Exhibit 10(as)
EMPLOYMENT AND SEVERANCE AGREEMENT
This EMPLOYMENT AND SEVERANCE AGREEMENT is made and entered into as
of the 23rd day of September, 1987, by and between CITIZENS BANCORP, a Maryland
corporation having its principal place of business in Riverdale, Maryland (the
"Corporation"), CITIZENS BANK & TRUST COMPANY OF MARYLAND, a bank organized
under the laws of the State of Maryland and having its principal place of
business in Riverdale, Maryland (the "Bank") (the Corporation and the Bank are
hereinafter sometimes collectively called "Employer"), and XXXXXXX X. XXXXXXXX,
who resides in Baltimore County, Maryland ("Executive").
WITNESSETH:
WHEREAS, the Corporation and the Bank, a wholly-owned subsidiary of
the Corporation, wish to employ the Executive, effective as of October 26, 1987,
as the Bank's President and Chief Operating Officer; and
WHEREAS, in today's business climate of takeovers and acquisitions,
the Executive may be concerned about the continuation of his employment and his
status and responsibilities in the event of a change in the ownership of either
the Corporation or the Bank, and the Employer is concerned that the Executive
may be approached by others with employment opportunities; and
WHEREAS, the Employer desires to ensure that, in the event a change
in the ownership of either the Corporation or the Bank appears possible, the
Executive will be in a secure position from which he can objectively engage in
any potential deliberations or negotiations respecting such change in ownership
without fear of any direct or implied threat to his future;
WHEREAS, the Executive is willing to leave his present employment
and become employed by the Employer, provided that the Employer agrees to and
carries out the understandings hereinafter set forth; and
WHEREAS, the Executive desires to have the foregoing assurances.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants and conditions set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. TERM. (a) The initial term of this Agreement and the Executive's
employment hereunder shall commence on October 26, 1987 and shall continue until
December 31, 1990. This Agreement and the Executive's employment hereunder shall
be deemed to be renewed automatically without the necessity of notice by either
party, on the same terms and conditions contained herein, for additional
consecutive terms of three (3) years each as of January 1, 1991 and as of the
end of each renewal term thereafter. All references herein to "the term of this
Agreement" refer to the original term and all renewals thereof.
(b) Notwithstanding the foregoing, the
Executive's employment under this Agreement is subject to termination, pursuant
to Section 12 of this Agreement, prior to the expiration of the term of this
Agreement. In. the event of such termination, applicable provisions of this
Agreement shall remain in full force and effect until both parties have
fulfilled or discharged all of their obligations under this Agreement.
2. DUTIES. (a) The Executive is hereby employed as the President and
Chief Operating Officer of the Bank. The Executive shall perform the duties of
those positions, and is hereby given the broad authority to manage and run the
day-to-day operations of the Bank. The Executive shall have direct
responsibility and authority for the general supervision, management and control
of the activities, affairs and property of the Bank (and its subsidiaries),
including by way of illustration and not limitation, personnel (including
hiring, firing, promotions, and compensation), lending, credit authorization,
asset/liability management, strategic planning, financial management, pricing
and budgeting, subject to the oversight of the Board of Directors of the Bank.
Any activities, subsidiaries or personnel within the Corporation (and its
subsidiaries) shall also be subject to the control, supervision, and authority
of the Executive, it being the understanding of the parties that at all times
during the term of the Executive's employment under this Agreement, the
Executive shall be the highest ranking full-time employee of both the
Corporation and the Bank reporting to the Chairmen of their Boards.
(b) During the term of the Executive's
employment under this Agreement, the Executive shall devote substantially all
of his time, services, skills and abilities to his employment hereunder, except
during periods of vacation, illness or disability. Notwithstanding the
foregoing, the Executive shall be permitted to devote such time and energy as he
deems appropriate to: (i) the prompt winding-up of all active business pursuits
in which he is engaged as of the date of this Agreement; (ii) passive
investments, including, but not limited to, real estate and stock investments;
(iii) reasonable and customary commitments to community or civic affairs; and
(iv) membership on boards of directors of other corporations; provided that none
of the foregoing activities materially interferes with Executive's duties
hereunder or materially conflicts with the interests of the Employer.
(c) During the term of this Agreement, the
Board of Directors of the Corporation and the Bank, respectively, shall
re-elect the Executive to the offices of President and Chief Operating Officer
of the Bank.
3. COMPENSATION. (a) During the period from October 26, 1987 through
December 31, 1988, the Executive shall receive a salary from the Employer at the
annual rate of Two Hundred Fifty Thousand Dollars ($250,000), payable in equal
biweekly installments. This annual salary shall be reviewed annually by the
Board of Directors of the Corporation or the Bank, as the case may be, and shall
be increased as of January 1 of each year, beginning on January 1, 1989, which
increase shall in no event be less than five percent (5%) per year above the
prior year's salary.
(b) For each calendar year subsequent to
1987, the Executive shall be eligible to receive a cash bonus from the Employer
of up to 40% of the Executive's salary during such calendar year based upon the
Executive's success in achieving various performance standards and/or objectives
agreed upon by the Employer and the Executive prior to the beginning of such
calendar year. Notwithstanding the above, for the period from January 1, 1988
through December 31, 1988, the Executive shall be paid a minimum bonus of
$50,000 by the Employer. The Employer and the Executive agree to act in good
faith and in a reasonable manner in implementing this bonus system and in
agreeing upon performance standards and objectives. The Employer may determine,
in its discretion, to pay the Executive a greater bonus than otherwise due under
this Section 3(b). All bonuses payable under this Section 3(b) shall be paid
within 60 days after the end of the calendar year in question.
4. HEALTH, DISABILITY AND LIFE INSURANCE BENEFITS. So
long as Executive is employed by the Employer, and thereafter to the extent
provided in Section 12, the Employer shall provide the Executive, at the
Employer's expense, with the following health, disability and life insurance
benefits:
(a) comprehensive major medical, health and
dental insurance and term life insurance covering Executive and his immediate
family on the same terms and conditions as provided to other employees of the
Corporation and Bank from time to time, with full coverage commencing as of
October 26, 1987 notwithstanding any otherwise applicable waiting periods or
other conditions precedent to coverage;
(b) short and long-term disability insurance
under a policy and with an insurer reasonably acceptable to the Executive,
providing monthly benefits of not less than $15,000 per month commencing
immediately upon the Executive's disability and continuing for Executive's life
provided that Employer may, in its discretion, self-insure such benefits for up
to the first six (6) months of any disability; and
(c) guaranteed renewable term life insurance
under a policy and with an insurer reasonably acceptable to the Executive, the
beneficiary of which shall be designated by the Executive, and in a face amount
not less than the greater of: (i) three times his annual salary as in effect
from time to time; or (ii) $900,000. Such term life insurance policy shall be
assigned to Executive, at his request, upon the termination of Employer's
obligation to maintain such insurance policy.
