Exhibit 10.2.2

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT made and entered into on the 19th day of December,
2008, by and between Enterprise Bancorp, Inc., a Massachusetts corporation with
a principal office at 222 Merrimack Street, Lowell, Massachusetts 01852
(“Company”)  and its wholly owned subsidiary, Enterprise Bank and Trust Company,
a Massachusetts trust company with its main office at 222 Merrimack Street,
Lowell, Massachusetts  01852 (“Bank”) (Bank and Company being collectively
referred to herein as “Employer”), and Richard W. Main, who resides at 1
Overlook Drive, Chelmsford, Massachusetts  01824 (the “Executive”), amends and
restates the Employment Agreement dated as of January 1, 2004, as amended.  The
provisions of this Restatement are effective as of April 1, 2008 (the “Effective
Date”).

 

W I T N E S S E T H :

 

WHEREAS, Executive has been employed by Employer for a substantial length of
time and the services of Executive, his experience, and his knowledge of the
affairs of Employer are of great value to Employer and Employer desires to
continue to employ Executive as the President of the Company and President and
Chief Lending Officer of the Bank under the terms and conditions set forth
below; and

 

WHEREAS, Executive desires to continue to be employed by Employer as President
of Company and President and Chief Lending Officer of Bank upon the terms and
conditions hereinafter set forth;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, and intending to be
legally bound hereby, it is hereby agreed as follows:

 

1. EMPLOYMENT; POSITION; TERM.  EMPLOYER HEREBY EMPLOYS EXECUTIVE, AND EXECUTIVE
AGREES TO BE EMPLOYED AS PRESIDENT OF COMPANY AND PRESIDENT AND CHIEF LENDING
OFFICER OF BANK FOR A TERM COMMENCING AS OF THE EFFECTIVE DATE AND ENDING ON THE
SECOND ANNIVERSARY OF THE EFFECTIVE DATE, APRIL 1, 2010 (“TERM OF EMPLOYMENT”);
PROVIDED, HOWEVER, THAT, COMMENCING ON THE DATE ONE YEAR AFTER THE EFFECTIVE
DATE, AND ON EACH ANNUAL ANNIVERSARY OF SUCH DATE (SUCH DATE AND EACH ANNUAL
ANNIVERSARY THEREOF, THE “RENEWAL DATE”), UNLESS PREVIOUSLY TERMINATED, THE TERM
OF EMPLOYMENT SHALL BE AUTOMATICALLY EXTENDED SO AS TO TERMINATE TWO YEARS FROM
SUCH RENEWAL DATE, UNLESS, AT LEAST 60 DAYS PRIOR TO THE RENEWAL DATE, EITHER
EMPLOYER OR EXECUTIVE GIVES NOTICE TO THE OTHER THAT THE TERM OF EMPLOYMENT
SHALL NOT BE SO EXTENDED (“NOTICE OF NON-RENEWAL”).  BY WAY OF EXAMPLE, ON
APRIL 1, 2009, THE TERM OF EMPLOYMENT SHALL BE EXTENDED FROM A TERM ENDING ON
APRIL 1, 2010  TO A TERM ENDING ON APRIL 1,

 

GALLAGHER & CAVANAUGH, LLP, 100 FOOT OF JOHN STREET, LOWELL, MASSACHUSETTS 01852

 

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2011. UPON THE TIMELY DELIVERY BY EITHER PARTY OF A NOTICE OF NON-RENEWAL, THE
TERM OF EMPLOYMENT SHALL NO LONGER BE SUBJECT TO THE AUTOMATIC EXTENSION
PROVIDED FOR HEREIN, BUT RATHER SHALL EXPIRE UPON THE CONCLUSION OF THE THEN
TERM OF EMPLOYMENT (“EXPIRATION OF TERM DUE TO NON-RENEWAL”).  BY WAY OF
EXAMPLE, IF A NOTICE OF NON-RENEWAL WERE FIRST DELIVERED ON NOVEMBER 1, 2009,
THE TERM OF EMPLOYMENT WOULD EXPIRE ON APRIL 1, 2011. A NOTICE OF NON-RENEWAL
MAY NOT BE DELIVERED BY EMPLOYER DURING THE TWO YEAR PERIOD IMMEDIATELY
FOLLOWING A CHANGE IN CONTROL EVENT (AS HEREINAFTER DEFINED).  EXECUTIVE’S
SERVICE AS A DIRECTOR OF EMPLOYER AND/OR ANY AFFILIATE (AS HEREAFTER DEFINED)
SHALL BE WITHOUT ANY FURTHER COMPENSATION IN ADDITION TO THAT SET FORTH HEREIN.

 

2. DUTIES; PLACE OF EMPLOYMENT; TIME AND EFFORTS.

 

2.1          DUTIES.  DURING THE TERM OF EMPLOYMENT, EXECUTIVE SHALL EXERCISE
AND ASSUME SUCH DUTIES, RESPONSIBILITIES AND AUTHORITIES AS ARE PROVIDED IN THE
BYLAWS OF EMPLOYER WITH RESPECT TO HOLDING THE OFFICE OF PRESIDENT OF COMPANY
AND PRESIDENT AND CHIEF LENDING OFFICER OF BANK.  NOTWITHSTANDING THE ABOVE,
EXECUTIVE SHALL NOT BE REQUIRED TO PERFORM ANY DUTIES AND RESPONSIBILITIES WHICH
WOULD RESULT IN EMPLOYER’S OR EXECUTIVE’S NONCOMPLIANCE WITH, OR ANY OTHER
VIOLATION OF, ANY APPLICABLE LAW, REGULATION, REGULATORY POLICY OR OTHER
REGULATORY REQUIREMENT.

 

2.2          PLACE OF EMPLOYMENT.  EXECUTIVE SHALL RENDER HIS SERVICES PRIMARILY
AT EMPLOYER’S OFFICE IN LOWELL, MASSACHUSETTS. EXECUTIVE SHALL TRAVEL AS
REASONABLY REQUIRED FOR THE PERFORMANCE OF HIS DUTIES HEREUNDER.

 

2.3          TIME AND EFFORTS.  DURING THE TERM OF EMPLOYMENT, EXECUTIVE SHALL,
EXCEPT FOR PERIODS OF ABSENCE OCCASIONED BY ILLNESS, VACATION, AND ANY OTHER
REASONABLE LEAVES OF ABSENCE IN ACCORDANCE WITH APPLICABLE POLICIES, PROGRAMS,
PROCEDURES OR PRACTICES OF EMPLOYER, DILIGENTLY AND CONSCIENTIOUSLY DEVOTE HIS
FULL BUSINESS TIME AND ATTENTION AND BEST EFFORTS, BUSINESS SKILLS, ABILITY AND
FIDELITY TO THE BUSINESS OF EMPLOYER AND THE DISCHARGE OF HIS DUTIES HEREUNDER;
PROVIDED, HOWEVER, THAT EXECUTIVE MAY, SO LONG AS SUCH ACTIVITIES (INDIVIDUALLY
AND COLLECTIVELY) DO NOT CONFLICT OR MATERIALLY INTERFERE WITH THE PERFORMANCE
OF EXECUTIVE’S DUTIES HEREUNDER (A) CONTINUE TO SERVE ON ANY BOARDS AND
COMMITTEES ON WHICH EXECUTIVE IS PRESENTLY SERVING OR IN A POSITION WHICH
EXECUTIVE CURRENTLY HOLDS PROVIDED SAME HAS BEEN DISCLOSED TO EMPLOYER ON A
SCHEDULE ATTACHED TO THIS AGREEMENT; (B) MANAGE HIS PERSONAL FINANCIAL AFFAIRS,
INCLUDING HIS PERSONAL PASSIVE INVESTMENTS;  (C) SERVE ON BOARDS OF DIRECTORS OR
TRUSTEES OR COMMITTEES OF CIVIC OR CHARITABLE ORGANIZATIONS OR TRADE
ASSOCIATIONS, AND (D) WITH THE WRITTEN CONSENT OF THE BOARD OF DIRECTORS, AS
EVIDENCED BY A FORMALLY ADOPTED VOTE OR RESOLUTION AND SUBJECT TO SUCH TERMS AND
CONDITIONS SPECIFIED IN ANY SUCH VOTE OR RESOLUTION, SERVE AS A NON-EMPLOYEE
DIRECTOR, TRUSTEE, MANAGER OR PARTNER OF ANY BUSINESS ENTITY.

 

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3. COMPENSATION AND OTHER BENEFITS.

 

3.1          BASE SALARY. IN CONSIDERATION OF THE SERVICES OF EXECUTIVE,
EMPLOYER SHALL PAY TO EXECUTIVE A BASE SALARY OF $193,919.96 PER ANNUM, TOGETHER
WITH SUCH INCREASES AS THE BOARD OF DIRECTORS OF EMPLOYER MAY FROM TIME TO TIME
APPROVE IN ITS SOLE DISCRETION (BUT SUCH SHALL BE REVIEWED BY THE BOARD AT LEAST
ANNUALLY), IN EQUAL INSTALLMENTS IN ACCORDANCE WITH THE CUSTOMARY PAYROLL
PRACTICES OF EMPLOYER (“BASE SALARY”).

 

3.2          ANNUAL CASH BONUS. DURING THE TERM OF EMPLOYMENT, EXECUTIVE SHALL
BE ENTITLED TO PARTICIPATE IN AN EQUITABLE MANNER WITH OTHER EXECUTIVE OFFICERS
OF EMPLOYER IN SUCH DISCRETIONARY BONUS PAYMENT OR AWARDS AS MAY BE AUTHORIZED,
DECLARED AND/OR PAID BY THE BOARD OF DIRECTORS TO EMPLOYER’S EXECUTIVE
EMPLOYEES.  NOTHING IN THIS AGREEMENT, HOWEVER, SHALL BE CONSTRUED TO REQUIRE
EMPLOYER TO ESTABLISH, MAINTAIN OR CONTINUE ANY BONUS PLAN, PROGRAM OR
ARRANGEMENT.  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED BY THEIR TERMS, SUCH BONUS
PLAN, PROGRAMS OR ARRANGEMENTS ARE SUBJECT TO MODIFICATION OR TERMINATION BY
EMPLOYER AT ANY TIME IN ITS SOLE DISCRETION.  NO OTHER COMPENSATION OR
ADDITIONAL BENEFITS PROVIDED FOR IN THIS AGREEMENT SHALL BE DEEMED TO BE A
SUBSTITUTE FOR EXECUTIVE’S RIGHT TO RECEIVE SUCH BONUSES IF, WHEN AND AS
DECLARED AND PAID BY THE BOARD OF DIRECTORS.

 

3.3          Incentive, Retirement, and Savings Plans.  During the Term of
Employment, Executive shall be entitled to participate in all incentive,
pension, retirement, savings, stock option and other stock grant and equity
compensation plans, as well as all other nonseverance related benefits, plans
and programs, which may be maintained from time to time by Employer for the
benefit of senior executives and/or other employees of Employer.

 

3.4          Welfare Benefit Plans.  During the Term of Employment, Executive
and his spouse and other eligible dependents shall be entitled to participate
in, and be covered by, all of the health and other welfare benefit plans and
programs that may be maintained from time to time by Employer for the benefit of
senior executives and/or other employees of Employer. In the case of any group
disability plan maintained by Employer, Employer shall provide Executive the
opportunity to pay directly by payroll deduction or otherwise all or any portion
of the premium on any policy or policies providing such coverage.

 

3.5          Expense Reimbursement.  During the Term of Employment, Executive
shall be entitled to receive prompt reimbursement for all reasonable expenses,
including reasonable business travel expenses, incurred by Executive in
performing his duties and responsibilities under this Agreement, in accordance
with the policies, programs, procedures and practices of Employer as in effect
at the time the expense was incurred. To the extent necessary to avoid
characterizing any reimbursement to Executive as deferred compensation under
Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) and the
United States Treasury regulations then in effect (“Treas. Regs.”), such

 

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reimbursements shall be paid on or before March 1 following the close of the
calendar year in which the expense was incurred by Executive.  Amounts which are
not submitted within the required timeframe shall not be eligible for
reimbursement hereunder.

 

3.6          FRINGE BENEFITS; AUTOMOBILE.  DURING THE TERM OF EMPLOYMENT,
EXECUTIVE SHALL BE ELIGIBLE TO BENEFIT FROM SUCH FRINGE BENEFITS AND
PERQUISITES, IN ACCORDANCE WITH THE POLICIES, PROGRAMS, PROCEDURES AND PRACTICES
OF EMPLOYER, AS MAY BE IN EFFECT AND PROVIDED FROM TIME TO TIME TO SENIOR
EXECUTIVES AND/OR OTHER EMPLOYEES OF EMPLOYER, AND SHALL BE ENTITLED TO THE USE
OF AN AUTOMOBILE, OF A TYPE COMMENSURATE WITH EXECUTIVE’S OFFICE AND STANDING,
AT EMPLOYER’S EXPENSE.

 

3.7          Vacation.  Executive shall earn and accrue thirty-one (31) days of
vacation for each twelve month period served during the Term of Employment. 
Executive shall be entitled to the continuation of his Base Salary and benefits
during vacations to be scheduled at the reasonable convenience of the parties
hereto.  Vacation will be earned ratably over the course of each such twelve
month period and shall be used in accordance with Employer’s policies.

 

3.8          Salary Continuation Agreement.  The parties acknowledge that
Executive and Bank are parties to a Salary Continuation Agreement dated as of
July 15, 2005.  Each of the Employer and Executive agrees to fulfill its
obligations under such Salary Continuation Agreement in accordance with the
terms thereof.

