EXHIBIT 10.28
FORM OF
CHANGE-IN-CONTROL AGREEMENT
This AGREEMENT is made effective as of _______________, 2000, by and among
Xxxxxx Savings Bank (the "Savings Bank") a federally-chartered savings bank,
with its principal administrative office at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxx, 00000, Xxxxxx Financial, Inc. (the "Holding Company"), a
corporation organized under the laws of the State of Pennsylvania which is the
holding company for the Savings Bank, and ____________________ (the
Executive").
WHEREAS, the Savings Bank recognizes the substantial contribution Executive
has made to the Savings Bank and wishes to protect Executive's position
therewith for the period provided in this Agreement; and
WHEREAS, Executive has been appointed to, and has agreed to serve in the
position of __________________________ for the Savings Bank, a position of
substantial responsibility.
NOW, THEREFORE, in consideration of the contribution and responsibilities
of Executive, and upon the other terms and conditions hereinafter provided, the
parties hereto agree as follows:
1. TERM OF AGREEMENT.
(a) The term of this agreement shall be deemed to have commenced as of the
date first above written and shall continue for a period of twenty-four (24)
full calendar months thereafter. The Agreement will be up for consideration for
renewal each ____________, after the Board of Directors completes a formal
performance evaluation of the Executive. The purpose of this evaluation will be
to determine whether or not to extend the Agreement. The results of this
evaluation will be included in the Minutes of the next Board Meeting. The
Agreement will renew for an additional year so that the remaining term shall be
two (2) years unless written notice is provided to the Executive at least ten
(10) days, but not more than twenty (20) days prior to the anniversary date,
that this Agreement shall cease at the end of the twelve (12) months following
such anniversary date.
2. PAYMENTS TO THE EXECUTIVE UPON CHANGE IN CONTROL.
(a) Upon the occurrence of a Change in Control of the Savings Bank or the
Holding Company (as herein defined) followed at any time during the term of this
Agreement by the voluntary (for any of the bases set below) or involuntary
termination of Executive's employment, other than for Cause, as defined in
Section 2(c) hereof, the provisions of Section 3 shall apply. Upon the
occurrence of a Change in Control, Executive shall have the right to elect to
voluntarily terminate his employment at any time during the term of this
Agreement following any demotion, loss of title, office or
significant authority, reduction in his annual compensation, relocation of his
principal place of employment by more than 30 miles from its location
immediately prior to the Change in Control or the failure to continue in effect
any substantially similar vacation benefits, pension plan, dental plan, life
insurance plan, health, accident or disability plan in which Executive is
participating immediately prior to Change in Control.
(b) Change in Control" shall mean an event of a nature that: (i) would be
required to be reported in response to Item 1 of the current report on Form 8-K,
as in effect on the date hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 0000 (xxx "Xxxxxxxx Xxx"); or (ii) results in a
Change in Control of the Savings Bank or the Holding Company within the meaning
of the Change in Bank Control Act and the Rules and Regulations promulgated by
the Federal Deposit Insurance Corporation ("FDIC") at 12 C.F.R. (S) 303.4 (a)
with respect to the Savings Bank and the Board of Governors of the Federal
Reserve System ("FRB") at 12 C.F.R. (S) 225.41(b) with respect to the Stock
Holding Company, as in effect on the date hereof; or (iii) without limitation
such a Change in Control shall be deemed to have occurred at such time as (a)
any "person" (as the term is used in Sections 13(d) and 14(d) of the Exchange
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of Securities of the Savings Bank or the
Holding Company representing 20% or more of the Savings Bank's or the Holding
Company's outstanding securities except for any securities of the Savings Bank
purchased by the Holding Company in connection with the conversion of the
Company to the stock form and any securities purchased by the Savings Bank's
employee stock ownership plan and trust; or (b) individuals who constitute the
Board on the date hereof (the "Incumbent Board") cease for any reason to
constitute at least a majority thereof, provided that any person becoming a
director subsequent to the date hereof whose election was approved by a vote of
at least three-quarters of the directors comprising the Incumbent Board, or
whose nomination for election by the Holding Company's stockholders was approved
by the same Nominating Committee serving under an Incumbent Board, shall be, for
purposes of this clause (b), considered as though he were a member of the
Incumbent Board; or (c) a plan of reorganization, merger, consolidation, sale of
all or substantially all the assets of the Savings Bank or Holding Company or
similar transaction occurs in which the Savings Bank or Holding Company is not
the resulting entity; or (d) a proxy statement shall be distributed soliciting
proxies from stockholders of the Holding Company, by someone other than the
current management of the Holding Company, seeking stockholder approval of a
plan of reorganization, merger, or consolidation of the Holding Company or
Savings Bank or similar transaction with one or more corporations as a result of
which the outstanding shares of the class of securities then subject to such
plan or transaction are exchanged for or converted into cash or property or
securities not issued by the Savings Bank or the Holding Company; or (e) a
tender offer is made and accepted for 20% or more of the voting securities of
the Savings Bank or Holding Company then outstanding. Notwithstanding anything
herein to the contrary, a Change in Control shall not be deemed to occur upon
the conversion of the Holding Company's mutual holding company to stock form.