5. RETIREMENT BENEFITS; RIGHT TO RETIRE. (a) The
Executive shall be entitled to participate in the Employer's retirement and
pension plans, in accordance with their respective terms as in effect from
time to time.
(b) In addition to the benefits provided
under Section 5(a) above, the Employer shall provide the Executive with
monthly guaranteed supplemental retirement benefits determined and payable as
follows:
(i) The amount of the
monthly supplemental retirement benefit (the "Supplemental
Retirement Benefit") shall be equal to the amount set forth in
Section 5(c) (the "Monthly Amount") opposite the age of the
Executive as of the Payment Initiation Date (as defined in Section
5(d)) (or, if the Executive is not living as of the Payment
Initiation Date, the age he would have been as of the Payment
Initiation Date), multiplied by the Vested Percentage (as defined in
Section 5(e)). Once the payment of the Supplemental Retirement
Benefits commences, the amount of the monthly Supplemental
Retirement Benefit shall be fixed for the entire term of such
payments.
(ii) Payment of the Supplemental
Retirement Benefits shall be made in cash in equal monthly
installments by the Employer commencing on the Payment Initiation
Date and continuing on the first day of each month thereafter until
the later of: (A) the Executive's death; or (B) until the Executive
or his Designated Beneficiary shall have received the number of
monthly guaranteed payments set forth below based upon the
Executive's age as of the Payment Initiation Date:
Executive's Age as of Number of Guaranteed
Payment Initiation Date Monthly Payments
----------------------- --------------------
55 - 59 years 216
60 - 64 years 180
65 years or older 120
For example, if the Executive elects to begin receiving the Supplemental
Retirement Benefits when he is 58 years of age, he or his Designated Beneficiary
shall receive no less than 216 guaranteed monthly payments.
(c) The Monthly Amounts are as follows:
Age of Executive as of
Payment Initiation Date Monthly Amount
55 $12,500
56 14,167
57 15,833
58 17,500
59 19,167
60 20,833
61 23,333
Age of Executive as of
Payment Initiation Date Monthly Amount
62 25,833
63 28,333
64 30,833
65 or older 33,333
(d) The "Payment Initiation Date" means the
date on which payment of the Supplemental Retirement Benefits is to commence,
as specified by written notice which the Executive or his Designated Beneficiary
gives to the Employer. Such notice may be given at any time before or after the
Executive's termination of employment, but at least 30 days prior to the Payment
Initiation Date specified in the notice.
For example, if the Executive were to retire from the Employer at
age 52 and he delivers a notice designating a Payment Initiation Date which is
at a time when the Executive would be 60 years old, the monthly guaranteed
Supplemental Retirement Benefit would be $20,833, multiplied by the Vested
Percentage.
(e) The "Vested Percentage" shall mean a
percentage equal to 0.5%, multiplied by the number of months (a partial month
to be rounded up or down to the nearest whole month) during which the Executive
has been in the employ of either the Corporation or the Bank as of the date of
termination of employment of the Executive, subject to Sections 12(a)(ii)(C) and
12(a)(iii)(C). However, in the event the Executive is in the employ of either
the Corporation or the Bank at the age of 55, the Vested Percentage
automatically shall be 100%. The vesting of the Executive shall continue to be
effective, and the Executive shall be entitled to the vested Supplemental
Retirement Benefits provided in this Section 5, notwithstanding the termination
of his employment for any reason whatsoever.
For example, if the employment of the Executive were to terminate at
a time when he had been employed for 120 months, the Vested Percentage would be
60%. Such Vested Percentage would be applicable regardless of when the payment
of the Supplemental Retirement Benefits commences. Thus, if the Payment
Initiation Date occurred when the Executive is (or would have been if living) 60
years old, the monthly benefit would be $12,500 per month ($20,833 x 60%).
(f) In the event payment of the
Supplemental Retirement Benefits is to be made subsequent to the Executive's
death in accordance with Section 5(b)(ii)(B), such payments shall be made to
those person or persons designated by the Executive pursuant to written notice
given by the Executive to Employer (the "Designated Beneficiary"). If the
Executive fails to designate any Designated Beneficiary prior to his death, or
his Designated Beneficiary predeceases him, payments shall be made to the
Executive's estate. In the event the Executive's Designated Beneficiary survives
the Executive, but dies prior to payment in full of the guaranteed amounts due
under Section 5(b)(ii)(B), such payments otherwise due to the Executive's
deceased Designated Beneficiary shall be made to those persons designated by
that Designated Beneficiary by delivery of written notice to the Employer. If
such deceased Designated Beneficiary fails to so designate a Designated
Beneficiary or his Designated Beneficiary predeceases him, payment of the
amounts due shall be made to the deceased Designated Beneficiary's estate.
(g) In the event of the Executive's death
prior to the termination of his employment with the Employer, no Supplemental
Retirement Benefits shall be paid subsequent to his death. In the event of the
Executive's death subsequent to the termination of his employment, whether
before or after the commencement of the payment of the Supplemental Retirement
Benefits, his Designated Beneficiary shall be entitled to receive the
Supplemental Retirement Benefits for the remaining number of guaranteed months
specified in Section 5(b)(ii)(B).
(h) For the purposes of the Supplemental
Retirement Benefits payable pursuant to Section 5(b), the Executive's age as of
a given date shall be deemed to be his age as of his closest birthday.
6. VACATIONS. The Executive shall be entitled to 4 weeks'
vacation with pay during each calendar year (or portion thereof) of this
Agreement.
7. PERQUISITES. So long as the Executive is employed by Employer,
and thereafter to the extent provided in Section 12, he shall receive the
following additional perquisites and fringe benefits: an automobile selected by
him (with a cost not to exceed the approximate cost of a luxury American-made
car, such as a Cadillac Seville) and replaced every three years or 60,000 miles
(whichever is sooner), together with all associated expenses, including
insurance, maintenance and gasoline; the initial fee and annual dues for a
country club selected by the Executive; and any other perquisites and benefits
customarily provided to employees of the Employer from time to time. The cost of
all such perquisites and benefits shall be paid solely by the Employer.
8. STOCK OPTIONS. (a) So long as the Executive is employed
by the Employer, and thereafter to the extent provided in Section 12, the
Executive shall be entitled to participate in any stock option plan which the
Employer may adopt.
