EMPLOYMENT AGREEMENT
EMPLOYMENT
AGREEMENT (this "Agreement") dated as of March
12,
2007 among Great Lakes Bancorp, Inc. a Delaware corporation having its principal
place of business at 0000 Xxxx Xxxxxx, Xxxxxxx, Xxx Xxxx 00000 ("GLB"), Greater
Buffalo Savings Bank, a New York chartered savings bank having its principal
place of business at 0000 Xxxx Xxxxxx, Xxxxxxx, Xxx Xxxx 00000 ("GBSB") and
Xxxxx X. Xxxxxxx, an individual residing at 000 Xxxxxxxx Xxxxx,
Xxxxxxxxxxxxx, Xxx Xxxx 00000 (the "Executive"). GLB, GBSB and the Executive
are
collectively the Parties and individually a Party.
WITNESSETH:
WHEREAS,
GBSB is a wholly owned subsidiary of GLB;
WHEREAS,
GLB and GBSB (collectively, the "Employers") desire to employ the Executive,
and
the Executive desires to be employed by the Employers, all in accordance with
the terms and subject to the conditions set forth herein; and
WHEREAS,
the Parties are entering into this Agreement to set forth and confirm their
respective rights and obligations with respect to the Executive's employment
by
the Employers.
NOW,
THEREFORE, in consideration of the promises and the mutual covenants herein
contained, the Parties hereto, intending to be legally bound hereby, mutually
agree as follows:
1. Employment
and Term.
(a) Effective
as of March 12, 2007 (the "Effective Date"), (i) GLB shall employ the Executive,
and the Executive shall be employed by GLB, as the Executive Vice President
and
Chief Credit Officer of GLB and (ii) GBSB shall employ the Executive, and the
Executive shall be employed by GBSB, as the Executive Vice President and Chief
Credit Officer of GBSB (with all such positions described in clauses (i) and
(ii) hereof being collectively referred to herein as the "Position"), in
accordance with the terms and subject to the conditions set forth herein for
a
term (the "Term") that shall commence on the Effective Date and, subject to
Sections 1(b), l(c), and l(d), shall continue for a period of two years. The
Employers shall be jointly and severally liable to the Executive with respect
to
(i) all liabilities of GBSB to the Executive hereunder and (ii) all liabilities
of GLB to the Executive hereunder; provided, however, that GLB shall not be
responsible for any liability of GBSB to the Executive to the extent that such
liability has been discharged by GBSB, and GBSB shall not be responsible for
any
liability of GLB to the Executive to the extent that such liability has been
discharged by GLB.
(b) Unless
written notice in accordance with Section 1(c) or 1(d), as the case may be,
terminating the Executive's employment under this Agreement is given by (i)
either of the Employers or (ii) the Executive, the Employers shall have the
option to renew this Agreement for additional one year terms (“Renewal Term”) on
an annual basis thereafter by providing the Executive with ninety (90) days
written notice of the intent to renew. Unless otherwise provided in this
Agreement or as agreed by the Employers and the Executive, all of the terms
and
conditions of this Agreement shall continue in force and effect throughout
the
Term and any Renewal Term. In the event the Employers do not exercise their
right to a Renewal Term, the Executive shall use his best efforts during the
remaining period of the Term to effectuate the orderly transition of his duties
in whatever manner the Employers direct.
(c) Notwithstanding
Section 1(b), the Employers, by action of their Boards of Directors (the
"Boards") and effective as of the date specified in a written notice to the
Executive in accordance with the terms of this Agreement, shall have the right
to terminate the Executive's employment under this Agreement at any time during
the Term or any Renewal Term (i) for Cause (as hereafter defined), (ii) other
than for Cause, or (iii) on account of the Executive's death or Permanent
Disability (as defined in this Agreement).
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(d) Notwithstanding
Section 1(b), the Executive, effective as of the date specified in a written
notice provided no less than 30 days in advance, shall have the right to
terminate his employment under this Agreement at any time during the Term (i)
for Good Reason (ii) without Good Reason or (iii) in the event a Change in
Control occurs.
