EMPLOYMENT AGREEMENT
Exhibit
10.24
This
Agreement is made and entered into as of the 28th day of February, 2007, by
and
between SOUTHERN CONNECTICUT BANCORP., INC. and it subsidiary, THE BANK OF
SOUTHERN CONNECTICUT, having its principal place of business in New Haven,
Connecticut (hereinafter referred to as the “Employer”) and Xxxxxxx X. Xxxxxxxx,
residing in Guilford, Connecticut (hereinafter referred to as the
“Employee”).
W
I T N E
S S E T H
WHEREAS,
the Employee is experienced in the operation and management of a bank;
and
WHEREAS,
the Employer desires to secure the services of the Employee on the terms herein
set forth; and
WHEREAS,
the Employee is willing to enter into this Agreement on said terms;
NOW,
THEREFORE, in consideration of the promises and the mutual covenants herein
contained, the parties hereto, intending to be legally bound, do hereby mutually
covenant and agree as follows:
1.
Employment:
The
Employer agrees to employ the Employee as President and Chief Executive Officer
of the Employer beginning July 1, 2007, for the Term of Employment as defined
in
Section 2, and the Employee accepts said employment and agrees to serve in
such
capacity upon the terms and conditions hereinafter set forth. Between March
1,
2007 and June 30, 2007 Employee shall be President and Chief Operating Officer.
2.
Term
of Employment:
The
Term of Employment shall commence on March 1, 2007, and shall end on December
31, 2009. The Term of Employment shall be extended through December 31, 2010,
unless the Employer notifies the Employee in writing of its desire to terminate
the Agreement before December 31, 2008 or unless by mutual notification. If
a
“Business Combination” as defined in Paragraph 5(b) occurs, the Term of
Employment shall be automatically extended to December 31, 2010. Notwithstanding
the foregoing, the term of Employment shall end if sooner terminated as provided
in Section 5.
3.
Duties
of Employment:
The
Employee agrees that, so long as he shall be employed by the Employer, the
Employee shall perform all duties assigned or delegated to him under the by-laws
of the Employer and/or from time to time by the independent Board of Directors
of the Employer consistent with his position as President and Chief Operating
Officer from March 1, 2007, or President and Chief Executive Officer of the
Employer from July 1, 2007 through December 31, 2009 or 2010 if the option
is
exercised. The Employee shall be responsible for and perform all acts and
services customarily associated with such position including the overall
management of the Employer, devoting his full time, best efforts and attention
to the advancement of the interests and business of the Employer. The Employee
understands that the independent Board of Directors may establish an Executive
Committee which will provide advice and/or guidance, but further understands
that any adverse employment decision, up to and including termination, may
only
occur by vote of the full Board. The Employee shall also serve as a member
of
the Board of Directors of the Employer. The Employee shall not be engaged in
or
concerned with any other duties or pursuits which are competitive or
inconsistent with the interests and business of the Employer. It is understood
that the Employee may have other
directorships
which may, from time to time, require minor portions of his time but which
shall
not interfere or be inconsistent with his duties hereunder; PROVIDED, HOWEVER,
that each such directorship shall be subject to the approval of the independent
Board of Directors of the Employer, which approval shall to be unreasonably
withheld.
4.
Compensation:
During
the Term of Employment, the Employer shall pay to the Employee as compensation
for the services to be rendered by him hereunder the following:
(a)
The
Employer shall pay to the Employee a base salary at the rate of ONE HUNDRED
SEVENTY-ONE THOUSAND FIVE HUNDRED DOLLARS ($171,500.00) from March 1, 2007
to
June 30, 2007, and ONE HUNDRED EIGHTY-ONE THOUSAND DOLLARS ($181,000.00) from
July 1, 2007 to December 31, 2007, both pro-rated. The Employer shall pay to
the
Employee a base salary of ONE HUNDRED NINETY-THREE THOUSAND DOLLARS
($193,000.00) for the calendar year 2008 and TWO HUNDRED TEN THOUSAND DOLLARS
($210,000.00) for the calendar year 2009. The Employer shall pay to the Employee
a base salary of TWO HUNDRED TWENTY THOUSAND DOLLARS ($220,000.00), if the
Agreement is extended for the fourth year. Such compensation shall be payable
in
accordance with normal payroll practices of the Employer.