(b) As of the date of initial employment with
the Employer under this Agreement, the Executive shall receive, pursuant to the
Corporation's existing stock option plan, an option to purchase 5,000 shares of
the Corporation's Common Stock at a price equal to the fair market value for
such shares on such date of initial employment. This option shall vest and be
exercisable immediately. The number of shares covered by this option shall be
subject to appropriate adjustment to reflect any stock splits, stock
combinations, stock dividends, recapitalizations, and other similar changes in
the capitalization of the Employer subsequent to the execution and delivery of
this Agreement.
9. BUSINESS EXPENSES AND OTHER PERQUISITES. The Employer shall, so
long as the Executive is employed by the Employer, reimburse Executive for all
reasonable and proper expenses incurred by him in the furtherance of the
business of the Employer in accordance with its standard practices and
procedures for top executive officers. In addition, the Employer shall, so long
as the Executive is employed by the Employer, continue to furnish the Executive
an office and suitable office fixtures, telephone service, and secretarial
assistance, all of which shall be appropriate to his position and status.
10. OTHER BENEFITS. (a) If, while the Executive is employed by the
Employer or, to the extent provided in Section 12, after the termination of his
employment with the Employer, the Employer establishes or provides benefits for
its top executive officers in addition to those described herein, the Executive
also shall be entitled to receive such additional benefits on the same terms and
conditions as other top executive officers.
(b) The Employer and the Executive acknowledge
and agree that stock option programs and other incentive plans are crucial to
the successful recruitment and retention of key management personnel of the
Employer Accordingly, the Employer agrees to use its best efforts to establish
and implement, and, if the approval of the Corporation's stockholders is
required, to recommend to its stockholders the adoption of, with the advice of
the Executive and other officers of the Employer: (i) a stock option program
under which key executives (including the Executive) are awarded options to
purchase stock of the Corporation on an annual basis, and (ii) an incentive
program under which key executives are eligible to receive annual cash bonuses
based upon their success in achieving performance standards. These programs
shall be reasonably comparable to those offered by similar banking corporations
in the financial services industry, and shall be implemented as soon as
reasonably practicable, but no later than December 31, 1988.
11. NON-COMPETITION. (a) The Executive agrees that,
during the one (1) year period following the expiration or termination of this
Agreement, he shall not directly solicit business from any customer or client of
the Employer.
(b) The Executive shall be relieved of the
restrictions under Section 11(a) in the event that: (i) the Employer terminates
the Executive's employment under this Agreement other than for Strict Cause (as
defined in Section 12(i)); or (ii) the Executive terminates his employment under
this Agreement for Good Reason (as defined in Section 12(i)).
12. TERMINATION; WHEN COMPENSATION AND BENEFITS PAYABLE.
(a) The Executive may terminate his
employment under this Agreement at any time by delivering a Notice of
Termination to Employer at least 90 days prior to the effective date of such
termination.
(i) In the event such termination
occurs for other than Good Reason, the Executive shall be entitled
to no further compensation or benefits under this Agreement upon his
termination, except for:
(A) those benefits
which, by their terms, such as the benefits payable
pursuant to Section 5, extend beyond or become payable
after the termination of Executive's employment under
this Agreement; and
(B) immediate payment
of salary, bonuses, and any other amounts earned,
but unpaid, as of the date of termination.
(ii) In the event such termination
occurs for Good Reason prior to a Change of Control (and not in
anticipation of a Change of Control), the Executive shall be
entitled to:
(A) payments during
the Severance Period equal in amount to his salary it
the same annual rate as in effect as of the date of
termination, and payable in biweekly installments at the
same time as such salary would have been paid;
(B) continuation of
all benefits and perquisites provided under Sections
4, 5(a), and 8 (but only to the extent that options have
theretofore been granted to the Executive) of this
Agreement during the Severance Period;
(C) payment of
benefits pursuant to Section 5(b), without change or
diminution. For the purposes of determining the Vested
Percentage, the Executive shall be deemed to be in the
employ of the Employer during the Severance Period;
(D) maintenance and
payment of any other benefits which, by their terms,
extend beyond or become payable after the termination of
the Executive's employment under this Agreement; and
(E) immediate payment
of salary, bonuses, and any other amounts earned,
but unpaid, as of the date of termination.
(iii) In the event such termination
occurs for Good Reason after or in anticipation of a Change in
Control, the Executive shall be entitled to:
(A) payment of: (1)
liquidated damages consisting of a lump sum cash
payment in an amount equal to 2.99 times the average
annual salary and bonus which was paid by the Employer
to the Executive and includible in the Executive's gross
income during the five (5) most recent taxable years
ending before the Change of Control (or such portion of
such period during which the Executive performed
services for the Employer); or (2) at the Executive's
election, a series of payments with an aggregate present
value equal to the amount of such lump sum cash payment,
as determined pursuant to Section 28OG of the Internal
Revenue Code of 1986, as amended from time to time, or
any successor thereto of similar import, and any
regulations promulgated thereunder (the "Code"). Such
lump sum payment or the first installment of the series
of payments, as the case may be, shall be paid by the
Employer within 90 days after the Notice of Termination;
(B) continuation of
all benefits and perquisites provided under Sections
4, 5(a), and 8 (but only to the extent that options have
theretofore been granted to Executive) of this Agreement
during the Severance Period;
(C) payment of
benefits pursuant to Section 5(b), without change or
diminution. For purposes of determining the Vested
Percentage, Executive shall be deemed to be in the
employ of Employer during the Severance Period;
(D) maintenance and
payment of any other benefits which, by their terms,
extend beyond or become payable after the termination of
the Executive's employment under this Agreement; and
(E) immediate payment
of salary, bonuses, and any other amounts earned,
but unpaid, as of the date of termination.
For purposes of determining the Executive's average
annual salary and bonus under Section 12(a)(iii)(A), any
salary and bonus paid to the Executive for less than an
entire taxable year shall be annualized.
(b) The Employer may terminate the Executive's
employment under this Agreement for any reason (including, but not limited to,
the Executive's death) by delivery of a Notice of Termination to the Executive
at least 90 days prior to the effective date of such termination.
(i) If such termination is for
Strict Cause, the Executive shall be entitled to payments and
benefits in the same amounts and on the same terms as set forth in
Section 12(a)(i).
(ii) Except as provided by Section
12(b)(iii) below, if such termination is for any reason other than
termination for Strict Cause or due to the Executive's death or
Disability, the Executive shall be entitled to payments and benefits
in the same amounts and on the same terms as set forth in Section
12(a)(ii).
