EXHIBIT 10(C)
EMPLOYMENT AGREEMENT
THIS AGREEMENT, is made as of this 1ST day of JANUARY, 1997, by and
among Iroquois Bancorp, Inc., a New York corporation ("Iroquois"), CAYUGA
SAVINGS BANK ("Member Bank") (Iroquois and Member Bank each an "Employer" and
collectively, "Employers") and XXXXXXXX X'XXXXXX, a New York State resident (the
"Executive").
WHEREAS, the services of the Executive and the Executive's managerial
experience is of great value to the Employers; and
WHEREAS, the Employers and the Executive desire and agree to enter into
and/or continue the employment relationship by means of this Employment
Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is mutually covenanted and
agreed by and among the parties as follows:
1. EMPLOYMENT AND DUTIES.
(a) Iroquois and Member Bank each hereby employ the Executive as TREASURER
AND CHIEF FINANCIAL OFFICER of CAYUGA SAVINGS BANK, with all the powers
and duties customary to such position in similar corporations and
banking institutions, and the Executive hereby accepts such employment.
The Executive shall perform such other duties and have such other powers
and responsibilities as may be assigned to the Executive by the
Employers and which are commensurate with the Executive's position. The
Executive shall report directly to the president/chief executive officer
of Iroquois or such other executive officer as the president/chief
executive officer may designate or to the board of directors of the
Employers, as appropriate.
(b) During the term of this Agreement, the Executive shall devote his or her
entire time and attention to the business and affairs of the Employers
and shall do all that is reasonably in his or her power to promote,
develop, and extend the business of Iroquois and its affiliates. The
Executive shall at all times during employment hereunder, conduct
himself or herself faithfully and diligently in a manner consistent with
the position and shall not knowingly perform any act contrary to the
best interests of the Employers or any affiliate thereof.
2. TERM.
Unless sooner terminated as provided by Section 5 herein, the term of this
Agreement shall be one year commencing as of January 1, 1997. The term may be
renewed annually by affirmative action of the boards of directors of the
Employers upon the same terms and conditions and at such compensation level
determined appropriate by the boards of directors at the time of renewal.
Employers shall notify the Executive of the Employers' intention not to renew
this Agreement not
less than thirty (30) days prior to expiration of the initial term of this
Agreement or any renewal of such term.
3. COMPENSATION.
(a) The annual base salary of the Executive during the initial term of this
Agreement shall be $100,800.00, subject to adjustment at the time of
renewal by the appropriate board of directors. The Executive will be
advised of any adjustment to base salary not later than forty-five (45)
days after the commencement of the renewal term. Any such adjustment in
base salary however, shall be made in the sole discretion of such board
of directors, and nothing herein contained shall be construed to provide
the Executive with any assurance that base salary will be increased upon
affirmative renewal of this Agreement.
(b) The Executive, if otherwise eligible under any particular program or
plan, shall participate in any bonus or incentive compensation plan,
stock purchase or stock option plan, profit sharing plan, retirement
plan, supplemental retirement plan or other plan or program designed for
or available generally to senior management of Iroquois and its
affiliates.
4. ADDITIONAL BENEFITS.
(a) The Executive shall be entitled to reimbursement of reasonable expenses
incurred in the performance of the duties required hereunder in
furtherance of the business of the Employers and affiliates of the
Employers, upon submission of appropriate invoices or vouchers
documenting such expenses and provided such expenditures were consistent
with the Employers' policies.
(b) The Executive shall be eligible for FOUR (4) weeks of paid vacation in
any calendar year, to be taken at such time or times as the Executive
shall elect in accordance with Employers' policies then in effect.
Unused vacation may not be accrued or carried over from year to year.
(c) The Executive shall be eligible to receive full salary during any period
of disability, subject to a limitation of eighteen (18) months of
continued salary and benefits with respect to any single disability. In
the event that the Executive is entitled to payments under any
disability insurance policy during such period of disability, the
aggregate payments from such disability insurance coverage and from the
Employers for salary and benefits shall not exceed an amount equal to
the Executive's full salary and benefits for such period.
(d) The Executive shall be eligible to participate in any Employer group
medical or hospitalization insurance plan and in any other fringe
benefit plan generally available to employees of the Employers. The
Executive may also be entitled to special fringe benefits, if
applicable, as identified on Schedule A attached hereto, which Schedule
may be amended by the appropriate board of directors at the time of
renewal or such other time as such boards of directors deem appropriate
under the circumstances. The foregoing benefits and special benefits
described in clauses (a) through (d) of this Section 4 shall be known
collectively as the "Welfare Benefits."
