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Exhibit 10.4
THIS AGREEMENT is entered into as of the 1st day of February, 1997 by and
between Mellon Bank Corporation (the "Company"), a Pennsylvania corporation,
and Xxxxx X. Xxxxxxx ("Executive").
W I T N E S S E T H
WHEREAS, the Company considers the establishment and maintenance of a
sound and vital management to be essential to protecting and enhancing the best
interests of the Company and its shareholders; and
WHEREAS, the Company recognizes that, as is the case with many publicly
held corporations, the possibility of a change in control may arise and that
such possibility may result in the departure or distraction of management
personnel to the detriment of the Company and its shareholders; and
WHEREAS, the Human Resources Committee (the "Committee") of the Board of
Directors of the Company (the "Board") has determined that it is in the best
interests of the Company and its shareholders to secure Executive's continued
services and to ensure Executive's continued and undivided dedication to his
duties in the event of any threat or occurrence of a Change in Control (as
defined in Section 1) of the Company; and
WHEREAS, the Committee has authorized the Company to enter into this
Agreement.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Company and Executive hereby agree as follows:
1. Definitions. As used in this Agreement, the following terms shall have
the respective meanings set forth below:
(a) "Bonus Amount" means the highest annual incentive bonus earned by
Executive from the Company (or its affiliates) during the last three (3)
completed fiscal years of the Company immediately preceding Executive's Date of
Termination (annualized in the event Executive was not employed by the Company
(or its affiliates) for the whole of any such fiscal year).
(b) "Cause" means (i) the willful and continued failure of Executive
to perform substantially his duties with the Company (other than any such
failure resulting from Executive's incapacity due to physical or mental illness
or any such failure subsequent to Executive being delivered a Notice of
Termination without Cause by the Company or delivering a Notice of Termination
for Good Reason to the Company) after a written demand for substantial
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performance is delivered to Executive by the Board which specifically
identifies the manner in which the Board believes that Executive has not
substantially performed Executive's duties, (ii) the willful engaging by
Executive in illegal conduct or gross misconduct which is demonstrably and
materially injurious to the Company or its affiliates, or (iii) the conviction
of Executive of, or a plea by Executive of nolo contendere to, a felony. For
purpose of this paragraph (b), no act or failure to act by Executive shall be
considered "willful" unless done or omitted to be done by Executive in bad
faith and without reasonable belief that Executive's action or omission was in
the best interests of the Company or its affiliates. Any act, or failure to
act, based upon authority given pursuant to a resolution duly adopted by the
Board, based upon the advice of counsel for the Company or upon the
instructions of the Company's chief executive officer or another senior officer
of the Company shall be conclusively presumed to be done, or omitted to be
done, by Executive in good faith and in the best interests of the Company.
Cause shall not exist unless and until the Company has delivered to Executive a
copy of a resolution duly adopted by three-fourths (3/4) of the entire Board
(excluding Executive if Executive is a Board member) at a meeting of the Board
called and held for such purpose (after reasonable notice to Executive and an
opportunity for Executive, together with counsel, to be heard before the
Board), finding that in the good faith opinion of the Board an event set forth
in clauses (i) or (ii) has occurred and specifying the particulars thereof in
detail. The Company must notify Executive of any event constituting Cause
within ninety (90) days following the Company's knowledge of its existence or
such event shall not constitute Cause under this Agreement.
