Exhibit 10.5
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
THIS AGREEMENT is made this day of , 1996
between Weetamoe Bancorp, a Massachusetts corporation, with its principal
place of business in Somerset, Massachusetts, hereafter referred to as the
Employer, or the Corporation, and Xxxxx X. Xxxxx of Somerset, Massachusetts,
Executive Vice-President of the Corporation, hereafter referred to as the
Employee.
Xxxxx X. Xxxxx has been employed by the Corporation or its subsidiary
Xxxxx'x Ferry Bank ("the Bank") for a number of years. During this time, he
has performed his duties ably and well, to the satisfaction and substantial
benefit of the Corporation and the Bank. As a result, the Corporation
wishes to provide additional incentive to retain the services of Xxxxx X.
Xxxxx until his retirement.
THEREFORE, in consideration of these premises and the mutual promises
and obligation set forth hereafter, Xxxxx X. Xxxxx as Employee and the
Corporation as Employer agree as follows:
1. The Corporation agrees that, if Employee remains continuously employed
by the Corporation and/or its subsidiary Bank until his retirement, in such
offices and capacities as he may be elected to by the Board of Directors of
either entity at such compensation as may be mutually agreed upon, the
Corporation will pay and the Employee shall be entitled to receive
additional compensation in the amount of $2,500 per month for one hundred
twenty (120) months commencing on the first day of the first month following
his retirement.
2. (a) The Corporation agrees that the Employee may retire from full-time
employment upon the first day of the month immediately following his 65th
birthday, or at any time prior thereto after completing fifteen years
continuous employment with the Corporation if he becomes permanently and
totally disabled as defined in paragraph (b) or at anytime following his
65th birthday, but not later than the first day of February following his
70th birthday, hereinafter called the Retirement Date.
(b) Employee shall be deemed to have become permanently and totally
disabled if and when the Board of Directors of the Corporation determines,
on the basis of medical or other evidence satisfactory to it, that the
Employee qualifies as disabled under the Social Security Act (42 U.S.C.
section 1382) as amended for the purposes of supplemental security income.
3. The Corporation agrees that, in the event of the death of the Employee
after completing fifteen years continuous employment with the Corporation
and prior to the Retirement Date while employed by the Corporation, it will
pay to his surviving spouse, if any, or, if none, in equal shares to his
children then living and deceased children leaving issue then living by
right of representation, or to such other persons as he may have designated,
or if none, to his estate, $2,500 per month for one hundred and twenty
(120) consecutive months commencing upon the first day of the first month
following the date of death of the Employee. If any beneficiary should die
prior to the receipt of all such payments, any remaining payments shall be
made to such beneficiary's estate.
4. The Corporation agrees to pay to or for the benefit of Employee from the
date of his retirement and thereafter for and during the term of his natural
life such amounts as are required for the employer contribution to provide
medical health insurance coverage comparable to that provided immediately
before his retirement, supplemental to Medicare as it may be amended, in
the form of Blue Cross/Blue Shield Medex Gold or its substantial equivalent
according to the schedule of contribution by the Corporation or the Bank
and the Employee as is in effect for the Corporation's (or the Bank's, if
provided through the Bank) employees generally at the time of Employee's
retirement.
The Corporation agrees to pay to or for the benefit of Employee's wife
such amounts as are required according to the schedule of contribution by
the Corporation or the Bank and the Employee, as amended from time to time,
to provide master medical health insurance in effect at the Corporation or
the Bank and available to employees generally, or its equivalent, for
Employee's wife until she attains the age of 65 years or obtains coverage
under the Medicare program, whichever first occurs, and thereafter to pay
such amounts as are required under such schedule of contribution as is in
effect at that time to provide comparable medical health insurance coverage
supplemental to Medicare as it may be amended, in the form of Blue
Cross/Blue Shield Medex Gold, or its substantial equivalent, for and during
the term of her natural life.
5. Employee's rights and benefits under this agreement are in addition to
and not a substitute for Employee's rights and benefits under the
Corporation or Bank's other retirement, disability or benefit plans.
Subject to the terms of the group life insurance policy in force at the time
of retirement, the Bank will continue to include the Employee in the current
group life insurance policy in force at the time of retirement.
