EX-10.3
(Exhibit 10.3) Employment Agreement-Xxxxx X. Xxxxxxxx
Amended 6/2001
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as
of the 25th day of June 1999, between FINANCIAL INSTITUTIONS, INC. ("Employer"),
a bank holding company, chartered under the laws of New York, having its
principal office at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000 and XXXXX X.
XXXXXXXX ("Executive"), an individual residing at 000 X. Xxxxxxx Xxxxxx, Xxxxxx,
Xxx Xxxx 00000.
WHEREAS, Employer wishes to employ Executive in an executive capacity,
as its President, and Executive wishes to accept such employment on the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual promises, benefits and
covenants herein contained, Employer and Executive hereby agree as follows:
1. Effective Date; Term.
1.1 Effective Date. This Agreement shall be effective commencing on the
date hereof (the "Effective Date").
1.2 Initial Term. Employer employs Executive, and Executive accepts
such employment, for a three (3) year period commencing on the Effective Date
(the "Initial Term").
1.3 Renewal Term. This Agreement will automatically renew for
successive three year terms (each a "Renewal Term") upon the expiration of the
Initial Term or a subsequent Renewal Term unless either party provides written
notice to the other at least ninety (90) days before the end of the Initial Term
or Renewal Term that such party does not intend to renew this Agreement upon the
expiration thereof.
1.4 Termination. This Agreement may be terminated prior to the
expiration of the Initial Term or any Renewal Term as provided in Sections 4.1
and 4.4 of this Agreement (see Early Retired Employee).
2. Scope of Employment.
2.1 Position and Duties. During the term of this Agreement, Employer
shall employ Executive to serve as the President of Employer. In such capacity,
Executive shall perform such executive, administrative and operational duties as
may be assigned to Executive from time to time by the Board of Directors of
Employer, provided that such assignments are materially consistent with the
current job description.
2.2 Exclusive Efforts. Executive agrees to serve Employer faithfully
and to the best of Executive's ability and to devote Executive's entire business
time, attention and efforts to the interests and business of Employer, its
subsidiaries and their affiliates.
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2.3 Compliance with Laws. Executive agrees at all times to strictly
adhere to and perform all his duties in accordance with applicable laws, rules
and regulations and the written policies and procedures of Employer in effect
from time to time.
3. Compensation, Benefits and Expenses.
3.1 Base Salary. Except as otherwise provided in this Agreement, during
the period from the Effective Date through December 31, 1999 (the "First Year")
Employer shall pay to Executive a base salary at a rate of $282,000 per year
(the "Base Salary"). The Base Salary may be increased, in the sole discretion of
Employer, in a manner comparable to other senior executives, during the
remainder of the terms of this Agreement, but may not be decreased. Employer
shall pay the Base Salary to Executive in equal installments pursuant to
Employer's standard payroll policies and Executive's salary shall be subject to
such withholding or deductions as may be mutually agreed between Employer and
Executive or required by law.
3.2 Bonus. In addition to the salary set forth in Section 3.1,
Executive may receive bonuses as follows:
3.2.1 If the Employer meets or exceeds target performance factors
pursuant to the Employer's senior management incentive compensation
plan, the Executive shall be paid a bonus which shall be determined by
the Compensation Committee of the Board of Directors of Employer.
3.2.2 The bonus earned by Executive each year during the term of this
Agreement, if any, shall be paid to Executive in a lump sum promptly
after the Employer's audited annual financial results are publicly
disclosed.
3.2.3 Payment of any bonus shall be subject to such withholding or
deductions as may be mutually agreed between Employer and Executive or
required by law.
3.3 Incentive Stock Plan Benefits. During the period of his employment,
Executive shall be entitled to receive grants of options under any incentive
stock plan operated by Financial Institutions, Inc. ("FII") for its employees
and those of its subsidiaries, in such amounts as may be determined by the FII
Board of Directors or by the FII Compensation Committee, in a manner comparable
to other senior executives of FII.