 

4. TERMINATION. UNLESS EXECUTIVE’S EMPLOYMENT IS TERMINATED PURSUANT TO THIS
SECTION 4, EMPLOYER WILL CONTINUE TO EMPLOY EXECUTIVE AND EXECUTIVE WILL
CONTINUE TO SERVE EMPLOYER THROUGHOUT THE TERM OF EMPLOYMENT. TERMINATION OF
EXECUTIVE’S EMPLOYMENT WILL CONSTITUTE AN AUTOMATIC TERMINATION OF ALL OTHER
POSITIONS HELD BY EXECUTIVE INCLUDING SERVICE AS A DIRECTOR, UNLESS OTHERWISE
REQUESTED BY EMPLOYER.

 

4.1          EXPIRATION OF THE TERM DUE TO NON-RENEWAL.  UPON EXPIRATION OF TERM
DUE TO NON-RENEWAL, EXECUTIVE’S EMPLOYMENT WITH EMPLOYER WILL BE TERMINATED
(HEREIN “DATE OF TERMINATION”) WITHOUT FURTHER ACTION BY EXECUTIVE OR EMPLOYER
AND EXECUTIVE WILL BE ENTITLED TO RECEIVE THE FOLLOWING:

 

(A)           EARNED AND ACCRUED BUT PREVIOUSLY UNPAID BASE SALARY THROUGH THE
DATE OF TERMINATION,

 

(B)           PAYMENT IN RESPECT OF ANY VACATION DAYS ACCRUED BUT UNUSED THROUGH
THE DATE OF TERMINATION,

 

(C)           REIMBURSEMENT OF ANY REMAINING EXPENSE PROPERLY INCURRED IN
ACCORDANCE WITH EMPLOYER’S POLICY PRIOR TO THE DATE OF TERMINATION AND NOT YET
REIMBURSED BY EMPLOYER,

 

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(D)           ANY BONUS ACTUALLY AWARDED OR EARNED, BUT NOT YET PAID AS OF THE
DATE OF TERMINATION,  AND

 

(E)           ANY VESTED BENEFITS UNDER ANY INSURANCE POLICY, PENSION,
RETIREMENT, SAVINGS, STOCK OPTION AND OTHER STOCK GRANT AND EQUITY COMPENSATION
PLANS, TOGETHER WITH ANY OTHER NON-SEVERANCE RELATED COMPENSATION AND BENEFITS
AS MAY BE PROVIDED IN ACCORDANCE WITH THE TERMS AND PROVISIONS OF ANY OTHER
AGREEMENTS BETWEEN EXECUTIVE AND EITHER COMPANY OR BANK AND ANY APPLICABLE
PLANS, PROGRAMS, PROCEDURES AND PRACTICES OF EMPLOYER.

 

THE AGGREGATE BENEFITS PAYABLE PURSUANT TO CLAUSES (A), (B), (C) AND (D) ARE
HEREAFTER REFERRED TO AS THE “ACCRUED OBLIGATIONS.”  THE VESTED BENEFITS
REFERENCED IN CLAUSE (E) ARE HEREAFTER REFERRED TO AS THE “ADDITIONAL BENEFITS.”

 

4.2          DEATH. THE EMPLOYMENT OF EXECUTIVE HEREUNDER SHALL TERMINATE
IMMEDIATELY UPON HIS DEATH; PROVIDED, HOWEVER, THAT IN THE EVENT OF DEATH, THE
EMPLOYER WILL PAY TO THE BENEFICIARY NAMED ON THE DESIGNATION OF BENEFICIARY
FORM COMPLETED BY EXECUTIVE THE FOLLOWING:

 

(A)                                  THE ACCRUED OBLIGATIONS,

 

(B)                                 THE ADDITIONAL BENEFITS,

 

(C)           A LUMP SUM AMOUNT EQUAL TO SIX MONTH’S OF BASE SALARY AT THE RATE
IN EFFECT ON THE DATE OF DEATH, PAYABLE WITHIN THIRTY (30) DAYS OF THE DATE OF
DEATH (“LUMP SUM PAYMENT”), AND

 

 (D)          CONTINUATION, AT NO COST TO EXECUTIVE’S SPOUSE AND OTHER ELIGIBLE
DEPENDENTS, OF ALL HEALTH AND OTHER WELFARE BENEFITS PROVIDED UNDER SECTION 3.4
OF THIS AGREEMENT FOR THE BENEFIT OF EXECUTIVE’S SPOUSE AND OTHER ELIGIBLE
DEPENDENTS FOR A PERIOD COMMENCING ON THE DATE OF DEATH AND ENDING, WITH RESPECT
TO EXECUTIVE’S SPOUSE, ON THE EARLIER OF HER DEATH OR REMARRIAGE AND, WITH
RESPECT TO ANY OTHER ELIGIBLE DEPENDENT OF EXECUTIVE, THE DATE SUCH DEPENDENT IS
NO LONGER ELIGIBLE FOR SUCH COVERAGE IN ACCORDANCE WITH THE TERMS OF ANY
APPLICABLE PLAN.

 

4.3          DISABILITY.  EMPLOYER WILL HAVE THE RIGHT TO SUSPEND EXECUTIVE’S
EMPLOYMENT HEREUNDER IN THE EVENT EXECUTIVE BECOMES DISABLED (“DISABILITY
SUSPENSION”), BY GIVING WRITTEN NOTICE OF SAME TO EXECUTIVE (“NOTICE OF
DISABILITY SUSPENSION”).  EXECUTIVE’S DISABILITY SUSPENSION SHALL BECOME
EFFECTIVE UPON THE 30TH DAY FOLLOWING THE DATE OF THE NOTICE OF DISABILITY
SUSPENSION (“DISABILITY SUSPENSION EFFECTIVE DATE”).  FOR PURPOSES OF THIS
AGREEMENT, DISABILITY SHALL MEAN (1) EXECUTIVE IS UNABLE TO ENGAGE IN ANY
SUBSTANTIAL GAINFUL ACTIVITY BY REASON OF ANY MEDICALLY DETERMINED PHYSICAL OR
MENTAL IMPAIRMENT THAT CAN BE EXPECTED TO RESULT IN DEATH OR TO LAST FOR A
CONTINUOUS PERIOD OF NOT LESS THAN TWELVE (12) MONTHS, OR (2) EXECUTIVE IS, BY
REASON OF ANY MEDICALLY DETERMINABLE PHYSICAL OR MENTAL IMPAIRMENT THAT CAN BE

 

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EXPECTED TO RESULT IN DEATH OR CAN BE EXPECTED TO LAST FOR A CONTINUOUS PERIOD
OF NOT LESS THAN TWELVE (12) MONTHS, RECEIVING INCOME REPLACEMENT OR DISABILITY
 BENEFITS FOR A PERIOD OF NOT LESS THAN THREE (3) MONTHS UNDER ANY GROUP
LONG-TERM DISABILITY PLAN OR ACCIDENT AND HEALTH PLAN THEN MAINTAINED BY
EMPLOYER.  IN THE EVENT THAT EXECUTIVE RETURNS TO FULL-TIME EMPLOYMENT WITH
EMPLOYER FOLLOWING THE NOTICE OF DISABILITY SUSPENSION BUT PRIOR TO THE
DISABILITY SUSPENSION EFFECTIVE DATE, THE NOTICE OF DISABILITY SUSPENSION SHALL
BE DEEMED AUTOMATICALLY WITHDRAWN.  IN ANY EVENT, THE PERIOD OF DISABILITY
SUSPENSION WILL END ON THE EARLIEST TO OCCUR OF THE FOLLOWING (“DISABILITY
TERMINATION DATE”):  (A) THE DATE ON WHICH EXECUTIVE RETURNS TO FULL-TIME
EMPLOYMENT WITH EMPLOYER; (B) EXECUTIVE’S DEATH, IN WHICH EVENT THE PROVISIONS
OF SECTION 4.2 SHALL GOVERN; OR (C) THE TERMINATION BY EITHER PARTY OR THE
EXPIRATION OF THE TERM OF EMPLOYMENT, IN EACH CASE IN ACCORDANCE WITH THE TERMS
OF THIS AGREEMENT.

 

EMPLOYER SHALL PAY TO EXECUTIVE, AS OF THE DISABILITY SUSPENSION EFFECTIVE DATE,
THE ACCRUED OBLIGATIONS.  DURING THE PERIOD OF DISABILITY SUSPENSION UP UNTIL
THE DISABILITY TERMINATION DATE EXECUTIVE SHALL:

 

(A)           RECEIVE AN AMOUNT EQUAL, ON A PER ANNUM BASIS, TO SEVENTY-FIVE
PERCENT (75%) OF EXECUTIVE’S HIGHEST ANNUAL COMPENSATION, AS HEREAFTER DEFINED,
AS DETERMINED ON THE DISABILITY SUSPENSION EFFECTIVE DATE.  SUCH AMOUNT SHALL BE
PAID BY EMPLOYER, COMMENCING ON THE FIRST ORDINARY PAYROLL PAYMENT DATE
FOLLOWING THE DISABILITY SUSPENSION EFFECTIVE DATE, IN EQUAL PERIODIC
INSTALLMENTS IN ACCORDANCE WITH EMPLOYER’S ORDINARY PAYROLL PRACTICES IN EFFECT
AT THE TIME OF SUCH PAYMENTS ARE MADE.  THE PAYMENTS MADE PURSUANT TO THIS
PROVISION SHALL BE IN ADDITION TO ANY PAYMENTS OR OTHER BENEFITS PAYABLE TO
EXECUTIVE UNDER ANY QUALIFIED OR NONQUALIFIED RETIREMENT PLANS OR PROGRAMS
MAINTAINED BY EMPLOYER BUT SHALL BE REDUCED BY ANY PAYMENTS RECEIVED BY
EXECUTIVE DURING SUCH DISABILITY SUSPENSION UNDER ANY GROUP LONG-TERM DISABILITY
PLAN MAINTAINED BY EMPLOYER;

 

(B)           CONTINUE TO ACCRUE AND PARTICIPATE IN ALL INCENTIVE, PENSION,
RETIREMENT, SAVINGS, STOCK OPTION AND OTHER STOCK GRANT AND EQUITY COMPENSATION
PLANS, AS WELL AS ALL OTHER EMPLOYEE BENEFIT PLANS AND PROGRAMS, WHICH ARE
REFERENCED IN SECTION 3.3; AND

 

(C)           CONTINUE TO RECEIVE ALL LIFE, HEALTH AND OTHER WELFARE COVERAGE
AND BENEFITS AS SET FORTH IN SECTION 3.4, INCLUDING THOSE FOR THE BENEFIT OF
EXECUTIVE’S SPOUSE AND OTHER ELIGIBLE DEPENDENTS.

 

FROM AND AFTER THE DISABILITY SUSPENSION EFFECTIVE DATE, EMPLOYER SHALL BE FREE
TO FILL EXECUTIVE’S POSITIONS; PROVIDED, HOWEVER, THAT IF EXECUTIVE IS ABLE TO
RETURN TO FULL-TIME EMPLOYMENT WITH EMPLOYER AT ANY TIME DURING THE PERIOD OF
DISABILITY SUSPENSION PRIOR TO THE DISABILITY TERMINATION DATE, EXECUTIVE SHALL
RESUME HIS POSITIONS AND DUTIES WITH EMPLOYER UNLESS EMPLOYER HAS FILLED EITHER
OF THOSE POSITIONS AND DOES NOT REAPPOINT EXECUTIVE TO BOTH SUCH POSITIONS, IN

 

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WHICH EVENT, EXECUTIVE MAY, AT HIS OPTION:

 

(I)            ASSUME THE POSITION(S) AND DUTIES THAT EMPLOYER MAY ASSIGN TO HIM
AT THE SAME BASE SALARY AS WAS IN EFFECT ON THE DISABILITY SUSPENSION EFFECTIVE
DATE AND, OTHERWISE, ON THE SAME TERMS AND CONDITIONS AS SET FORTH HEREIN; OR

 

(II)           IN THE EVENT THAT THE POSITION AND DUTIES ASSIGNED TO HIM WOULD
CONSTITUTE A MATERIAL DIMINUTION IN HIS AUTHORITY, DUTIES OR RESPONSIBILITIES OR
OTHERWISE CONSTITUTE GOOD REASON, AS HEREINAFTER DEFINED, EXECUTIVE MAY EXERCISE
HIS RIGHT TO TERMINATE THIS AGREEMENT FOR GOOD REASON PURSUANT TO SECTION 4.5.

 

IN THE EVENT THAT EXECUTIVE REFUSES TO ASSUME THE POSITION AND DUTIES ASSIGNED
TO HIM PURSUANT TO CLAUSE (I) UNDER CIRCUMSTANCES THAT DO NOT CONSTITUTE GOOD
REASON, SUCH SHALL CONSTITUTE A VOLUNTARY TERMINATION BY EXECUTIVE SUBJECT TO
SECTION 4.6 BELOW.

 

NOTWITHSTANDING ANY OTHER PROVISION CONTAINED IN THIS AGREEMENT TO THE CONTRARY,
THE OCCURRENCE OF A DISABILITY SUSPENSION SHALL NOT IN ANY WAY PREVENT OR
OTHERWISE LIMIT THE PARTIES FROM EXERCISING ANY OF THEIR RESPECTIVE RIGHTS TO
TERMINATE THE TERM OF EMPLOYMENT AT ANY TIME IN ACCORDANCE WITH THE TERMS OF
THIS AGREEMENT OR FROM DELIVERING NOTICE OF NON-RENEWAL PURSUANT TO SECTION 1.