(c) "Change in Control" means the occurrence of any one of the
following events:
(i) individuals who, on January 17, 1997, constitute the Board (the
"Incumbent Directors") cease for any reason to constitute at least a
majority of the Board, provided that any person becoming a director
subsequent to January 17, 1997, whose election or nomination for election
was approved by a vote of at least two-thirds of the Incumbent Directors
then on the Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
director, without written objection by such Incumbent Directors to such
nomination) shall be deemed to be an Incumbent Director; provided,
however, that no individual elected or nominated as a director of the
Company initially as a result of an actual or threatened election contest
with respect to directors or any other actual or threatened solicitation
of proxies by or on behalf of any person other than the Board shall be
deemed to be an Incumbent Director;
(ii) any "person" (as such term is defined in Section 3(a)(9) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and
as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or
becomes a "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing
15% or more of the
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combined voting power of the Company's then outstanding securities
eligible to vote for the election of the Board (the "Company Voting
Securities"); provided, however, that the event described in this
paragraph (ii) shall not be deemed to be a Change in Control by virtue of
any of the following acquisitions: (A) by the Company or any Subsidiary,
(B) by any employee benefit plan sponsored or maintained by the Company or
any Subsidiary, or by any employee stock benefit trust created by the
Company or any Subsidiary, (C) by any underwriter temporarily holding
securities pursuant to an offering of such securities, (D) pursuant to a
Non-Qualifying Transaction (as defined in paragraph (iii)), (E) pursuant
to any acquisition by Executive or any group of persons including
Executive (or any entity controlled by Executive or any group of persons
including Executive); or (F) a transaction (other than one described in
(iii) below) in which Company Voting Securities are acquired from the
Company, if a majority of the Incumbent Directors approves a resolution
providing expressly that the acquisition pursuant to this clause (F) does
not constitute a Change in Control under this paragraph (ii);
(iii) the consummation of a merger, consolidation, share exchange
or similar form of corporate transaction involving the Company or any of
its Subsidiaries that requires the approval of the Company's shareholders,
whether for such transaction or the issuance of securities in the
transaction (a "Business Combination"), unless immediately following such
Business Combination: (A) more than 50% of the total voting power of (x)
the corporation resulting from the consummation of such Business
Combination (the "Surviving Corporation"), or (y) if applicable, the
ultimate parent corporation that directly or indirectly has beneficial
ownership of 100% of the voting securities eligible to elect directors of
the Surviving Corporation (the "Parent Corporation"), is represented by
Company Voting Securities that were outstanding immediately prior to such
Business Combination (or, if applicable, represented by shares into which
such Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company
Voting Securities among the holders thereof immediately prior to the
Business Combination, (B) no person (other than any employee benefit plan
sponsored or maintained by the Surviving Corporation or the Parent
Corporation or any employee stock benefit trust created by the Surviving
Corporation or the Parent Corporation), is or becomes the beneficial
owner, directly or indirectly, of 15% or more of the total voting power of
the outstanding voting securities eligible to elect directors of the
Parent Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) and (C) at least a majority of the members of the board of
directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation) were Incumbent Directors at the
time of the Board's approval of the execution of the initial agreement
providing for such Business Combination (any Business
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Combination which satisfies all of the criteria specified in (A), (B) and
(C) above shall be deemed to be a "Non-Qualifying Transaction"); or
(iv) the shareholders of the Company approve a plan of complete
liquidation or dissolution of the Company or a sale of all or
substantially all of the Company's assets.
Notwithstanding the foregoing, a Change in Control of the Company shall
not be deemed to occur solely because any person acquires beneficial ownership
of more than 15% of the Company Voting Securities as a result of the
acquisition of Company Voting Securities by the Company which reduces the
number of Company Voting Securities outstanding; provided, that if after such
acquisition by the Company such person becomes the beneficial owner of
additional Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such person, a
Change in Control of the Company shall then occur.
(d) "Date of Termination" means (1) the effective date on which
Executive's employment by the Company terminates as specified in a prior
written notice by the Company or Executive, as the case may be, to the other,
delivered pursuant to Section 10 or (2) if Executive's employment by the
Company terminates by reason of death, the date of death of Executive.
(e) "Disability" means termination of Executive's employment by the
Company due to Executive's absence from Executive's duties with the Company on
a full-time basis for at least one hundred eighty (180) consecutive days as a
result of Executive's incapacity due to physical or mental illness.