(iii) If the Employer terminates
the Executive's employment for other than Strict Cause or due to
the Executive's death or Disability, either in anticipation of a
Change of Control or at any time within three (3) years after a
Change in Control, Executive shall be entitled to liquidated damages
and benefits in the same amounts and on the same terms as set forth
in Section 12(a)(iii).
(iv) If Executive's employment is
terminated by reason of the Executive's death, the Employer:
(A) shall maintain
and pay to the Executive's estate all benefits which
by their terms, such as the benefits payable pursuant to
Section 5(a), extend beyond or become payable after the
termination of the Executive's employment under this
Agreement;
(B) shall immediately
pay to the Executive's estate all salary, bonuses,
and any other amounts earned, but unpaid, as of the date
of Executive's death; and
(C) shall maintain
medical, health and dental insurance covering the
Executive's immediate family, more particularly
described in Section 4(a), for a period of one year
following the termination of the Executive's employment
under this Agreement.
(v) If the Employer terminates
the Executive's employment due to the Executive's Disability, the
Executive shall be entitled to:
(A) payments and
benefits in the same amounts and on the same terms as
set forth in Section 12(a)(i); and
(B) continuation of
the term life insurance policy, more particularly
described in Section 4(c) of this Agreement, at the
Employer's expense, for a period of one year following
the termination of Executive's employment under this
Agreement.
(c) The parties acknowledge that the
payments and benefits provided to the Executive pursuant to Section 12(a) or
Section 12(b), including but not limited to the payments under Sections
12(a)(iii)(A) and 12(b)(iii), are paid in consideration for the Executive's
services to the Employer prior to the Change of Control or termination of his
employment, as the case may be, the restrictions imposed on the Executive under
Section 11 and the constraints imposed upon the Executive's subsequent
employment by other employers pursuant to Section 12(f).
(d) For the purposes of Sections 12(a) and
12(b), termination of the Executive's employment by Employer shall be deemed to
be "in anticipation of a Change of Control" if a Change of Control occurs within
sixty (60) days subsequent to the date of termination of the Executive's
employment or if other facts and circumstances support such a finding.
(e) For the purposes of Section 12(a)
and 12(b), the determination of any benefit or perquisite provided under
Sections 4, 5, or 8 subsequent to the termination of the Executive's employment
shall be based upon the following premises, but only to the extent relevant to
such determination:
(i) reference shall be made to
the Executive's annual salary in effect as of the date of
termination of his employment and the bonus last paid to, or
earned by, the Executive; and
(ii) the Executive shall be
deemed to be in the employ of the Employer during the Severance
Period.
(f) In the event the Executive's employment
is terminated, whether before or following a Change of Control, the Executive
shall have no obligation to seek other employment in order to mitigate his
damages hereunder if any. However, in the event the Executive obtains full-time
employment with a financial institution engaging in the business of providing
banking services ("Other Employment"), payments due to the Executive pursuant to
Section 12(a) and Section 12(b) shall be subject to adjustments as follows:
(i) In the case of termination of
the Executive's employment pursuant to Section 12(a)(ii) or Section
12(b)(ii):
(A) The following
adjustment shall be made within 7 days of the end of
each calendar month during the Severance Period:
(1) If the
salary actually paid in cash to the
Executive from Other Employment during such
month (the "Current Monthly Salary") exceeds
70% of the amounts actually paid in cash to
the Executive by the Employer pursuant to
Section 12(a)(ii)(A) during such month (the
"Monthly Salary Equivalent"), the Executive
shall refund to the Employer an amount equal
to the lesser of: (i) the Current Monthly
Salary; or (ii) the Monthly Salary
Equivalent.
(2) If the
Current Monthly Salary does not exceed 70%
of the Monthly Salary Equivalent, no refund
shall be due from Executive.
(B) The following
further adjustment shall be made within 30 days of the
end of each consecutive twelve month period during the
Severance Period:
(1) If the
salary and bonuses actually paid in cash
to the Executive from Other Employment
during such twelve month period (the
"Current Annual Compensation") exceeds 70%
of the salary and bonuses actually paid in
cash to the Executive by the Employer during
the twelve month period immediately
preceding the termination of his employment
with the Employer (the "Prior Annual
Compensation"), the Executive shall refund
to the Employer the amount by which: (i) the
aggregate amount of Monthly Salary
Equivalents actually paid in cash to the
Executive by the Employer during such twelve
month period, less the aggregate amount
refunded by the Executive to the Employer
with respect to such period; exceeds (ii)
the aggregate amount of Monthly Salary
Equivalents which the Employer was required
to pay to the Executive during such twelve
month period (without reduction under
Section 12(f)(i)(A)) reduced (but not below
zero) by the Current Annual Compensation.
(2) If the
Current Annual Compensation does not exceed
70% of the Prior Annual Compensation, the
Employer shall pay to the Executive an
amount equal to the amounts refunded by the
Executive to the Employer pursuant to
Section 12(f)(i)(A).
(ii) In the case of termination
pursuant to Section 12(a)(iii) or Section 12(b)(iii), payments by
Employer of amounts described in Section 12(a)(iii)(A) ("Liquidated
Damages") shall be subject to the following adjustments, within 30
days of the end of each consecutive twelve month period during the
36 month period commencing as of the first date on which Liquidated
Damages are payable by the Employer pursuant to Section
12(a)(iii)(A) (the "Mitigation Period"):
(A) If the Current
Annual Compensation for such twelve month period
exceeds 70% of the Prior Annual Compensation, and the
Executive has elected to receive Liquidated Damages in
lump sum or in installments over a period of 36 months
or less, the Executive shall refund to the Employer an
amount equal to the lesser of: (i) the Current Annual
Compensation; or (ii) an amount equal to one-third of
the amount of the Liquidated Damages which would have
been payable to the Executive by the Employer had he
elected to receive payment of the Liquidated Damages in
a lump sum (the "Deemed Payment"). In no event, however,
shall the Executive be required to refund to the
Employer, pursuant to this Section 12(f)(ii)(A), any
amount, which, together with amounts previously refunded
by the Executive pursuant to this Section 12(f)(ii)(A),
exceeds the aggregate amount of Liquidated Damages
actually paid to the Executive by the Employer as of the
end of such twelve month period.
