EXHIBIT 10.1
EXECUTIVE EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is between Bank Rhode
Island, a financial institution organized under the laws of the State of
Rhode Island with its executive offices located at Xxx Xxxxx Xxxx Xxxxx,
Xxxxxxxxxx, Xxxxx Xxxxxx 00000 (the "Bank"), Bancorp Rhode Island, Inc. a
corporation organized under the laws of the State of Rhode Island and sole
shareholder of the Bank (the "Company"), and Xxxxxxx X. Xxxxxxx of 00
Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000 (the "Executive").
IT IS MUTUALLY AGREED by the parties as follows:
1. Employment; Duties
1.1 Responsibilities and Authority. (a) The Bank hereby
employs Executive to serve as President and Chief Executive Officer
of the Bank, and Executive hereby accepts such employment. Executive
shall have the duties, responsibilities, authorities and powers
normally incident to such offices. At all times, however,
Executive's activities and authority with respect to such offices
will be subject to supervision, control and direction by the Board of
Directors of the Bank (the "Board") or by the Executive Committee of
the Board, and Executive hereby agrees to carry out such duties and
responsibilities as either of them may from time to time reasonably
assign to Executive. Executive shall report from time to time or
routinely, upon request, to the Board as to the current status of any
of Executive's assigned duties and responsibilities.
(b) The Company hereby employs Executive to serve as
President and Chief Executive Officer of the Company and such
other offices and positions as the Company may determine, and
Executive hereby accepts such employment. Executive shall have
the duties, responsibilities, authorities and powers normally
incident to such offices. At all times, however, Executive's
activities and authority with respect to such offices will be
subject to supervision, control and direction by the Board of
Directors of the Company (the "Company Board") or by the
Executive Committee of the Company Board, and Executive hereby
agrees to carry out such duties and responsibilities as either
of them may from time to time reasonably assign to Executive.
Executive shall report from time to time or routinely, upon
request, to the Company Board as to the current status of any
of Executive's assigned duties and responsibilities.
1.2 Compensation. The Bank shall pay Executive a base salary
at the rate of (i) Two Hundred Sixty-Three Thousand Seven Hundred
Dollars ($263,700) per year, commencing on the date hereof and
continuing through December 31, 2000, and (ii) Three Hundred Fourteen
Thousand Four Hundred Dollars ($314,400) per year commencing on
January 1, 2001 and thereafter, payable on a bi-weekly basis, or at
such higher rate as shall be determined from time to time by the
Board. In addition, Executive shall be entitled to receive payments
under any incentive compensation or bonus program which the Bank may
establish for its employees and/or senior executives (as in effect
from time to time), in such amounts as are provided by such programs,
provided, however, that Executive shall be provided with an annual
bonus opportunity of no less than 60% of Executive's base salary.
1.3 Employee Benefits. As a full-time employee of the Bank,
Executive shall be eligible to participate in any and all employee
benefit plans generally available to full-time employees of the Bank,
including non-contributory plans and, at Executive's option,
contributory plans.
1.4 Certain Specific Employee Benefits.
(a) Grant of Stock Options. Executive shall receive
stock options to purchase shares of the Company's common stock
in such number and at an exercise price and such other terms as
the Compensation Committee of the Company Board may determine,
in its sole discretion. Any such options will become
exercisable on a schedule no less favorable than the following:
25% on the grant date and an additional 25% on each of the
first through third anniversaries of the grant date, with such
vesting to accelerate on a Change in Control (as defined in
Section 3.2).
(b) Automobile. The Bank shall provide Executive with
an automobile for Executive's personal and business use, both
in the course of her employment hereunder and afterwards as
specifically provided herein, at the Bank's expense. All
expenses related to the operation of such automobile shall be
paid for by the Bank, including but not limited to automobile
insurance, gasoline, maintenance, repairs, and other expenses
associated with the operation of such automobile, subject to
applicable rules and regulations regarding reporting of income
and withholding of applicable taxes.
1.5 Vacation. Executive shall be entitled to six weeks of
vacation during each year of employment, such vacation to be taken in
accordance with the Bank's customary vacation policies and at such
times and intervals as are mutually agreed upon by Executive and the
Bank. Executive shall be entitled to holiday time and sick leave in
accordance with the then existing policies of the Bank, as in effect
from time to time.