6. In the event that the Employee should die on or after the Retirement
Date but prior to receipt of any amount to which he is entitled hereunder
pursuant to Paragraph 1, or of all such amounts, any amounts remaining
unpaid shall be paid to such beneficiary or beneficiaries as the Employee
may designate by filing with the Corporation a notice in writing, but in the
absence of any such designation, such unpaid amounts shall be so paid to his
surviving spouse, if any, or, if none, in equal shares to his children then
living and deceased children leaving issue then living by right of
representation, and if none, then to his estate.
7. Whenever the Employee's beneficiaries (other than his, his spouse's or
any beneficiary's estate) shall be entitled to receive any amount hereunder,
the amount shall be paid to such beneficiaries in monthly installments: (a)
over a period of ten (10) years, in the event that no monthly installment
payments have theretofore commenced to the Employee, or (b) for the balance
of the ten (10) year period (commencing with the first such installment so
received by the Employee), on the same due dates, in the event payment of
monthly installments shall have theretofore commenced to the Employee.
8. Notwithstanding any other provision of this Agreement to the contrary,
the Employee shall have the right, with the consent of the Corporation, to
elect that payment of the amounts due hereunder be made (a) over a longer
period than one hundred and twenty (120) months or (b) as a life annuity
(with or without refund).
9. Notwithstanding any other provision of this Agreement to the contrary,
following his retirement, the Employee shall have the right, without the
consent of the Corporation, to demand immediate distribution to him in cash
or in kind of an amount equal to the value of the Supplemental Executive
Retirement Account determined as of the date of such demand, following
completion after his retirement of any three (3) successive fiscal years of
the Corporation in which the book value of the Corporation shall have been
successively decreased or any one or more successive fiscal year(s) in which
the book value of the Corporation shall have decreased by a total of more
than 33 1/3%.
10. As used herein the term "Value of the Account" shall mean an amount
equal to the sum of the monthly remaining payments for the remaining period
of payment discounted at the prime lending rate as published in the Wall
Street Journal on the first Monday after the event triggering the valuation.
11. Except as otherwise expressly provided in this Agreement, Employee
agrees on behalf of himself and of his executors and administrators, heirs,
legatees, distributees, and any other person or persons claiming any
benefits under him under this Agreement that this Agreement and its rights,
interests, and benefits shall not be assigned, transferred, pledged, or
hypothecated in any way by Employee or any executor, administrators, heir,
legatee, distributee, or other person claiming under Employee by virtue of
this Agreement, and shall not be subject to execution, attachment, or
similar process. Any attempted assignment, transfer, pledge or
hypothecation, or other disposition of this Agreement or of such rights,
interests, and benefits contrary to the above provisions, or the levy of any
attachment or similar process thereupon, shall be null and void and without
effect.
12. This agreement does not constitute an employment agreement. Nothing
contained in this agreement shall be construed to be a contract of
employment for any term of years, nor as conferring upon the Employee the
right to continue to be employed by the Corporation or the Bank in his
present capacity, or in any other capacity. It is expressly understood by
the parties hereto that this Agreement relates exclusively to additional
compensation for the Employee's services, which compensation is payable
after his retirement from full-time service with the Corporation and the
Bank or his death, and is not intended to be an employment contract. The
benefits payable under this agreement shall be independent of, and in
addition to, any benefits under any other employment agreement that may
exist from time to time between the parties hereto, or any other
compensation payable by the corporation to the Employee whether as salary or
otherwise. In the event that Employee's employment is terminated for any
reason other than his death or retirement under the provision of paragraphs
2 and 3 hereof, this Agreement shall automatically terminate and the
Corporation shall have no further obligation hereunder.
13. The rights of the Employee under this agreement and of any beneficiary
of the Employee shall be solely those of an unsecured creditor of the
Corporation, and neither the Employee nor any beneficiary of the Employee
shall have or acquire any interest, rights or claims to any property or
assets of the Corporation by virtue of this agreement except as set forth in
paragraph 16.B. The Corporation's obligation hereunder, except as set forth
in paragraph 16.B., shall be an unfunded and unsecured promise to pay money
in the future.