(e) As
used
in this Agreement,
(i) "Cause"
shall mean (A) the Executive's willful and continued failure substantially
to
perform his duties with the Employers as set forth in this Agreement, or the
commission by the Executive of any act constituting a violation under any
federal, state or local law or regulation applicable to the activities of GBSB
or GLB, in each case, after notice thereof from the Employers to the Executive
and a reasonable opportunity for the Executive to cease such failure, breach
or
violation in all material respects, (B) an act of dishonesty, fraud or material
misrepresentation, breach of fiduciary duty, or other acts that cause damage
to
the property or business of GBSB or GLB by the Executive, (C) the Executive's
repeated absences from work such that he is unable to perform his duties under
this Agreement other than for physical or mental impairment or illness, (D)
the
Executive's conviction of, or plea of nolo contendere to, any crime referenced
in Section 19 of the Federal Deposit Insurance Act, (E) the Executive's
conviction of, or plea of nolo contendere to, any felony or any other crime
that, in the reasonable judgment of the Boards, adversely affects GBSB's or
GLB's reputation or the Executive's ability to carry out his obligations under
this Agreement, (F) the Executive's non-compliance with the provisions of
Section 2(b) of this Agreement after notice thereof from the Employers to the
Executive and a reasonable opportunity for the Executive to cure such
non-compliance, or (G) the Executive’s failure to achieve or attain the goals
and objectives as established from time to time by the Board and agreed to
by
the Executive.
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(ii) "Permanent
Disability" shall mean a physical or mental disability such that the Executive
is, with or without reasonable accommodation, substantially unable to perform
the duties of his Position and the nonperformance of such duties has continued
for a period of six months or for an aggregate of nine months during any 12
month period, provided, however, that in order to terminate the Executive's
employment under this Agreement on account of Permanent Disability, the
Employers must provide the Executive with written notice, not less than 30
days
prior to the date of termination specified in such notice, of the Boards' good
faith determination, based on a medical opinion of a physician selected by
the
Employers and reasonably acceptable to the Executive, to terminate the
Executive's employment under this Agreement for reason of Permanent Disability.
Until the specified effective date of termination by reason of Permanent
Disability, the Executive shall continue to receive compensation at the rates
set forth in Section 3. No termination of the Executive's employment under
this
Agreement because of Permanent Disability shall impair any rights of the
Executive under any disability insurance policy maintained by the Employers.
(iii) "Good
Reason" shall mean: (A) the Executive's Position or the scope of the Executive's
authority, duties or responsibilities as described in this Agreement are
materially diminished without the Executive's written consent, excluding for
this purpose any action not taken by the Employers in bad faith and that is
remedied by the Employers promptly following written notice thereof from the
Executive to the Employers; (B) a material breach by either Employer of its
respective obligations to the Executive under this Agreement, which breach
is
not cured in all material respects to the reasonable satisfaction of the
Executive within 30 days (except in the case of a payment default for which
the
cure period shall be 10 days), in each case following written notice thereof
from the Executive to the Employers, or (C) any termination of the Executive's
employment under this Agreement without Cause; and
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(iv) "Change
of Control" shall mean: (A) the acquisition of shares of GLB by any "Person"
or
"Group" (as such terms are used in Rule 13d-3 under the Securities Exchange
Act
of 1934 as now or hereafter amended) in a transaction or series of transactions
that result in such person or group directly or indirectly first owning
beneficially more than 50% of GLB's Common Stock after the date of this
Agreement, or (B) the consummation of a merger or other business combination
after which the holders of voting capital stock of GLB immediately prior to
the
transaction do not collectively own 50% or more of the voting capital stock
(immediately following the transaction) of the entity surviving such merger
or
other business combination, or (C) a sale of all or substantially all of the
assets or earning power of GLB, taken as a whole (with the stock or other
ownership interests of GLB in any of its Affiliates constituting assets of
GLB
for this purpose) to a Person that is not an Affiliate of GLB, or (D) as the
result of or in connection with any cash tender offer or exchange offer, merger
or other business combination, sale of assets or contested election of directors
or any combination of the foregoing transactions (a "Transaction"), the persons
who constituted a majority of the members of the Board of Directors of GLB
on
the Effective Date and persons whose election as members of the Board of
Directors of GLB was approved by such members then still in office or whose
election was previously so approved after the Effective Date, but before the
event that constitutes a Transaction, no longer constitute such a majority
of
the members of the Board of Directors of GLB then in office. A Transaction
constituting a Change of Control shall be deemed to have occurred only upon
the
closing of the Transaction.
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(v) An
“Affiliate” of, or a Person “Affiliated” with, a specified Person, shall mean: a
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by, or is under common control with, the Person
specified.
2. Duties
of the Executive.