1.6 Reimbursement of Expenses. (a) Executive shall be
reimbursed by the Bank for reasonable business expenses incurred by
Executive incident to her employment by the Bank upon presentation of
appropriate vouchers, receipts, and other supporting documents
required by the Bank.
(b) Executive shall be reimbursed by the Company for
reasonable business expenses incurred by Executive incident to
her employment by the Company upon presentation of appropriate
vouchers, receipts, and other supporting documents required by
the Company.
1.7 Duty to Perform Services. So long as Executive is
employed by the Company and Bank, Executive agrees to devote her full
business and productive time, skill, and energy diligently, loyally,
effectively, and to the best of her ability to the rendering of
services to the Company and Bank, and will exert Executive's best
efforts in the rendering of such services. This provision will not
prohibit Executive from:
(a) making passive investments;
(b) serving on the board of directors of any company,
subject to the provisions of Section 4.2 below and provided
that Executive shall not 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
Executive's ability to fulfill her duties and responsibilities
to the Company and Bank.
Executive agrees that in the rendering of all services to the Company
and Bank and in all aspects of her employment in connection with
Executive's duties as President and Chief Executive Officer, she will
comply with all directives, policies, standards, and regulations from
time to time established by the Company or the Bank or by applicable
law.
1.8 Death or Disability.
(a) Death. In the event of Executive's death during
the term of her employment under this Agreement, the Bank shall
immediately pay to Executive's designated beneficiary any
salary accrued but unpaid as of the date of death. Upon
payment of the aforementioned sums, the Bank's obligations to
make further salary payments shall terminate. This provision
shall not be construed to negate any rights Executive may have
to death benefits under any employee benefit or welfare plan of
the Company or Bank in which Executive may from time to time be
a participant or under any other written agreement with the
Company or Bank which specifically provides for such benefits.
(b) Disability. In the event of Executive's
"disability" (as defined below) during the term of her
employment under this Agreement, the Bank shall continue to pay
Executive her base salary (reduced by any benefits she may be
entitled to receive under any state or federal disability
insurance program, such as Rhode Island temporary disability
insurance or federal social security) for a period of one year
from the date of "disability". For purposes of this Agreement,
"disability" shall mean the good faith determination by the
Board that Executive is unable for any reason, either physical
or mental, to perform the duties required of her hereunder.
1.9 Term of Employment. The term of Executive's employment
under this Agreement shall commence on the date hereof and shall
continue, unless sooner terminated pursuant to the provisions of this
Agreement, for a period of three years (the "Term"), which Term shall
automatically renew on each successive one year anniversary hereafter
commencing with the first anniversary hereof unless any party shall
have given written notice to the other parties of such party's
election not to extend the Term within ninety (90) calendar days
prior to any anniversary date.
1.10 Termination. This Agreement and the rights of the
parties hereunder will terminate (subject to the provisions of
Section 1.11 below) upon the occurrence of one of the following:
(a) Upon the Executive's death or disability as
provided in Section 1.8 above;
(b) Upon termination of employment by the Bank or the
Company for Cause as provided in Section 3.5, immediately upon
the giving of notice by the Bank or at such later time as such
notice may specify or as may be required by Section 3.5;
(c) Upon termination of employment at the election of
the Executive for Good Reason (as hereinafter defined) as
provided in Section 2.2;
(d) Upon expiration of the Term, upon notice by any
party not to renew the term as provided in Section 1.9; or
(e) In the event of the Executive's resignation for any
reason (other than the reasons set forth in Sections 1.10(a),
(c) or (d) above), upon thirty days' prior written notice of
such resignation to the Bank or the Company; or, in the event
of termination of Executive's employment by the Bank or the
Company for any reason (other than the reasons set forth in
Sections 1.10(a), (b) or (d) above), upon thirty days' prior
written notice of such termination to the Executive.