 

FURTHER, NOTHING IN THIS SECTION SHALL BE DEEMED AS A WAIVER BY EXECUTIVE OF HIS
RIGHT TO UNPAID LEAVE UNDER THE FAMILY AND MEDICAL LEAVE ACT OF 1993, THE
AMERICANS WITH DISABILITIES ACT OF 1990, OR ANY ANALOGOUS PROVISION OF STATE
LAW.

 

4.4          FOR CAUSE.  SUBJECT TO COMPLIANCE WITH THE PROCEDURE SET FORTH
HEREIN, EMPLOYER WILL HAVE THE RIGHT TO TERMINATE EXECUTIVE’S EMPLOYMENT FOR
CAUSE. FOR PURPOSES OF THIS AGREEMENT, “CAUSE” MEANS: (I) EXECUTIVE’S WILLFUL
AND CONTINUED FAILURE TO SUBSTANTIALLY PERFORM HIS EMPLOYMENT DUTIES (OTHER THAN
ANY SUCH FAILURE RESULTING FROM EXECUTIVE’S ILLNESS OR DISABILITY, WHICH SHALL
BE SUBJECT TO THE PROVISIONS OF THE PRECEDING SECTION), OR (II) EXECUTIVE’S
WILLFULLY ENGAGING IN CONDUCT (OTHER THAN CONDUCT RELATED TO THE OPERATION OF AN
AUTOMOBILE) WHICH IS DEMONSTRABLY AND MATERIALLY INJURIOUS TO EMPLOYER,
MONETARILY OR OTHERWISE; PROVIDED, HOWEVER, THAT NO ACT OR FAILURE TO ACT, ON
THE PART OF EXECUTIVE SHALL BE DEEMED “WILLFUL” UNLESS DONE, OR OMITTED TO BE
DONE, BY EXECUTIVE NOT IN GOOD FAITH AND WITHOUT REASONABLE BELIEF THAT
EXECUTIVE’S ACT OR FAILURE TO ACT, WAS IN THE BEST INTEREST OF EMPLOYER. UPON
SUCH TERMINATION, EXECUTIVE WILL THEREAFTER BE ENTITLED TO RECEIVE ONLY THE
COMPENSATION AND BENEFITS SET FORTH IN SECTION 4.1 (A) THROUGH (E) HEREINABOVE
APPLICABLE TO EXPIRATION OF THE TERM DUE TO NON-RENEWAL.

 

(A) PROCEDURE.  AT A MEETING OF THE APPLICABLE EMPLOYER’S BOARD OF DIRECTORS,
DULY CALLED FOR THE PURPOSE OF DETERMINING WHETHER CAUSE EXISTS (“DETERMINATION
MEETING”), THE ALLEGED ACTS OR OMISSIONS OF EXECUTIVE MUST BE FOUND BY
TWO-THIRDS OF THE DISINTERESTED DIRECTORS PRESENT AT THE

 

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MEETING TO HAVE BEEN ESTABLISHED BEYOND REASONABLE DOUBT. FOR PURPOSES OF THIS
SECTION 4.4, “DISINTERESTED” SHALL MEAN THOSE DIRECTORS OTHER THAN THE EXECUTIVE
AND ANY OTHER DIRECTORS WHO ARE ALLEGED TO HAVE BEEN INVOLVED OR OTHERWISE TO
HAVE AN INTEREST IN ANY OF SUCH ALLEGED ACTS OR OMISSIONS OF THE EXECUTIVE.  IF
SAID BOARD DETERMINES, AS SET FORTH IN THE PRECEDING SENTENCE, THAT CAUSE
EXISTS, SAID EMPLOYER SHALL DELIVER, WITHIN TEN (10) DAYS OF THE DETERMINATION
MEETING, WRITTEN NOTICE TO EXECUTIVE OF SAME WHICH SHALL SET FORTH, IN
REASONABLE DETAIL, THE FINDINGS OF THE BOARD AS TO THE ACT(S) AND/OR
OMISSION(S), INCLUDING THE DATES, FACTS AND CIRCUMSTANCES, CONSTITUTING CAUSE
(“NOTICE OF TERMINATION FOR CAUSE”).  THE NOTICE OF TERMINATION FOR CAUSE SHALL
ALSO ADVISE EXECUTIVE THAT UNLESS AN OPPORTUNITY NOTICE, AS HEREINAFTER DEFINED,
IS DELIVERED BY EXECUTIVE AS HEREINAFTER PROVIDED, EXECUTIVE’S EMPLOYMENT SHALL
TERMINATE FOR CAUSE EFFECTIVE ON THE ELEVENTH (11TH) DAY AFTER THE RECEIPT BY
EXECUTIVE OF THE NOTICE OF TERMINATION FOR CAUSE.  EXECUTIVE MAY, WITHIN TEN
(10) DAYS OF HIS RECEIPT OF THE NOTICE OF TERMINATION FOR CAUSE, REQUEST, BY
WRITTEN NOTICE DELIVERED TO SAID EMPLOYER, THAT A SPECIAL MEETING OF THE BOARD
BE CALLED FOR THE PURPOSE OF PROVIDING EXECUTIVE AN OPPORTUNITY TO APPEAR BEFORE
THE BOARD, WITH COUNSEL, TO DISCUSS SUCH ACT(S) OR OMISSION(S) (“OPPORTUNITY
NOTICE”).  UPON RECEIPT OF THE OPPORTUNITY NOTICE, A SPECIAL MEETING OF THE
BOARD SHALL BE DULY CALLED TO TAKE PLACE ON A DATE SELECTED BY THE BOARD, WHICH
IS NOT LESS THAN TEN (10) NOR MORE THAN THIRTY (30) DAYS AFTER EMPLOYER’S
RECEIPT OF THE OPPORTUNITY NOTICE, AT THE PRINCIPAL OFFICE OF EMPLOYER OR SUCH
OTHER LOCATIONS AS HAS BEEN MUTUALLY AGREED UPON BY EMPLOYER AND EXECUTIVE
(“FINAL MEETING”).  IF THE BOARD DOES NOT, BY VOTE OF GREATER THAN ONE-THIRD OF
THE DISINTERESTED DIRECTORS PRESENT AT THE MEETING, RESCIND ITS NOTICE OF
TERMINATION FOR CAUSE AT THE FINAL MEETING OR EXECUTIVE FAILS TO ATTEND THE
FINAL MEETING FOR ANY REASON OTHER THAN EITHER A VALID MEDICAL REASON OR A
REASON THAT IS DEEMED CREDIBLE AND SUFFICIENT BY THE ACTING CHAIRMAN OF THE
BOARD IN HIS OR HER SOLE AND ABSOLUTE DISCRETION (IN WHICH EVENT, THE CHAIRMAN
SHALL RESCHEDULE THE FINAL MEETING TO A DATE SELECTED BY HIM OR HER THAT IS
PRACTICAL IN LIGHT OF THE REASON FOR EXECUTIVE’S FAILURE TO ATTEND), EXECUTIVE’S
EMPLOYMENT SHALL BE TERMINATED FOR CAUSE EFFECTIVE IMMEDIATELY AS OF THE
CONCLUSION OF THE FINAL MEETING, WITHOUT FURTHER NOTICE.  THE PROCEDURE SET
FORTH HEREIN SHALL AT ALL TIMES BE SUBJECT TO THE REQUIREMENTS OF APPLICABLE
LAW, REGULATION, REGULATORY POLICY OR OTHER REGULATORY REQUIREMENTS.

 

(B) SUSPENSION.  NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT,
DURING THE PERIOD COMMENCING ON THE DATE ON WHICH NOTICE OF THE DETERMINATION
MEETING IS DULY GIVEN TO THE BOARD AND ENDING THE EARLIEST OF THE DATE OF
(I) THE DETERMINATION MEETING, IF NO DETERMINATION OF CAUSE IS MADE AT SAID
MEETING AS HEREINABOVE PROVIDED,  (II) THE DATE OF

 

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TERMINATION (WHICH MAY BE EITHER THE ELEVENTH DAY FOLLOWING EXECUTIVE’S RECEIPT
OF THE NOTICE OF TERMINATION FOR CAUSE IF AN OPPORTUNITY NOTICE IS NOT DELIVERED
BY EXECUTIVE AS HEREINABOVE PROVIDED OR THE DATE OF THE FINAL MEETING IF AN
OPPORTUNITY NOTICE IS PROVIDED AND THE NOTICE OF TERMINATION OF CAUSE IS NOT
RESCINDED AT SUCH MEETING), OR (III) THE DATE OF THE FINAL MEETING IF THE NOTICE
OF TERMINATION FOR CAUSE IS RESCINDED AS SET FORTH IN SUBSECTION (C) BELOW:

 

(1)  EXECUTIVE, IN THE SOLE DISCRETION OF THE BOARD, MAY BE SUSPENDED FROM
EMPLOYMENT WITH EMPLOYER AND THE BOARD MAY, DURING SUCH PERIOD, REASONABLY LIMIT
EXECUTIVE’S ACCESS TO THE PRINCIPAL OFFICES AND ANY OTHER PREMISES OF EMPLOYER
AND/OR EXECUTIVE’S ACCESS TO ANY OF EMPLOYER’S ASSETS OR PERSONNEL; AND

 

(2)  EXECUTIVE SHALL CONTINUE TO RECEIVE HIS BASE SALARY AND ALL BENEFITS IN
ACCORDANCE WITH SECTION 3 OF THIS AGREEMENT TO THE EXTENT SUCH PAYMENTS AND
BENEFITS ARE NOT PROHIBITED BY APPLICABLE LAW, REGULATION, REGULATORY POLICY OR
OTHER REGULATORY REQUIREMENT.

 

(C)           RESCISSION OF NOTICE OF TERMINATION FOR CAUSE.  IN THE EVENT THAT
THE FINAL MEETING IS NOT CALLED AS PROVIDED FOR HEREIN, OR A QUORUM OF THE BOARD
FAILS TO APPEAR FOR THE FINAL MEETING, OR THE BOARD VOTES TO RESCIND ITS NOTICE
OF TERMINATION FOR CAUSE THEN SUCH NOTICE SHALL BE DEEMED RESCINDED AND
EXECUTIVE SHALL BE RETURNED TO HIS DUTIES AS OF THE DATE OF SUCH RESCISSION.

 

(D)           TIMELINESS.  NO EVENT SHALL CONSTITUTE GROUNDS FOR A “CAUSE”
TERMINATION IN THE EVENT THAT EMPLOYER FAILS TO TAKE ACTION WITHIN 90 DAYS AFTER
EMPLOYER’S CHAIRMAN OR THE CHAIRMAN OF EMPLOYER’S AUDIT COMMITTEE OBTAINS
KNOWLEDGE OF THE OCCURRENCE OF SUCH EVENT.

 

(E)           PAYMENT UPON TERMINATION FOR CAUSE.  IF EXECUTIVE’S EMPLOYMENT
SHALL BE TERMINATED FOR CAUSE AS SET FORTH HEREIN, EMPLOYER SHALL PAY EXECUTIVE:

 

(I)            THE ACCRUED OBLIGATIONS, AND

 

(II)           THE ADDITIONAL BENEFITS, IN ACCORDANCE WITH THE TERMS OF THE
APPLICABLE PLAN, PROGRAM OR ARRANGEMENT.