3.4 Fringe Benefits. During the period of his employment, Executive
shall be entitled to participate in FII's plans for the welfare and benefit of
its employees to the extent Executive satisfies the requirements provided in
such health plans, including health standards, and other qualifications for
participation. In the event Executive becomes a "Retired Early Employee" as
defined in subparagraph 4.4.1, or is terminated for reasons other than those set
forth in subparagraphs 4.1.3, 4.1.4, 4.1.6 or 4.1.7 health insurance and dental
benefits will be continued as if Executive continued to remain an employee for
the remainder of the Initial Term or Renewal Term then in effect, or until
Executive obtains a position offering comparable benefits, whichever occurs
first.
3.5 Vacation and Holidays. During the term of this Agreement, Executive
shall accrue paid vacation in accordance with Employer's policies of four (4)
weeks per calendar year.
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Executive shall be entitled to take accrued vacation days and paid holidays in
accordance with Employer's policies applicable to its employees generally.
Executive may not carry forward vacation days from year to year.
3.6 Expenses. During the term of this Agreement, Employer authorizes
Executive to incur reasonable and necessary out-of-pocket business expenses in
the course of performing his duties and rendering services hereunder in
accordance with Employer's policies with respect thereto, and Employer shall
reimburse Executive for all such expenses, provided (i) such expenses and the
purpose for which they were incurred, are in accordance with Employer's
policies, and (ii) Executive timely submits to Employer expense reports and
substantiation of the expenses in accordance with Employer's policies.
3.7 Country Club Dues and Automobile Expenses. During the term of this
Agreement, Employer shall reimburse Executive for monthly membership dues at a
country club of Executive's choosing, and shall provide Executive with use of a
suitable automobile.
4. Termination of Employment.
4.1 Events of Termination. Executive's Employment by Employer shall
terminate at the expiration of the Initial Term or any Renewal Term provided
timely notice is given as provided in Section 1.3 and shall terminate prior to
the expiration of the then current term, if any of the following occur:
4.1.1 the death of Executive;
4.1.2 the date on which Executive is (i) determined to be
"permanently disabled" as defined under the disability
insurance policy covering Executive, or (ii) if Executive is
not covered by any such disability policy, Executive is
determined to be "totally disabled" by the Board of Directors
of Employer based upon the advice of a board certified
physician reasonably acceptable to Employer and Executive or
his legal representative, which may include a determination
that Executive is or may be unable, because of physical or
mental illness or incapacity or otherwise, to fulfill his
duties under this Agreement for six consecutive months
4.1.3 the commission by Executive of, or the determination by the
Board of Directors, based on reasonable evidence of misconduct
as presented by a law enforcement agency, or as a result of an
internal or external audit or investigation, that the
Executive has committed (i) a criminal offense involving the
violation of state or federal law], (ii) a breach of fiduciary
duty, (iii) a material act of dishonesty, fraud or
misrepresentation, or (iv) any act of moral turpitude which
the Board of Directors determines has or may be reasonably
expected to have a material detrimental impact on Employer's
business or operations, or which may prevent, because of its
demonstrated or demonstrable effect on employees, regulatory
agencies or customers, Executive from effectively performing
his executive and other duties under this Agreement;
4.1.4 Executive materially neglects to satisfactorily perform the
duties which Executive is required to perform under this
Agreement or performs such duties other than in
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good faith, as determined by the Board of Directors. The Board
will provide a written notice to the Executive, specifying the
unsatisfactory performance and suggest what must be done to
improve and maintain such performance. The written notice will
also specify the time period (considered probationary period)
given the Executive to correct such conduct.
4.1.5 the termination of Executive's employment by Employer during
the term of this Agreement for any reason without cause other
than pursuant to Sections 4.1.1, 4.1.2, 4.1.3 or 4.1.4;
4.1.6 Executive's resignation or retirement; or
4.1.7 the mutual consent to such termination in writing by Executive
and Employer.