1.11 Survival. The provisions of Sections 1.8, 2.1, 2.2, 3.1
through 3.11 inclusive, and 4.1, 4.2, 4.4, 4.6, 4.8, 4.9 and 4.11 of
the Agreement shall remain in full force and effect and shall
continue to be enforceable in accordance with their terms beyond the
termination of employment and beyond expiration of this Agreement,
except as otherwise agreed in writing by Executive and the Company
and the Bank.
2. Severance.
2.1 Severance Benefit. In the event of a termination of
Executive's employment by the Bank or the Company without Cause (as
such term is defined in Section 3.5) at any time, or in the event of
termination of Executive's employment by her for Good Reason, the
Bank will pay to Executive within 30 days of the date of such
termination or expiration, in lump sum, a severance payment equal to
2.99 times the sum of (a) Executive's annual base salary then in
effect and (b) an amount equal to the average executive cash bonus
earned by Executive with respect to the two (2) full fiscal years
immediately preceding the year in which termination occurs (the
"Severance Benefit"). In addition, the Bank shall continue to pay
for all medical and life insurance coverage provided on the date of
termination for the thirty-six month period commencing on the date of
termination of employment (the "Severance Period"); the Bank shall
continue to provide Executive with the same automobile then being
used by Executive in accordance with the provisions of Section
1.4(b) of this Agreement for the Severance Period and, at any time
during or within thirty (30) days of the expiration of the Severance
Period, Executive shall have the right and option, on written notice
to the Bank, to purchase such automobile for a purchase price equal
to 90% of the wholesale value as established by the National
Automobile Dealers Association Official Used Car Guide published in
the year of such notice; and, notwithstanding any provision of any
option agreement governing options to purchase common stock of the
Company granted to Executive ("Options"), any such Options which are
exercisable by Executive on the date of termination shall not
terminate until the expiration of the Severance Period. Any
Severance Benefit paid under this Section 2.1 shall be credited
against any amounts due Executive under Section 3 as a result of a
Change in Control. The Bank shall have no obligation to pay the
Severance Benefit to Executive in the event her employment is
terminated with Cause by the Bank or the Company or voluntarily by
Executive without Good Reason prior to a Change in Control.
2.2 "Good Reason" Defined. For purposes of this Agreement,
"Good Reason" shall mean and include any of the following without
Executive's prior written consent:
(i) a significant reduction in the nature or scope of
Executive's duties, responsibilities, authority and powers from
the duties, responsibilities, authority and powers exercised by
her on the date hereof;
(ii) any requirement by the Bank or any person in
control of the Bank that the location at which Executive
performs the principal duties for the Bank or the Company be
outside a radius of 50 miles from the location at which
Executive performed such duties as of the date hereof; or
(iii) the election by the Company or the Bank not to
renew this Agreement on any anniversary date unless the Company
and the Bank enter into a new employment agreement with
Executive on terms not less favorable than those existing
immediately prior to such notice of non-renewal, other than a
reduction of fringe benefits required by law or applicable to
all employees generally,
provided, however, that Good Reason shall not be deemed to have
occurred unless prior to Executive's termination of employment for
Good Reason, Executive shall give not less than 30 days written
notice to the Bank and the Company of her intent to terminate for
Good Reason stating the basis of the Good Reason sufficient to permit
the Bank and the Company to alleviate the basis of such Good Reason
prior to termination, and the Bank and the Company have not done so
within such 30 day period, and further provided, that Executive's
continuing to work in the absence of entering into a new employment
agreement following a notice of non-renewal by the Company or the
Bank shall be without prejudice to her right to claim termination for
Good Reason, absent written agreement between Executive and the Bank
or the Company to the contrary.
3. Change in Control
3.1 Purpose. In order to allow Executive to consider the
prospect of a Change in Control (as defined in Section 3.2) in an
objective manner and in consideration of the services rendered and to
be rendered by Executive to the Bank, the Bank is willing to provide,
subject to the terms of this Agreement, certain severance benefits to
protect Executive from the consequences of a Terminating Event (as
defined in Section 3.4) occurring subsequent to a Change in Control.