(b)
In
addition to the base salary set forth in (a) above, the Employee shall be
entitled to salary increases and other such merit bonuses reflecting job
performance achievements, and/or such other form(s) of merit compensation,
as
the independent Board of Directors of the Employer may in its discretion
determine at the end of each calendar year(s) during such Term of Employment.
The independent Board of Directors may establish one or more individual or
corporate goals for each such year, the achievement of which may be made a
condition to the
payment
of such additional compensation to the Employee. Such goals shall be
communicated to the Employee and shall be stated to be a condition to the
payment of such additional compensation to the Employee.
(c)
The
Employee shall be entitled to receive SEVENTY-FIVE HUNDRED (7,500) SHARES of
restricted stock, vesting 40% on December 31, 2007; 30% on December 31, 2008;
and 30% on December 31, 2009.
(d)
At
the end of each month during the term of this Agreement, the Employer shall
reimburse the Employee for reasonable business related travel and entertainment
expenses, bank related education, other ordinary business expenses and
convention expenses incurred by Employee in the course of performing his duties
for the Employer hereunder.
(e)
The
Employer shall provide group life insurance, comprehensive health insurance
and
Major Medical coverage for the Employee comparable to such coverage provided
for
officers of the Employer generally. The Employee shall be eligible to
participate in any profit sharing plan or Section 401(k) plan of the Employer
in
accordance with the terms thereof.
(f)
The
Employer shall pay for the lease payments not in excess of SIX HUNDRED FIFTY
DOLLARS ($650.00) per month until the remaining term of this Agreement, plus
insurance and personal property tax on the Employee’s car and all other
reasonable car expenses including gasoline, related to the business activities
of the Employer.
(g)
The
Employer shall pay the monthly membership fee of the Employee at the Quinnipiack
Club in New Haven, Connecticut.
(h)
The
Employer shall pay all cell phone, Blackberry or similar wireless device
expenses.
5.
Termination
of Employment.
(a)
The
Employer shall have the right to terminate this Agreement upon the occurrence
of
any one of the following events:
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(1)
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The
Employee’s conviction of a felony or any other crime involving the
Employee’s morals or honesty.
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(2)
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Dereliction
in the performance of the Employee’s duties hereunder.
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(3)
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Failure
of the Employee to adhere to the policies set forth by the Board
of
Directors of the Employer.
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(4)
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Failure
of the Employee to qualify for a
bond.
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(5)
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Death,
total disability, or drug abuse or alcoholism, which prevents the
Employee
from performing his functions under this
Agreement.
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(b)
In
the event the Employee’s position as President and Chief Operating Officer or
President and Chief Executive Officer shall end or the Employee’s
responsibilities shall be significantly reduced as a result of a “Business
Combination”, (1) the entity remaining after the “Business Combination” occurs
shall pay the Employee a lump sum payment of an amount equal to three times
the
total of his then current base annual compensation plus the amount of his bonus
for the prior calendar year. Such payment shall be in addition to any
compensation otherwise due the Employee under the following subparagraph (c)
or
any other provision of this Agreement; and (2) all of the Employee’s stock
options and restricted stock previously granted to the Employee by the Employer
shall immediately become fully vested. As a condition of the closing or
acquisition of stock resulting in a “Business Combination” the entity remaining
shall agree in writing to honor and comply with this paragraph 5(b). A “Business
Combination” for purposes
of
this
Agreement shall be defined as the sale by the Employer of all or substantially
all of its assets, the acquisition of fifty-one (51%) of the Employer’s
outstanding voting stock, or the merger of the Employer with another corporation
as a result of which the Employer is not the surviving entity.