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5. TERMINATION.
(a) Termination Events: the Executive's employment shall terminate during
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the term of this Agreement upon the occurrence of any of the following
events:
(i) the Executive's death;
(ii) termination by the Employers of the Executive's employment for
reasons of Disability (as hereinafter defined) upon fifteen (15)
days written notice to the Executive;
(iii) termination by the Employers of the Executive's employment for
Cause (as hereinafter defined) upon written notice to the
Executive;
(iv) termination by the Employers of the Executive's employment other
than for Cause (as hereinafter defined) upon thirty (30) days
written notice to the Executive; or
(v) resignation of the Executive.
(b) Termination Definitions: The following words and phrases shall have the
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meanings indicated below:
(i) Disability. "Disability" shall mean the Executive's incapacity or
inability to further perform services contemplated under this
Agreement for a period of at least eighteen (18) months because
of an impairment of his or her physical or mental health so as to
make it impossible or impractical for the Executive to perform
the duties and responsibilities contemplated hereunder.
(ii) Cause. "Cause" shall mean personal dishonesty, willful or
negligent misconduct, breach of fiduciary duty, intentional
failure to perform stated duties, willful violation of any law,
rule, or regulation (other than traffic violations or similar
minor offenses) or court or administrative order, or any removal
or permanent prohibition of the Executive from participating in
the conduct or affairs of Iroquois or a Member Bank by an order
of any regulatory authority having jurisdiction.
(iii) Date of Termination. "Date of Termination" shall mean:
- with respect to termination due to the death or resignation of
the Executive, the date of death or resignation;
- with respect to termination due to Disability, fifteen (15)
days following the giving of notice as referred to in Section
5(a)(ii) above;
- with respect to termination by the Employers for Cause, the
date notice is given to the Executive, as referred to in
Section 5(a)(iii) above;
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- with respect to termination by the Employers other than for
Cause, thirty (30) days following the giving of notice as
referred to in Section 5(a)(iv) above.
(c) Employers' Obligations Upon Termination:
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(i) Death. If the Executive's employment is terminated by reason of
the Executive's death during the term of this Agreement, this
Agreement shall terminate without further obligation to any legal
representative of the Executive, other than for any obligations
accrued prior to the Executive's death, which shall be payable
(in a lump sum) within thirty (30) days of the Date of
Termination. Notwithstanding such termination, the Executive's
legal representative shall be obligated to return Employer's
property pursuant to Section 7 herein.
(ii) Disability. If the Executive's employment is terminated by reason
of the Executive's Disability during the term of this Agreement,
this Agreement shall terminate (with the exception of Section 7
herein) without further obligation to the Executive, other than
for any obligations accrued prior to the Executive's Date of
Termination, which shall be payable (in a lump sum) within thirty
(30) days of the Date of Termination.
(iii) Cause. If the Executive's employment is terminated for Cause
during the term of this Agreement, this Agreement shall terminate
(with the exception of Section 7 herein) without further
obligation to the Executive other than for any obligations
accrued prior to the Executive's Date of Termination.
(iv) Termination by the Employers other than for Cause. If, during the
term of this Agreement, the Executive's employment shall be
terminated by Employers other than for Cause, or for reasons
other than the Executive's death, Disability or voluntary
resignation, then the Executive shall be entitled to the benefits
provided below:
(A) The Employers shall pay to the Executive any accrued but
unpaid base salary through the Date of Termination.
(B) In lieu of any further base salary and annual incentive
payments for periods subsequent to the Date of
Termination, the Employers shall pay to the Executive,
within thirty (30) days of the Date of Termination, a cash
payment in an amount equal to 100 percent (hereinafter the
"Severance Percentage") of the sum of (x) the Executive's
annual base salary for the year in which the Executive is
terminated and the two years immediately preceding the
year of termination, divided by three, and (y) the
Executive's target annual incentive (under the Iroquois
Annual Management Incentive Compensation Plan) for the
year in which the Executive is terminated and the annual
incentive earned by the Executive over the two years
immediately preceding the year of termination, divided by
three.