3.2 Change in Control. A "Change in Control" will be deemed
to have occurred if: (i) a Takeover Transaction is effectuated; or
(ii) the Company commences substantive negotiations with a third
party with respect to a Takeover Transaction if within twelve (12)
months of the commencement of such negotiations, enters into a
definitive agreement with respect to a Takeover Transaction with any
party with which negotiations were originally commenced; or (iii) any
election of directors of the Company occurs (whether by the directors
then in office or by the shareholders at a meeting or by written
consent) where a majority of the directors in office following such
election are individuals who were not nominated by a vote of two-
thirds of the members of the board of directors immediately preceding
such election; or (iv) either of the Company or the Bank effectuates
a complete liquidation.
3.3 Takeover Transaction. A "Takeover Transaction" shall
mean:
(a) The acquisition of voting securities of the Company
by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), other than by the
Company or its subsidiaries or any employee benefit plan (or
related trust) of the Company or its subsidiaries, which
theretofore did not beneficially own (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) securities
representing 30% or more of the voting power of all outstanding
shares of voting securities of the Company, if such acquisition
results in such individual, entity or group owning securities
representing more than 30% of the voting power of all
outstanding voting securities of the Company; provided, that
any acquisition by a corporation with respect to which,
following such acquisition, more than 50% of the then
outstanding shares of voting securities of such corporation, is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the
beneficial owners of the voting securities of the Company
outstanding immediately prior to such acquisition in
substantially the same proportion as their ownership,
immediately prior to such acquisition, of the outstanding
voting securities of the Company, shall not constitute a Change
in Control; or
(b) The issuance of additional shares of common stock
of the Company or the Bank, as applicable, in a single
transaction or a series of related transactions if the
individuals and entities who were the beneficial owners of the
outstanding voting securities of the Company or the Bank, as
applicable, immediately prior to such issuance do not,
following such issuance, beneficially own, directly or
indirectly, securities representing more than 50% of the voting
power of all then outstanding voting securities of the Company
or the Bank, as applicable; or
(c) Consummation by the Company or the Bank of (i) a
reorganization, merger or consolidation, in each case, with
respect to which all or substantially all of the individuals
and entities who were the beneficial owners of the voting
securities of such entity immediately prior to such
reorganization, merger or consolidation do not, following such
reorganization, merger or consolidation, beneficially own,
directly or indirectly, securities representing more than 50%
of the voting power of then outstanding voting securities of
the corporation resulting from such a reorganization, merger or
consolidation, or (ii) the sale, exchange or other disposition
(in one transaction or a series of related transactions) of all
or substantially all of the assets of the Company (on a
consolidated basis) or the Bank to a party which is not
controlled by or under common control with such entity, or
(iii) the sale by the Company in one transaction or in a series
of related transactions of voting securities of the Bank such
that following such transaction or transactions the Company no
longer beneficially owns, directly or indirectly, securities
representing more than 50% of the voting power of the then
outstanding voting securities of the Bank.
For purposes of this Section 3.3, "voting power" means ordinary
voting power for the election of directors.
3.4 Terminating Event. A "Terminating Event" means either
(a) Termination by the Bank or the Company of
Executive's employment for any reason other than "Cause" (as
such term is defined in Section 3.5 hereof); or
(b) Executive's resignation as an employee of the
Company or the Bank or any successor thereof following a
Takeover Transaction or a Change in Control under Section
3.2(iii), including, but not limited to, termination of this
Agreement by reason of disability pursuant to Section 1.8,
prior to the first anniversary of the Takeover Transaction or
such Change in Control; or
(c) Executive's death following a Takeover Transaction
or a Change in Control under Section 3.2(iii), prior to the
first anniversary of the Takeover Transaction or such Change in
Control.
