with the enforcement of any or all of the
Executive's rights under this Agreement, the Holding Company shall pay (or the
Executive shall be entitled to recover from the Holding Company, as the case may
be) the Executive's reasonable attorneys' fees and other reasonable costs and
expenses in connection with the enforcement of said rights (including the
enforcement of any arbitration award in court) regardless of the final outcome,
unless and to the extent the arbitrators shall determine that under the
circumstances recovery by the Executive of all or a part of any such fees and
costs and expenses would be unjust.
15.5 Assignment; Successors and Assigns, etc. Neither the Holding
Company nor the Executive may make any assignment of this Agreement or any
interest herein, by operation of law or otherwise, without the prior written
consent of the other party and without such consent any attempted transfer or
assignment shall be null and of no effect; provided, however, that the Holding
Company may assign its rights under this Agreement without the consent of the
Executive in the event either of the Holding Company shall hereafter effect a
reorganization, consolidate with or merge into any other Person, or transfer all
or substantially all of its properties or assets to any other Person. This
Agreement shall inure to the benefit of and be binding upon the Holding Company
and the Executive, and their respective successors, executors, administrators,
heirs and permitted assigns. In the event of the Executive's death prior to the
completion by the Holding Company of all payments due him under this Agreement,
the Holding Company shall continue such payments to the Executive's beneficiary
designated in writing to the Holding Company prior to his death (or to his
estate, if he fails to make such designation).
15.6 Enforceability. If any portion or provision of this
Agreement shall to any extent be declared illegal or unenforceable by a court of
competent jurisdiction, then the remainder of this Agreement, or the application
of such portion or provision in circumstances
10
other than those as to which it is so declared illegal or unenforceable, shall
not be affected thereby, and each portion and provision of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.
15.7 Waiver. No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party. The failure of any party
to require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
15.8 Prior Agreements. This Agreement supersedes the Amended and
Restarted Employment Agreement made as of April 21, 1994 by and among the
Executive, the Holding Company and the Bank.
15.9 Notices. Any notices, requests, demands and other
communications provided for by this Agreement shall be sufficient if in writing
and delivered in person or sent by registered or certified mail, postage
prepaid, to the Executive at the last address the Executive has filed in writing
with the Holding Company or, in the case of the Holding Company, at its main
office, attention of the Board of Directors.
15.10 Amendment. This Agreement may be amended or modified only
by a written instrument signed by the Executive and by duly authorized
representatives of the Holding Company.
15.11 Governing Law. This is a Massachusetts contract and shall
be construed under and be governed in all respects by the laws of The
Commonwealth of Massachusetts.
16. Source of Payments.
16.1 Payments by Holding Company. All payments provided in this
Agreement shall be timely paid in cash or check from the general funds of the
Holding Company subject to Section 16.2.
16.2 No Duplicate Payments. Notwithstanding any provision herein
to the contrary, to the extent that payments and benefits, as provided by this
Agreement, are paid to or received by Executive under the Employment Agreement
dated as of the date hereof between the Executive and the Bank, such
compensation payments and benefits paid by the Bank will be subtracted from any
amount due simultaneously to the Executive under similar provisions of this
Agreement. Under no circumstances shall the Executive be entitled to receive
duplicate payments or benefits under this Agreement and such other Employment
Agreement. Payments pursuant to this Agreement and the Bank Employment Agreement
shall be allocated in proportion to the services rendered and time expended on
such activities by the Executive as determined by the Holding Company and the
Bank on a quarterly basis.
17. Noncompetition.
17.1 While Employed. During such time as the Executive is
employed hereunder, the Executive will not compete with the banking or any other
business conducted by either of
11
the Employers during the period of his employment hereunder, nor will he attempt
to hire any employee of either of the Employers, assist in such hiring by any
other Person, encourage any such employee to terminate his or her relationship
with either of the Employers, or solicit or encourage any customer of either of
the Employers to terminate its relationship with such Employer or to conduct
with any other person any business or activity which such customer conducts or
could conduct with such Employer.
17.2 Post-Employment. The provisions of this Section 17.2 shall
not be binding on the Executive after a Change in Control shall have occurred.
During the one year period following the date of termination of the Executive's
employment (x) by the Executive on his own initiative for any reason other than
(1) death, (2) becoming Disabled (as defined in Section 11), or (3) Retirement
(as defined in Section 7.3), or (y) by either Employer for Cause or under
circumstances which result in the Executive receiving termination benefits
pursuant to Section 9 hereof, the Executive will not compete from an office
within 20 miles of the Bank's main office with the banking or any other business
conducted by either of the Employers during the period of his employment
hereunder, nor will he attempt to hire any employee of either of the Employers,
assist in such hiring by any other Person, or encourage any such employee to
terminate his or her relationship with either of the Employers.
* * * * *
IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Holding Company, by its duly authorized officer, and by the
Executive, as of the date first above written.
ATTEST: FIRST ESSEX BANCORP, INC.
___________________________ By:_________________________
Title:_______________________
[Seal]
WITNESS EXECUTIVE
--------------------------- ----------------------------
Xxxxxxx X. Xxxxxx
12