(a) Subject
to the ultimate control and discretion of the Boards of the Employers, the
Executive shall serve in the Position and perform all duties and services
commensurate with the Position. Throughout the Term or Renewal Term, the
Executive shall perform all duties reasonably assigned or delegated to him
under
the by-laws of the Employers or from time to time by the Boards consistent
with
the Position. Except for travel normally incidental and reasonably necessary
to
the business of the Employers and the duties of the Executive under this
Agreement, the duties of the Executive shall be performed from an office
location not greater than 20 miles from the Greater Buffalo, New York area.
(b) The
Executive shall devote substantially all of the Executive's business time and
attention to the performance of the Executive's duties under this Agreement
and,
during the term of his employment under this Agreement, the Executive shall
not
engage in any other business enterprise that requires any significant amount
of
the Executive's personal time or attention, unless granted by the prior
permission of the Boards. The foregoing provision shall not prevent the
Executive's purchase, ownership or sale of any interest in, or the Executive's
engaging, but not to exceed an average of five hours per week, in any business
that does not compete with the business of the Employers or the Executive's
involvement in charitable or community activities, provided, that the time
and
attention that the Executive devotes to such business and charitable or
community activities does not interfere with the performance of his duties
under
this Agreement and that the greatest portion of the time devoted by the
Executive to charitable or community activities are devoted to charitable or
community activities within GBSB's market area and further provided that such
conduct complies in all respects with applicable policies of the Employers.
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(c) The
Executive shall be entitled to four weeks of vacation leave during each calendar
year with full compensation, and to be taken at such time or times, as the
Executive and the Employers shall mutually determine. Earned but unused vacation
shall be accrued in accordance with the Employers' vacation policy as in effect
from time to time.
3. Compensation.
For all
services to be rendered by the Executive under this Agreement:
(a) The
Employers shall pay the Executive a base salary (the "Base Salary") at an annual
rate of $140,000, plus such other compensation as may, from time to time, be
determined by the Employers in their sole discretion. The Base Salary will
be
increase to an annual rate of $150,000 at the end of the month during which
the
Executive completed six months of employment. At the end of each fiscal year
of
the Employers, the Employers shall review the amount of the Executive's Base
Salary, and shall consider increasing but not decreasing such Base Salary for
the following year to such amount as the Boards may determine in their sole
discretion. Such Base Salary and other compensation shall be payable in
accordance with the Employers' normal payroll practices as in effect from time
to time.
(b) The
Executive will be entitled to participate in the Employers’ health and medical
benefit plans, any pension, profit sharing and retirement plans, and any
insurance policies or programs from time to time generally offered to all or
substantially all executive employees who are employed by the Employers. These
plans, policies and programs are subject to change at the sole discretion of
the
Employers.
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(c) The
Executive will be entitled to any other fringe benefit from time to time
generally offered to all or substantially all executive employees who are
employed by the Employers.
(d) The
Employers will deduct or withhold from all salary and bonus payments, and from
all other payments made to the Executive pursuant to this Agreement, all amounts
that may be required to be deducted or withheld under any applicable Social
Security contribution, income tax withholding or other similar law now in effect
or that may become effective during the term of this Agreement.
(e) The
Employers may develop incentive cash bonus and stock-based award programs in
the
future and the Executive will be entitled to participate in these
performance-based programs consistent with the participation in such programs
offered to other executive employees who are employed by the Employers. These
programs are subject to development and change at the sole discretion of the
Employers.
(f) Signing
Bonus.
GLB
agrees to grant to the Executive as a signing bonus (the "Signing Bonus") an
award of incentive stock options on 10,000 shares of GLB Common Stock pursuant
to the terms and conditions of GLB’s stock option plans as soon as practicable
following the Effective Date. The options will become vested and exercisable
with respect to 2,000 shares on the first anniversary of the date of grant,
and
on each anniversary of the date of grant thereafter, the option will become
vested and exercisable with respect to an additional 2,000 shares.
Notwithstanding the foregoing, immediate and complete vesting and exercisability
of any unvested options of the Common Stock shall take place in the event that
a
Change in Control as defined in this Agreement occurs within the initial
two-year Term of the Agreement or the first one-year Renewal Term of the
Agreement. For purposes of this Section 3(f), the Employers’ failure to renew
this Agreement at a time when Cause does not exist, will allow the Executive
to
terminate his employment at such time and such termination will be a termination
of employment by the Employers without Cause.
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4. Expenses.