4.2 Time of Termination. Executive's employment with Employer shall
terminate immediately upon Executive's death, upon written notice of termination
from Employer or Executive upon the occurrence of an event specified in Sections
4.1.2, 4.1.3, 4.1.5 or 4.1.6, upon the expiration of the cure period specified
in Section 4.1.4, on the date specified in the agreement terminating Executive's
employment pursuant to Section 4.1.7, or upon expiration of the Initial Term or
a Renewal Term if timely notice is given pursuant to Section 1.3 (as applicable,
the "Termination Date"). Employer's and Employee's obligations under this
Agreement shall terminate upon such termination of employment without any
further action by the parties except to the extent specifically provided herein.
4.3 Effect of Termination of Employment. Following the Termination
Date:
4.3.1 Executive shall return all property of Employer as provided in
Section 6 of this Agreement;
4.3.2 Executive's base salary shall cease to accrue;
4.3.3 Subject to Section 4.4, the Board of Directors shall pay an
appropriate bonus to Executive as his bonus or other incentive
compensation for the period through the Termination Date computed
consistently with the manner in which Executive's bonus or incentive
compensation would have been determined for such period, as defined in
Section 3.2, if Executive's employment had not terminated;
4.3.4 Executive's participation in FII's benefit plans shall cease
except as required by law, the terms of the plan(s) or as provided in
subparagraph 3.4 of this Agreement;
4.3.5 Executive shall cease to accrue vacation days and shall be paid
for unused vacation time accrued in accordance with Employer's policies
applicable to employees generally; and
4.3.6 Executive shall submit any claims for reimbursement of business
expenses incurred in accordance with Section 3.5 within the time period
required under Employer's policies generally or Employer will not be
obligated to reimburse such expenses.
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4.3.7 In the case of an Early Termination, the Employer shall have no
further liability to Executive hereunder, except as explicitly stated
in this Agreement, other than for earned but unpaid compensation and
those benefits (accrued but unpaid) to which Executive is entitled
under this Agreement through the Termination Date, including
termination in the cases listed in Section 3.4, continued fringe
benefits as provided in such Section 3.4.
Upon Termination of Employment, for any reason, all split dollar
insurance policies in effect on the Executive's life will terminate.
The Executive shall have the right, under the terms of the split dollar
agreement, to purchase the policies by paying to the Corporation an
amount as defined in Article 7.1 of the Split Dollar Agreement.
4.3.8 If, during the term of this Agreement, the Executive is
terminated for reasons other than those set forth in subparagraphs
4.1.1, 4.1.2, 4.1.3, 4.1.4, 4.1.6 or 4.1.7, Employer shall, during the
two year period after the Termination Date, make equal monthly payments
or a single lump sum payment to the Executive (which shall not be
deemed base annual salary payments) in an amount such that the present
value of all such payments, determined as of the Termination Date,
equals the sum of two times the Base Salary Amount paid to Executive,
as such term is defined in subparagraph 4.4.7 below, plus the sum of
the annual incentive compensation earned by Executive, as determined
over the most recent two (2) tax years ending before the Termination
Date occurred. It shall be at the discretion of the Compensation
Committee, as to whether the payment is made as a single lump sum
payment or equal monthly payments.
4.4. Change of Control and Change of Authority
4.4.1 Retired Early Employee. If a Change of Control and Change of
Authority, as such terms are defined in subparagraph 4.4.7 below,
occurs during the term of the Executive's employment under this
Employment Agreement, either the Executive, on the one hand, or
Employer, on the other, may elect by written notice, given to the other
party or parties, at any time within twelve (12) months after such
Change of Control and Change of Authority, to terminate the employment
of the Executive by Employer, whereupon the Executive will become a
"Retired Early Employee," and will be entitled to receive such payments
as are provided hereafter in this Section 4.4. Such election and the
termination of the Executive's employment shall become effective on the
first day of the second calendar month commencing after delivery of the
notice or on such earlier date as the Executive in his sole discretion
may specify (the "Effective Date").