(B) If the Current
Annual Compensation for such twelve month period
exceeds 70% of the Prior Annual Compensation, and the
Executive has elected to receive payment of Liquidated
Damages in installments over a period of more than 36
months, the Executive shall be obliged to refund to the
Employer an amount (the "Annual Refund") equal to the
lesser of: (i) the Current Annual Compensation; or (ii)
the Deemed Payment. However, the amount of the Annual
Refund to be paid by the Executive within 30 days of the
end of such twelve month period, pursuant to this
Section 12(f)(ii)(B), shall not exceed the amount of
Liquidated Damages actually paid to the Executive by the
Employer during such period (the "Actual Annual
Damages"). The portion of the Annual Refund which is
required to be paid pursuant to this Section
12(f)(ii)(B) in excess of Actual Annual Damages for a
given twelve month period (the "Carryover") shall be
carried forward and aggregated with the Carryovers, if
any, accrued with respect to other twelve month periods
during the Mitigation Period. Each installment of
Liquidated Damages payable to the Executive after the
Mitigation Period shall be reduced (but not below zero)
by an amount equal to the aggregate amount of the
Carryovers divided by the number of installments of
Liquidated Damages remaining to be paid as of the end of
the Mitigation Period.
(C) If the Current
Annual Compensation for such twelve month period does
not exceed 70% of the Prior Annual Compensation, no
refund shall be due from the Executive for such period.
(iii) The Employer shall have no
obligation to provide the Executive with any of the benefits
described in Section 4 hereof to the extent that Executive receives
equal or superior to benefits from Other Employment.
(g) The Employer's obligation to make the
payments and the arrangements provided in Sections 12(a) and 12(b) of this
Agreement shall be absolute and unconditional and shall not be affected by any
circumstance, including without limitation any offset, counterclaim, recoupment,
defense or other right which the Employer may have against the Executive or
anyone else. All amounts payable by the Employer hereunder shall be paid without
notice or demand.
(h) The parties acknowledge that, in the case
of termination of the Executive's employment under this Agreement, assessment of
the damages to the Executive would be impracticable. Accordingly, the parties
agree that this Section 12 sets forth the entire understanding as to the
parties' respective rights and obligations in the event of the termination of
the Executive's employment under this Agreement, and that neither party shall
have any further legal recourse against the other party other than to enforce
the provisions of this Section 12.
(i) As used herein, the following words and
phrases shall have the meanings set forth below:
(i) "Change in Control." A
"Change in Control" shall mean the occurrence of the following
event with respect to either the Corporation or the Bank: a change
of a nature that would be required to be reported, by persons or
entities subject to the reporting requirements of Section 13(d) of
the Securities and Exchange Act of 1934 (hereinafter called the
"Exchange Act"), in Schedule 13D of Regulation 13D-G, or any
successor provisions thereto, promulgated under the Exchange Act;
provided that a Change in Control shall be deemed to have occurred
only if any "person" (as that term is used in Section 13(d) and
14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rule 13d-3 issued under the Exchange Act), directly or
indirectly, of securities of the Corporation or the Bank
representing twenty-five percent (25%) or more of the combined
voting power of the Corporation's or the Bank's then outstanding
securities.
(ii) "Disability." "Disability"
shall mean that the Executive shall be ill, incapacitated or
disabled, physically or mentally, for a continuous, uninterrupted
period of no less than 365 days, to such an extent so as to prevent
the Executive, in the opinion of a physician chosen by the Executive
and reasonably acceptable to the Employer, from substantially
performing all of his duties under this Agreement.
(iii) "Good Reason." "Good Reason"
shall mean the occurrence of any of the following, in the
reasonable judgment of Executive: (A) without the Executive's
express prior written consent, the assignment to the Executive of
any duties materially inconsistent with his position, duties,
responsibilities and status with the Employer, a change in his
responsibilities, or the appointment of a higher ranking full-time
employee; (B) the removal of the Executive from or the failure to
re-elect the Executive to any one or all of the positions described
in Section 2(a) hereof, except in connection with promotions to
higher office, the termination of the Executive's employment by
reason of his death, or the termination of this Agreement by the
Employer for Strict Cause; (C) a failure by the Employer to provide
or timely pay to the Executive any of the perquisites, benefits or
compensation provided for in this Agreement; or (D) any material
breach or default by either the Corporation or the Bank in any of
its agreements, undertakings or covenants under this Agreement.
(iv) "Notice of Termination."
"Notice of Termination" shall mean a written notice indicating
the specific termination provision in this Agreement relied upon and
setting forth in reasonable detail the facts and circumstances
claimed to provide a basis for the termination.
(v) "Severance Period". "Severance
Period" shall mean the two year period commencing as of the date of
the termination of the Executive's employment under this Agreement.
(vi) "Strict Cause." "Strict
Cause" shall mean any of the following: (A) a conviction of the
Executive for a felony or for any lesser crime or offense than a
felony involving the property of the Employer or of one of its
subsidiaries; or (B) gross neglect of his duties hereunder, gross
dereliction of duty or other willful misconduct by the Executive and
failure to cure such situation within thirty (30) days after receipt
of notice thereof from the Board of Directors of the Corporation,
unless such situation cannot be completely cured within such 30 day
period, in which case, Strict Cause shall not be deemed to occur if
the Executive commences the cure of same within such 30 day period
and diligently continues to cure same.
13. SUCCESSORS; ASSIGNABILITY. (a) The Corporation and the Bank
shall require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business or
assets of the Corporation or the Bank, respectively, by written agreement in
form and substance satisfactory to the Executive, expressly to assume and agree
to perform this Agreement in the same manner and to the same extent as the
Corporation or the Bank would be required to perform if no such succession had
occurred. Failure of the Corporation or the Bank to obtain such agreement prior
to the effective date of any such succession shall be a breach of this Agreement
which shall entitle the Executive to terminate this Agreement on the same terms
and conditions and to obtain the same amounts and benefits as due in the case of
termination for Good Reason pursuant to Section 12(a)(iii).
(b) As used in this Agreement, "Corporation"
and "Bank" shall mean the Corporation and the Bank, respectively, as
hereinbefore defined and any successor to all or substantially all of its
business or assets which becomes bound by all of the terms and conditions of
this Agreement, whether by the terms hereof, by operation of law, or otherwise.
It is expressly understood and agreed that the obligations of the Employer under
this Agreement constitute the joint and several obligations of the Bank and the
Corporation, and the default or breach by either the Bank or the Corporation
hereunder shall constitute a default or breach by the other.
(c) This Agreement is personal in nature and
neither of the parties hereto shall assign or transfer this Agreement or any
rights or obligations hereunder, except by operation of law or pursuant to the
terms of this Section 13.
(d) The Corporation and the Bank each
acknowledge and represent and warrant to the Executive that: (i) the execution,
delivery, and performance of this Agreement have been duly authorized by their
respective Boards of Directors and any and all other required corporate action;
and (ii) upon execution and delivery, this Agreement constitutes the valid and
binding legal obligation of both the Bank and the Corporation, enforceable
against each of them in accordance with its terms.