 

4.5          INVOLUNTARY TERMINATION.

 

4.5.1       TERMINATION BY EMPLOYER WITHOUT CAUSE.  EMPLOYER MAY, UNILATERALLY,
TERMINATE EXECUTIVE’S EMPLOYMENT FOR ANY REASON AND WITHOUT CAUSE OR FOR NO
REASON AT ALL AT ANY TIME DURING THE TERM OF EMPLOYMENT UPON SIXTY (60) DAYS
PRIOR WRITTEN NOTICE TO EXECUTIVE.  IF EMPLOYER TERMINATES EXECUTIVE’S
EMPLOYMENT PURSUANT TO THIS SECTION 4.5.1, THEN THE TERM OF EMPLOYMENT SHALL
THEREUPON END (“DATE OF INVOLUNTARY TERMINATION”) AND EXECUTIVE SHALL, SUBJECT
TO BANK REGULATORY LIMITATIONS AS REFERENCED IN

 

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SECTION 4.14, ONLY BE ENTITLED TO RECEIVE THE FOLLOWING:

 

(A)           THE ACCRUED OBLIGATIONS; PROVIDED, HOWEVER, THAT IN ADDITION TO
THE PAYMENT OF THE PER DIEM VALUE OF ANY UNUSED VACATION DAYS THAT HAVE ACCRUED
DURING THE TERM OF EMPLOYMENT PRIOR TO THE DATE OF INVOLUNTARY TERMINATION,
EXECUTIVE SHALL RECEIVE THE UNUSED, UNACCRUED PORTION OF ANY VACATION DAYS
AVAILABLE THROUGH THE END (BUT NOT BEYOND) THE CALENDAR YEAR IN WHICH THE DATE
OF INVOLUNTARY TERMINATION OCCURS,

 

(B)                                 THE ADDITIONAL BENEFITS,

 

(C)           AN AGGREGATE AMOUNT EQUAL TO TWO TIMES EXECUTIVE’S HIGHEST ANNUAL
COMPENSATION, AS HEREINAFTER DEFINED (“SEVERANCE PAYMENT”), SUCH AMOUNT SHALL BE
PAID NO LATER THAN TWO AND ONE-HALF (2 ½) MONTHS AFTER THE CLOSE OF THE TAXABLE
YEAR OF EXECUTIVE OR EMPLOYER IN WHICH THE DATE OF INVOLUNTARY TERMINATION
OCCURS,

 

(D)           TO HAVE EMPLOYER PAY THE FULL PREMIUMS (EMPLOYER AND EMPLOYEE
PORTIONS) FOR EXECUTIVE’S AND ANY COVERED BENEFICIARY’S COVERAGE UNDER COBRA
HEALTH CONTINUATION BENEFITS OVER THE EIGHTEEN (18) MONTH PERIOD IMMEDIATELY
FOLLOWING THE DATE OF TERMINATION.  NOTWITHSTANDING THE FOREGOING, IF EXECUTIVE
ACCEPTS POST-EMPLOYMENT WITH ANOTHER ENTITY THAT PROVIDES COMPARABLE HEALTHCARE,
DURING SUCH PERIOD, EMPLOYER SHALL NOT PROVIDE EXECUTIVE WITH SUCH HEALTH
CONTINUATION BENEFITS, AND

 

(E)           REIMBURSEMENT FOR THE REASONABLE FEES OF A PROFESSIONAL
OUT-PLACEMENT SERVICE SELECTED BY EXECUTIVE; PROVIDED, HOWEVER, THAT ONLY
EXPENSES INCURRED BY EXECUTIVE NO LATER THAN THE END OF THE SECOND TAXABLE YEAR
FOLLOWING THE YEAR IN WHICH THE DATE OF INVOLUNTARY TERMINATION OCCURS SHALL BE
REIMBURSED AND SUCH REIMBURSEMENT SHALL BE PAID BY THE END OF THE THIRD TAXABLE
YEAR FOLLOWING THE YEAR IN WHICH THE DATE OF INVOLUNTARY TERMINATION OCCURS.

 

4.5.2       TERMINATION BY EXECUTIVE FOR GOOD REASON. EXECUTIVE MAY TERMINATE
HIS EMPLOYMENT FOR GOOD REASON.  UPON A TERMINATION BY EXECUTIVE FOR GOOD
REASON, EXECUTIVE SHALL BE ENTITLED TO THE SAME PAYMENTS AND BENEFITS AS
PROVIDED IN SECTION 4.5.1 ABOVE.  IN NO EVENT SHALL A TERMINATION OF EXECUTIVE’S
EMPLOYMENT FOR GOOD REASON OCCUR UNLESS AND UNTIL EXECUTIVE PROVIDES EMPLOYER,
WITHIN NINETY (90) CALENDAR DAYS FOLLOWING THE DATE ON WHICH THE FACTS AND
CIRCUMSTANCES UNDERLYING THE FINDING OF GOOD REASON REASONABLY COULD HAVE BEEN
KNOWN BY EXECUTIVE, WITH WRITTEN NOTICE THEREOF STATING WITH SPECIFICITY THE
FACTS AND CIRCUMSTANCES UNDERLYING THE FINDING OF GOOD REASON AND, IF THE BASIS
FOR SUCH FINDING OF GOOD REASON IS CAPABLE OF BEING CURED BY EMPLOYER, PROVIDING
EMPLOYER WITH AN OPPORTUNITY TO CURE THE SAME WITHIN THIRTY (30) CALENDAR DAYS
AFTER RECEIPT OF SUCH NOTICE.  IF EXECUTIVE TERMINATES HIS EMPLOYMENT PURSUANT
TO THIS SECTION 4.5.2, THEN THE TERM OF EMPLOYMENT SHALL END UPON THE RECEIPT BY
EMPLOYER OF THE NOTICE REQUIRED BY THIS SECTION 4.5.2;

 

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provided, however, that if the basis for such finding of Good Reason is capable
of being cured but Employer fails to cure as hereinabove provided, the Term of
Employment shall end  on the thirty-first calendar day following such notice
(“Date of Involuntary Termination”).

 

“GOOD REASON” SHALL MEAN, WITHOUT EXECUTIVE’S PRIOR WRITTEN CONSENT, THE
OCCURRENCE OF ANY OF THE FOLLOWING EVENTS OR ACTIONS:

 

(A)           MATERIAL DIMINUTION OF BASE SALARY ;

 

(B)           MATERIAL DIMINUTION IN EXECUTIVE’S AUTHORITY, DUTIES OR
RESPONSIBILITIES;

 

(C)           MATERIAL DIMINUTION IN THE AUTHORITY, DUTIES OR RESPONSIBILITIES
OF THE SUPERVISOR TO WHOM EXECUTIVE IS REQUIRED TO REPORT, INCLUDING A
REQUIREMENT THAT EXECUTIVE REPORT TO A CORPORATE OFFICER OR EMPLOYEE INSTEAD OF
DIRECTLY TO THE BOARD OF DIRECTORS;

 

(D)           MATERIAL DIMINUTION IN THE BUDGET OVER WHICH EXECUTIVE RETAINS
AUTHORITY;

 

(E)           MATERIAL CHANGE IN GEOGRAPHIC LOCATION AT WHICH EXECUTIVE MUST
PERFORM THE SERVICES; OR

 

(F)            ANY OTHER ACTION OR INACTION THAT CONSTITUTES A MATERIAL BREACH
OF THE TERMS OF AN APPLICABLE EMPLOYMENT AGREEMENT INCLUDING, BUT NOT LIMITED TO
EMPLOYER’S FAILURE TO OBTAIN A SATISFACTORY AGREEMENT FROM ANY SUCCESSOR(S) TO
ASSUME AND AGREE TO PERFORM EMPLOYER’S OBLIGATIONS UNDER THIS AGREEMENT.

 

IN ORDER TO CONSTITUTE AN INVOLUNTARY TERMINATION UNDER THIS SECTION 4.5.2,
EXECUTIVE MUST ACTUALLY TERMINATE HIS EMPLOYMENT PURSUANT TO THIS SECTION 4.5.2
WITHIN SIX (6) MONTHS FOLLOWING THE DATE ON WHICH THE FACTS AND CIRCUMSTANCES
UNDERLYING THE FINDING OF GOOD REASON REASONABLY COULD HAVE BEEN KNOWN BY
EXECUTIVE.

 

4.6          VOLUNTARY TERMINATION.  EXECUTIVE SHALL GIVE EMPLOYER NOT LESS THAN
SIXTY (60) DAYS’ PRIOR WRITTEN NOTICE OF HIS INTENTION VOLUNTARILY TO TERMINATE
HIS EMPLOYMENT BY EMPLOYER OTHER THAN FOR GOOD REASON. IF EXECUTIVE TERMINATES
HIS EMPLOYMENT ON HIS OWN INITIATIVE WITHOUT GOOD REASON AND UNDER CIRCUMSTANCES
OTHER THAN (I) A TERMINATION DUE TO DEATH, (II) A TERMINATION DUE TO RETIREMENT,
OR (III) AN EXPIRATION OF THE TERM DUE TO NON-RENEWAL, THEN EXECUTIVE UPON SUCH
TERMINATION (“VOLUNTARY TERMINATION”), WILL ONLY BE ENTITLED TO RECEIVE THE
FOLLOWING:

 

(A)           THE ACCRUED OBLIGATIONS, AND

 

(B)           THE ADDITIONAL BENEFITS, IN ACCORDANCE WITH THE TERMS OF THE
APPLICABLE PLAN, PROGRAM OR ARRANGEMENT.

 

4.7          TERMINATION DUE TO RETIREMENT.  DURING THE TERM OF

 

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EMPLOYMENT, EXECUTIVE MAY, UPON REACHING SIXTY-THREE (63) YEARS OF AGE,
VOLUNTARILY TERMINATE HIS EMPLOYMENT HEREUNDER BY GIVING NOT LESS THAN SIXTY
(60) DAYS PRIOR WRITTEN NOTICE TO EMPLOYER (“RETIREMENT”).  UPON EXPIRATION OF
SAID SIXTY (60) DAY NOTICE PERIOD (“RETIREMENT EFFECTIVE DATE”), EXECUTIVE WILL
ONLY BE ENTITLED TO RECEIVE THE FOLLOWING:

 

(A)           THE ACCRUED OBLIGATIONS,

 

(B)           THE ADDITIONAL BENEFITS, IN ACCORDANCE WITH THE TERMS OF THE
APPLICABLE PLAN, PROGRAM OR ARRANGEMENT,

 

(C)           ANY RIGHTS TO INDEMNIFICATION IN ACCORDANCE WITH SECTION 6 OF THIS
AGREEMENT,

 

(D)           TO CONTINUE, TOGETHER WITH HIS SPOUSE AND ELIGIBLE DEPENDENTS,
PARTICIPATION IN THE WELFARE BENEFITS DESCRIBED IN SECTION 3.4 (COLLECTIVELY,
THE “CONTINUING BENEFIT PLANS”); PROVIDED, HOWEVER, THAT COVERAGE (WITH REGARD
TO MEDICAL AND DENTAL BENEFITS FOR THE PERIOD AFTER THE END OF THE EIGHTEEN (18)
MONTH PERIOD FOLLOWING THE DATE OF TERMINATION) SHALL, UNLESS SAME IS A
NONTAXABLE BENEFIT EXCLUDIBLE FROM INCOME UNDER SECTION 105 OF THE CODE, BE
DEEMED TO BE MONTHLY, IN-KIND PAYMENTS OF THE PREMIUMS AND WILL BE TAXABLE
INCOME TO EXECUTIVE; AND PROVIDED, FURTHER, THAT THE PARTICIPATION BY EXECUTIVE
(AND, TO THE EXTENT APPLICABLE, EXECUTIVE’S SPOUSE AND DEPENDENTS) IN ANY
CONTINUING BENEFIT PLAN SHALL CEASE ON THE DATE, IF ANY, ON WHICH EXECUTIVE
BECOMES ELIGIBLE FOR COMPARABLE BENEFITS UNDER A SIMILAR PLAN, POLICY  OR
PROGRAM OF A SUBSEQUENT EMPLOYER (“END DATE”).  EXECUTIVE’S PARTICIPATION IN THE
CONTINUING BENEFIT PLANS WILL BE ON THE SAME TERMS AND CONDITIONS THAT WOULD
HAVE APPLIED HAD EXECUTIVE CONTINUED TO BE EMPLOYED BY EMPLOYER THROUGH THE END
DATE.  TO THE EXTENT ANY SUCH BENEFITS CANNOT BE PROVIDED UNDER THE TERMS OF THE
APPLICABLE PLAN, POLICY OR PROGRAM, EMPLOYER SHALL PROVIDE (OR SHALL CAUSE TO BE
PROVIDED) A COMPARABLE BENEFIT UNDER ANOTHER PLAN.

 

4.8          HIGHEST ANNUAL COMPENSATION.  “HIGHEST ANNUAL COMPENSATION” MEANS,
AS DETERMINED AS OF THE DATE OF TERMINATION OF EXECUTIVE’S TERM OF EMPLOYMENT
UNDER THE APPLICABLE TERMINATION PROVISION SET FORTH ABOVE, THE SUM OF (A) THE
HIGHEST PER ANNUM RATE OF BASE SALARY PAID BY EMPLOYER TO EXECUTIVE AT ANY TIME
DURING THE TERM OF EMPLOYMENT PRIOR TO SUCH DATE OF TERMINATION, AND (B) THE
HIGHEST ANNUAL CASH PERFORMANCE BONUS OR OTHER ANNUAL CASH INCENTIVE
COMPENSATION PAID BY EMPLOYER TO EXECUTIVE, INCLUDING ALL SUCH CASH AMOUNTS PAID
TO EXECUTIVE INDIVIDUALLY AND AS PART OF AN EMPLOYEE OR EXECUTIVE COMPENSATION
GROUP (OR WHICH WOULD HAVE BEEN PAID BUT FOR AN ELECTION BY EXECUTIVE TO DEFER
PAYMENT TO A LATER PERIOD) WITH RESPECT TO ANY FISCAL YEAR OF EMPLOYER DURING
THE TERM OF EMPLOYMENT PRIOR TO SUCH DATE OF TERMINATION.

 

4.9          CHANGE IN CONTROL.   A “CHANGE IN CONTROL EVENT” MEANS

 

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ANY EVENT THAT MAY QUALIFY AS A “CHANGE IN CONTROL” UNDER COMPANY’S 2003 STOCK
INCENTIVE PLAN, AS MAY BE AMENDED AND IN EFFECT FROM TIME TO TIME.