4.4.2 Cash Payments. If the Executive should become a Retired Early
Employee hereunder, Employer shall, during the period commencing on the
Effective Date and ending three years thereafter (the "Pay-Out
Period"), make equal monthly payments or a single lump sum payment to
the Executive (which shall not be deemed base annual salary payments)
in an amount such that the present value of all such payments,
determined as of the Effective Date, equals the sum of three times the
Base Salary Amount paid to Executive, as such term is defined in
subparagraph 4.4.7 below, plus the sum of the annual incentive
compensation earned by Executive, as determined over the most recent
three (3) tax years ending before the date on which the Change of
Control and Change of Authority occurred. The Executive shall request
the method of payment, however, it
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shall be at the discretion of the Compensation Committee, as to whether
the payment is made as a single lump sum payment or equal monthly
payments. The payment(s) provided for in subparagraph 4.3.8 do not
apply to Retired Early Employees who receive cash payment(s) pursuant
to this subparagraph.
If at any time during the Pay-Out Period the Compensation Committee of
the Board in its sole discretion shall determine, upon application of
the Retired Early Employee supported by substantial evidence, that the
Retired Early Employee is then under a severe financial hardship
resulting from (i) a sudden and unexpected illness or accident of the
Retired Early Employee or any of his dependents (as defined in section
152(a) of the Internal Revenue Code), (ii) loss of the Retired Early
Employee's property due to casualty, or (iii) other similar
extraordinary and unforeseeable circumstance arising as a result of
events beyond the control of the Retired Early Employee, Employer shall
make available to the Retired Early Employee, in one (1) lump sum, an
amount up to but not greater than the present value of all monthly
payments remaining to be paid to him in the Pay-Out Period, calculated
as of the date of such determination by the Compensation Committee of
the Board, for the purpose of relieving such severe financial hardship
to the extent the same has not been or may not be relieved by (xi)
reimbursement or compensation by insurance or otherwise, (xii)
liquidation of the Retired Early Employee's assets (to the extent such
liquidation would not itself cause severe financial hardship), or
(xiii) distributions from other benefit plans. If (a) the lump sum
amount thus made available is less than (b) the present value of all
such remaining monthly payments, Employer shall continue to pay to the
Retired Early Employee monthly payments for the duration of the Pay-Out
Period, but from such date forward such monthly payments will be in a
reduced amount such that the present value of all such reduced payments
will equal the difference between (b) and (a), above. The Retired Early
Employee may elect to waive any or all payments due him under this
subparagraph.
4.4.3 Acceleration of Stock Options. All options and other rights that
Executive may hold to purchase or otherwise acquire Common Stock of FII
shall immediately become vested and exercisable in full for the total
number of shares that are or might become purchasable thereunder, in
each case without further condition or limitation except the giving of
notice of exercise and the payment of the purchase price thereunder
(but without amendment of the plan under which they were issued). At
his discretion, Executive may elect to surrender to Employer his rights
in any such options and rights held by him and, upon that surrender,
Employer shall pay him an amount in cash equal to the aggregate spread
between the exercise prices of all those options and rights and the
value of the Common Stock purchasable thereunder (or of any other
security into which the Common Stock has been exchanged or converted)
as of the date of the termination of employment, the value to be
determined by the reported last sale price of the Common Stock or that
other security (or the mean between the reported last bid and asked
prices) on that date on NASDAQ (or, if it is not NASDAQ, on whatever
may then be the principal exchange or quotation system on which the
Employer's Common Stock or that other security is traded at that time).
4.4.4 Life Insurance Policies. Employer shall repay any policy loans
previously taken on the Employer's insurance policies on Executive's
life (provided that the directors of
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Employer were given written notice promptly after the making of any
such loans which were made while Executive was the president and chief
executive officer of Employer), and then shall transfer to Executive
any and all of its right, title, and interest in and to all Employer
life insurance policies on Executive's life (and upon that transfer,
Executive shall be deemed to have released Employer from any and all
obligations it then owes to him to maintain and pay premiums on those
policies, all other provisions of any agreements under which those
policies were agreed to be maintained, however, to remain in effect).