The
Employers shall promptly reimburse the Executive for (a) all reasonable expenses
paid or incurred by the Executive in connection with the performance of the
Executive's duties and responsibilities under this Agreement, upon presentation
of expense vouchers or other appropriate documentation therefore and (b) all
reasonable professional expenses, such as licenses and dues and professional
educational expenses paid or incurred by the Executive during the Term.
5. Termination.
(a) Termination
After Change of Control by Employers without Cause or Termination by Executive
with Good Reason.
If (A)
the Employers terminate the Executive's employment under this Agreement for
any
reason other than (i) for Cause, (ii) death or (iii) Permanent Disability and
such termination occurs as of a date that is within one year after the
occurrence of a Change of Control (such one-year period being referred to as
a
"Change in Control Period"), and such termination occurs within the initial
two-year Term of the Agreement or the first one-year Renewal Term of the
Agreement or (B) the Executive terminates his employment hereunder for Good
Reason effective as of a date within a Change in Control Period and such
termination occurs within the initial two-year Term of the Agreement or the
first one-year Renewal Term of the Agreement, the Employers shall, provided
the
Executive concurrently signs and delivers a general release and waiver in a
form
reasonably acceptable to the Employers, pay to the Executive, or his estate,
promptly after the event giving rise to such payment occurs: (1) the Executive's
then current Base Salary (as defined in this Agreement) accrued but unpaid
through the date the termination of the Executive's employment under this
Agreement is effective, (2) any cash bonuses or stock-based awards required
to
be paid to the Executive pursuant to Section 3(e), prorated for the period
of
employment, and (3) an amount equal to the Base Salary for the remainder of
the
Term or Renewal Term of the Agreement. Additionally, the stock options granted
as the Signing Bonus pursuant to Section 3(f) shall become fully vested and
exercisable and the Executive will have a period of two years from the date
of
termination in which to exercise the options.
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The
amounts payable under this Section 5(a) are subject to reduction in accordance
with the provisions of Section 6(a).
(b) Absent
a Change of Control; Termination by Employers without Cause or Termination
by
Executive with Good Reason.
If (A)
the Employers terminate the Executive's employment under this Agreement for
any
reason other than (i) for Cause, (ii) death or (iii) Permanent Disability,
and
such termination occurs as of a date that is not within a Change in Control
Period and such termination occurs within the initial two-year Term of the
Agreement or the first one-year Renewal Term of the Agreement, or (B) the
Executive terminates his employment hereunder for Good Reason, and such
termination occurs as of a date that is not within a Change in Control Period
and such termination occurs within the initial two-year Term of the Agreement
or
the first one-year Renewal Term of the Agreement, the Employers shall, provided
the Executive concurrently signs and delivers a general release and waiver
in a
form reasonably acceptable to the Employers, pay to the Executive, or his
estate, promptly after the event giving rise to such payment occurs: (1) the
Executive's then current Base Salary (as defined in this Agreement) accrued
but
unpaid through the date the termination of the Executive's employment under
this
Agreement is effective, (2) any cash bonuses or stock-based awards required
to
be paid to the Executive pursuant to Section 3(e), prorated for the period
of
employment, and (3) as a severance payment, continue to pay the then current
Base Salary for the remainder of the Term or Renewal Term of the Agreement.
Additionally, the stock options granted as the Signing Bonus pursuant to Section
3(f) shall become fully vested and exercisable and the Executive will have
a
period of two years from the date of termination in which to exercise the
options.
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(c) Termination
By Employers with Cause; Termination by Executive without Good Reason or
Termination on Account of Death or Disability.
If (A)
the Employers terminate the Executive's employment hereunder for Cause, (B)
the
Executive terminates his employment hereunder for any reason other than Good
Reason, or (C) this Agreement is terminated as a result of the death or
Permanent Disability of the Executive, the sole obligation of the Employers
shall be to pay to the Executive, or his estate, an amount equal to the sum
of
(1) the Executive's Base Salary accrued but unpaid through the date the
termination of the Executive's employment under this Agreement is effective,
and
(2) any cash bonuses or stock-based awards required to be paid to the Executive
pursuant to Section 3(e), prorated for the period of employment. The Executive
shall have a period of two years from the date of termination (but not later
than the date such options would otherwise expire had the Executive continued
to
be employed) in which to exercise any vested but unexercised options granted
as
part of the Signing Bonus under section 3(f).
(d) Any
notice of termination of the employment of the Executive under this Agreement
by
the Employers to the Executive or by the Executive to the Employers shall be
given in accordance with the provisions of Section 17. The date of termination
of employment will be the date specified in the notice or, in the event of
death
of the Executive, the date of death.