14. ENFORCEABILITY. This Agreement shall inure to the benefit of
and be enforceable by the Executive's personal and legal representatives,
executors, administrators, assigns, heirs, distributees, devisees and legatees.
15. WITHHOLDING OF TAXES AND HEALTH INSURANCE PREMIUMS. The Employer
may withhold from any compensation or benefits payable under this Agreement all
federal, state and local taxes as shall be required to be withheld by law,
regulation or ruling, and that portion of the premium costs which the Executive
is required to bear under the Employer's health insurance plan in accordance
with the terms of such plan.
16. MODIFICATION, WAIVER AND DISCHARGE. No provision of this
Agreement may be modified, waived or discharged unless the modification, waiver
or discharge is agreed to in writing signed by the Executive and the Employer.
No waiver by either party hereto at any time or any breach by the other party
hereto of, or compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
17. NOTICES. All notices required or permitted under this Agreement
shall be in writing and shall be deemed delivered or given upon personal
delivery or upon mailing to the parties at their respective addresses, as set
forth below, or such other address as a party may designate by prior notice to
the other party:
If to the Employer:
Citizens Bancorp
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
If to the Executive:
Xxxxxxx X. Xxxxxxxx
00000 Xxxxxxx Xxxxxx Xxxx
Xxxx Xxx, Xxxxxxxx 00000
18. ENTIRE AGREEMENT. This is the entire agreement of the
parties; no agreements or representations, oral or otherwise, express or
implied, have been made with respect to the subject matter hereof by either
party which are not expressly set forth in this Agreement.
19. LAW GOVERNING. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of Maryland.
20. SEVERABILITY. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under seal as of the day and year first above written.
WITNESS:
__________________________________________ ____________________(SEAL)
XXXXXXX X. XXXXXXXX
ATTEST: CITIZENS BANCORP
__________________________________________ By: _________________(SEAL)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
CITIZENS BANK & TRUST
COMPANY OF MARYLAND
__________________________________________ By: _________________(SEAL)
Witness Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
AMENDMENT NO.1 TO EMPLOYMENT AND SEVERANCE AGREEMENT
This AMENDMENT NO. 1 TO EMPLOYMENT AND SEVERANCE AGREEMENT is made
and entered into as of the 18th day of October, 1989, by and between CITIZENS
BANCORP, a Maryland corporation having its principal place of business in
Laurel, Maryland (the "Corporation"), CITIZENS BANK OF MARYLAND, a bank
organized under the laws of the State of Maryland and having its principal place
of business in Laurel, Maryland (the "Bank") [the Corporation and the Bank are
hereinafter sometimes collectively called "Employer"], and XXXXXXX X. XXXXXXXX,
who resides in Baltimore County, Maryland ("Executive").
EXPLANATORY STATEMENT
A. Employer and Executive entered into an Employment
and Severance Agreement on September 23, 1987 (the "Employment Agreement").
B. In consideration of the Executive's agreement to
receive a smaller bonus than originally envisioned in the Employment
Agreement, the Employer and the Employee have agreed to certain other changes
to the Employment Agreement.
C. Employer and Executive therefore desire to amend
the Employment Agreement in the manner hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing Explanatory
Statement, which is incorporated herein, the mutual covenants and conditions set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree that the
Employment Agreement is hereby amended as follows:
1. Section 2(a) of the Employment Agreement is hereby
deleted and the following is inserted in lieu thereof:
"(a) The Executive is hereby employed as the President
and Chief Operating Officer of the Bank and the
Corporation, and is hereby given the broad authority and
responsibility to manage and direct the day-to-day
operations of the Bank, the Corporation, their
respective affiliates and subsidiaries, and any entity
which directly or indirectly controls the Corporation
(collectively, the "Entities"). The Executive shall have
direct responsibility and authority for the general
supervision, management and control of the activities,
affairs and property of each of the Entities, including
by way of illustration and not limitation, personnel
(including hiring, firing, promotions and compensation),
lending, credit authorization, asset/liability
management, strategic planning, financial management,
pricing and budgeting, subject to the oversight of the
Board of Directors of the particular Entity in question.
At all times during the term of the Executive's
employment under this Agreement, it is agreed that the
Executive shall be the highest ranking salaried and
full-time employee of the Bank, the Corporation and any
entity which directly or indirectly controls the
Corporation, reporting to the Chairmen of their
respective Boards."
2. Section 3(a) of the Employment Agreement sets forth the procedure
to determine the salary of the Executive. The parties hereto acknowledge that
the annual salary of the Executive for the calendar year 1989 is Three Hundred
Thousand Dollars ($300,000.00), and the annual salary of the Executive for the
calendar year 1990 shall be Three Hundred Eighty-four Thousand Dollars
($384,000.00).
3. Section 3(b) of the Employment Agreement is hereby amended by
deleting the first sentence thereof and inserting in lieu thereof:
"For the calendar year 1988, the Executive shall be
eligible to receive a cash bonus from the Employer of up
to 40% of the Executive's salary during such calendar
year, and for each calendar year subsequent to 1988, the
Executive shall be eligible to receive a cash bonus from
the Employer of up to 20% of the Executive's salary
during such calendar year. In all cases, the cash bonus
shall be based upon the Executive's success in achieving
various performance standards and/or objectives agreed
upon by the Employer and the Executive."
4. Section 4(c) of the Employment Agreement is hereby deleted
in its entirety and the following is inserted in lieu thereof:
"(c) guaranteed renewable term life insurance or whole
life insurance under a policy and with an insurer
reasonably acceptable to the Executive, the beneficiary
of which shall be designated by the Executive, and in a
face amount not less than the greater of (i) 2.6 times
his annual salary as in effect from time to time; or
(ii) One Million Dollars ($1,000,000.00). At the
election of the Executive, such life insurance policy
may be owned by the Executive or assigned to the
Executive at his request. If the Executive elects that a
whole life insurance policy shall be acquired, the
Executive shall pay to the Employer an amount equal to
the difference, if any, between the premium that would
have been paid had the policy been a term life insurance
policy, and the actual premium paid for the whole life
insurance policy."
(For informational purposes only, attached hereto is a schedule reflecting the
current premium for a $1,000,000 term life insurance policy on the life of the
Executive. The premiums are subject to change.)