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(C) The Employers shall continue to provide the Executive with
Welfare Benefits in the amounts and upon the terms and
conditions present immediately prior to the Date of
Termination (and only to the extent the benefit is
permissible under such contract or plan), for a Severance
Period consisting of a number of months calculated based
on the Severance Percentage applicable to the Executive
where a Severance Percentage of 100% results in a
Severance Period of TWELVE (12) months (the "Severance
Period"); provided, however, that such Welfare Benefits
shall cease upon the Executive's becoming eligible to
receive substantially similar Welfare Benefits from a new
employer.
(D) For the period of months set forth in Schedule B attached,
the Employers shall reimburse all reasonable expenses (as
determined in the sole discretion of the appropriate board
of directors) incurred by the Executive for professional
outplacement services; provided, however, that such
reimbursement shall not exceed that percentage of the
Executive's annual base salary set forth in Schedule B and
that such reimbursement shall be discontinued once the
Executive attains employment in a position with duties,
responsibilities and level of compensation substantially
similar to his or her duties, responsibilities and level
of compensation with the Employers.
(v) Resignation. If the Executive's employment is terminated by
reason of the Executive's voluntary resignation during the term
of this Agreement, this Agreement shall terminate (with the
exception of Section 7 herein) without further obligation to the
Executive, other than for any obligations accrued prior to the
Executive's resignation, which shall be payable (in a lump sum)
within thirty (30) days of the Date of Termination.
(d) In the event the Executive's employment is terminated for any reason
with either Iroquois or Member Bank, employment shall be terminated
automatically with both Employers unless the non-terminating Employer
shall agree in writing to continue the terms of this Agreement solely
between the Executive and such non-terminating Employer.
(e) In the event this Agreement is not renewed at the discretion of the
Board and without cause pursuant to Section 2 above, the Executive shall
be entitled to:
(i) the compensation and benefits described in Sections 3 and 4
above, for the remainder of the term of this Agreement; and
(ii) if the Executive is no longer employed by the Employers or any
affiliates of the Employers, those benefits described in
Subsections (A), (B), (C) and (D) of Section 5(c)(iv) above.
6. SUSPENSION.
If the Executive is suspended or temporarily prohibited from participating in
the conduct or the
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affairs of Iroquois or Member Bank by action of any regulatory authority having
jurisdiction, the obligations of the Employers under this Agreement shall be
suspended as of the date of service of written notice of such suspension by such
regulatory agency, unless stayed by appropriate proceedings. If the charges
underlying such actions are dismissed, the Executive shall be entitled to
reinstatement and any compensation withheld while the Employers' obligations
under this Agreement were suspended.
7. CONFIDENTIAL INFORMATION AND BUSINESS MATERIALS.
(a) During the term of this Agreement and for a period of two years
following the termination or non-renewal of this Agreement, the
Executive agrees to receive confidential and proprietary information of
Employers and any affiliates in confidence, and not to disclose such
information to others except as authorized by the relevant Employer or
affiliate. Confidential and proprietary information shall mean
information not generally known to the public that is disclosed to the
Executive and is a consequence of employment by either Employer, whether
or not pursuant to this Agreement.
(b) The Executive further covenants and agrees that every document, computer
disc, computer software program, notation, record, diary, memorandum,
development, investigation, file, or the like, and any method or manner
of doing business of either Employer or any affiliate made or acquired
by the Executive during employment, is and shall be the sole and
exclusive property of such Employer or affiliate. The Executive will
deliver the same (and every copy, disc, abstract, summary or
reproduction of same made by or for the Executive or acquired by the
Executive) whenever either Employer may so require and in any event
prior to or at the termination of said employment.
(c) Employers and the Executive hereby acknowledge that the restrictions
stated herein above are reasonably necessary for the protection of
Employers' legitimate proprietary interests and Employers may enforce
such provisions through action for specific performance.
8. CHANGE OF CONTROL.
(a) In the event the Executive's employment is terminated (x) by the
Employers for any reason other than for Cause, death or Disability, or
(y) by the Executive for Good Reason (as defined in Section 8(d) below),
within twenty-four (24) months following a Change Of Control (as defined
in Section 8(b) below, or (z) by the Executive for any reason during the
thirty (30) day period beginning on the first anniversary of a Change of
Control, then:
(i) The Employers shall pay the Executive, within thirty (30) days
after the Date of Termination:
(A) any accrued but unpaid base salary earned through the Date
of Termination; and
(B) a pro-rata incentive award in an amount equal to the
product of (x) the target
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incentive amount which the Executive could earn for the
year in which the Date of Termination occurs pursuant to
the Iroquois Annual Management Incentive Plan, and (y) a
fraction, the numerator of which is the number of days in
the fiscal year through the Date of Termination, and the
denominator of which is 365; and
(C) a lump-sum cash payment equal to 2.99 times the sum of:
(x) the Executive's base salary immediately preceding the
Date of Termination, or immediately preceding the Change
of Control, whichever is greater, and (y) the average
annual incentive received by the Executive during the
three years immediately preceding the Date of Termination
(such cash payment being in lieu of any further base
salary and annual incentive payments the Executive may
have been entitled to pursuant to this Agreement).