(f) "Good Reason" means, without Executive's express written consent,
the occurrence of any of the following events after a Change in Control:
(i) (A) any change in the duties or responsibilities (including
reporting responsibilities) of Executive that is inconsistent in any
material and adverse respect with Executive's position(s), duties,
responsibilities or status with the Company immediately prior to such
Change in Control (including any material and adverse diminution of such
duties or responsibilities) or (B) a material and adverse change in
Executive's titles or offices (including, if applicable, membership on the
Board) with the Company as in effect immediately prior to such Change in
Control;
(ii) (A) a reduction by the Company in Executive's rate of annual
base salary as in effect immediately prior to such Change in Control or as
the same may be increased from time to time thereafter, or (B) the failure
by the Company to pay Executive an annual bonus in respect of the year in
which such Change in
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Control occurs or any subsequent year in an amount greater than or equal to
the annual bonus earned for the year prior to the year in which such
Change in Control occurs;
(iii) any requirement of the Company that Executive (A) be based
anywhere more than fifty (50) miles from the office where Executive is
located at the time of the Change in Control or (B) travel on Company
business to an extent substantially greater than the travel obligations of
Executive immediately prior to such Change in Control;
(iv) the failure of the Company to (A) continue in effect any
employee benefit plan, compensation plan, welfare benefit plan or material
fringe benefit plan in which Executive is participating immediately prior
to such Change in Control or the taking of any action by the Company which
would adversely affect Executive's participation in or reduce Executive's
benefits under any such plan, unless Executive is permitted to participate
in other plans providing Executive with substantially equivalent benefits
in the aggregate (at substantially equivalent cost with respect to welfare
benefit plans), or (B) provide Executive with paid vacation in accordance
with the most favorable vacation policies of the Company and its
affiliated companies as in effect for Executive immediately prior to such
Change in Control, including the crediting of all service for which
Executive had been credited under such vacation policies prior to the
Change in Control; or
(v) the failure of the Company to obtain the assumption (and, if
applicable, guarantee) agreement from any successor (and Parent
Corporation) as contemplated in Section 9(b).
Notwithstanding anything herein to the contrary, termination of employment
by Executive for any reason during the 30-day period commencing one (1) year
after the date of a Change in Control shall constitute Good Reason.
An isolated, insubstantial and inadvertent action taken in good faith and
which is remedied by the Company within ten (10) days after receipt of notice
thereof given by Executive shall not constitute Good Reason. Executive's right
to terminate employment for Good Reason shall not be affected by Executive's
incapacities due to mental or physical illness and Executive's continued
employment shall not constitute consent to, or a waiver of rights with respect
to, any event or condition constituting Good Reason; provided, however, that
Executive must provide notice of termination of employment within one-hundred
eighty (180) days following Executive's knowledge of an event constituting Good
Reason or such event shall not constitute Good Reason under this Agreement.
(g) "Qualifying Termination" means a termination of Executive's
employment (i) by the Company other than for Cause or (ii) by Executive for
Good Reason. Termination of
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Executive's employment on account of death, Disability or Retirement shall not
be treated as a Qualifying Termination.
(h) "Retirement" means the termination of Executive's employment on or
after the first of the month coincident with or following Executive's
attainment of age 65, or such later date as may be provided in a written
agreement between the Company and the Executive.
(i) "Subsidiary" means any corporation or other entity in which the
Company has a direct or indirect ownership interest of 50% or more of the total
combined voting power of the then outstanding securities or interests of such
corporation or other entity entitled to vote generally in the election of
directors or in which the Company has the right to receive 50% or more of the
distribution of profits or 50% of the assets upon liquidation or dissolution.
(j) "Termination Period" means the period of time beginning with a
Change in Control and ending three (3) years following such Change in Control.
Notwithstanding anything in this Agreement to the contrary, if (i) Executive's
employment is terminated prior to a Change in Control for reasons that would
have constituted a Qualifying Termination if they had occurred following a
Change in Control; (ii) Executive reasonably demonstrates that such termination
(or Good Reason event) was at the request of a third party who had indicated an
intention or taken steps reasonably calculated to effect a Change in Control;
and (iii) a Change in Control involving such third party (or a party competing
with such third party to effectuate a Change in Control) does occur, then for
purposes of this Agreement, the date immediately prior to the date of such
termination of employment or event constituting Good Reason shall be treated as
a Change in Control. For purposes of determining the timing of payments and
benefits to Executive under Section 4, the date of the actual Change in Control
shall be treated as Executive's Date of Termination under Section 1(d).
2. Obligation of Executive. In the event of a tender or exchange offer,
proxy contest, or the execution of any agreement which, if consummated, would
constitute a Change in Control, Executive agrees not to voluntarily leave the
employ of the Company, other than as a result of Disability, Retirement or an
event which would constitute Good Reason if a Change in Control had occurred,
until the Change in Control occurs or, if earlier, such tender or exchange
offer, proxy contest, or agreement is terminated or abandoned.