3.5 Termination for "Cause" Defined. For purposes of this
Agreement, termination for Cause, as determined by the Board shall
include termination by reason of any of the following:
(a) Continuing any arrangement, holding any position or
engaging in any activities that conflict with the interest of,
or that interfere with Executive's duties owed to, the Company
or the Bank, after ten (10) days prior written notice by the
Company or the Bank, as applicable, to Executive of the same;
(b) Conviction of embezzlement or other crimes against
the Company or the Bank;
(c) Deliberate misappropriation of the Company's or the
Bank's funds;
(d) Material violation of written policies of the
Company or the Bank or material breach of any of Executive's
obligations under the terms of this Agreement, which continues
after ten (10) days prior written notice by the Company or the
Bank, as applicable, to Executive of the same; and
(e) Refusal to perform assigned duties when such
refusal is not justified or excused either by the terms of this
Agreement or by actions taken by the Bank or the Company in
violation of this Agreement; provided, however, that if
Executive should dispute the Bank's or the Company's
determination that it has caused Executive to terminate her
employment, or if Executive asserts that this act or omission
was caused by actions taken by the Bank or the Company in
violation of this Agreement, the dispute will be governed by
Section 4.8 hereof.
3.6 Payment In Connection With Terminating Event. If a
Terminating Event occurs within one (1) year after a Change in
Control (which one year period shall be calculated from the effective
date of the Takeover Transaction if the Terminating Event occurs
after a Takeover Transaction), the Bank will pay to Executive an
amount (the "Severance Payment") equal to 2.99 times the sum of (i)
the annual base salary in effect at the time of the Change in Control
plus (ii) the amount of the largest annual bonus paid to Executive
within the three year period preceding the Change in Control, which
Severance Payment shall be payable in one lump sum within 30 days of
the date of termination of employment, or if such Change in Control
is governed by clause (ii) of Section 3.2 and the Terminating Event
occurs prior to entering into a definitive agreement, upon the
entering into of a definitive agreement by the Company. In addition,
during the Severance Period (which, for purposes of Section 3 shall
be deemed to commence on the date of a Terminating Event), the
Executive shall be entitled to receive continuing medical and life
insurance benefits, use of an automobile with the option to purchase,
and extended Options, all as more specifically set forth in Section
2.1 hereof, provided, however, that any unvested Options held by
Executive shall accelerate and become vested upon a Change in Control
pursuant to Section 1.4(a). No Severance Payment will be made to
Executive under Section 3 if her employment with the Company and the
Bank terminates for any reason prior to a Change in Control, or if
her employment with the Company and the Bank terminates after a
Change in Control but such termination or resignation is not a
Terminating Event. In addition, no Severance Payment will be made to
Executive under Section 3.6 of this Agreement with respect to a
Terminating Event which occurs more than one year after a Change in
Control (which one year period shall be calculated from the effective
date of the Takeover Transaction if the Terminating Event occurs
after a Takeover Transaction).
3.7 Applicability of Change in Control Provisions. The
provisions of Section 3 shall terminate upon the earliest of (i) the
termination by the Company or the Bank of Executive's employment for
any reason prior to a Change in Control, (ii) the termination of
Executive's employment by the Company or the Bank after a Change in
Control for Cause, (iii) Executive's resignation or termination of
employment with the Company or the Bank for any reason other than
Good Reason prior to a Change in Control, and (iv) Executive's
resignation or termination of employment after a Change in Control on
or after the first anniversary of the Takeover Transaction or events
specified in Sections 3.2(iii) or (iv).
3.8 Excise Tax Equalization Payment. In the event that
Executive becomes entitled to a Severance Payment or any other
payment or benefit under this Agreement, or under any other agreement
with or plan of the Company (in the aggregate, the "Total Payments"),
and if any of the Total Payments will be subject to the tax (the
"Excise Tax") imposed by Section 4999 of the Code (or any similar tax
that may hereafter be imposed), then the Bank shall pay to Executive
in cash an additional amount (the "Gross-Up Payment") such that the
net amount retained by Executive after deduction of any Excise Tax
upon the Total Payments and any Federal, state and local income tax
and Excise Tax upon the Gross-Up Payment provided for by this Section
3.8 (including FICA and FUTA), shall be equal to the Total Payments.
Such payment shall be made by the Bank to Executive as soon as
practical following the effective date of the Terminating Event, but
in no event beyond thirty (30) days from such date.