14. Hereafter, either during his full-time employment or while he is
receiving any benefits under this Agreement, Employee agrees that he will
not enter into competition with the Corporation or the Bank, directly or
indirectly, within the Town of Somerset or a fifty (50) mile radius thereof,
either as a director, officer, employee, agent, consultant, partner or any
other capacity with any business which is in substantial competition with
the Corporation or the Bank. The reasonable judgment of a majority of the
Board of Directors that such competition exists shall be conclusive for the
purposes of this Agreement. This provision shall not be construed to
prevent the Employee from owning shares in any publicly traded corporation
for investment purposes.
15. In the event that Employee should violate the provisions of Article 14
hereof, and should he continue to do so without adequate cause for a period
of thirty days after the Corporation shall have requested him in writing to
refrain from an action prohibited by said Article 14, Employee agrees that
no further payments shall be due him, his spouse, or any other designated
beneficiary under this Agreement and that the Corporation shall have no
further obligation whatsoever hereunder. Any disputes hereunder shall be
referred to arbitration pursuant to Article 17 hereof.
16.A. The Corporation agrees that it will not merge or consolidate with any
other corporation or organization, or permit its business to be taken over
by any other organization, unless and until the succeeding or continuing
corporation or other organization shall expressly assume the rights and
obligations of the Corporation herein set forth. The Corporation further
agrees that it will not cease its business activities or terminate its
existence, other than as heretofore set forth in this Article, without
having made adequate provision for the fulfilling of its obligations
hereunder.
16.B. In the event of a change of control (as defined below) of the
Corporation, Employee shall have the right (exercisable within 90 days of
the change of control) to require the Corporation to immediately fund the
unpaid portion of Employee's compensation hereunder by establishing an
irrevocable trust account with an independent corporate Trustee which is a
national or state charted bank with Trustee powers located in Massachusetts
or Rhode Island, funded with an amount which will be sufficient to meet all
of Employer's obligations hereunder. The terms of the Trust shall meet the
requirements of the Internal Revenue Service for "rabbi trusts" and shall
generally provide as set forth herein modified or expanded as necessary to
meet said IRS requirements. The Trust fund shall be held and managed by the
Trustee for the exclusive purpose of providing the compensation hereunder to
Employee hereunder and the Trustee shall act as agent of the Corporation by
making payments of benefits to the Employee in accordance with the terms
hereof. Any and all expenses and taxes incurred by reason of the Trust and
its income shall be paid by the Corporation. After all benefits payable
hereunder have been paid to the Employee or his beneficiaries or after this
agreement has otherwise properly terminated under its terms, any amounts
remaining in the Trust account shall revert to Corporation. Except for the
rights of creditors in the event of Corporation's bankruptcy or
receivership, Corporation shall have no right to reclaim amounts contributed
to the Trust hereunder until all benefits have been paid or this agreement
has properly terminated under its terms. In the event of Corporation's
bankruptcy or receivership, the Trustee shall, upon proper notice, deliver
all assets held hereunder to the Trustee in bankruptcy or the duly court
appointed receiver for the benefit of the general creditors (including
Employee) of Corporation.
"Change of Control" as used herein means any merger or consolidation with or
acquisition by any other organization, the sale of substantially all the
assets of the Corporation to another person or organization, or the
acquisition directly or indirectly of 20% or more of the common stock of the
Corporation by one or more persons or organizations acting in concert.
17. Unless otherwise provided in this agreement, any controversy or claim
arising out of or relating to this contract, or the breach thereof, shall be
settled by arbitration in accordance with the Rules of the American
Arbitration Association, and judgment upon the award rendered by the
Arbitrator(s) may be entered in any Court having jurisdiction thereof. The
Corporation agrees that it will pay Employee's costs including reasonable
attorneys' fees in connection with any controversy or claim hereunder in
which Employee prevails or in which the Arbitrator(s) or court determine
that the Corporation should pay such costs.
18. This agreement shall be binding upon and inure to the benefit of the
parties, the Corporation's successors and assigns, and the Employee's heirs,
beneficiaries, executors and administrators.
IN WITNESS WHEREOF the parties have executed this agreement the day and year
first written above.
Weetamoe Bancorp
Attest: /s/ Xxxxx Xxxxxxx, Esq. By: /s/ Xxxxx Xxxxxx
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Secretary (Title: Sr. Vice President, Treasurer)
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