6. Tax
Provisions.
(a) 280G.
Notwithstanding anything in this Agreement or any other agreement to the
contrary, in the event it is determined that part or all of the consideration,
compensation or benefits to be paid to the Executive by the Employers or any
affiliate (as defined under the Securities Act of 1933, as amended, and the
regulations thereunder) or any other person to or for the benefit of the
Executive, whether paid or payable pursuant to the terms of this Agreement,
or
pursuant to any other agreement or arrangement with the Employers or any such
affiliate, constitute “parachute payments” under Section 280G(b)(2) of the
Internal Revenue Code of 1986, as amended, (the “Code”) then, if the aggregate
present value of such parachute payments, singularly or together with the
aggregate present value of any consideration, compensation or benefits to be
paid to the Executive under any other plan, arrangement or agreement which
constitute “parachute payments” (collectively, the “Parachute Amount”) exceeds
2.99 times the Executive’s “base amount,” as defined in Section 280G(b)(3) of
the Code (the “Executive Base Amount”), the amounts constituting “parachute
payments” which would otherwise be payable to or for the benefit of the
Executive shall be reduced to the extent necessary so that the Parachute Amount
is equal to 2.99 times the Executive Base Amount. If the determination made
pursuant to the preceding sentence results in a reduction of the payments that
would otherwise be paid to the Executive, then the Executive may then elect,
in
the Executive’s sole discretion, which and how much of any particular
entitlement shall be eliminated or reduced and shall advise the Employers in
writing of the Executive’s election within ten days of the determination of the
reduction in payments. If no such election is made by the Executive within
such
ten-day period, the Employers may elect which and how much of any entitlement
shall be eliminated or reduced and shall notify the Executive promptly of such
election. The calculations under this Section will be made by the Employers’
independent accounting firm, engaged immediately prior to the event
that triggered the payment, in consultation with the Employers’ outside legal
counsel. For purposes of making the calculations required by this Section,
the
accounting firm may make reasonable assumptions and approximations concerning
applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of Sections 280G and 4999 of the Code, provided
that
the accounting firm’s determinations must be made with substantial authority
(within the meaning of Section 6662 of the Code).
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(b) 409A.This
Agreement is intended to comply with Section 409A of the Code, where applicable,
and will be interpreted and applied in a manner consistent with that intention.
Toward that end, unless permitted sooner by Section 409A of the Code, if the
Executive is designated as a “Specified Employee” as of the date of his
“Separation from Service,” the payment of amounts that are treated as deferred
compensation for purposes of Section 409A of the Code and are payable solely
on
account of the Executive’s Separation from Service that would otherwise be paid
during the six-month period following the Executive’s Separation from Service
will be deferred until and become payable on the first day of the seventh month
following such Separation from Service. For purposes hereof, the terms
“Specified Employee” and “Separation from Service” will have the same meanings
as such terms under Section 409A of the Code and the regulations thereunder.
If
other payments of money or other benefits due to the Executive under this
Agreement or otherwise would cause the application of an accelerated or
additional tax under Section 409A of the Code, the payments or other benefits
will be deferred if deferral will make such payment or other benefits compliant
under Section 409A of the Code, or otherwise such payment or other benefits
will
be restructured, to the extent possible, in a manner that does not cause such
an
accelerated or additional tax or result in a material additional cost to the
Company.
If,
after
the application of the preceding paragraph, in the event that it is determined
that any payment, coverage or benefit due or owing to the Executive pursuant
to
this Agreement is subject to the excise tax imposed by Section 409A of the
Code
or any successor provision thereof or any interest or penalties, including
interest imposed under Section 409A(1)(B)(i)(I) of the Code, incurred by the
Executive as a result of the application of such provision, the Employers,
within 30 days thereafter, shall pay to the Executive, in addition to any other
payment, coverage or benefit due and owing under this Agreement, an amount
(the
“409A Payment”) that will result in the Executive's net after tax position,
after taking into account any interest, penalties or taxes imposed on the
amounts paid under this Section 6(b), being no less advantageous to the
Executive than the net after tax position to the Executive that would have
been
obtained had Section 409A of the Code not been applicable to such payment,
coverage or benefits. The amount of the 409A Payment will be calculated by
the
Employer’s independent accounting firm, in consultation with the Employer’s
outside legal counsel. For purposes of making the calculations required by
this
Section, the accounting firm may make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Section 409A of the Code, provided
that the accounting firm’s determinations must be made with substantial
authority (within the meaning of Section 6662 of the Code). If the precise
amount of the 409A Payment cannot be determined on the date it is to be paid,
an
amount equal to the best estimate of the 409A Payment will be made on that
date
and, within 10 days after the precise calculation is obtained, either the
Employers will pay any additional amount to the Executive or the Executive
will
pay any excess amount to the Employers, as the case may be. If subsequently
the
IRS claims that any additional amounts are owing, an additional 409A Payment
will be paid to the Executive within 30 days of the Executive providing
substantiation of the claim made by the IRS. After payment to the Executive
of
the 409A Payment, the Executive will provide to the Employers any information
reasonably requested by the Employers relating to the tax and penalties, the
Executive will take those actions as the Employers reasonably requests to
contest the tax and penalties, cooperate in good faith with the Employers to
effectively contest the tax and penalties and permit the Employers to
participate in any proceedings contesting the tax and penalties. The Employers
will bear and pay directly all costs and expenses (including any interest or
additional penalties), and indemnify and hold the Executive harmless, on an
after-tax basis, from all such costs and expenses related to such contest.