3. Term of Agreement. This Agreement shall be effective on the date hereof
and shall continue in effect until the Company shall have given three (3)
years' written notice of cancellation; provided, that, notwithstanding the
delivery of any such notice, this Agreement shall continue in effect for a
period of three (3) years after a Change in Control, if such Change in Control
shall have occurred during the term of this Agreement. Notwithstanding anything
in this Section to the contrary, this Agreement shall terminate if Executive or
the Company terminates Executive's employment prior to a Change in Control
except as provided in Section 1(j).
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4. Payments Upon Termination of Employment.
(a) Qualifying Termination -- Cash Payment. If during the Termination
Period the employment of Executive shall terminate pursuant to a Qualifying
Termination, then the Company shall provide to Executive, subject to the
provisions of Section 11 hereunder:
(i) within twenty (20) days following the Date of Termination a
lump-sum cash amount equal to the sum of (A) Executive's base salary
through the Date of Termination and any bonus amounts which have become
payable, to the extent not theretofore paid or deferred, (B) a pro rata
portion of Executive's annual bonus for the fiscal year in which
Executive's Date of Termination occurs in an amount at least equal to (1)
Executive's Bonus Amount, multiplied by (2) a fraction, the numerator of
which is the number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the denominator of
which is three hundred sixty-five (365), and reduced by (3) any amounts
paid from the Company's annual incentive plan for the fiscal year in which
Executive's Date of Termination occurs and (C) any accrued vacation pay,
to the extent not theretofore paid; plus
(ii) within twenty (20) days following the Date of Termination, a
lump-sum cash amount equal to the sum of (i) three (3) times Executive's
highest annual rate of base salary during the 12-month period immediately
prior to Executive's Date of Termination, plus (ii) three (3) times
Executive's Bonus Amount; provided, however, that if Executive's Date of
Termination is within three (3) years of the earliest date on which
termination by the Executive could otherwise be considered a Retirement
("Retirement Date"), such sum shall be multiplied by a fraction
("Adjustment Fraction"), the numerator of which is equal to the number of
full months from the Date of Termination to the Retirement Date, and the
denominator of which is equal to 36.
(b) Qualifying Termination -- Continued Coverage. If during the
Termination Period the employment of Executive shall terminate pursuant to a
Qualifying Termination, the Company shall continue to provide, for a period of
three (3) years following Executive's Date of Termination, Executive (and
Executive's dependents, if applicable) with the same level of medical, dental,
accident, disability and life insurance benefits upon substantially the same
terms and conditions (including contributions required by Executive for such
benefits) as existed immediately prior to Executive's Date of Termination (or,
if more favorable to Executive, as such benefits and terms and conditions
existed immediately prior to the Change in Control); provided, however, that if
Executive's Date of Termination is within three (3) years of Executive's
Retirement Date, the number of years of continued benefits coverage (as
described in this Section 4(b)) shall be equal to the product of (x) three, and
(y) the Adjustment Fraction; provided, further, if Executive cannot continue to
participate in the Company plans providing such benefits, the Company shall
otherwise provide such benefits on the same after-tax basis as if
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continued participation had been permitted. Notwithstanding the foregoing, in
the event Executive becomes reemployed with another employer and becomes
eligible to receive welfare benefits from such employer, the welfare benefits
described herein shall be secondary to such benefits during the period of
Executive's eligibility, but only to the extent that the Company reimburses
Executive for any increased cost and provides any additional benefits necessary
to give Executive the benefits provided hereunder. The Executive's accrued
benefits as of the Date of Termination under the Company's employee benefit
plans shall be paid to Executive in accordance with the terms of such plans.
(c) Qualifying Termination -- SERP Accrual. If during the Termination
Period the employment of Executive shall terminate pursuant to a Qualifying
Termination, the Company shall provide Executive with three (3) additional
years of service credit under all non-qualified retirement plans and excess
benefit plans in which the Executive participated as of his Date of
Termination; provided, however, that if Executive's Date of Termination is
within three (3) years of Executive's Retirement Date, the number of years of
additional service credit (as described in this Section 4(c)) shall be equal to
the product of (x) three, and (y) the Adjustment Fraction.
(d) Other than Qualifying Termination. If during the Termination
Period the employment of Executive shall terminate other than by reason of a
Qualifying Termination, then the Company shall pay to Executive within thirty
(30) days following the Date of Termination, a lump-sum cash amount equal to
the sum of (1) Executive's base salary through the Date of Termination and any
bonus amounts which have become payable, to the extent not theretofore paid or
deferred, and (2) any accrued vacation pay, to the extent not theretofore paid.