[Upon termination of employment, all split dollar policies in effect on
the Executive's life will terminate. The Executive shall have the
right, under the terms of the split dollar agreement, to purchase the
policies by paying to the Corporation an amount as defined in Article
7.1 of the Split Dollar Agreement.]
4.4.5 Death of Retired Early Employee. If the Retired Early Employee
dies before receiving all monthly payments payable to him under
subparagraph 4.4(b), above, Employer shall pay to the Retired Early
Employee's estate, one (1) lump sum payment in an amount equal to the
present value of all such remaining unpaid monthly payments, determined
as of the date of death of the Retired Early Employee. If the Retired
Early Employee was receiving health insurance and dental benefits
pursuant to paragraph 3.4 hereof at the time of death, Employer shall
continue to provide such health insurance and dental benefits to the
dependents of the deceased Retired Early Employee for the duration
specified in paragraph 3.4, if the Retired Early Employee had not died.
4.4.6 Indemnification of Executive. In the event a Change of Control
and Change of Authority occurs, Employer shall indemnify Executive for
all reasonable legal fees and expenses subsequently incurred by
Executive through legal counsel approved in advance by Employer [(which
approval shall not be unreasonably withheld)] in seeking to obtain or
enforce any right or benefit provided under this Employment Agreement,
including but not limited to the rights and benefits provided under
this Section 4.4 and whether or not Executive has become a Retired
Early Employee hereunder, provided, however, that such right to
indemnification will not apply if and to the extent that a court of
competent jurisdiction shall determine that any such fees and expenses
have been incurred as a result of Executive's bad faith or willful
misconduct [or if such a court dismisses the action seeking to enforce
the right or benefit for failure to state a claim]. Indemnification
payments payable hereunder by Employer shall be made not later than
thirty (30) days after a request for payment has been received from
Executive with such evidence of indemnifiable fees and expenses as
Employer may reasonably request.
4.4.7 Definitions.
(i) The "Base Salary Amount" for purpose of this Paragraph 4.4
shall equal the annual compensation payable by Employer to Executive
and includable by Executive in gross income for the most recent year
ending before the date on which the Change of Control and Change of
Authority occurred.
(ii) A "Change of Control" shall be deemed to have occurred if
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(A) any individual corporation (other than
FII), partnership, trust, association, pool,
syndicate, or any other entity or any group of
persons acting in concert becomes the beneficial
owner, as that concept is defined in Rule 13d-3
promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as the
result of any one or more securities transactions
(including gifts and stock repurchases but excluding
transactions described in subdivision (B),
following), of securities of FII possessing twenty
percent (20%) or more of the voting power for the
election of directors of such entity,
(B) there shall be consummated any
consolidation, merger or stock-for-stock exchange
involving FII or the securities of FII in which the
holders of voting securities of FII immediately prior
to such consummation own, as a group, immediately
after such consummation, voting securities of FII
(or, if FII does not survive such transaction voting
securities of the corporation surviving such
transaction) having less than fifty percent (50%) of
the total voting power in an election of directors of
FII (or such other surviving corporation), excluding
securities received by any members of such group
which represent disproportionate percentage increases
in their shareholdings vis-a-vis the other members of
such group,
(C) "approved directors" shall constitute
less than a majority of the entire Board of
Directors, with "approved directors" defined to mean
the members of the Board of Directors of Employer as
of the date of this Agreement and any subsequently
elected members who shall be nominated or approved by
a majority of the approved directors on the Board
prior to such election, or
(D) there shall be consummated any sale,
lease, exchange or other transfer (in one transaction
or a series of related transactions, excluding any
transaction described in subdivision (B), above), of
all, or substantially all, of the assets of FII to a
party which is not controlled by or under common
control with FII.