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(c) Executive shall not have the right to receive termination benefits
pursuant to Section 3 hereof upon Termination for Cause. The term "Termination
for Cause" shall mean termination because of the Executive's personal
dishonesty, willful misconduct, any 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 material breach of any material provision of
this Agreement. For purposes of this Section, no act, or the failure to act on
Executive's part shall be "willful" unless done or omitted to be done, not in
good faith and without reasonable belief that the action or omission was in the
best interests of the Holding Company or the Savings Bank. Notwithstanding the
foregoing, Executive shall not be deemed to have been Terminated for Cause
unless and until there shall have been delivered to him a Notice of Termination
which shall include a copy of a resolution duly adopted by the affirmative vote
of not less than two-thirds of the members of the Board at a meeting of the
Board called and held for that purpose (after reasonable notice to the Executive
and an opportunity for him, together with counsel, to be heard before the
Board), finding that in good faith opinion of the Board, the Executive was
guilty of conduct justifying Termination for Cause and specifying the
particulars thereof in detail. The Executive shall not have the right to
receive compensation or other benefits for any period after Termination for
Cause. Any stock options or limited rights granted to Executive under any stock
option plan or any unvested awards granted to Executive under a Recognition and
Retention Plan of the Savings Bank, the Company or any subsidiary or affiliate
thereof, shall become null and void effective upon Executive's receipt of Notice
of Termination for Cause and shall not be exercisable by Executive at any time
subsequent to such Termination for Cause.
3. TERMINATION BENEFITS.
(a) Upon the occurrence of a Change in Control, followed at any time
during the term of this Agreement by the voluntary or involuntary termination of
the Executive's employment, other than for Termination for Cause, the Savings
Bank and the Company shall pay the Executive, or in the event of his subsequent
death, his beneficiary or beneficiaries, or his estate, as the case may be, as
severance pay or liquidated damages, or both, a sum equal to two (2) times the
Executive's annual base salary and bonus. In addition, Executive shall be
entitled to any other cash or deferred compensation paid, or to be paid, to the
Executive for such years and such benefits as are otherwise payable to Executive
under the Company's or the Bank's plans upon a Change in Control. At the
election of the Executive such payment may be made in a lump sum or paid in
equal monthly installments during the twelve (12) months following the
Executive's termination. In the event that no election is made, payment to the
Executive will be made on a monthly basis during the remaining term of this
Agreement.
(b) Upon the occurrence of a Change in Control of the Savings Bank or the
Holding Company followed at any time during the term of this Agreement by the
Executive's voluntary or involuntary termination of employment, other than for
Termination for Cause, the Savings Bank shall cause to be continued life,
medical, dental
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and disability coverage substantially identical to the coverage
maintained by the Savings Bank for the Executive prior to his severance. Such
coverage and payments shall cease upon the expiration of twenty-four (24)
months.
(c) Upon the occurrence of a Change in Control, the Executive shall be
entitled to receive benefits due him under, or contributed by the Bank on his
behalf pursuant to any retirement, incentive, profit sharing, bonus,
performance, disability or other employee benefit plan maintained by the Bank on
the Executive's behalf to the extent that such benefits are not otherwise paid
to the Executive under a separate provision of this Agreement.
(d) Notwithstanding the preceding paragraphs of this Section 3, in the
event that:
(i) the aggregate payments or benefits to be made or afforded to the
Executive under said paragraphs (the "Termination Benefits") would
be deemed to include an "excess parachute payment" under Section
280G of the Internal Revenue Code of 1986 (the Code) or any
successor thereto, and
(ii) if such Termination Benefits were reduced to an amount (the "Non-
Triggering Amount"), the value of which is one dollar ($1.00) less
than an amount equal to three (3) times Executive's "base amount" as
determined in accordance with said Section 280G, then the
Termination Benefits shall be reduced to the Non-Triggering Amount.
The allocation of the reduction required hereby among the
Termination Benefits provided by the preceding paragraphs of this
Section 3 shall be determined by the Executive.
4. NOTICE OF TERMINATION.
(a) Any purported termination by the Savings Bank, the Holding Company or
by Executive shall be communicated by Notice of Termination to the other party
hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a
written notice which shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of executive's
employment under the provision so indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination which, in the instance of Termination for Cause, shall be
immediate.
5. SOURCE OF PAYMENTS.
(a) It is intended by the parties hereto that all payments provided in
this Agreement shall be paid in cash or check from the general funds of the
Savings Bank. The Holding Company, however, guarantees payment and provision of
all amounts and
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benefits due hereunder to the Executive and, if such amounts and benefits due
from the Savings Bank are not timely paid or provided by the Savings Bank, such
amounts and benefits shall be paid or provided by the Holding Company.
6. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS.
(a) This Agreement contains the entire understanding between the parties
hereto and supersedes any prior agreement between the Savings Bank and the
Executive, except that this Agreement shall not affect or operate to reduce any
benefit or compensation inuring to the Executive of a kind elsewhere provided.
No provision of this Agreement shall be interpreted to mean that the Executive
is subject to receiving fewer benefits than those available to him without
reference to this Agreement.