The Company may make such additional payments, and provide such additional
benefits, to Executive as the Company and Executive may agree in writing. The
Executive's accrued benefits as of the Date of Termination under the Company's
employee benefit plans shall be paid to Executive in accordance with the terms
of such plans.
5. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payment, award, benefit or distribution
(or any acceleration of any payment, award, benefit or distribution) by the
Company (or any of its affiliated entities) or any entity which effectuates a
Change in Control (or any of its affiliated entities) to or for the benefit of
Executive (whether pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this
Section 5) (the "Payments") would be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), or
any interest or penalties are incurred by Executive 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"), then the Company
shall pay to Executive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by Executive of all taxes (including any Excise
Tax) imposed upon the Gross-Up Payment, Executive retains
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an amount of the Gross-Up Payment equal to the sum of (x) the Excise Tax
imposed upon the Payments and (y) the product of any deductions disallowed
because of the inclusion of the Gross-Up Payment in Executive's adjusted gross
income and the highest applicable marginal rate of federal income taxation for
the calendar year in which the Gross-Up Payment is to be made. For purposes of
determining the amount of the Gross-Up Payment, the Executive shall be deemed
to (i) pay federal income taxes at the highest marginal rates of federal income
taxation for the calendar year in which the Gross-Up Payment is to be made,
(ii) pay applicable state and local income taxes at the highest marginal rate
of taxation for the calendar year in which the Gross-Up Payment is to be made,
net of the maximum reduction in federal income taxes which could be obtained
from deduction of such state and local taxes and (iii) have otherwise allowable
deductions for federal income tax purposes at least equal to the Gross-Up
Payment. Notwithstanding the foregoing provisions of this Section 5(a), if it
shall be determined that Executive is entitled to a Gross-Up Payment, but that
the Payments would not be subject to the Excise Tax if the Payments were
reduced by an amount that is less than 5% of the portion of the Payments that
would be treated as "parachute payments" under Section 280G of the Code, then
the amounts payable to Executive under this Agreement shall be reduced (but not
below zero) to the maximum amount that could be paid to Executive without
giving rise to the Excise Tax (the "Safe Harbor Cap"), and no Gross-Up Payment
shall be made to Executive. The reduction of the amounts payable hereunder, if
applicable, shall be made by reducing first the payments under Section
4(a)(ii), unless an alternative method of reduction is elected by Executive.
For purposes of reducing the Payments to the Safe Harbor Cap, only amounts
payable under this Agreement (and no other Payments) shall be reduced. If the
reduction of the amounts payable hereunder would not result in a reduction of
the Payments to the Safe Harbor Cap, no amounts payable under this Agreement
shall be reduced pursuant to this provision.
(b) Subject to the provisions of Section 5(a), all determinations
required to be made under this Section 5, including whether and when a Gross-Up
Payment is required, the amount of such Gross-Up Payment, the reduction of the
Payments to the Safe Harbor Cap and the assumptions to be utilized in arriving
at such determinations, shall be made by the public accounting firm that is
retained by the Company as of the date immediately prior to the Change in
Control (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and Executive within fifteen (15) business
days of the receipt of notice from the Company or the Executive that there has
been a Payment, or such earlier time as is requested by the Company
(collectively, the "Determination"). In the event that the Accounting Firm is
serving as accountant or auditor for the individual, entity or group effecting
the Change in Control, Executive may appoint another nationally recognized
public accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm hereunder).
All fees and expenses of the Accounting Firm shall be borne solely by the
Company and the Company shall enter into any agreement requested by the
Accounting Firm in connection with the performance of the services hereunder.