(ii) The Employer shall continue all Welfare Benefits received by the
Executive for the Severance Period; provided, however, that such
Welfare Benefits shall cease upon the Executive becoming eligible
to receive substantially similar benefits from a new employer.
(iii) For the period of months set forth in Schedule B attached, the
Employers shall reimburse all reasonable expenses (as determined
in the sole discretion of the appropriate board of directors)
incurred by the Executive for professional outplacement services;
provided, however, that such reimbursement shall not exceed that
percentage of the Executive's annual base salary set forth in
Schedule B and that such reimbursement shall be discontinued once
the Executive attains employment in a position with duties,
responsibilities and level of compensation substantially similar
to his or her duties, responsibilities and level of compensation
with the Employers.
(b) For the purposes of this Agreement, a "Change Of Control" shall mean:
(i) any "person," including a "group" as determined in accordance with
the Section 13(d) of the Securities Exchange Act of 1934 (the "Exchange
Act"), is or becomes the beneficial owner, directly or indirectly, of
securities of Iroquois representing 20% or more of the combined voting
power of the then outstanding securities of Iroquois; (ii) as a result
of, or in connection with, any tender offer or exchange offer, merger or
other business combination (a "Transaction"), the persons who were
directors of Iroquois before the Transaction shall cease to constitute a
majority of the board of directors of Iroquois or any successor of
Iroquois, (iii) Iroquois is merged or consolidated with another
corporation and as a result of the merger or consolidation less than 80%
of the outstanding voting securities of the surviving or resulting
corporation shall then be owned in the aggregate by the former
shareholders of Iroquois, other than (A) affiliates within the meaning
of the Exchange Act, or (B) any party to the merger or consolidation;
(iv) a tender offer or exchange offer is made and consummated for the
ownership of securities of Iroquois representing 20% or more of the
combined voting power of Iroquois' then outstanding voting securities;
or (v) Iroquois transfers substantially all of its assets to another
corporation which is not controlled by Iroquois.
(c) Iroquois agrees that during the term of this Agreement, any options
granted to the Executive
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under the 1988 Stock Option Plan, as amended, or the 1996 Stock Option
Plan, as amended, or any other similar plan subsequently instituted by
the Employers (collectively the "Plans"), shall provide that the
Executive may, upon a Change Of Control of Iroquois, and without regard
to any restrictions on exercise that may otherwise apply, within twelve
(12) months of the date the Executive receives written notice of such
Change Of Control, (i) surrender such option or options for a cash
payment equal to the difference between the aggregate option exercise
price and the aggregate fair market value of the shares of stock subject
to the option, as such fair market value is determined in accordance
with the Plan, or (ii) exercise such option or options, whether or not
such options are exercisable pursuant to the terms of the Plans.
(d) For purposes of this Section 8, "Good Reason" shall mean:
(i) assignment to the Executive of any duties inconsistent with his
or her status as an executive officer of Iroquois or a Member
Bank, or a substantial adverse alteration in the nature or status
of the Executive's responsibilities from those in effect
immediately prior to the Change Of Control;
(ii) reduction of the Executive's base salary as in effect immediately
preceding the Change of Control, or any reduction in the
Executive's normative incentive award percentage or any change in
the method for applying the normative incentive award percentage
to determine the Executive's incentive award, which would
materially reduce such incentive award;
(iii) failure by the Employers to continue to provide the Executive
with Welfare Benefits substantially similar to those received by
the Executive immediately preceding the Change of Control; or
(iv) the relocation of the Employers principal executive offices and
the principal offices occupied by the Executive more than a
reasonable distance from their current location.
In the event the Executive terminates employment for Good Reason, the
Date of Termination shall mean the date on which the Executive notifies
the Employers of such termination.