Should it ultimately be determined that any amount of the tax or penalties
are
not properly owed, the Executive will refund to the Employers the related amount
of the 409A Payment.
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7. Indemnification.
Notwithstanding anything in the Employers' certificates of incorporation or
by-laws to the contrary, the Executive shall at all times during his employment
by the Employers, and thereafter, be indemnified by the Employers to the fullest
extent permitted by applicable law for any matter in any way relating to the
Executive's affiliation with the Employers and its subsidiaries; provided,
however, that if the Executive's employment shall have been terminated by the
Employers for Cause, then, to the extent required by applicable law, the
Employers shall have no obligation whatsoever to indemnify the Executive for
any
claim arising out of the matter for which his employment shall have been
terminated for Cause or for any conduct of the Executive not within the scope
of
the Executive's duties under this Agreement.
8. The
Employers agree to reimburse the Executive for the reasonable fees and expenses
of the Executive's attorneys and for court and related costs in any proceeding
to enforce the provisions of this Agreement in which the Executive is successful
on the merits.
9. Confidential
Information.
The
Executive acknowledges that, in the course of his employment by the Employers,
he will have access to confidential or proprietary information and trade secrets
relating to the business of the Employers and that the Employers desire to
protect including, but not limited to (i) trade secrets, business plans,
software programs, operating plans, marketing plans, financial reports,
operating data, budgets, wage and salary rates, terms of agreements with
suppliers or customers, customer lists, reports, correspondence, tapes, disks,
tangible property and specification owned by or used in the Employers’
businesses, (ii) operating strengths and weaknesses of the Employers’ officers,
directors, employees, agents, suppliers and customers and/or (iii) information
pertaining to future development such as, but not limited to, future marketing
plans or ideas and plans or ideas for new services or products, information
and
data relating to the Employers’ strategic plans and acquisition strategies; (iv)
all information which is learned by the Executive in the course and performance
of his duties under this Agreement and (v) other tangible and intangible
property which is used in the business operations of the Employers but not
made
publicly available (the “Confidential Information”).
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10. Treatment
of Confidential Information; Confidentiality Agreements.
The
Executive will not, directly or indirectly, disclose, use or make known for
the
Executive’s or another’s benefit any Confidential Information, as defined above,
of the Employers or use such Confidential Information in any way except in
the
best interests of the Employers in the performance of the Executive’s duties for
the Employers. The Executive will take all necessary steps to safeguard the
Employers’ Confidential Information. In addition, to the extent that the
Employers have entered into a confidentiality agreement with any other person
or
entity, the Executive agrees to comply with the terms of such confidentiality
agreement and to be subject to the restrictions and limitations imposed by
such
confidentiality agreements as if the Executive was a party thereto.
11. Non-competition. During
the term of this Agreement and during any period for which Executive is entitled
to receive compensation after the termination of this Agreement or pursuant
to
any other agreement (but, in any case, for a period of not less than six (6)
months after the termination of this Agreement), Executive shall not engage,
anywhere within New York State or in any area outside of New York State in
which
the Employers conduct business, whether directly or indirectly, as principal,
owner, officer, director, agent, employee, consultant or partner, in the
management of a bank holding company, commercial bank, savings bank, credit
union or any other financial services provider that competes with the Employers
or their products or programs (“Restricted Activities”), provided that the
foregoing shall not restrict Executive from engaging in any Restricted
Activities which the Employers direct Executive to undertake or which the
Employers otherwise expressly authorizes. The foregoing shall not restrict
Executive from owning less than five percent (5%) of the outstanding capital
stock of any company which engages in Restricted Activities, provided that
Executive is not otherwise involved with such company as an officer, director,
agent, employee or consultant. The foregoing provisions of this Section 11
shall
not be held invalid because of the scope of the territory covered, the actions
restricted thereby, or the period of time such covenant is operative.