5. Section 5(b)(ii) of the Employment Agreement is hereby deleted
in its entirety and the following is inserted in lieu thereof:
"(ii) Payment of the Supplemental Retirement Benefits
shall be made in cash in equal monthly installments by
the Employer commencing on the Payment Initiation Date
and continuing on the first day of each month thereafter
until the later of: (A) the Executive's death; (B) the
death of Xxxxxxx X. Xxxxxxxx, if she is the Designated
Beneficiary of the Executive; or (C) January 1, 2027."
6. Section 5(e) of the Employment Agreement is hereby amended by
deleting in the first sentence thereof the percentage "0.5%" and inserting
in lieu thereof the percentage "0.7%."
7. Section 5(g) of the Employment Agreement is hereby deleted
in its entirety and the following is inserted in lieu thereof:
"Whether or not the Executive dies prior to or
subsequent to the termination of his employment, his
Designated Beneficiary shall be entitled to receive the
Supplemental Retirement Benefits for the period
specified in Section 5(b)(ii)."
8. Section 7 of the Employment Agreement is hereby amended by
deleting in the first sentence thereof the phrase "(with a cost not to exceed
the approximate cost of a luxury American-made car, such as a Cadillac
Seville)", and inserting at the end of Section 7 the following:
"It is acknowledged that the automobile furnished to the
Executive may be occasionally driven by members of the
Executive's family or such other individuals to whom the
Executive grants permission. In the event the Executive
selects an automobile whose cost exceeds the approximate
cost of a fully equipped Cadillac Seville, the Executive
shall reimburse the Employer for an amount equal to the
difference between the lease value of the actual
automobile selected and the lease value of a Cadillac
Seville, which values shall be determined using the
Internal Revenue Service publication for leasing of
vehicles. Such reimbursement shall be made no less
frequently than quarterly over the period of use of the
automobile and, at the Executive's election, may be made
through payroll deductions from the Executive's salary."
9. Section 12(i)(i) of the Employment Agreement is hereby
amended by adding at the end thereof, after the words "Bank's then outstanding
securities" the following:
", or the sale by the Corporation of all or
substantially all of the capital stock of the Bank
owned by it, or the sale by the Bank of substantially
all of the assets of the Bank."
10. Section 17 of the Employment Agreement is hereby amended by
deleting the address shown therein for the Employer and inserting in lieu
thereof the following:
"14401 Xxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx, 00000."
11. All references in the Employment Agreement to "Citizens Bank
and Trust Company of Maryland" shall instead refer to "Citizens Bank of
Maryland."
12. The Employment Agreement, as amended hereby, is hereby
ratified and affirmed and shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed
this Amendment No. 1 to Employment and Severance Agreement under seal as of the
date and year first above written.
WITNESS:
_______________________________ ______________________________(SEAL)
XXXXXXX X. XXXXXXXX
WITNESS: CITIZENS BANCORP
_______________________________ By: ________________________(SEAL)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
CITIZENS BANK OF MARYLAND
_______________________________ By: ________________________(SEAL)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
XXXXXXXXXXX, XXXXXXXXXXXXX 00000
AUGUST 22, 1989
HYPOTHETICAL TERM ILLUSTRATION
PROPOSED INSURED: XXXXXXX XXXXXXXX AGE 45 MALE
PLAN: YEARLY RENEWABLE TERM POLICY NONSMOKER
AMOUNT OF INSURANCE: $1,000,000 ANNUAL PREMIUM: $4,280.00
DIVIDEND OPTION: PRECEDING YEAR'S DIVIDEND USED TO REDUCE CURRENT PREMIUM
DIVIDENDS ARE NOT GUARANTEED AND ARE SUBJECT TO SIGNIFICANT FLUCTUATIONS.
CHANGES IN DIVIDENDS WILL CHANGE ALL NON-GUARANTEED VALUES. SEE DIVIDENDS
FOOTNOTE FOR FURTHER INFORMATION.
TOTAL ANNUAL TOTAL
ANNUAL ANNUAL PRECEDING NET DEATH
POL PREMIUM PREMIUM YEAR'S PREMIUM BENEFIT
YR BEG YEAR BEG YEAR DIVIDEND BEG YEAR END YEAR
1 2 3 4 5
1 3,630 4,280 4,280 1,000,000
2 3,970 4,666 4,666 1,000,000
3 4,370 5,132 5,132 1,000,000
4 6,760 7,585 2,390 5,195 1,000,000
5 7,400 8,301 2,650 5,651 1,000,000
6 8,100 9,104 2,960 6,144 1,000,000
7 8,780 10,000 3,200 6,800 1,000,000
8 9,570 11,043 3,510 7,533 1,000,000
9 10,450 12,209 3,920 8,289 1,000,000
10 11,420 13,535 4,390 9,145 1,000,000
11 12,580 15,091 5,120 9,971 1,000,000
12 13,900 17,007 5,790 11,217 1,000,000
13 15,380 19,066 6,400 12,666 1,000,000
14 16,940 21,262 7,030 14,232 1,000,000
15 18,620 23,471 7,780 15,691 1,000,000
16 20,390 25,250 8,520 16,730 1,000,000
17 22,330 27,199 9,500 17,699 1,000,000
18 24,500 29,378 10,440 18,938 1,000,000
19 26,990 31,877 11,580 20,297 1,000,000
20 29,810 34,709 12,900 21,809 1,000,000
@60 18,620 23,471 7,780 15,691 1,000,000
@65 29,810 34,709 12,900 21,809 1,000,000
AMENDMENT NO. 2 TO EMPLOYMENT AND
SEVERANCE AGREEMENT
THIS AMENDMENT NO. 2 to EMPLOYMENT AND SEVERANCE AGREEMENT is entered into as of
the 15th day of December, 1993, between CITIZENS BANCORP, a Maryland corporation
(the "Corporation"), CITIZENS BANK OF MARYLAND, a Maryland state chartered bank
(the "Bank") [the Corporation and the Bank sometimes collectively the
"Employer"] and XXXXXXX X. XXXXXXXX, a resident of Baltimore County, Maryland
(the "Executive").
EXPLANATORY STATEMENT
A. The Employer and the Executive entered into an Employment and
Severance Agreement dated September 23, 1987 (the "Employment Agreement").
B. The terms of the Employment Agreement were amended by Amendment No.
1 to Employment and Severance Agreement dated October 18, 1989, and by
subsequent annual letter agreements.
C. The parties now desire to make certain other amendments to the
Employment Agreement.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants and conditions set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1 . Section 5(e) of the Employment Agreement is hereby amended by deleting in
the first sentence thereof (as amended) the percentage "0.7%" and inserting in
lieu thereof the percentage "1.1%".