The Gross-Up Payment under this Section 5 with respect to any Payments shall be
made no later than thirty (30) days following such Payment. If the Accounting
Firm determines that no Excise Tax is payable by Executive, it shall furnish
Executive with a written opinion to such effect, and to the effect that
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failure to report the Excise Tax, if any, on Executive's applicable federal
income tax return will not result in the imposition of a negligence or similar
penalty. In the event the Accounting Firm determines that the Payments shall be
reduced to the Safe Harbor Cap, it shall furnish Executive with a written
opinion to such effect. The Determination by the Accounting Firm shall be
binding upon the Company and Executive. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the Determination, it is
possible that Gross-Up Payments which will not have been made by the Company
should have been made ("Underpayment") or Gross-Up Payments are made by the
Company which should not have been made ("Overpayment"), consistent with the
calculations required to be made hereunder. In the event that the Executive
thereafter is required to make payment of any Excise Tax or additional Excise
Tax, the Accounting Firm shall determine the amount of the Underpayment that
has occurred and any such Underpayment (together with interest at the rate
provided in Section 1274(b)(2)(B) of the Code) shall be promptly paid by the
Company to or for the benefit of Executive. In the event the amount of the
Gross-Up Payment exceeds the amount necessary to reimburse the Executive for
his Excise Tax, the Accounting Firm shall determine the amount of the
Overpayment that has been made and any such Overpayment (together with interest
at the rate provided in Section 1274(b)(2) of the Code) shall be promptly paid
by Executive (to the extent he has received a refund if the applicable Excise
Tax has been paid to the Internal Revenue Service) to or for the benefit of the
Company. Executive shall cooperate, to the extent his expenses are reimbursed
by the Company, with any reasonable requests by the Company in connection with
any contests or disputes with the Internal Revenue Service in connection with
the Excise Tax.
6. Withholding Taxes. The Company may withhold from all payments due to
Executive (or his beneficiary or estate) hereunder all taxes which, by
applicable federal, state, local or other law, the Company is required to
withhold therefrom.
7. Reimbursement of Expenses. If any contest or dispute shall arise under
this Agreement involving termination of Executive's employment with the Company
or involving the failure or refusal of the Company to perform fully in
accordance with the terms hereof, the Company shall reimburse Executive, on a
current basis, for all reasonable legal fees and expenses, if any, incurred by
Executive in connection with such contest or dispute (regardless of the result
thereof), together with interest in an amount equal to the prime rate of Mellon
Bank, N.A. (or, if such prime rate is not available from Mellon Bank, N.A., the
prime rate of Citibank, N.A.) from time to time in effect, but in no event
higher than the maximum legal rate permissible under applicable law, such
interest to accrue from the date the Company receives Executive's statement for
such fees and expenses through the date of payment thereof, regardless of
whether or not Executive's claim is upheld by an arbitration panel.
8. Scope of Agreement. Nothing in this Agreement shall be deemed to
entitle Executive to continued employment with the Company or its Subsidiaries,
and if Executive's employment with the Company shall terminate prior to a
Change in Control, Executive shall have no further rights under this Agreement
(except as otherwise provided hereunder); provided,
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however, that any termination of Executive's employment during the Termination
Period shall be subject to all of the provisions of this Agreement.
9. Successors; Binding Agreement.
(a) This Agreement shall not be terminated by any Business
Combination. In the event of any Business Combination, the provisions of this
Agreement shall be binding upon the Surviving Corporation, and such Surviving
Corporation shall be treated as the Company hereunder.
(b) The Company agrees that in connection with any Business
Combination, it will cause any successor entity to the Company unconditionally
to assume (and for any Parent Corporation in such Business Combination to
guarantee), by written instrument delivered to Executive (or his beneficiary or
estate), all of the obligations of the Company hereunder. Failure of the
Company to obtain such assumption and guarantee prior to the effectiveness of
any such Business Combination that constitutes a Change in Control shall be a
breach of this Agreement and shall constitute Good Reason hereunder and shall
entitle Executive to compensation and other benefits from the Company in the
same amount and on the same terms as Executive would be entitled hereunder if
Executive's employment were terminated following a Change in Control by reason
of a Qualifying Termination. For purposes of implementing the foregoing, the
date on which any such Business Combination becomes effective shall be deemed
the date Good Reason occurs, and shall be the Date of Termination if requested
by Executive.
(c) This Agreement shall inure to the benefit of and be enforceable by
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If Executive shall die
while any amounts would be payable to Executive hereunder had Executive
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to such person or persons
appointed in writing by Executive to receive such amounts or, if no person is
so appointed, to Executive's estate.
10. Notice.
(a) For purposes of this Agreement, all notices and other
communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given when delivered or five (5) days after deposit in
the United States mail, certified and return receipt requested, postage
prepaid, addressed as follows:
If to the Executive:
At the address set forth below the signatory.
