EXHIBIT 10.4
FIRST AMENDMENT TO THE EMPLOYMENT AGREEMENT
DATED JANUARY 18, 2002
BY AND BETWEEN XXXX X. XXXXX AND AMERICAN SAVINGS BANK
EXHIBIT 10.4
FIRST AMENDMENT TO THE EMPLOYMENT AGREEMENT
DATED JANUARY 18, 2002
BY AND BETWEEN XXXX X. XXXXX AND AMERICAN SAVINGS BANK
WHEREAS, the Board of Directors of American Savings Bank (the "Bank")
entered into an employment agreement with Xxxx X. Xxxxx ("Executive") dated
January 18, 2002, (the "Agreement"); and
WHEREAS, the Bank and Executive deem it appropriate to amend the Agreement
to reflect prevailing industry practice and clarify certain terms of Executive's
employment; and
WHEREAS, Section 14 of the Agreement provides that the Agreement may be
modified or amended in writing signed by both the Bank and Executive.
NOW, THEREFORE, the Agreement is hereby amended effective June 25, 2002,
as follows:
FIRST CHANGE
Section 3(a) of the Agreement is hereby amended by deleting the last
sentence thereof.
SECOND CHANGE
Section 5(c) of the Agreement is hereby deleted in its entirety and
replaced with the following new Section 5(c):
"(c) Upon the occurrence of a Change in Control followed by Executive's
termination of employment, as provided in paragraph (b) of this Section 5,
the Bank (or its successors) shall pay Executive, or in the event of his
subsequent death, his beneficiary or beneficiaries, or his estate, as the
case may be, as severance pay or liquidated damages, or both, the greater
of: (i) the payments and benefits that would be due for the remaining term
of the Agreement pursuant to the provisions of Section 3 of this
Agreement, or (ii) three (3) times the sum of the following items:
(1) the average of Executive's Base Salary (as defined in
Section 3(a) of the Agreement) at the highest rate in effect
during each of the three (3) most recently completed
calendar years preceding the Change in Control;
(2) the average of the cash incentive compensation or bonus paid
to Executive, or accrued on Executive's behalf, with respect
to each of the three (3) most recently completed calendar
years preceding the Change in Control;
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(3) the average of the income realized by Executive during each
of the three (3) most recently completed calendar years
preceding the Change in Control as a result of the vesting
of any restricted shares of Holding Company common stock
held by or on behalf of Executive;
(4) the sum of the average of the value of the allocation or
contribution made on behalf of Executive by the Bank under
(i) the American Savings Bank Employee Stock Ownership Plan
("ESOP") and the American Savings Bank Employees' Savings &
Profit Sharing Plan and Trust (or any other tax-qualified
defined contribution retirement plan sponsored by the Bank)
and (ii) Section 4.01 of the American Savings Bank
Supplemental Executive Retirement Plan (or any similar
provision of any similar plan then in effect), during each
of the three (3) most recently completed calendar years
preceding the Change in Control; and
(5) the sum of the average of the annual increase in the value
of Executive's benefit under the (i) Retirement Plan for
Employees of American Savings Bank (or any other
tax-qualified defined benefit retirement plan sponsored by
the Bank) and (ii) the American Savings Bank Benefit
Equalization Plan, as amended (or any similar plan then in
effect), during each of the three (3) most recently
completed calendar years preceding the Change in Control;
and
(6) the average of the value of the premiums paid by the Bank on
Executive's behalf with respect to all employee welfare
benefit plans (including, but not limited to, group health,
dental, life and disability plans) in which Executive
participated during each of the three (3) most recently
completed calendar years preceding the Change in Control;
and
(7) the average of any other taxable income included by the
Holding Company or the Bank on Executive's Form W-2 or
reflected on a Form 1099 provided by the Holding Company or
the Bank to Executive (but excluding income (i) attributable
to the Executive's exercise of a non-statutory stock option
to acquire Holding Company common stock, (ii) the
disqualifying disposition of an incentive stock option to
acquire Holding Company common stock, (iii) relating to the
distribution to Executive of benefits under any
tax-qualified or non-tax-qualified retirement or deferred
compensation plan sponsored by the Holding Company or the
Bank or any retirement or deferred compensation agreement
between Executive and the Holding Company and/or the Bank),
or (iv) attributable to payments made in lieu of any benefit
payable under a plan or agreement covered by the preceding
clause (iii) of this paragraph), during each of the three
(3) most recently completed calendar years preceding the
Change in Control.
For purposes of paragraph 4 of this Section 5(c), the value of allocations
made to Executive under the American Savings Bank Employee Stock Ownership Plan
or Section 4.01 of the American Savings Bank Supplemental Executive Retirement
Plan shall be valued by
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reference to the fair market value of Holding Company common stock as of the
date of allocation. For purposes of paragraph 5 of this Section 5(c), the value
of the annual increase in Executive's benefit under the Retirement Plan for
Employees of American Savings Bank and the American Savings Bank Benefit
Equalization Plan shall be determined by reference to the year-over-year
increase in the actuarially equivalent lump-sum value of Executive's accrued
benefit under such plans calculated by using the actuarial factors set forth in
the Retirement Plan for Employees of American Savings Bank, or, if such factors
are not available, reasonable actuarial factors established by reference to
Section 417(e) of the Internal Revenue Code of 1986, as amended.
At the election of Executive, which election is to be made prior to or
within thirty (30) days of the Date of Termination on or following a Change in
Control, such payment may be made in a lump sum (without discount for early
payment) on or immediately following the Date of Termination (which may be the
date a Change in Control occurs) or paid in equal monthly installments during
the thirty-six (36) months following Executive's termination. In the event that
no election is made, payment to Executive will be made on a monthly basis during
the thirty-six (36) months following Executive's termination.
AMERICAN SAVINGS BANK
/s/ Xxxxxx X. Xxxxxx
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For the Entire Board of Directors
Date: July 29, 2002
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EXECUTIVE
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
Date: July 29, 2002
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