3.9 Tax Computation. For purposes of determining whether any
of the Total Payments will be subject to the Excise Tax and the
amounts of such Excise Tax:
(a) Any other payments or benefits received or to be
received by Executive in connection with a Change in Control or
Executive's termination of employment (whether pursuant to the
terms of this Agreement or any other plan, arrangement, or
agreement with the Company or the Bank, or with any person
(which shall have the meaning set forth in Section 3(a)(9) of
the Exchange Act, including a "group" as defined in Section
13(d) therein) whose actions result in a Change in Control or
any person affiliated with the Company or such persons) shall
be treated as "parachute payments" within the meaning of
Section 280G(b)(1) of the Code, and all "excess parachute
payments" within the meaning of Section 280G(b)(1) shall be
treated as subject to the Excise Tax, unless in the opinion of
tax counsel as supported by the Company's independent auditors
and acceptable to Executive, such other payments or benefits
(in whole or in part) do not constitute parachute payments, or
unless such excess parachute payments (in whole or in part)
represent reasonable compensation for services actually
rendered within the meaning of Section 280G(b)(4) of the Code
in excess of the base amount within the meaning of Section 280G
(b)(3) of the Code, or are otherwise not subject to the Excise
Tax;
(b) The amount of the Total Payments which shall be
treated as subject to the Excise Tax shall be equal to the
lesser of: (i) the total amount of the Total Payments; or (ii)
the amount of excess parachute payments within the meaning of
Section 280G(b)(1) (after applying clause (a) above); and
(c) The value of any noncash benefits or any deferred
payment or benefit shall be determined by the Company's
independent auditors in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code.
For purposes of determining the amount of the Gross-Up Payment,
Executive shall be deemed to pay Federal income taxes at the highest
marginal rate of Federal income taxation in the calendar year in which the
Gross-Up Payment is to be made, and state and local income taxes at the
highest marginal rate of taxation in the state and locality of Executive's
residence on the effective date of the Terminating Event, net of the
maximum reduction in Federal income taxes which could be obtained from
deduction of such state and local taxes.
3.10 Subsequent Recalculation. In the event the Internal
Revenue Service adjusts the computation of the Bank under Section 3.9
herein so that Executive did not receive the greatest net benefit,
the Bank shall reimburse Executive for the full amount necessary to
make her whole, plus a market rate of interest, as determined by the
Compensation Committee of the Board.
3.11 Dispute Resolution. If any dispute between the Bank and
Executive as to any of the amounts to be determined under Sections
3.8 or 3.9, or the method of calculating such amounts, cannot be
resolved by Executive and the Bank, either the Bank or Executive
after giving three (3) days written notice to the other, may refer
the dispute to a partner in the Boston, Massachusetts office of a
firm of independent certified public accountants selected jointly by
Executive and the Bank. The determination of such partner as to the
amount to be determined under Section 3.8 and 3.9 and the method of
calculating such amounts shall be final and binding on both Executive
and the Bank and the Company. The Bank shall bear the costs of any
such determination. The Company shall have the same rights and
obligations as the Bank under this Section 3.11 in the event of a
dispute between the Company and Executive.
4. Miscellaneous.
4.1 Confidential Information. Unless Executive first secures
the Company's consent, Executive will not disclose or use, at any
time either during or subsequent to her employment by the Company or
the Bank, except as required by her duties to the Company or Bank,
any secret or confidential information of the Company or Bank of
which Executive becomes informed during her employment, whether or
not developed by her. 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 Company's
or Bank's management, but does not include any information which has
become part of the public domain by means other than Executive's non-
observance of her obligations hereunder.
4.2 Non-Competition. During Executive's employment by the
Company and the Bank hereunder, and during a period of one year
following the date of termination of her employment with the Company
or the Bank for any reason, Executive will not, directly or
indirectly whether as partner, consultant, agent, employee, co-
venturer, greater than 2% owner, or otherwise, or through any Person
(as hereafter defined),
(a) attempt to recruit any employee of the Company or
Bank, assist in such hiring by any other Person, or encourage
any such employee to terminate his or her relationship with the
Company or Bank, or
(b) encourage any customer of the Company or Bank to
conduct with any other Person any business or activity which
such customer conducts or could conduct with the Company or
Bank, as applicable.
For purposes of this Section 4.2, the term "Person" shall mean an
individual, a corporation, an association, a partnership, an estate,
a trust and any other entity or organization.