(e) Notwithstanding anything contained in this Agreement to the contrary, to
the extent that the payments and benefits provided under this Agreement
or provided for the benefit of the Executive under any other plan or
agreement of or with the Employers (each such payment of benefit, a
"Payment," and such payments and benefits collectively, the "Payments"),
would be subject to the excise tax imposed under Sections 4999 and 280G
of the Internal Revenue Code, or any interest or penalties with respect
to such excise tax (such excise tax, together with any such interest and
penalties are hereinafter collectively referred to as the "Excise Tax"),
the Payments shall be reduced to the maximum amount which may be paid so
that no such Payment shall be subject to the Excise Tax. If necessary,
the Employers shall reduce or eliminate the Payments by first reducing
or eliminating the payments due under Section 8(a)(i)(B) above, then by
reducing or eliminating the amounts payable under
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Section 8(a)(i)(C), and then by reducing or eliminating benefits which
are not payable in cash, in each case, in reverse order beginning with
payments or benefits which are to be paid the farthest in time from the
Date of the Termination.
9. COMPLIANCE WITH LAWS.
Any payments made to the Executive pursuant to this Agreement, or otherwise, by
Iroquois or a Member Bank, are subject to and conditioned upon compliance with
all federal and state laws and regulations as may be applicable at the time to
Iroquois, the Member Bank or any other affiliate for which the Executive has
been assigned direct duties or responsibilities, including without limitation,
Section 18(k) of the Federal Deposit Insurance Act.
10. BINDING EFFECT; BENEFITS.
This Agreement shall inure to the benefit of, and shall be binding upon, the
parties hereto and their respective successors, assigns, heirs, and legal
representatives, except that insofar as the Executive is concerned, this
Agreement, being personal, cannot be assigned.
11. NOTICES.
All notices and other communications which are required or permitted hereunder
shall be in writing and shall be sufficient if delivered or mailed by registered
or certified mail, postage prepaid, to the following addresses or such other
address as any party hereto shall have specified by a notice in writing to the
other parties hereto:
If to the Executive: Xxxxxxxx X'Xxxxxx
0000 Xxxx Xxxx Xxx 000
Xxxxxxxxx, Xxx Xxxx 00000
If to Iroquois: Iroquois Bancorp, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Chairman of the Board
If to Member Bank: Cayuga Savings Bank
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Chairman of the Board
All such notices and communications shall be deemed to have been received on the
date of delivery thereof or the fifth business day after the mailing thereof,
whichever is earlier. A copy of any notice to either Iroquois or to Member Bank
shall be sent promptly by the Executive to the other.
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12. ENTIRE AGREEMENT.
This Agreement contains the entire agreement between the parties hereto and
supersedes all other discussions and understandings, oral or written, between
the parties hereto with respect to the subject matter hereof.
13. AMENDMENT AND WAIVERS.
This Agreement may not be modified or amended except by an instrument or
instruments in writing signed by the party against whom enforcement or any such
modification or amendment is sought. The waiver by any party hereto of a breach
of any term or provision of this Agreement shall not be construed as a waiver of
any subsequent breach.
14. SECTION AND OTHER HEADINGS.
This section and other headings contained in this Agreement are for reference
purposes only and shall not be deemed to be a part of this Agreement or to
control or affect the meaning or construction of any provision of this
Agreement.
15. SEVERABILITY.
If any term or provision of this Agreement is held or deemed to be invalid or
unenforceable, in whole or in part, by a court of competent jurisdiction, this
Agreement shall be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforeceable the remaining terms
and provisions of this Agreement.
16. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the laws of
the State of New York.
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IN WITNESS WHEREOF, the parties hereto have duly executed this agreement as of
the date first above written.
IROQUOIS BANCORP, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxxxxx X. X'Xxxxxx
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Its: President & CEO [the Executive]
Member Bank
By: /s/ Xxxxxxx X. Xxxxxxxx
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Its: President & CEO
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SCHEDULE A
In accordance with Section 4(d) of the Agreement, the Executive shall be
entitled to the following "special fringe benefits" in addition to his or her
regular benefits:
1) Bi-annual physical examination per the Iroquois Bancorp Physical
Examination Policy
SCHEDULE B
In accordance with Sections 5(c)(iv)(C) and 8(a)(iii) of the Agreement, the
Executive shall be entitled, based upon his or her position, to the
reimbursement of outplacement expenses for the number of months set forth in the
table below and up to the percentage (also set forth below) of the Executive's
annual base salary immediately preceding his or her Date of Termination:
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NUMBER OF PERCENTAGE OF
POSITION MONTHS BASE SALARY
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Chief Financial Officer of
Iroquois Bank 12 12%