(iii) A "Change of Authority" shall be deemed to have occurred
if upon the occurrence of a Change in Control, Executive, without
his/her written consent, is required by Employer to accept any
demotion, loss of title, or office, reduction in his annual
compensation or benefits, or relocation of his principal place of
employment by more than 25 miles from its location immediately prior to
the Change in Control; provided, however, that Executive may consent in
writing to any such demotion, loss, reduction or relocation.
5. Confidentiality; Inventions.
5.1 Confidential Information. Executive has and will have access to and
participate in the development of or be acquainted with confidential or
proprietary information and trade secrets related to the business of Employer,
its subsidiaries and any affiliates (collectively, the
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"Companies"), including but not limited to (i) business plans, software
programs, operating plans, marketing plans, financial reports, operating data,
budgets, wage and salary rates, pricing strategies and information, terms of
agreements with suppliers or customers and others, customer lists, reports,
correspondence, tapes, disks, tangible property and specifications owned by or
used in the Companies' businesses; (ii) operating strengths and weaknesses of
the Companies' officers, directors, employees, agents, suppliers and customers,
and/or (iii) information pertaining to future developments such as, but not
limited to, research and development, software development or enhancement,
future marketing plans or ideas, and plans or ideas for new services or
products, (iv) all information which is learned or developed by Executive in the
course and performance of his duties under this Employment Agreement, including
without limitation, reports, information and data relating to the Employer's
acquisition strategies, and (v) other tangible and intangible property which is
used in the business and operations of the Companies but not made publicly
available (i) through (v) are, collectively, (the "Confidential Information").
5.2 Treatment of Confidential Information; Confidentiality Agreements.
Executive shall not, directly or indirectly, disclose, use or make known for his
or another's benefit any Confidential Information of the Companies or use such
Confidential Information in any way except in the best interests of the
Companies in the performance of Executive's duties under this Agreement. In
addition, to the extent that Employer has entered into a confidentiality
agreement with any other person or entity Executive agrees to comply with the
terms of such confidentiality agreement and to be subject to the restrictions
and limitations imposed by such confidentiality agreements as if he was a party
thereto.
5.3 Inventions. Executive shall promptly disclose both orally and in
writing to Employer all discoveries, ideas, software, developments, discoveries,
designs, improvements, innovations and inventions (collectively referred to
herein as "Inventions"), whether patentable or not, either relating to the
existing or contemplated business, products, services, plans, processes, or
procedures of Employer, or suggested by or resulting from Executive's work at
Employer, or resulting wholly or in part from the use of Employer's time,
material, facilities or ideas, which Executive made or conceived or may make or
conceive, whether or not during working hours, alone or with others, at any time
during the term of this Agreement or within one year thereafter, and Executive
agrees that all such inventions shall be the exclusive property of the Employer.
5.4 Assignment of Inventions. Executive hereby assigns to Employer all
his rights and interests in and to all such inventions and all patents,
copyrights, trademarks or other types of intellectual property protection which
may be obtained on them, in this and all foreign countries. At Employer's
expense, but without charge to it, Executive agrees to execute, acknowledge and
deliver to Employer any specific assignments to any such inventions or other
relevant documents and to take any such further action as may be considered
necessary by Employer at any time to obtain or defend letters patent in any and
all countries, to obtain documents relating to registration, ownership or
transfer of copyrights, to vest title in such inventions in Employer or its
assigns, or to obtain for Employer any other legal protection for such
inventions.
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5.5 Survival of Obligations. The obligations of Executive under this
Section 5 shall survive the termination of Executive's employment and the
expiration or termination of this Agreement.