4.3 No Conflicting Obligations. The Company and the Bank, in
entering into this Agreement, understand, and Executive hereby
represents, that she is not under any obligation to any former
employer or any person, firm or corporation that would prevent, limit
or impair, in any way, the performance by Executive of her duties as
an employee of the Company or the Bank.
4.4 Ethical Behavior. Upon termination by the Company or the
Bank of Executive's employment for any reason, Executive shall act at
all times in an ethical manner with regard to the Bank and the
Company, and during the one-year period following the date of such
termination, shall take no action which directly or indirectly could
reasonably be expected to have the effect of terminating or otherwise
adversely affecting the relationship of the Company or the Bank with
any employee of, or others with business or advantageous
relationships with, the Company or any of its affiliates, including
the Bank.
4.5 Withholding. All payments made by the Bank or the
Company under this Agreement will be net of any tax or other amounts
required to be withheld by the Bank or the Company under applicable
law.
4.6 Legal Fees. Upon submission of appropriate statements or
documentation, the Company and the Bank jointly and severally agree
to reimburse Executive for reasonable legal fees actually incurred by
her in connection with the negotiation, review and enforcement of the
terms of this Agreement, provided, however, that neither the Company
nor the Bank shall be obligated to reimburse Executive for any legal
fees or expenses incurred by her in connection with the Company's or
the Bank's enforcement of the terms of this Agreement or in
connection with any arbitration or litigation in which the Company or
the Bank is the prevailing party.
4.7 Binding Effect. This Agreement is binding upon and will
inure to the benefit of the parties hereto and their respective
heirs, administrators, executors, successors and assigns. The
Company and the Bank will 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 Company or the
Bank, as the case may be, to assume expressly and perform the
Agreement. Failure of the Company or the Bank, as applicable, to
obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of the Agreement and shall
entitle Executive to compensation from the Bank in the same amount
and on the same terms as she would be entitled to hereunder following
a Terminating Event, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective
shall be deemed the date on which Executive becomes entitled to such
compensation from the Bank. As used in this Agreement, "Bank" shall
mean the Bank, as hereinbefore defined and any successor to its
business and/or assets as aforesaid which assumes and agrees to
perform the Agreement by operation of law, or otherwise.
4.8 Arbitration of Disputes. Any dispute, controversy or
claim arising out of or relating to this Agreement or the breach or
performance hereof will be settled by arbitration in accordance with
the laws of the State of Rhode Island by an arbitrator mutually
agreed upon by Executive and the Bank and/or the Company. If an
arbitrator cannot be agreed upon, Executive shall choose an
arbitrator and the Company and/or the Bank shall choose an
arbitrator, and these two together shall select a third arbitrator.
If the first two arbitrators cannot agree on the appointment of a
third arbitrator, then the third arbitrator will be appointed by the
American Arbitration Association in Providence, Rhode Island. Such
arbitration will be conducted in the City of Providence in accordance
with the Commercial Arbitration Rules of the American Arbitration
Association, except with respect to the selection of arbitrators
which shall be as provided in this Section 4.8. Judgment upon the
award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
4.9 Indemnification. The Company and the Bank each hereby
covenants and agrees to indemnify Executive and hold her harmless
fully, completely, and absolutely against and in respect to any and
all actions, suits, proceedings, claims, demands, judgments, costs,
expenses (including attorney's fees), losses, and damages resulting
from Executive's good faith performance of her duties and obligations
under the terms of this Agreement.
4.10 Interpretation. In case of ambiguity with respect to the
meaning or intent of any provision herein, whether in the course of
arbitration or otherwise, such provision shall be construed in the
manner most favorable to the Executive.
4.11 Guaranty. The Company hereby guarantees the due and
punctual performance in full by the Bank of its covenants, agreements
and obligations contained herein.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
/s/18th day of /s/December, 2000.
BANCORP RHODE ISLAND, INC.
By: /s/Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx, Chairman
BANK RHODE ISLAND
By: /s/Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx, Chairman
EXECUTIVE
/s/Xxxxxxx X. Xxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxx
#383466v9
Xxxxxxx Employ.
13
EXHIBIT 10.1