 

(A)           TERMINATION PURSUANT TO CERTAIN PROVISIONS PRIOR TO A CHANGE IN
CONTROL EVENT.  IF THE TERM OF EMPLOYMENT HAS BEEN TERMINATED PURSUANT TO
SECTIONS 4.2, 4.6 OR 4.7 AT ANY TIME DURING THE TWELVE MONTH PERIOD PRIOR TO A
CHANGE IN CONTROL EVENT, EXECUTIVE OR THE NAMED BENEFICIARY OR OTHER LEGAL
REPRESENTATIVE, AS THE CASE MAY BE, SHALL BE ENTITLED  TO RECEIVE, IN ADDITION
TO PAYMENTS AND BENEFITS SET FORTH IN  THE APPLICABLE SECTION, THE SEVERANCE
PAYMENT AS SET FORTH IN SECTION 4.5.1(C) ABOVE SUBJECT TO THE PROVISIONS OF
SECTION 4.11 (“CHANGE IN CONTROL PAYMENT”); PROVIDED, HOWEVER, THAT ANY SUMS
PREVIOUSLY PAID TO THE EXECUTIVE’S NAMED BENEFICIARY OR OTHER LEGAL
REPRESENTATIVE PURSUANT TO SECTION 4.2(C) PROVIDING FOR A LUMP SUM PAYMENT SHALL
REDUCE THE AMOUNT OF THE CHANGE IN CONTROL  PAYMENT.  IN ANY SUCH CASE, THE
CHANGE IN CONTROL PAYMENT SHALL BE PAID ON THE EARLIEST DATE DURING THE FIRST
TAXABLE YEAR OF EXECUTIVE FOLLOWING THE TAXABLE YEAR OF EXECUTIVE IN WHICH
EXECUTIVE’S EMPLOYMENT TERMINATES ON WHICH SUCH PAYMENT CAN BE MADE IN
COMPLIANCE WITH SECTION 409A OF THE CODE.

 

(B)           TERMINATION PURSUANT TO CERTAIN PROVISIONS FOLLOWING A CHANGE IN
CONTROL EVENT. (I) IF, DURING THE PERIOD BEGINNING ON THE DATE OF THE CHANGE IN
CONTROL EVENT AND ENDING ON THE DATE TWO (2) YEARS AFTER A CHANGE IN CONTROL
EVENT, EXECUTIVE’S TERM OF EMPLOYMENT IS TERMINATED PURSUANT TO SECTION 4.2,
EXECUTIVE’S NAMED BENEFICIARY OR OTHER LEGAL REPRESENTATIVE, AS THE CASE MAY BE,
SHALL BE ENTITLED TO RECEIVE, IN ADDITION TO PAYMENTS AND BENEFITS SET FORTH IN
SECTION 4.2, THE CHANGE IN CONTROL PAYMENT; PROVIDED, HOWEVER, THAT PAYMENT OF
THE CHANGE IN CONTROL PAYMENT SHALL BE IN LIEU OF THE LUMP SUM PAYMENT.  IN SUCH
CASE, THE CHANGE IN CONTROL PAYMENT WILL BE PAID IMMEDIATELY WITHIN THIRTY (30)
DAYS OF THE DATE OF DEATH; (II) IF, DURING THE PERIOD BEGINNING ON THE DATE OF
THE CHANGE IN CONTROL EVENT AND ENDING ON THE DATE THAT IS ONE (1) YEAR AFTER A
CHANGE IN CONTROL EVENT, EXECUTIVE EITHER VOLUNTARILY TERMINATES HIS EMPLOYMENT
PURSUANT TO SECTION 4.6, OR RETIRES PURSUANT TO SECTION 4.7, THEN EXECUTIVE
SHALL BE ENTITLED TO RECEIVE THE CHANGE IN CONTROL PAYMENT, SUCH PAYMENT TO BE
PAID WITHIN THIRTY (30) DAYS FOLLOWING THE DATE EXECUTIVE EMPLOYMENT TERMINATES.

 

4.10        RELEASE.  IN THE EVENT OF TERMINATION OF EMPLOYMENT FOR ANY REASON,
THE PAYMENTS AND OTHER BENEFITS (IF ANY) REQUIRED TO BE PROVIDED TO EXECUTIVE
PURSUANT TO THIS SECTION 4 (INCLUDING THOSE, IF ANY, REQUIRED UNDER THIS
SECTION 4 TO BE PAID PURSUANT TO OTHER SECTIONS OF THIS AGREEMENT) WILL BE IN
FULL AND COMPLETE SATISFACTION OF ANY AND ALL OBLIGATIONS OWING TO EXECUTIVE
PURSUANT TO THIS AGREEMENT AND, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OTHER CLAIMS EXECUTIVE MAY HAVE IN RESPECT OF EXECUTIVE’S EMPLOYMENT BY
EMPLOYER. SUCH

 

13

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AMOUNTS SHALL CONSTITUTE LIQUIDATED DAMAGES WITH RESPECT TO ANY AND ALL SUCH
RIGHTS AND CLAIMS AND, UPON EXECUTIVE’S RECEIPT OF SUCH AMOUNTS, EMPLOYER SHALL
BE RELEASED AND DISCHARGED FROM ANY AND ALL LIABILITY TO EXECUTIVE IN CONNECTION
WITH THIS AGREEMENT OR OTHERWISE IN CONNECTION WITH EXECUTIVE’S EMPLOYMENT BY
EMPLOYER. NOTWITHSTANDING THE FOREGOING, EXECUTIVE SHALL RETAIN ALL RIGHTS
(I) WITH RESPECT TO EMPLOYER’S CONTINUING OBLIGATIONS TO INDEMNIFY EXECUTIVE AS
A FORMER OFFICER OR DIRECTOR OF EMPLOYER AS SET FORTH IN SECTION 6, 
(II) MATTERS COVERED BY PROVISIONS OF THIS AGREEMENT THAT EXPRESSLY SURVIVE THE
TERMINATION OF THIS AGREEMENT,  (III) RIGHTS TO WHICH EXECUTIVE IS ENTITLED BY
VIRTUE OF HIS PARTICIPATION IN THE EMPLOYEE BENEFIT PLANS, POLICIES AND
ARRANGEMENTS OF EMPLOYER, AND (IV) AS OTHERWISE EXCLUDED BY APPLICABLE LAW.

 

4.11        CODE SECTION 280G REDUCTION.  ANYTHING IN THIS AGREEMENT OR IN ANY
OTHER AGREEMENT, CONTRACT, UNDERSTANDING, PLAN OR PROGRAM, ENTERED INTO OR
MAINTAINED BY EMPLOYER TO THE CONTRARY NOTWITHSTANDING, IN THE EVENT IT SHALL BE
DETERMINED THAT ANY PAYMENT OR DISTRIBUTION BY EMPLOYER TO OR FOR THE BENEFIT OF
EXECUTIVE, WHETHER PAID OR PAYABLE OR DISTRIBUTED OR DISTRIBUTABLE PURSUANT TO
THE TERMS OF THIS AGREEMENT OR OTHERWISE (COLLECTIVELY, THE “PAYMENTS”), WOULD
BE SUBJECT TO THE EXCISE TAX IMPOSED BY SECTION 4999 OF THE CODE, AND/OR ANY
SUCCESSOR PROVISION OR SECTION THERETO (SUCH EXCISE TAX, TOGETHER WITH ANY
INTEREST OR PENALTIES INCURRED BY EXECUTIVE WITH RESPECT TO SUCH EXCISE TAX,
COLLECTIVELY, THE “EXCISE TAX”), AND IF THE PAYMENTS LESS THE EXCISE TAX WOULD
BE LESS THAN THE AMOUNT OF THE PAYMENTS THAT WOULD OTHERWISE BE PAYABLE TO
EXECUTIVE WITHOUT IMPOSITION OF THE EXCISE TAX, THEN, TO THE EXTENT NECESSARY TO
ELIMINATE THE IMPOSITION OF THE EXCISE TAX (AND TAKING INTO ACCOUNT ANY
REDUCTION IN THE PAYMENTS PROVIDED BY REASON OF SECTION 280G OF THE CODE IN ANY
SUCH OTHER AGREEMENT, CONTRACT, UNDERSTANDING, PLAN OR PROGRAM), THE CASH AND
NON-CASH PAYMENTS AND BENEFITS PAYABLE TO THE EXECUTIVE SHALL BE REDUCED (WITH
EXECUTIVE BEING PROVIDED WITH THE AMOUNT OF EACH PAYMENT AND BENEFIT AS
CALCULATED BY THE EMPLOYER AND GIVEN TEN (10) BUSINESS DAYS IN WHICH TO
PRIORITIZE THE ORDER OF REDUCTION OF EACH SUCH PAYMENT OR BENEFIT); BUT ONLY IF,
BY REASON OF ANY SUCH REDUCTION, THE PAYMENTS WITH ANY SUCH REDUCTION SHALL
EXCEED THE PAYMENTS LESS THE EXCISE TAX WITHOUT ANY SUCH REDUCTION.  FOR
PURPOSES OF THIS SECTION 4.11, (I) NO PORTION OF THE PAYMENTS, THE RECEIPT OR
ENJOYMENT OF WHICH EXECUTIVE SHALL HAVE EFFECTIVELY WAIVED IN WRITING PRIOR TO
THE DATE OF TERMINATION, SHALL BE TAKEN INTO ACCOUNT, (II) NO PORTION OF THE
PAYMENTS SHALL BE TAKEN INTO ACCOUNT THAT, IN THE OPINION OF TAX COUNSEL
SELECTED IN GOOD FAITH BY EMPLOYER, DOES NOT CONSTITUTE A “PARACHUTE PAYMENT”
WITHIN THE MEANING OF SECTION 280G(B)(2) OF THE CODE, INCLUDING WITHOUT
LIMITATION BY REASON OF SECTION 280G(B)(4)(A) OF THE CODE, (III) ANY PAYMENTS
AND/OR BENEFITS UNDER THIS AGREEMENT OR OTHERWISE FOR SERVICES TO BE RENDERED ON
OR AFTER THE EFFECTIVE DATE OF A CHANGE IN CONTROL SHALL BE REDUCED ONLY TO THE
EXTENT NECESSARY SO THAT SUCH PAYMENTS AND/OR BENEFITS IN THEIR ENTIRETY
CONSTITUTE REASONABLE COMPENSATION FOR SERVICES ACTUALLY RENDERED WITHIN THE
MEANING OF SECTION 280G(B)(4)(B) OF THE

 

14

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CODE OR ARE OTHERWISE NOT SUBJECT TO DISALLOWANCE AS DEDUCTIONS, IN THE OPINION
OF THE TAX COUNSEL REFERRED IN THE IMMEDIATELY PRECEDING CLAUSE (II) OF THIS
SENTENCE, AND (IV) THE VALUE OF ANY NON-CASH PAYMENT OR BENEFIT OR ANY DEFERRED
PAYMENT OR BENEFIT INCLUDED IN THE PAYMENTS SHALL BE DETERMINED BY EMPLOYER’S
INDEPENDENT AUDITORS IN ACCORDANCE WITH THE PRINCIPLES OF SECTIONS
280G(D)(3) AND 280G(D)(4) OF THE CODE AND THE APPLICABLE REGULATIONS OR PROPOSED
REGULATIONS UNDER THE CODE.  EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION 4.11,
THE FOREGOING CALCULATIONS AND DETERMINATIONS SHALL BE MADE IN GOOD FAITH BY
EMPLOYER AND SHALL BE CONCLUSIVE AND BINDING UPON THE PARTIES.  EMPLOYER SHALL
PAY ALL COSTS AND EXPENSES INCURRED IN CONNECTION WITH ANY SUCH CALCULATIONS OR
DETERMINATIONS.

 

4.12        TIMING OF PAYMENT; SECTION 409A.  ALL ACCRUED OBLIGATIONS PAYABLE
UNDER THIS AGREEMENT SHALL BE PAID IN CASH IN SINGLE LUMP SUM WITHIN FOURTEEN
(14) DAYS FOLLOWING THE DATE OF TERMINATION (OR AT SUCH EARLIER DATE REQUIRED BY
LAW). THE ADDITIONAL BENEFITS SHALL BE PAID IN ACCORDANCE WITH THE TERMS OF THE
APPLICABLE PLAN, PROGRAM OR ARRANGEMENT.  EXCEPT TO THE EXTENT PROHIBITED BY
APPLICABLE LAW OR THE TERMS OF THIS AGREEMENT, ALL OTHER PAYMENTS TO WHICH
EXECUTIVE SHALL BE ENTITLED TO UNDER THIS SECTION 4 SHALL BE MADE WITHIN THIRTY
(30) DAYS FOLLOWING THE DATE OF TERMINATION, SUBJECT TO THE FOLLOWING:

 

(A)           PAYMENTS TO EXECUTIVE UNDER THIS SECTION 4 SHALL BE BIFURCATED
INTO TWO PORTIONS, CONSISTING OF A PORTION THAT DOES NOT CONSTITUTE
“NONQUALIFIED DEFERRED COMPENSATION” WITHIN THE MEANING OF SECTION 409A OF THE
CODE AND A PORTION THAT DOES CONSTITUTE NONQUALIFIED DEFERRED COMPENSATION.
PAYMENTS HEREUNDER SHALL FIRST BE MADE FROM THE PORTION, IF ANY, THAT DOES NOT
CONSIST OF NONQUALIFIED DEFERRED COMPENSATION UNTIL IT IS EXHAUSTED AND THEN
SHALL BE MADE FROM THE PORTION THAT DOES CONSTITUTE NONQUALIFIED DEFERRED
COMPENSATION. HOWEVER, ANYTHING IN THIS AGREEMENT TO THE CONTRARY
NOTWITHSTANDING, IF AT THE TIME OF EXECUTIVE’S TERMINATION OF EMPLOYMENT,
EXECUTIVE IS CONSIDERED A “SPECIFIED EMPLOYEE” AS DEFINED IN
SECTION 409A(A)(2)(B)(I) OF THE CODE, THEN TO THE EXTENT REQUIRED BY
SECTION 409A OF THE CODE, NO PAYMENTS THAT CONSTITUTE NONQUALIFIED DEFERRED
COMPENSATION SHALL BE PAYABLE PRIOR TO THE DATE THAT IS THE EARLIER OF (I) SIX
MONTHS AND A DAY AFTER EXECUTIVE’S DATE OF TERMINATION, OR (II) EXECUTIVE’S
DEATH (“EARLIEST PAYMENT DATE”).  ANY PAYMENTS THAT ARE DELAYED PURSUANT TO THE
PRECEDING SENTENCE SHALL BE PAID ON THE EARLIEST PAYMENT DATE. THE DETERMINATION
OF WHETHER, AND THE EXTENT TO WHICH, ANY OF THE PAYMENTS TO BE MADE TO EXECUTIVE
HEREUNDER ARE NONQUALIFIED DEFERRED COMPENSATION SHALL BE MADE AFTER THE
APPLICATION OF ALL APPLICABLE EXCLUSIONS UNDER TREAS. REG. § 1.409A-1(B)(9). ANY
PAYMENTS THAT ARE INTENDED TO QUALIFY FOR THE EXCLUSION FOR SEPARATION PAY DUE
TO INVOLUNTARY SEPARATION FROM SERVICE SET FORTH IN TREAS. REG. §
1.409A-1(B)(9)(III) MUST BE PAID NO LATER

 

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THAN THE LAST DAY OF THE SECOND TAXABLE YEAR OF EXECUTIVE FOLLOWING THE TAXABLE
YEAR OF EXECUTIVE IN WHICH THE DATE OF TERMINATION OCCURS.