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If to the Company:
Mellon Bank Corporation
Xxx Xxxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Corporate Secretary
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
(b) A written notice of Executive's Date of Termination by the Company
or Executive, as the case may be, to the other, shall (i) indicate the specific
termination provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of Executive's employment under the
provision so indicated and (iii) specify the Date of Termination (which date
shall be not less than fifteen (15) (thirty (30), if termination is by the
Company for Disability) nor more than sixty (60) days after the giving of such
notice). The failure by Executive or the Company to set forth in such notice
any fact or circumstance which contributes to a showing of Good Reason or Cause
shall not waive any right of Executive or the Company hereunder or preclude
Executive or the Company from asserting such fact or circumstance in enforcing
Executive's or the Company's rights hereunder.
11. Full Settlement; Resolution of Disputes. The Company's obligation to
make any payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall be in lieu and in full settlement of all other
severance payments to Executive under any other severance or employment
agreement between Executive and the Company, and any severance plan of the
Company; provided, however, that obligations to Executive under the Employment
Agreement between Mellon Bank, N.A. and Executive, effective July 25, 1993, as
amended and restated October 17, 1995 (the "Prior Agreement") shall remain in
full force and effect; provided, further, that the amount of payments required
to be made under Section 4(a) of this Agreement shall be reduced (but not below
zero) by the amount of severance payments made pursuant to the Prior Agreement.
The Company's obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against Executive or others. In no event shall Executive be
obligated to seek other employment or take other action by way of mitigation of
the amounts payable to Executive under any of the provisions of this Agreement
and, except as provided in Section 4(b), such amounts shall not be reduced
whether or not Executive obtains other employment. Any dispute or controversy
arising under or in connection with this Agreement shall be settled exclusively
by arbitration in Pittsburgh, Pennsylvania, by three arbitrators in accordance
with the rules of the American Arbitration Association then in effect. Judgment
may be entered on the arbitrators' award in any court having jurisdiction. The
Company shall bear all costs and expenses arising in connection with any
arbitration proceeding pursuant to this Section.
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12. Employment with Subsidiaries. Employment with the Company for purposes
of this Agreement shall include employment with any Subsidiary.
13. Survival. The respective obligations and benefits afforded to the
Company and Executive as provided in Sections 4 (to the extent that payments or
benefits are owed as a result of a termination of employment that occurs during
the term of this Agreement), 5 (to the extent that Payments are made to
Executive as a result of a Change in Control that occurs during the term of
this Agreement), 6, 7, 9(c) and 11 shall survive the termination of this
Agreement.
14. GOVERNING LAW; VALIDITY. THE INTERPRETATION, CONSTRUCTION AND
PERFORMANCE OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE COMMONWEALTH OF PENNSYLVANIA
WITHOUT REGARD TO THE PRINCIPLE OF CONFLICTS OF LAWS. THE INVALIDITY OR
UNENFORCEABILITY OF ANY PROVISION OF THIS AGREEMENT SHALL NOT AFFECT THE
VALIDITY OR ENFORCEABILITY OF ANY OTHER PROVISION OF THIS AGREEMENT, WHICH
OTHER PROVISIONS SHALL REMAIN IN FULL FORCE AND EFFECT.
15. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original and all of which together shall
constitute one and the same instrument.
16. Miscellaneous. No provision of this Agreement may be modified or
waived unless such modification or waiver is agreed to in writing and signed by
Executive and by a duly authorized officer of the Company. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. Except
as set forth in Sections 1(b) and 1(f), the failure by Executive or the Company
to insist upon strict compliance with any provision of this Agreement or to
assert any right Executive or the Company may have hereunder shall not be
deemed to be a waiver of such provision or right or any other provision or
right of this Agreement. Except as otherwise specifically provided herein, the
rights of, and benefits payable to, Executive, his estate or his beneficiaries
pursuant to this Agreement are in addition to any rights of, or benefits
payable to, Executive, his estate or his beneficiaries under any other employee
benefit plan or compensation program of the Company.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by a duly authorized officer of the Company and Executive has executed this
Agreement as of the day and year first above written.
MELLON BANK CORPORATION
X.X. XXXXXXXXX
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By: Xxxxxx X. Xxxxxxxxx
Title: Chairman, Human
Resources Committee
EXECUTIVE
XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
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