(b) Nothing in this Agreement shall confer upon the Executive the right to
continue in the employ of Savings Bank or shall impose on the Savings Bank any
obligation to employ or retain the Executive in its employ for any period.
7. NO ATTACHMENT.
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
the Executive, the Savings Bank and their respective successors and assigns.
8. MODIFICATION AND WAIVER.
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
waiver or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any act other than that
specifically waived.
9. REQUIRED REGULATORY PROVISIONS.
(a) The Board may terminate the Executive's employment at any time, but any
termination by the Board, other than Termination for Cause, shall not prejudice
the
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Executive's right to compensation or other benefits under the Agreement.
The Executive shall not have the right to receive compensation or other benefits
for any period after Termination for Cause as defined in Section 2 herein above.
10. SEVERABILITY.
(a) If, for any reason, any provision of this Agreement, or any part of
any provision, is held invalid, such invalidity shall not affect any other
provision of this Agreement or any part of such provision not held so invalid,
and each such other provision and part thereof shall to the full extent
consistent with law continue in full force and effect.
11. HEADINGS FOR REFERENCE ONLY.
(a) The headings of sections and paragraphs herein are included solely
for the convenience of reference and shall not control the meaning or
interpretation of any of the provisions of this Agreement.
12. GOVERNING LAW.
(a) The validity, interpretation, performance, and enforcement of this
Agreement shall be governed by Pennsylvania law.
13. ARBITRATION.
(a) Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration 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 provided,
however, that the Executive shall be entitled to seek specific performance of
his right to be paid until the Date of Termination during the pendency of an
dispute or controversy arising under or in connection with this Agreement.
(b) In the event any dispute or controversy arising under or in
connection with Executive's termination is resolved in favor of the Executive,
whether by judgment, arbitration or settlement, Executive shall be entitled to
the payment of all back-pay, including salary, bonuses and any other cash
compensation, fringe benefits and any compensation and benefits due Executive
under this Agreement.
14. PAYMENT OF COSTS AND LEGAL FEES.
(a) All reasonable costs and legal fees paid or incurred by the Executive
pursuant to any dispute or question of interpretation relating to this Agreement
shall be paid or reimbursed by the Savings Bank (which payments are guaranteed
by the Holding
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Company pursuant to Section 5 hereof) if Executive is successful pursuant to
legal judgment, arbitration or settlement.
15. INDEMNIFICATION.
(a) The Savings Bank shall provide Executive (including his or her legal
representatives, successors, and assigns) with coverage under a standard
directors' and officers' liability insurance policy at its expense, or in lieu
thereof, shall indemnify Executive (including his or her legal representatives,
successors, and assigns) to the fullest extent permitted under Pennsylvania law
against all expenses and liabilities reasonably incurred by Executive in
connection with or arising out of any action, suit or proceeding in which he may
be involved by reason of his having been a trustee or officer of the Savings
Bank (whether or not he continues to be a trustee or officer at the time of
incurring such expenses or liabilities). Such expenses or liabilities may
include, but not be limited to, judgments, court costs and attorneys' fees and
the cost of reasonable settlements for reasonable costs and expenses incurred by
Executive in defending or settling any judicial or administrative proceeding, or
threatened proceeding, whether civil, criminal, or otherwise, including any
appeal or other proceeding for review.
(b) Indemnification by the Savings Bank shall be made only upon the final
judgment on the merits in favor of the Executive, in case of settlement, in case
of final judgment against Executive or in the case of final judgment in favor of
Executive other than on the merits, if a majority of the disinterested directors
of the Savings Bank determine Executive was acting in good faith within the
scope of Executive's employment or authority.
(c) Any such indemnification of Executive for such expenses and
liabilities are to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements, such settlements to be
approved by the Board of Directors of the Savings Bank, if such action is
brought against the Executive in his or her capacity as an officer or trustee of
the Savings Bank, provided however, such indemnity shall not extend to matters
as to which the Executive is finally adjudged to be liable for willful
misconduct in the performance of his or her duties.
16. SUCCESSOR TO THE BANK.
(a) The Savings Bank shall require any successor or assignee, whether
direct or indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Savings Bank or the Holding
Company, expressly and unconditionally to assume and agree to perform the
Savings Bank's obligations under this Agreement, in the same manner and to the
same extent that the Savings Bank would be required to perform if no such
succession or assignment had taken place.
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17. SIGNATURES.
IN WITNESS WHEREOF, Xxxxxx Savings Bank and Xxxxxx Financial, MHC have
caused this Agreement to be executed by their duly authorized officers, and
Executives have signed this Agreement, on the ___ day of ________________,
2000.
SEAL
ATTEST:
XXXXXX SAVINGS BANK
__________________________ BY:_________________________________
Corporate Secretary President / Chief Executive Officer
SEAL
ATTEST: XXXXXX FINANCIAL, MHC
(Guarantor)
__________________________ BY:__________________________________
Corporate Secretary President / Chief Executive Officer
SEAL
WITNESS:
__________________________ BY:___________________________________
(EXECUTIVE)
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