 

(b)           The intent of the parties is that payments and benefits under this
Agreement comply with Section 409A and, accordingly, to the maximum extent
permitted, this Agreement shall be interpreted to be in compliance therewith.
The parties acknowledge and agree that the interpretation of Section 409A of the
Code and its application to the terms of this Agreement is uncertain and may be
subject to change as additional guidance and interpretations become available.
Anything to the contrary herein notwithstanding, all benefits or payments
provided by Employer to Executive that would be deemed to constitute
“nonqualified deferred compensation” within the meaning of Section 409A of the
Code are intended to comply with Section 409A of the Code. If, however, any such
benefit or payment is deemed to not comply with Section 409A of the Code,
Employer and Executive agree that this Agreement may be amended (and that any
such amendment may be retroactive to the extent permitted under Section 409A),
as reasonably requested by either party, and as may be necessary to fully comply
with Section 409A of the Code and all related rules and regulations in order to
preserve the payments and benefits provided hereunder without additional cost to
either party.

 

4.13        NO OBLIGATION TO MITIGATE; SET OFF UNDER CERTAIN CIRCUMSTANCES.  IN
THE EVENT OF ANY TERMINATION OF EXECUTIVE’S EMPLOYMENT UNDER THIS SECTION 4,
EXECUTIVE SHALL BE UNDER NO OBLIGATION TO SEEK OTHER EMPLOYMENT OR TO MITIGATE
DAMAGES, AND NO PAYMENT PROVIDED FOR IN THIS AGREEMENT SHALL BE REDUCED BY ANY
COMPENSATION EARNED BY EXECUTIVE AS THE RESULT OF EMPLOYMENT BY ANOTHER
EMPLOYER, OR FROM SELF-EMPLOYMENT, AFTER THE TERMINATION OF HIS EMPLOYMENT WITH
EMPLOYER.  NOTWITHSTANDING THE FOREGOING, NOTHING HEREIN SHALL BE DEEMED TO
PREVENT EMPLOYER FROM SETTING OFF AGAINST ANY AMOUNTS DUE TO EXECUTIVE UNDER
THIS AGREEMENT ANY AMOUNTS DUE FROM EXECUTIVE TO EMPLOYER AS OF THE DATE OF SUCH
PAYMENT.

 

4.14        BANK REGULATORY LIMITATIONS.  ANY PAYMENTS MADE TO EXECUTIVE
PURSUANT TO THIS AGREEMENT, OR OTHERWISE, ARE SUBJECT TO AND CONDITIONED UPON
THEIR COMPLIANCE WITH 12 U.S.C. § 1818(K) AND ANY APPLICABLE REGULATIONS
PROMULGATED THEREUNDER.  IN ADDITION, TO THE EXTENT REQUIRED BY APPLICABLE LAW,
REGULATION, REGULATORY POLICY OR OTHER REGULATORY REQUIREMENT, THE AGGREGATE
AMOUNT AND/OR VALUE OF THE COMPENSATION PAID AS A RESULT OF ANY TERMINATION OF
EXECUTIVE’S EMPLOYMENT WITH EMPLOYER, REGARDLESS OF THE REASON FOR ANY SUCH
TERMINATION OF EMPLOYMENT, SHALL NOT EXCEED THE LIMIT PRESCRIBED BY SUCH
APPLICABLE LAW, REGULATION, REGULATORY POLICY OR OTHER REGULATORY REQUIREMENT.

 

4.15  OPTION TO SERVE AS CONSULTANT.  DURING THE TERM OF EMPLOYMENT AND IN LIEU
OF A TERMINATION UNDER SECTIONS 4.5, 4.6 OR 4.7, THE

 

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PARTIES MAY MUTUALLY AGREE THAT EXECUTIVE’S POSITION UNDER SECTION 1 AND HIS
DUTIES, AS WELL AS THE TIME AND EFFORT REQUIRED, UNDER SECTION 2 BE MODIFIED AND
THE COMPENSATION SET FORTH IN SECTION 3 BE ADJUSTED AS SET FORTH IN THIS
SECTION 4.15 AND, IN SUCH EVENT, EXECUTIVE SHALL CONTINUE IN THE EMPLOY OF
EMPLOYER UNDER THE SAME TERMS AND CONDITIONS, INCLUDING BUT NOT LIMITED TO
BENEFITS UNDER SECTIONS 3.3 THROUGH 3.7, AS IS SET FORTH IN THIS AGREEMENT
EXCEPT AS SPECIFICALLY MODIFIED BY THIS SECTION 4.15.

 

(A)  POSITION AND DUTIES.  EXECUTIVE SHALL SERVE AS A CONSULTANT TO EMPLOYER AND
SHALL RENDER SUCH SERVICES OF AN ADVISORY OR CONSULTATIVE NATURE AS EMPLOYER MAY
REASONABLY REQUIRE OF HIM FROM TIME TO TIME AND HE SHALL ASSIST EMPLOYER IN ITS
RELATIONS WITH ITS EMPLOYEES AND CUSTOMERS, SUCH THAT EMPLOYER SHALL HAVE THE
BENEFIT OF EXECUTIVE’S EXPERIENCE AND KNOWLEDGE OF EMPLOYER’S BUSINESS AND
OPERATIONS, HIS REPUTATION AND CONTACTS IN THE INDUSTRY GENERALLY AS WELL AS
EMPLOYERS’ MARKET AREA AND HIS GENERAL BUSINESS EXPERIENCE. IN THE EVENT THAT
EXECUTIVE WAS SERVING AS A DIRECTOR AS REFERENCED IN SECTION 1, THERE SHALL BE
NO AFFIRMATIVE OBLIGATION ON THE PART OF EXECUTIVE TO SERVE OR CONTINUE TO SERVE
AS SUCH AND SERVICE AS A DIRECTOR SHALL BE IN ACCORDANCE WITH THE MUTUAL
AGREEMENT OF EXECUTIVE AND EMPLOYER.

 

(B) TIME AND EFFORT.  EXECUTIVE SHALL PERFORM SUCH SERVICES AT A LEVEL OF AT
LEAST FIFTY PERCENT (50%) OF THE SERVICES THAT EXECUTIVE PERFORMED OVER THE 36
MONTH PERIOD OCCURRING IMMEDIATELY PRIOR TO THE IMPLEMENTATION OF THIS
SECTION 4.15.

 

(C) COMPENSATION.  UPON IMPLEMENTATION OF THIS SECTION 4.15, EXECUTIVE SHALL
RECEIVE, IN EQUAL INSTALLMENTS IN ACCORDANCE WITH THE CUSTOMARY PAYROLL
PRACTICES OF EMPLOYER, COMPENSATION, IN LIEU OF THE COMPENSATION SET FORTH IN
SECTIONS 3.1 AND 3.2, IN AN AMOUNT EQUAL, ON A PER ANNUM BASIS, TO FIFTY PERCENT
(50%) OF EXECUTIVE’S HIGHEST ANNUAL COMPENSATION AS DETERMINED AS OF THE DAY
IMMEDIATELY PRIOR TO THE IMPLEMENTATION OF THIS SECTION 4.15 AND SUCH AMOUNT
SHALL CONSTITUTE EXECUTIVE’S BASE SALARY AMOUNT FOR ALL PURPOSES OF THIS
AGREEMENT.

 

5. CONFIDENTIALITY/NON-COMPETITION/NON-SOLICITATION/INTELLECTUAL PROPERTY.

 

5.1      CONFIDENTIALITY.  EXECUTIVE SHALL NOT, DURING THE EMPLOYMENT TERM OR
ANYTIME THEREAFTER, MAKE USE OF OR DISCLOSE ANY CONFIDENTIAL INFORMATION TO ANY
PERSON OR ENTITY (INCLUDING, BUT NOT LIMITED TO ANY BANK, TRUST COMPANY, CREDIT
UNION, CORPORATION, FIRM, UNINCORPORATED ORGANIZATION, ASSOCIATION, PARTNERSHIP,
LIMITED LIABILITY COMPANY, TRUST ESTATE, JOINT VENTURE OR OTHER BUSINESS
ORGANIZATION OR ENTITY) (“PERSON”) FOR ANY REASON OR PURPOSE WHATSOEVER OTHER
THAN IN FURTHERANCE OF EMPLOYER’S BUSINESS.  THE TERM “CONFIDENTIAL INFORMATION”
SHALL MEAN ALL CONFIDENTIAL INFORMATION OF OR RELATING TO EMPLOYER AND ANY
PERSON EFFECTIVELY CONTROLLING, EFFECTIVELY CONTROLLED BY OR EFFECTIVELY UNDER
COMMON CONTROL WITH EMPLOYER (“AFFILIATE”) INCLUDING, WITHOUT

 

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LIMITATION, FINANCIAL INFORMATION AND DATA, BUSINESS PLANS AND INFORMATION
REGARDING PROSPECTS AND OPPORTUNITIES (SUCH AS, BY WAY OF EXAMPLE ONLY, CLIENT
AND CUSTOMER LISTS AND ACQUISITION, DISPOSITION, EXPANSION, PRODUCT DEVELOPMENT
AND OTHER STRATEGIC PLANS), BUT DOES NOT INCLUDE ANY INFORMATION THAT IS OR
BECOMES PUBLIC KNOWLEDGE BY MEANS OTHER THAN EXECUTIVE’S BREACH OR NONOBSERVANCE
OF HIS OBLIGATIONS DESCRIBED IN THIS SECTION 5.1.  NOTWITHSTANDING THE
FOREGOING, EXECUTIVE MAY DISCLOSE SUCH CONFIDENTIAL INFORMATION AS HE MAY BE
LEGALLY REQUIRED TO DO SO ON THE ADVICE OF COUNSEL IN CONNECTION WITH ANY LEGAL
OR REGULATORY PROCEEDING; PROVIDED, HOWEVER, THAT EXECUTIVE SHALL PROVIDE
EMPLOYER WITH PRIOR WRITTEN NOTICE OF ANY SUCH REQUIRED OR POTENTIALLY REQUIRED
DISCLOSURE AND SHALL COOPERATE WITH EMPLOYER AND USE HIS BEST EFFORTS UNDER SUCH
CIRCUMSTANCES TO OBTAIN APPROPRIATE CONFIDENTIAL TREATMENT OF ANY SUCH
CONFIDENTIAL INFORMATION THAT MAY BE SO REQUIRED TO BE DISCLOSED IN CONNECTION
WITH ANY SUCH LEGAL OR REGULATORY PROCEEDING.  EXECUTIVE’S OBLIGATION TO REFRAIN
FROM DISCLOSING CONFIDENTIAL INFORMATION UNDER THIS SECTION 5.1 SHALL CONTINUE
IN EFFECT IN ACCORDANCE WITH ITS TERMS FOLLOWING ANY TERMINATION OF THIS
AGREEMENT PURSUANT TO SECTION 4 ABOVE.

 

5.2      Non-competition.  Without prior written consent of the Board of
Directors of Employer, Executive agrees that he will not, at any time during the
Term of Employment and for the two-year period following the Expiration of the
Term of Employment for Non-Renewal as set forth in Section 4.1 or the
termination of the Term of Employment for any reason as set forth above in
Sections 4.4 through 4.7, directly or indirectly, whether as owner, partner,
shareholder (other than the holder of 1% or less of the common stock of any
company the common stock of which is listed on a national stock exchange or
quoted on the Nasdaq Stock Market), or as consultant, agent, employee of any
other Person or otherwise, engage in competition (as to any service or product
provided by Employer or for which Employer had made substantial preparation to
enter into or offer prior to the termination of Executive’s employment) with
Employer or any of its Affiliates anywhere within a ten (10) mile radius of any
city or town in which Bank or any Affiliate has a branch or other office (or to
such lesser extent and for such lesser period as may be deemed enforceable, it
being the intention of the parties that this Section 5.2 shall be so enforced);
provided, however,  that the restrictive covenant set forth herein shall
automatically terminate or expire upon a Change in Control event and shall not
be of any further force or effect whatsoever following said Change in Control
event.