6. Return of Employer's Property. Immediately upon the Termination
Date, Executive shall deliver to Employer all copies of data, information and
knowledge, including, without limitation, all notes, reference materials,
sketches, diagrams, reproductions, memoranda, documentation and records
incorporating or reflecting any Confidential Information, documents,
correspondence, notebooks, reports, computer programs, names of full-time and
part-time employees and consultants, and all other materials and copies thereof
(including computer disks and other electronic media) relating in any way to the
business of Employer in any way obtained by Executive during the period of his
employment with Employer, along with any automobile provided by Employer for
Executive's use (the "Employer's Property"). The Employer's Property shall
belong exclusively to the Employer and shall be delivered to the Employer
immediately upon termination of Executive's employment with the Employer, for
whatever reason said termination occurs. The obligations of Executive under this
Section 6 shall survive the termination of Executive's employment and the
expiration or termination of this Agreement.
7. Non-competition and Non-solicitation.
7.1 Non-competition. [During the term of this Agreement and during the
period for which Executive is entitled to receive compensation] after the
termination of this Agreement pursuant to subparagraphs 4.3.8 or 4.4.2,
regardless of whether such compensation is paid in a lump sum rather than
monthly payments, Employee shall not engage, anywhere within New York State,
whether directly or indirectly, as principal, owner, officer, director, agent,
employee, consultant or partner, in the management of a bank holding company,
commercial bank, savings bank, credit union or any other financial services
provider that competes with FII, its subsidiaries or its products or programs
("Restricted Activities"), provided that the foregoing shall not restrict
Executive from engaging in any Restricted Activities which Employer directs
Executive to undertake or which Employer otherwise expressly authorizes. The
foregoing shall not restrict Executive from owning less than 5% of the
outstanding capital stock of any company which engages in Restricted Activities,
provided that Executive is not otherwise involved with such company as an
officer, director, agent, employee or consultant
7.2 Scope and Breach of Non-Competition. Subject to Executive's
continuing compliance with the provisions of Section 7.1, Executive may be a
principal, owner, officer, director, agent, consultant or partner, of any
corporation, partnership or other entity. The foregoing provisions of Section
7.1 shall not be held invalid because of the scope of the territory covered, the
actions restricted thereby, or the period of time such covenant is operative. In
the event of a breach or threatened breach by the Executive of Section 7.1,
Employer shall be entitled to a temporary restraining order and an injunction
restraining Executive from the commission of such breach. Nothing herein shall
be construed as prohibiting Employer from pursuing any other remedies available
to it for such breach or threatened breach, including the recovery of money
damages.
7.3 Non-solicitation. During the term of this Agreement and for a two
(2) year period following the Termination Date, Executive shall not, directly or
indirectly, without the written
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consent of Employer: (i) recruit or solicit for employment any employee of
Employer or FII or encourage any such employee to leave their employment with
Employer or FII, or (ii) solicit, induce or influence any customer, supplier,
lessor or any other person or entity which has a business relationship with
Employer or FII to discontinue or reduce the extent of such relationship with
Employer or FII.
7.4 In the event that the Executive breaches any of the provisions of
paragraphs 7.1,7.2, or 7.3, the cash payments provided for by subparagraphs
4.3.8 or 4.4.2 shall cease immediately. Executive shall have no further
entitlement to receive cash payments pursuant to subparagraphs 4.3.8 or 4.4.2
and Employer shall have no further liability for such payments after the date of
Executive's breach.
7.5 The Executive and the Employer believe that the restrictions and
covenants in this section are reasonable and enforceable under the
circumstances. However, if any one or more of the provisions in this section
shall, for any, reason be held to be excessively broad as to time, duration,
geographic scope, activity, or subject, it shall be construed by limiting and
reducing it so as to be enforceable to the extent compatible with law and with
the Executive's and the Employer's intentions as stated herein.
7.6 Survival of Obligations. The obligations of Executive and Employer
under this Section 7 shall survive the termination of Executive's employment and
the expiration or termination of this Agreement.