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12. Non-solicitation.
During
the term of this Agreement and during the period for which Executive is entitled
to receive compensation after the termination of this Agreement or pursuant
to
any other agreement,
and
for a
period of six-months thereafter, Executive shall not, directly or indirectly,
without the written consent of the Employers: (i) recruit or solicit for
employment any employee of the Employers or encourage any such employee to
leave
their employment with the Employers, or (ii) solicit, induce or influence
any customer, supplier, lessor or any other person or entity which has a
business relationship with the Employers to discontinue or reduce the extent
of
such relationship with the Employers.
13. Effect
of Regulatory Actions.
Any
actions by the Employers under this Agreement must comply with the law,
including regulations and other interpretive action, of the Federal Deposit
Insurance Act, Federal Deposit Insurance Corporation, or other entities that
supervise any of the activities of the Employer. Specifically:
(a) Temporary
Suspension or Prohibition.
If the
Executive is suspended from office or temporarily prohibited from participating
in the conduct of the affairs of any banking subsidiary of GLB by a notice
served under Section 8(e)(3) or (g)(1) of the Federal Deposit Insurance Act
(“FDIA”), 12 U.S.C. § 1818(e)(3) and (g)(1), the Employers’ obligations under
this Agreement will be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the
Employers, in their discretion, may (i) pay the Executive all or part of the
compensation withheld while its obligations under this Agreement were suspended
and (ii) reinstate in whole or in part any of its obligations that were
suspended.
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(b) Permanent
Suspension or Prohibition.
If the
Executive is removed from office or permanently prohibited from participating
in
the conduct of the affairs of any banking subsidiary of GLB by an order issued
under Section 8(e)(4) or (g)(1) of the FDIA, 12 U.S.C. § 1818(e)(4) and (g)(1),
all obligations of the Employers under this Agreement will terminate as of
the
effective date of the order, but vested rights of the Parties will not be
affected.
(c) Default
of the Bank.
If any
banking subsidiary of GLB is in default (as defined in Section 3(x)(1) of the
FDIA, 12 U.S.C. § 1813(x)(1)), all obligations under this Agreement will
terminate as of the date of default, but vested rights of the Parties will
not
be affected.
(d) Termination
by Regulators.
All
obligations under this Agreement will be terminated, except to the extent
determined by the federal bank regulatory agency of any banking subsidiary
of
GLB that continuation of this Agreement is necessary for the continued operation
of the banking subsidiary, if (1) the governing federal bank regulatory agency
enters into an agreement to provide assistance to or on behalf of a banking
subsidiary of GLB under the authority contained in Section 13(c) of the
FDIA, 12 U.S.C. § 1823(c); or (2) such banking subsidiary of GLB is determined
by the federal bank regulatory authority to be in an unsafe or unsound
condition. However, vested rights of the Parties will not be
affected.
(e) Vested
Rights.
For
purposes of this Section 13, to determine the “vested rights of the Parties,” a
right shall be deemed vested if, but for this Agreement, such right would be
vested for purposes of any applicable agreement or applicable law and this
Agreement shall not expand or contract such right.
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14. Representation
and Warranty of the Executive.
The
Executive represents and warrants that he is not under any obligation,
contractual or otherwise, to any other firm or corporation, that would prevent
his entry into the employ of the Employers or his performance of the terms
of
this Agreement.
15. Entire
Agreement; Amendment.
This
Agreement contain the entire agreement between the Employers and the Executive
with respect to the subject matter hereof, and may not be amended, waived,
changed, modified or discharged except by an instrument in writing executed
by
the Employers and the Executive. This Agreement supersedes any previous
agreements between the Employers and the Executive with respect to the subject
matter hereof.
16. Assignability.
The
services of the Executive under this Agreement are personal in nature, and
neither this Agreement nor the rights or obligations of the Employers under
this
Agreement may be assigned by the Employers, whether by operation of law or
otherwise, without the Executive's prior written consent. This Agreement shall
be binding upon, and inure to the benefit of, the Employers and their permitted
successors and assigns under this Agreement. This Agreement shall not be
assignable by the Executive, but shall inure to the benefit of the Executive's
heirs, executors, administrators and legal representatives.