 

5.3          NON-SOLICITATION.  WITHOUT PRIOR WRITTEN CONSENT OF THE BOARD OF
DIRECTORS OF EMPLOYER, EXECUTIVE AGREES THAT HE WILL NOT, AT ANY TIME DURING THE
TWO-YEAR PERIOD FOLLOWING THE EXPIRATION OF THE TERM OF EMPLOYMENT FOR
NON-RENEWAL AS SET FORTH IN SECTION 4.1 OR THE TERMINATION OF THE TERM OF
EMPLOYMENT FOR ANY REASON AS SET FORTH ABOVE IN SECTIONS 4.4 THROUGH 4.7:

 

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(A)           HIRE OR ATTEMPT TO HIRE, OR ASSIST IN HIRING, ANY EMPLOYEES OF
EMPLOYER OR ANY OF ITS AFFILIATES, OR SOLICIT, ENCOURAGE OR INDUCE ANY SUCH
EMPLOYEE TO TERMINATE HIS OR HER RELATIONSHIP WITH EMPLOYER OR ANY SUCH
AFFILIATE; OR

 

(B)           SOLICIT, ENCOURAGE OR INDUCE ANY CUSTOMER OR CLIENT OF EMPLOYER OR
ANY OF ITS AFFILIATES TO TERMINATE HIS OR ITS RELATIONSHIP WITH EMPLOYER OR ANY
SUCH AFFILIATE OR TO DO BUSINESS WITH ANYONE OTHER THAN EMPLOYER AND ITS
AFFILIATES.

 

5.4          INTELLECTUAL PROPERTY.  EXECUTIVE WILL, DURING THE PERIOD OF HIS
EMPLOYMENT, DISCLOSE TO EMPLOYER PROMPTLY AND FULLY ALL INTELLECTUAL PROPERTY
(AS DEFINED BELOW) MADE OR CONCEIVED BY EXECUTIVE (EITHER SOLELY OR JOINTLY WITH
OTHERS) INCLUDING BUT NOT LIMITED TO INTELLECTUAL PROPERTY WHICH RELATE TO THE
BUSINESS OF EMPLOYER OR RESULT FROM WORK PERFORMED BY HIM FOR EMPLOYER. ALL
INTELLECTUAL PROPERTY AND ALL RECORDS RELATED TO INTELLECTUAL PROPERTY, WHETHER
OR NOT PATENTABLE, SHALL BE AND REMAIN THE SOLE AND EXCLUSIVE PROPERTY OF
EMPLOYER AND EMPLOYER SHALL HAVE THE EXCLUSIVE WORLDWIDE AND PERPETUAL RIGHT TO
USE, MAKE, AND SELL PRODUCTS AND/OR SERVICES DERIVED THEREFROM.  INTELLECTUAL
PROPERTY MEANS ALL COPYRIGHTS, TRADEMARKS, TRADE NAMES, TRADE SECRETS,
PROPRIETARY INFORMATION, INVENTIONS, DESIGNS, DEVELOPMENTS, AND IDEAS, AND ALL
KNOW-HOW RELATED THERETO. EXECUTIVE HEREBY ASSIGNS AND AGREES TO ASSIGN TO
EMPLOYER ALL HIS RIGHTS TO INTELLECTUAL PROPERTY AND ANY PATENTS, TRADEMARKS, OR
COPYRIGHTS WHICH MAY BE ISSUED WITH RESPECT TO INTELLECTUAL PROPERTY.  EXECUTIVE
FURTHER ACKNOWLEDGES THAT ALL WORK SHALL BE WORK MADE FOR HIRE. DURING AND AFTER
THE TERM OF EMPLOYMENT, EXECUTIVE AGREES TO ASSIST EMPLOYER, WITHOUT CHARGE TO
EMPLOYER BUT AT ITS REQUEST AND EXPENSE, TO OBTAIN AND RETAIN RIGHTS IN
INTELLECTUAL PROPERTY, AND WILL EXECUTE ALL APPROPRIATE RELATED DOCUMENTS AT THE
REQUEST OF EMPLOYER. EXECUTIVE AND EMPLOYER AGREE THAT THIS SECTION 5.4 SHALL
NOT APPLY TO ANY INTELLECTUAL PROPERTY FOR WHICH NO EQUIPMENT, SUPPLIES,
FACILITIES, TRADE SECRET, OR OTHER CONFIDENTIAL INFORMATION OF EMPLOYER WAS USED
AND WHICH WAS DEVELOPED ENTIRELY ON HIS OWN TIME, PROVIDED THAT IT DOES NOT
RELATE TO THE BUSINESS OF EMPLOYER OR AND DOES NOT RESULT FROM ANY WORK
PERFORMED BY HIM FOR EMPLOYER.

 

5.5          RETURN OF MATERIALS.  UPON THE TERMINATION OF EXECUTIVE’S
EMPLOYMENT, EXECUTIVE WILL RETURN TO EMPLOYER ALL EMPLOYER PROPERTY, INCLUDING
ALL MATERIALS FURNISHED TO EXECUTIVE DURING THE TERM OF EMPLOYMENT (INCLUDING
BUT NOT LIMITED TO KEYS, COMPUTERS, AUTOMOBILES, ELECTRONIC COMMUNICATION
DEVICES, FILES, ELECTRONIC STORAGE DEVICES AND IDENTIFICATION CARDS); PROVIDED,
HOWEVER, THAT EXECUTIVE MAY RETAIN COPIES OF MATERIALS RELATING TO HIS
COMPENSATION OR BENEFITS. IN ADDITION, UPON TERMINATION, EXECUTIVE WILL PROVIDE
EMPLOYER WITH ALL PASSWORDS AND SIMILAR INFORMATION WHICH ARE REASONABLY
NECESSARY FOR EMPLOYER TO ACCESS MATERIALS ON WHICH EXECUTIVE WORKED OR TO
OTHERWISE CONTINUE IN ITS BUSINESS.

 

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5.6                               INJUNCTIVE RELIEF.  EXECUTIVE ACKNOWLEDGES AND
AGREES THAT THE PROTECTIONS OF EMPLOYER SET FORTH IN THIS SECTION 5 ARE FAIR AND
REASONABLE AND ARE NECESSARY FOR EMPLOYER TO PROTECT ITS LEGITIMATE BUSINESS
INTERESTS, INCLUDING ITS CONFIDENTIAL INFORMATION AND BUSINESS RELATIONSHIPS,
AND THAT EMPLOYER WILL HAVE NO ADEQUATE REMEDY AT LAW, AND WOULD BE IRREPARABLY
HARMED, IF EXECUTIVE BREACHES OR THREATENS TO BREACH ANY OF THE PROVISIONS OF
THIS SECTION 5.  EXECUTIVE AGREES THAT EMPLOYER SHALL BE ENTITLED TO SEEK
EQUITABLE AND/OR INJUNCTIVE RELIEF TO PREVENT ANY BREACH OF THREATENED BREACH OF
THIS SECTION 5, AND TO SPECIFIC PERFORMANCE OF EACH OF THE TERMS OF THIS
SECTION 5 IN ADDITION TO ANY OTHER LEGAL OR EQUITABLE REMEDIES THAT EMPLOYER MAY
HAVE, WITHOUT POSTING A BOND.  EXECUTIVE FURTHER AGREES THAT HE SHALL NOT, IN
ANY EQUITY PROCEEDING RELATING TO THE ENFORCEMENT OF THE TERMS OF THIS
SECTION 5, RAISE THE DEFENSE THAT EMPLOYER HAS AN ADEQUATE REMEDY AT LAW.

 

5.7                               CLAW-BACK.   TO THE FULLEST EXTENT PERMITTED
BY LAW, IN THE EVENT THAT EXECUTIVE BREACHES ANY OF THE PROVISIONS OF SECTIONS
5.1, 5.2 OR 5.3:

 

(A)                                  EMPLOYER SHALL BE ENTITLED TO RECOUP
PAYMENTS MADE TO EXECUTIVE PURSUANT TO SECTION 4 HEREOF, PROVIDED, HOWEVER,
THAT, IN THE EVENT OF A BREACH OF SECTION 5.1, SUCH RECOUPMENT SHALL BE LIMITED
TO THE REASONABLE DAMAGES INCURRED BY EMPLOYER AS A RESULT OF SUCH BREACH AND,
IN THE EVENT OF A BREACH OF SECTION 5.2 OR SECTION 5.3, SUCH RECOUPMENT SHALL BE
EQUAL TO THE TOTAL PAYMENTS MADE TO EXECUTIVE PURSUANT TO SECTION 4 MULTIPLIED
BY A FRACTION, THE NUMERATOR OF WHICH IS THE NUMBER OF MONTHS REMAINING FROM THE
DATE OF SUCH BREACH TO THE SECOND ANNIVERSARY OF THE TERM OF EMPLOYMENT OR
EXPIRATION OF THE TERM OF EMPLOYMENT FOR NON-RENEWAL, AS THE CASE MAY BE, AND
THE DENOMINATOR OF WHICH IS TWENTY-FOUR (24) MONTHS; AND

 

(B)                                 TO THE EXTENT THAT ANY OTHER BENEFITS ARE
BEING PROVIDED TO EXECUTIVE PURSUANT TO SECTION 4, SUCH WILL CEASE IMMEDIATELY,
AND EXECUTIVE WILL NOT BE ENTITLED TO ANY FURTHER COMPENSATION AND BENEFITS FROM
EMPLOYER PURSUANT TO SECTION 4.

 

5.8                               SPECIAL SEVERABILITY.  THE TERMS AND
PROVISIONS OF THIS SECTION 5 ARE INTENDED TO BE SEPARATE AND DIVISIBLE
PROVISIONS AND IF, FOR ANY REASON, ANY ONE OR MORE OF THEM IS HELD TO BE INVALID
OR UNENFORCEABLE, NEITHER THE VALIDITY NOR THE ENFORCEABILITY OF ANY OTHER
PROVISION OF THIS AGREEMENT SHALL THEREBY BE AFFECTED.

 

6.                                      INDEMNIFICATION.  EXECUTIVE (AND HIS
HEIRS, EXECUTORS AND ADMINISTRATORS) SHALL BE INDEMNIFIED AND HELD HARMLESS BY
EMPLOYER TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, REGULATION,
REGULATORY POLICY OR OTHER REGULATORY REQUIREMENT, AGAINST ALL EXPENSES,
LIABILITIES AND LOSSES (INCLUDING WITHOUT LIMITATION, ALL REASONABLE ATTORNEYS’
FEES AND ALL JUDGMENTS, FINES, EXCISE TAXES OR PENALTIES AND AMOUNTS PAID OR TO
BE PAID IN SETTLEMENT) INCURRED OR SUFFERED BY EXECUTIVE AS A CONSEQUENCE OF
EXECUTIVE BEING OR HAVING BEEN MADE A PARTY TO, OR BEING OR HAVING BEEN INVOLVED
IN, ANY THREATENED, PENDING OR

 

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COMPLETED ACTION, SUIT OR PROCEEDING, WHETHER CIVIL, CRIMINAL, ADMINISTRATIVE OR
INVESTIGATIVE, BY REASON OF THE FACT THAT EXECUTIVE IS OR WAS A TRUSTEE,
DIRECTOR OR OFFICER OF EMPLOYER OR IS OR WAS SERVING AT THE REQUEST OF EMPLOYER
AS A TRUSTEE, DIRECTOR OR OFFICER OF EMPLOYER OF IS OR WAS SERVING AT THE
REQUEST OF EMPLOYER AS A TRUSTEE, DIRECTOR OR OFFICER OF ANOTHER CORPORATION OR
OTHER ENTITY AND SUCH INDEMNIFICATION SHALL CONTINUE AFTER EXECUTIVE SHALL CEASE
TO BE AN OFFICER, DIRECTOR OR TRUSTEE.  THE RIGHT TO INDEMNIFICATION CONFERRED
HEREBY SHALL BE A CONTRACT RIGHT AND SHALL ALSO INCLUDE, TO THE EXTENT PERMITTED
BY APPLICABLE LAW, REGULATION, REGULATORY POLICY OR OTHER REGULATORY
REQUIREMENT, THE RIGHT TO BE PAID BY EMPLOYER THE EXPENSES INCURRED IN DEFENDING
ANY SUCH PROCEEDING IN ADVANCE OF THE FINAL DISPOSITION UPON RECEIPT BY EMPLOYER
OF AN UNDERTAKING BY OR ON BEHALF OF EXECUTIVE TO REPAY SUCH AMOUNT OR A PORTION
THEREOF, IF IT SHALL ULTIMATELY BE DETERMINED THAT EXECUTIVE IS NOT ENTITLED TO
BE INDEMNIFIED BY EMPLOYER PURSUANT HERETO OR AS OTHERWISE AUTHORIZED BY LAW,
REGULATION, REGULATORY POLICY OR OTHER REGULATORY REQUIREMENT, BUT SUCH
REPAYMENT BY EXECUTIVE SHALL ONLY BE IN AN AMOUNT ULTIMATELY DETERMINED TO
EXCEED THE AMOUNT TO WHICH EXECUTIVE WAS ENTITLED TO BE INDEMNIFIED.  EMPLOYER’S
ACCEPTANCE OF ANY SUCH UNDERTAKING BY OR ON BEHALF OF EXECUTIVE MAY NOT BE
CONDITIONED UPON ANY EVIDENCE OR DEMONSTRATION BY OR ON BEHALF OF EXECUTIVE OF
ANY FINANCIAL CAPACITY TO MAKE ANY SUCH REPAYMENT AT THE TIME SUCH UNDERTAKING
IS DELIVERED.  THE PROVISIONS OF THIS SECTION 6 SHALL SURVIVE ANY TERMINATION OF
THIS AGREEMENT.