2. Section 3 of the Employment Agreement is hereby amended to read as follows:
"(a) During the period from January 1, 1994 through
December 31, 1994, the Executive shall receive a salary from the
Employer at the annual rate of $472,500, payable in equal biweekly
installments. This salary shall be reviewed annually by the Board of
Directors of the Corporation or of the Bank, as the case may be, and
may be increased, but shall not be subject to decrease, as of
January 1 of each year, beginning on January 1, 1995.
(b) For the calendar year 1994, the Executive shall be
eligible to receive a cash bonus from the Employer of up to
$100,000, based upon the Executive's success in achieving various
performance standards and/or objectives agreed upon by the Employer
and the Executive prior to the beginning of such calendar year. For
calendar years beginning in 1995, the bonus for which the Executive
shall be eligible shall be reviewed annually by the Board of
Directors of the Corporation or the Bank, as the case may be, shall
be modified each year, and shall be increased no less than 5% above
the eligible bonus applicable to the prior year."
3. Section 4(a) is hereby amended to read as follows:
"(a) comprehensive major medical, health and dental
insurance covering Executive and his immediate family, such benefits
to be no less comprehensive, in the reasonable judgment of the
Executive, than those provided to him in 1993. At the election of
the Employer and subject to the consent of the Executive (which
shall be reasonably exercised), such benefits may be provided by the
Employer's medical plan or by direct reimbursement to the Executive
or by a combination of the two."
4. Section 5 is hereby amended to add Section 5(i) and 5(j), which
shall read as follows:
"(i) Upon retirement and until the death of the
Executive, the Employer shall provide the Executive and his
immediate family, at the expense of the Employer, with the benefits
set forth in Section 4(a), such benefits to be no less
comprehensive, in the reasonable judgment of the Executive, than
those provided to him in 1993."
(j) "Retirement" as used herein and other than for the
purpose of the Employer's pension plans, shall mean and shall be
deemed to occur upon the first to occur of the election of the
Executive to retire from employment with the Corporation and the
Bank at any time after reaching age 55 or the election of the
Executive to retire from employment with the Corporation and the
Bank for Good Reason upon the occurrence of a Change in Control."
5. Section 5(c) is hereby amended to delete the Monthly Amounts set
forth therein and to substitute in lieu thereof the following Monthly Amounts:
Age of Executive as of
Payment Initiation Date Monthly Amount
----------------------- --------------
55 $21,000
56 23,000
57 25,000
58 27,000
59 29,000
60 31,000
61 33,000
Age of Executive as of
Payment Initiation Date Monthly Amount
----------------------- --------------
62 35,000
63 37,000
64 39,000
65 41,000
6. The example set forth in Section 5(d) is hereby amended to show a
monthly guaranteed Supplemental Retirement Benefit of $31,000, multiplied by the
Vested Percentage.
7. The example set forth in Section 5(e) is hereby amended to show a
monthly benefit of $31,000 per month ($31,000 x 100%).
8. Section 12 is hereby amended to provide that, whenever the
Executive is entitled to receive the benefits described in Section 4(a), such
benefits shall be no less comprehensive, in the reasonable judgment of the
Executive, than those provided to him in 1993.
9. Section 12(f) is hereby deleted in its entirety and the following
is substituted in lieu thereof:
"(f) In the event the employment of the Executive is
terminated, whether before or following a Change of Control, the
Executive shall have no obligation to seek other employment to
mitigate his damages hereunder, if any; and, if the Executive does
obtain other employment at anytime subsequent to the termination of
his employment with the Employer, the payments and/or benefits
payable to him pursuant to this Section 12 shall not be subject to
modification or adjustment."
10. Section 13(a) is hereby amended to add the following
language at the end of the existing text:
"If the successor is part of a holding company structure, then the
publicly-traded parent company shall join in the written agreement
to assume and agree to perform this Agreement as set forth herein."
11. The term "Change of Control," wherever used in the Employment
Agreement or in any amendment thereto, shall have the same meaning as the term
"Change in Control."
12. The Employment Agreement, as amended, is hereby ratified and
affirmed, and shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
No. 2 under seal as of the day and year first above written.
WITNESS: CITIZENS BANCORP
_____________________________________ By: _________________________(SEAL)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
WITNESS: CITIZENS BANK OF MARYLAND
_____________________________________ By: _________________________(SEAL)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
_____________________________________ ______________________________(SEAL)
XXXXXXX X. XXXXXXXX
CORRECTION TO AMENDMENT NO. 2 TO
EMPLOYMENT AND SEVERANCE AGREEMENT
WHEREAS, Citizens Bancorp, a Maryland corporation (the
"Corporation"), Citizens Bank of Maryland, a Maryland State chartered commercial
bank (the "Bank") [the Corporation and the Bank hereinafter collectively
referred to as "Employer"] and Xxxxxxx X. Xxxxxxxx, a resident of Baltimore
County, Maryland (the "Executive") entered into an Employment and Severance
Agreement dated September 23, 1987 (the "Agreement") as amended by Amendment No.
1 dated October 18, 1989, and Amendment No. 2 dated December 15, 1993, and by
subsequent annual letter agreements; and
WHEREAS, it was the intent of the parties to the Agreement that,
pursuant to Amendment No. 2, certain benefits set forth in Section 4(a) of the
Agreement be provided by the Employer to the Executive and his immediate family
upon retirement of the Executive and until the deaths of both the Executive and
his spouse:
NOW, THEREFORE, the Employer and the Executive agree that:
1. Section 5(i) of Amendment No. 2 to the Agreement should be
corrected to clarify the intent of the parties and more accurately reflect the
agreement of the parties that certain benefits set forth in Section 4(a) of the
Agreement will be provided by the Employer to the Executive and his immediate
family upon retirement of the Executive and until the deaths of both the
Executive and his spouse by restating Section 5(i) as follows:
"(i) Upon retirement and until the death of both the Executive and
his spouse, the Employer shall provide the Executive and his immediate family,
at the expense of the Employer, with the benefits set forth in Section 4(a),
such benefits to be no less comprehensive, in the reasonable judgment of the
Executive, than those provided to him in 1993."
2. The Agreement, as amended and corrected , is hereby ratified and
affirmed, and shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Correction
to Amendment No. 2 under seal this 19th day of June, 1996.
WITNESS: CITIZENS BANCORP
_____________________________________ By __________________________(Seal)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
WITNESS: CITIZENS BANK OF MARYLAND
_____________________________________ By __________________________(Seal)
Xxxxxx X. Xxxxx, Xx.
Title: Chairman of the Board
_____________________________________ ____________________________(Seal)
Xxxxxxx X. Xxxxxxxx