8. Miscellaneous.
8.1 Remedies. Each of the parties hereto shall have all rights and
remedies set forth in this Agreement. All remedies hereunder are cumulative and
are not exclusive of any other remedies provided by law or any other agreement
or contract to which such person is a party. Each party shall be entitled to
enforce such rights specifically (without the requirement of posting a bond or
other security), to recover damages by reason of any breach of any provision of
this Agreement and to exercise all other rights granted by law. Without limiting
the generality of the foregoing, Executive specifically agrees that any breach
or threatened breach of Sections 5, 6 or 7 would cause irreparable injury to
Employer, that money damages would not provide an adequate remedy to Employer,
and that Employer shall accordingly have the right and remedy (i) to obtain an
injunction prohibiting Executive from violating or threatening to violate such
provisions, (ii) to have such provisions specifically enforced by any court of
competent jurisdiction, and (iii) to require Executive to account for and pay
over to Employer all compensation, profits, monies, accruals, increments or
other benefits derived or received by Executive as the result of any
transactions constituting a breach of such provisions.
8.2 Entire Agreement; Amendments and Waivers. This Agreement (including
the schedule hereto) represents the entire understanding and agreement between
the parties hereto with respect to the subject matter hereof and can be amended,
supplemented or changed, and any provision hereof can be waived, only by a
written instrument making specific reference to this Agreement signed by the
party against whom enforcement of any such amendment, supplement, modification
or waiver is sought. The waiver by any party hereto of a breach of any provision
of this Agreement shall not operate or be construed as a further or continuing
waiver of such breach
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or as a waiver of any other or subsequent breach. No failure on the part of any
party to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of such right, power or remedy by such party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
8.3 Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without reference to its
principles of conflicts of law.
8.4 Notices. All notices, demands, solicitations of consent or
approval, and other communications hereunder shall be in writing and shall be
delivered personally, mailed, sent by telefax or sent by recognized commercial
courier (e.g., Federal Express). If delivered personally, such notice shall be
deemed to be given when delivered to the intended recipient. If delivered by
mail, such notice shall be deemed to be given five (5) days after having been
deposited in the United States mail so addressed, with postage thereon prepaid.
If delivered by telefax, such notice shall be deemed given when transmission of
the notice is complete to the telefax number of the other party. If delivered by
recognized commercial carrier, such notice shall be deemed given one (1) day
after having been delivered to a recognized commercial carrier for overnight
delivery. All such notices shall be addressed to the address set forth in the
preamble to this Agreement or to such other address which such party shall have
given to the other party for such purpose by notice hereunder.
8.5 Captions. The headings used in this Agreement are intended for
reference purposes only and shall not control or affect in any manner the
meaning or interpretation of any of the provisions of is Agreement.
8.6 Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of the
remaining provisions of this Agreement, and this Agreement shall be construed in
all respects as if such invalid or unenforceable provision were omitted. All
provisions of this Agreement shall be enforced to the full extent permitted by
law.
8.7 Interpretation. The parties acknowledge and agree that: (i) each
party and its counsel reviewed and negotiated the terms and provisions of this
Agreement and have contributed to its revision; (ii) the rule of construction to
the effect that any ambiguities are resolved against the drafting party shall
not be employed in the interpretation of this Agreement; and (iii) the terms and
provisions of this Agreement shall be construed fairly as to all parties hereto,
regardless of which party was generally responsible for the preparation of this
Agreement.
8.8 Counterparts. This Agreement may be executed in any number of
copies, each of which shall be deemed an original, and all of which together
will be deemed one and the same instrument.
8.9 Successors and Assigns. All covenants and agreements contained in
this Agreement by or on behalf of any of the parties hereto shall bind, and
inure to the benefit of the respective successors and permitted assigns of the
parties hereto whether so expressed or not.
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Neither party shall transfer or assign this Agreement or any of their rights or
obligations hereunder, whether by operation of law or otherwise, without the
prior written consent of the other party hereto. Any attempted transfer or
assignment of this Agreement or any rights or obligations hereunder in violation
of this provision shall be void ab initio.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.
FINANCIAL INSTITUTIONS, INC.
By: /s/Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Chairman Compensation Committee
Financial Institutions, Inc.
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
President & CEO