17. Notice.
Any
notice that may be given under this Agreement shall be in writing and be deemed
given when hand delivered and acknowledged or, if mailed, one day after mailing
by registered or certified mail, return receipt requested, or if delivered
by an
overnight delivery service, one day after the notice is delivered to such
service, to either the Employers or the Executive at their respective addresses
stated above, or at such other address as the Executive or the Employers may
by
similar notice designate.
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18. Specific
Performance.
The
Employers and the Executive agree that irreparable damage would occur in the
event that any of the provisions of Sections 9-13 were not performed in
accordance with their specific terms or were otherwise breached. The Executive
accordingly agrees that the Employers shall be entitled to an injunction or
injunctions to prevent breaches of Sections 9-12 and to enforce specifically
the
terms and provisions of Sections 9-12 in addition to any other remedy to which
the Employers are entitled at law or in equity.
19. No
Third Party Beneficiaries.
Nothing
in this Agreement, express or implied, is intended to confer upon any person
or
entity other than the Parties (and the Executive's heirs, executors,
administrators and legal representatives and the permitted transferees of the
Shares) any rights or remedies of any nature under or by reason of this
Agreement.
20. Successor
Liability.
The
Employers 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 Employers to assume expressly and agree to perform this
Agreement in the same manner and to the same extent that the Employers would
be
required to perform it if no such succession had taken place.
21. Mitigation.
The
Executive shall not be required to mitigate the amount of any payment provided
for in this Agreement by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this Agreement be reduced
by
any compensation earned by the Executive as the result of employment by another
employer or by retirement benefits payable after the termination of this
Agreement, except that the Employers shall not be required to provide the
Executive and his eligible dependents with medical insurance coverage as long
as
the Executive and his eligible dependents are receiving comparable medical
insurance coverage from another employer.
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22. Waiver
of Breach.
The
failure at any time to enforce or exercise any right under any of the provisions
of this Agreement or to require at any time performance by the other Parties
of
any of the provisions hereof shall in no way be construed to be a waiver of
such
provisions or to affect either the validity of this Agreement or any part
hereof, or the right of any party hereafter to enforce or exercise its rights
under each and every provision in accordance with the terms of this Agreement.
23. No
Attachment.
Except
as required by law, no right to receive payments under this Agreement shall
be
subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge or hypothecation or to execution, attachment, levy or similar
process or assignment by operation of law, and any attempt, voluntary or
involuntary, to effect any such action shall be null, void and of no effect;
provided, however, that nothing in this Section 16 shall preclude the assumption
of such rights by executors, administrators or other legal representatives
of
the Executive or his estate and their assigning any rights under this Agreement
to the person or persons entitled hereto.
24. Severability.
The
invalidity or unenforceability of any term, phrase, clause, paragraph,
restriction, covenant, agreement or other provision of this Agreement shall
in
no way affect the validity or enforceability of any other provision, or any
part
thereof, but this Agreement shall be construed as if such invalid or
unenforceable term, phrase, clause, paragraph, restriction, covenant, agreement
or other provision had never been contained in this Agreement unless the
deletion of such term, phrase, clause, paragraph, restriction, covenant,
agreement or other provision would result in such a material change as to cause
the covenants and agreements contained in this Agreement to be unreasonable
or
would materially and adversely frustrate the objectives of the Employers and
the
Executive as expressed in this Agreement.
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25. Survival
of Benefits.
Any
provision of this Agreement that provides a benefit to the Executive and that
by
the express terms hereof does not terminate upon the expiration of the Term
shall survive the expiration of the Term and shall remain binding upon the
Employers until such time as such benefits are paid in full to the Executive
or
his estate.
26. Construction.
This
Agreement shall be governed by and construed in accordance with the internal
laws of the State of New York, without giving effect to principles of conflict
of laws. All headings in this Agreement have been inserted solely for
convenience of reference only, are not to be considered a part of this Agreement
and shall not affect the interpretation of any of the provisions of this
Agreement.
[Remainder
of Page Intentionally Left Blank. Signature Page Follows.]
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IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date
first written above.
| GREATER BUFFALO SAVINGS BANK | ||
| |
|
|
| By: | ||
|
Xxxxxx
X. Xxxx, Xx., President
and
Chief Executive Officer
|
||
|
Xxxxx X. Xxxxxxx March
12, 2007
|
||
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