(c)
In
the event of a termination of employment of the Employee by the Employer
(including a termination under subparagraph 5(b) above) other than a termination
stated in subparagraph 5(a), the Employee shall be entitled to his compensation
benefits under subparagraph 4(a) of this Agreement for the balance of the
unexpired term of employment as such term exists immediately before such
termination to be paid at the Employee’s option in a lump sum or ratably over
the balance of said term.
6.
Vacation.
During
the Term of Employment, the Employee shall be entitled each year to a vacation
of at least three (3) weeks, and during such time his compensation shall be
paid
in full. The period of vacation selected each year shall be with approval of
the
Employer. Vacation time which is not taken by the Employee in any year may
not
be accumulated or carried over from year to year. The Employee shall be entitled
to be paid for any accrued vacation time after termination of the Employee’s
employment hereunder for the year of the Employee’s termination. Normal bank
holidays, seminars or convention attendance, teaching at banking schools or
speaking engagements shall not be considered as part of the Employee’s vacation
period. The Employee shall comply with any banking regulations relating to
the
scheduling of vacation time.
7.
Incentive
Stock Options.
No
further incentive stock options (“ISO’s”) within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended, to purchase common
stock
in
Southern Connecticut Bancorp, Inc. under the stock option plan adopted for
employees of the Employer have been promised the Employee. Any further grant
of
stock options shall be in the sole and absolute discretion of the Board of
Directors of the Employer based upon criteria to be established by the Board
of
Directors.
8.
Notices.
All
notices under this Agreement shall be in writing and shall be deemed effective
when delivered in person to the Employee or to the Secretary of the Employer
and
the Chairman of the Compensation Committee, or if mailed, postage prepaid,
registered or certified mail, addressed, in the case of the Employee, to his
last known address as carried on the personnel records of the Employer, and,
in
the case of the Employer, to the corporate headquarters, attention of the
Secretary and to the Chairman of the Compensation Committee at his place of
business, or to such other address as the party to be notified may specify
by
notice to the other party.
9.
Successors
and Assigns.
The
Rights and obligations of the Employer under this Agreement shall inure to
the
benefit of and shall be binding (except as to the positions and duties of the
Employee) upon the successors and assigns of the Employer, including, without
limitation, any corporation, individual or other person or entity which may
acquire all or substantially all of the assets and business of Employer, or
any
division of the Employer for which the Employee has primary management
responsibility, or with or into which the Employer may be consolidated or merged
or any surviving corporation in any merger involving the
Employer.
10.
Arbitration.
Any
dispute which may arise between the parties hereto shall be submitted to binding
arbitration in New Haven, Connecticut, in accordance with the Employment Rules
of the American Arbitration Association provided that any such dispute shall
first be
submitted
to the Employer’s Board of Directors in an effort to resolve such dispute
without resort to arbitration. A single arbitrator shall decide each dispute.
In
any dispute which is submitted to arbitration, the arbitration costs and
attorney’s fees of the prevailing party shall be paid by the other
party.
11.
Severability.
If any
of the terms or conditions of this Agreement shall be declared void or
unenforceable by any court or administrative body or competent jurisdiction,
such term of condition shall be deemed severable from the remainder of this
Agreement, and the other terms and conditions of this Agreement shall continue
to be valid and enforceable.
12.
Construction.
This
Agreement shall be construed under the laws of the State of Connecticut. Words
of the masculine gender mean and include correlative words of the feminine
gender. Section headings are for convenience only and shall be considered a
part
of the terms and provisions of the Agreement.
IN
WITNESS WHEREOF, Employer has caused this Agreement to be executed by a duly
authorized officer and Employee has hereunto set his hand, this 28th day of
February, 2007.
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EMPLOYER:
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SOUTHERN
CONNECTICUT BANCORP, INC.
THE
BANK
OF SOUTHERN CONNECTICUT, INC.
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BY:
/s/ XXXX XXXXXXXX
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XXXX
XXXXXXXX
Chairman,
Compensation Commisttee
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EMPLOYEE:
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/s/
XXXXXXX X. XXXXXXXX
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XXXXXXX
X. XXXXXXXX