 

7.                                      NOTICES.  ANY NOTICE GIVEN HEREUNDER
SHALL BE IN WRITING AND SHALL BE DEEMED GIVEN WHEN DELIVERED IN-HAND TO THE
OTHER PARTY, BY FACSIMILE TRANSMISSION, BY OVERNIGHT COURIER, OR BY REGISTERED
OR CERTIFIED MAIL (RETURN RECEIPT REQUESTED, POSTAGE PREPAID) ADDRESSED TO THE
APPROPRIATE PARTY AT THE ADDRESS FIRST SET FORTH ABOVE, OR AT SUCH OTHER ADDRESS
AS THE PARTY SHALL DESIGNATE FROM TIME TO TIME IN A NOTICE.

 

8.                                      DISPUTES. ANY DISPUTE, CLAIM OR
CONTROVERSY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE BREACH,
TERMINATION, ENFORCEMENT, INTERPRETATION OR VALIDITY THEREOF HEREOF (OTHER THAN
AN ACTION BROUGHT BY EMPLOYER FOR INJUNCTIVE OR OTHER EQUITABLE RELIEF IN THE
ENFORCEMENT OF EMPLOYER’S RIGHTS UNDER SECTION 5 ABOVE, IN WHICH CASE SUCH
ACTION MAY BE BROUGHT IN ANY COURT OF COMPETENT JURISDICTION), INCLUDING THE
DETERMINATION OF THE SCOPE OR APPLICABILITY OF THIS AGREEMENT TO ARBITRATE,
SHALL BE DETERMINED BY ARBITRATION IN BOSTON, MASSACHUSETTS, BEFORE THREE
NEUTRAL ARBITRATORS (ONE OF WHOM SHALL BE APPOINTED BY EMPLOYER, ONE BY
EXECUTIVE AND THE THIRD BY THE FIRST TWO ARBITRATORS).  THE ARBITRATION SHALL BE
ADMINISTERED BY JAMS PURSUANT TO ITS STREAMLINED ARBITRATION RULES AND
PROCEDURES. JUDGMENT ON THE AWARD MAY BE ENTERED IN ANY COURT HAVING
JURISDICTION. THIS CLAUSE SHALL NOT PRECLUDE PARTIES FROM SEEKING PROVISIONAL
REMEDIES IN AID OF ARBITRATION FROM A COURT OF APPROPRIATE JURISDICTION.  IN THE
EVENT THAT IT SHALL BE NECESSARY OR DESIRABLE FOR EXECUTIVE TO RETAIN LEGAL
COUNSEL AND/OR INCUR OTHER COSTS AND EXPENSES IN

 

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CONNECTION WITH THE ENFORCEMENT OF ANY OR ALL OF EXECUTIVE’S RIGHTS UNDER THIS
AGREEMENT, EMPLOYER SHALL PAY (OR EXECUTIVE SHALL BE ENTITLED TO RECOVER FROM
EMPLOYER, AS THE CASE MAY BE) EXECUTIVE’S REASONABLE ATTORNEYS’ FEES AND OTHER
REASONABLE COSTS AND EXPENSES IN CONNECTION WITH THE ENFORCEMENT OF SAID RIGHTS
(INCLUDING THE ENFORCEMENT OF ANY ARBITRATION AWARD IN COURT) REGARDLESS OF THE
FINAL OUTCOME, UNLESS AND TO THE EXTENT THAT THE ARBITRATORS SHALL DETERMINE
THAT EXECUTIVE HAS NOT ACTED IN GOOD FAITH OR PRESENTED A BONA FIDE CLAIM OR
DISPUTE OR THAT UNDER THE CIRCUMSTANCES RECOVERY BY EXECUTIVE OF ALL OR PART OF
ANY SUCH FEES AND COSTS AND EXPENSES WOULD BE INEQUITABLE OR OTHERWISE UNJUST.

 

The parties agree that any and all disputes, claims or controversies arising out
of or relating to this Agreement shall first be submitted to JAMS, or its
successor, for mediation, and if the matter is not resolved through mediation,
then it shall be submitted to JAMS, or its successor, for final and binding
arbitration pursuant to the arbitration clause set forth above. Either party may
commence mediation by providing to JAMS and the other party a written request
for mediation, setting forth the subject of the dispute and the relief
requested. The parties will cooperate with JAMS and with one another in
selecting a mediator from JAMS panel of neutrals, and in scheduling the
mediation proceedings. The parties covenant that they will participate in the
mediation in good faith. Employer shall pay (or Executive shall be entitled to
recover from Employer, as the case may be) Executive’s reasonable attorneys’
fees and other reasonable costs of such mediation.  All offers, promises,
conduct and statements, whether oral or written, made in the course of the
mediation by any of the parties, their agents, employees, experts and attorneys,
and by the mediator or any JAMS employees, are confidential, privileged and
inadmissible for any purpose, including impeachment, in any arbitration or other
proceeding involving the parties, provided that evidence that is otherwise
admissible or discoverable shall not be rendered inadmissible or
non-discoverable as a result of its use in the mediation. Either party may
initiate arbitration with respect to the matters submitted to mediation by
filing a written demand for arbitration at any time following the initial
mediation session or 45 days after the date of filing the written request for
mediation, whichever occurs first. The mediation may continue after the
commencement of arbitration if the parties so desire. Unless otherwise agreed by
the parties, the mediator shall be disqualified from serving as arbitrator in
the case. The provisions of this Clause may be enforced by any Court of
competent jurisdiction, and the party seeking enforcement shall be entitled to
an award of all costs, fees and expenses, including attorneys’ fees, to be paid
by the party against whom enforcement is ordered.

 

IN THE EVENT THAT WITHIN THIRTY (30) CALENDAR DAYS AFTER THE DATE THAT
EXECUTIVE’S TERM OF EMPLOYMENT HAS BEEN TERMINATED BY EMPLOYER FOR CAUSE OR BY
EXECUTIVE FOR GOOD REASON, EXECUTIVE (IN THE CASE OF TERMINATION FOR CAUSE), OR
EMPLOYER (IN THE CASE OF TERMINATION FOR GOOD REASON), NOTIFIES THE OTHER IN
WRITING THAT A DISPUTE EXISTS CONCERNING THE TERMINATION OF EMPLOYMENT EITHER
FOR CAUSE OR FOR GOOD REASON, AS THE CASE MAY BE (“NOTICE OF DISPUTE”),

 

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(1)                EXECUTIVE SHALL BE ENTITLED, TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW, REGULATION, REGULATORY POLICY OR OTHER REGULATORY REQUIREMENT,
TO BE PAID HIS BASE SALARY PURSUANT TO SECTION 3.1 AND TO CONTINUE TO RECEIVE
ALL OTHER BENEFITS SET FORTH IN SECTION 3 UNTIL THE EARLIEST TO OCCUR OF THE
FOLLOWING: (I) THE EXPIRATION OF THE THEN CURRENT TERM OF EMPLOYMENT, OR
(II) THE RESOLUTION, PURSUANT TO THE PROVISIONS OF SECTION 8, OF SUCH DISPUTE;
AND

 

(2)                THERE SHALL BE NO REDUCTION WHATSOEVER OF ANY AMOUNTS
SUBSEQUENTLY PAID TO EXECUTIVE UPON RESOLUTION OF SUCH DISPUTE AS A RESULT OF,
OR IN RESPECT TO, SUCH INTERIM PAYMENTS OR COVERAGE;

 

provided, however, that the Notice of Dispute is given in good faith, sets forth
a bona fide claim or dispute and Executive pursues the resolution of such
dispute with reasonable diligence.  The Notice of Dispute hereunder shall in all
circumstances constitute (a) a Notice of Non-Renewal under Section 1 for
purposes of determining the expiration of the then current Term of Employment,
and (b) a request for mediation and, therefore, a copy of such Notice of Dispute
shall be provided to JAMS as set forth above.

 

9.                                      Binding Effect; Successors.  This
Agreement shall inure to the benefit of and be binding upon Employer, its
successors and assigns, and Executive and his heirs, legal or personal
representatives, but shall not inure to the benefit of or be enforceable by any
third party except as otherwise expressly provided herein.  Except as otherwise
expressly provided herein, Employer and Executive agree on behalf of themselves
and of any other person or persons claiming any benefits by virtue of this
Agreement, that this Agreement and the rights, interests and benefits under it
shall not be assigned, transferred, pledged, or hypothecated in any way by
Employer or Executive or by any other person claiming under Employer or
Executive by virtue hereof; provided, however, that an assignment may be made to
the extent that the other party has consented to same in writing.

 

9.1                               Executive.  This Agreement is personal to
Executive and, without the prior written consent of Employer, shall not be
assignable by Executive, except that Executive’s rights to receive any
compensation or benefits under this Agreement may be transferred or disposed of
pursuant to testamentary disposition, intestate succession or pursuant to a
qualified domestic relations order.  In the event of Executive’s death prior to
the completion by Employer of all payments due to Executive under this
Agreement, Employer shall continue to make such payments to Executive’s
beneficiary(ies) as designated in writing by Executive to Employer prior to his
death (or to his estate, if he fails to make such designation).

 

9.2                               Employer. Both Company and Bank shall require
any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of its businesses and/or assets to assume

 

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expressly and agree to perform this Agreement in the same manner and to the same
extent as if no sucession had taken place.  Failure of either Company or Bank to
obtain such assumption and agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle Executive to
compensation in the same amount and on the same terms as he would be entitled to
hereunder if he terminated this Agreement for Good Reason following a Change in
Control, except that for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed to be the date of
termination.  As used in this Agreement, “Company,” “Bank” and “Employer” shall
mean the Company, Bank and Employer as hereinbefore defined and any sucessor to
the business and/or assets of either Company or Bank as aforesaid which
successor assumes and agrees to perform this Agreement by operation of law or
otherwise.

 

10.                               Miscellaneous.

 

10.1                        Governing Law.  This Agreement is made and delivered
in, and shall be construed in accordance with the substantive laws of, the
Commonwealth of Massachusetts without regard to conflict of law principles.

 

10.2                        Amendments; Waiver.  No amendment, waiver or
modification of this Agreement shall be valid unless the same shall be in
writing and signed by the party sought to be charged therewith; provided,
however, that no amendment that will result in a violation of Section 409A of
the Code, or any other provision of applicable law, may be made to this
Agreement and any such amendment shall be void ab initio. Failure to insist in
any one or more instances on strict compliance with the terms of this Agreement
shall not be deemed a waiver. Waiver of a breach of any provision of this
Agreement shall not be construed as a waiver of any subsequent breach.

 

10.3                        Entire Agreement. The parties acknowledge and agree
that they are not relying on any representations, oral or written, other than
those expressly contained herein.  This Agreement supersedes all proposals, oral
or written, all negotiations, conversations or discussions between the parties
and all course of dealing. All prior understandings and agreements between the
parties are hereby merged in this Agreement, which alone is the complete and
exclusive statement of their understanding.

 

10.4                        Withholdings; Reporting.  All payments to be made to
Executive by Employer shall be subject to withholding of such amounts, if any,
relating to tax and other payroll deductions as Employer may reasonably
determine it should withhold pursuant to any applicable law and regulation.
Employer may withhold from any amounts payable under this Agreement such taxes
as shall be required to be withehld pursuant to any applicable law or
regulation. Executive acknowledges that Employer may be required to report
amounts deferred by or for Executive under nonqualified deferred compensation
plans on forms W-2 and agrees that Employer shall comply with all such

 

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requirements and Executive agrees to pay and be solely responsible for all
taxes, interest and penalties.

 

10.5                        Enforceability.  If any portion or provision of this
Agreement shall to any extent to be declared illegal or uneforceable by a court
of competent jurisdiction, then the remainder of this Agreement or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or uneforceable, shall not be affected thereby,
and each portion and provision of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.

 

10.6                        Captions.  Paragraph headings are for convenience of
reference only and are not intended to create substantive rights or obligations.

 

10.7                        Survivorship.  The respective rights and oblitations
of the parties to this Agreement including, without limitation, any of their
respective rights and obligations under Section 6 of this Agreement, shall
survive any termination of this Agreement or any termination of Executive’s
employment hereunder for any reason to the extent necessary to accomplish the
intended preservation of such rights and obligations.

 

10.8                        Construction.  The parties acknowledge that they
each participated in drafting this Agreement, and there shall be no presumption
against any party on the ground that such party was responsible for preparing
this Agreement or any part hereof.

 

[Remainder of Page Intentionally Blank]

 

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IN WITNESS WHEREOF, this Agreement has been duly executed by the undersigned as
of the day and year first above written.

 

ATTEST:

ENTERPRISE BANCORP, INC.

 

 

 

 

 

 

/s/ Tanya A. Hubanks

 

By

/s/ James F. Conway, III

 

James F. Conway, III

 

Director, Chairman of Compensation

 

Committee

 

 

 

 

 

 

ATTEST:

ENTERPRISE BANK AND TRUST
COMPANY

 

 

 

 

 

 

/s/ Tanya A. Hubanks

 

By

/s/ James F. Conway, III

 

James F. Conway, III

 

Director, Chairman of Compensation

 

Committee

 

 

 

 

 

 

WITNESS:

EXECUTIVE

 

 

 

 

 

 

/s/ Tanya A. Hubanks

 

/s/ Richard W. Main

 

Richard W. Main

 

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