Filed by Bowne Pure Compliance





Exhibit 10.3




FIRST NIAGARA FINANCIAL GROUP

AMENDED AND RESTATED

CEO EXECUTIVE SEVERANCE PLAN




Effective as of February 20, 2007




ARTICLE I.

ESTABLISHMENT OF THE PLAN




First Niagara Financial Group, Inc. (“First Niagara”) hereby establishes a self-insured
severance plan for its John Koelmel, its Chief Executive Officer (“CEO”). The term “Company” means
First Niagara and any Organization Under Common Control that is covered under the Plan in
accordance with Section 5.6. Both the original effective date and the amended and restated
effective date of the Plan is February 20, 2007 (the “Effective Date”). The Plan Year is the
calendar year.



ARTICLE II.

PARTICIPATION




The CEO will become a participant in the Plan as of the Effective Date. The CEO will not be
eligible to receive any benefit under the terms of the First Niagara Financial Group Separation Pay
Plan.



ARTICLE III.

BENEFITS AND PAYMENT OF BENEFITS




Section 3.1. In General. The CEO will receive a Severance Payment, as determined
under Section 3.2, in the event (i) his employment is involuntarily terminated by the Company for
reasons other than Cause, as hereafter defined, (ii) he is required to move employment to a
location further than 100 miles of his current place of employment and he does not accept such
relocation and terminates employment or (iii) his aggregate compensation is materially reduced and
he terminates employment so long as the CEO remains in employment with the Company through his
release date as established by the Company.  



(a) For purposes of this Plan, “Cause” means a finding by the Board of Directors of the
Company that any of the following conditions exist:




(1) The CEO’s willful and continued failure substantially to perform the CEO’s
duties (other than as a result of disability) that is not or cannot be cured within
30 days of the Company giving the CEO notice of the failure to so perform. For
purposes of this Plan, no act or failure to act will be deemed “willful” unless
effected by the CEO not in good faith and without a reasonable
belief that the CEO’s action or failure to act was in or not opposed to the
Company’s best interests.


 


 









 






(2) A willful act or omission by the CEO constituting dishonesty, fraud or other
malfeasance, and any act or omission by the CEO constituting immoral conduct, which
in any such case is injurious to the financial condition or business reputation of
the Company.




(3) The CEO’s indictment for a felony offense under the laws of the United
States or any state other than for actions related to operation of motor vehicles
which does not involve operation of a motor vehicle while intoxicated or impaired.




(4) Breach by the CEO of First Niagara’s Code of Ethics for Senior Financial
Officers, any restrictive covenant, non-competition, confidentiality or
non-solicitation, or other similar agreement which is applicable to the CEO.



The CEO will not be deemed to have been terminated for Cause until there has been delivered to
him a copy of a resolution, duly adopted by the affirmative vote of not less than a majority of the
Board of First Niagara at a meeting called and held for that purpose (after reasonable notice to
the CEO and an opportunity for the CEO, with the CEO’s counsel, to be heard before the Board),
stating that, in the good faith opinion of the Board, the CEO has engaged in conduct described
above and specifying the particulars in detail.



(b) Upon the occurrence of any event described in Section 3.1(ii) or (iii) above, the CEO
shall have the right to elect to terminate his employment under this Agreement by resignation upon
not less than thirty (30) days prior written notice to First Niagara, which notice must be given by
the CEO within ninety (90) days after the initial event giving rise to said right to elect to
terminate his employment. Notwithstanding the preceding sentence, in the event of a continuing
breach of this Agreement by First Niagara, the CEO, after giving due notice within the prescribed
time frame of an initial event specified above, shall not waive any of his rights solely under this
Agreement by virtue of the fact that CEO has submitted his resignation but has remained in the
employment of First Niagara and is engaged in good faith discussions to resolve any occurrence of
an event described above. First Niagara shall have at least thirty (30) days to remedy any
condition set forth above, provided, however, that First Niagara shall be entitled to waive such
period and make an immediate payment hereunder.



Section 3.2. Benefit Amount. The CEO’s Severance Payment will be equal to the
greater of:



(i) The CEO’s base salary, determined as of the date of termination, for twenty-four (24)
months, plus the CEO’s targeted bonus amount; or



(ii) The CEO’s base salary, determined as of the date of termination, for thirty-six (36)
months.


 


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In addition, for a twelve (12)-month period following the termination of employment, First
Niagara will reimburse the CEO for outplacement services in an amount not to exceed $10,000;
provided however, that reimbursements for such outplacement services shall be made in a cash lump
sum within 30 days of CEO’s remittance to First Niagara of a receipt for such services.



Section 3.3. Form of Benefit Payment. The CEO will receive his benefit in the form of
direct deposit to his bank account in accordance with the normal payroll process over the period of
the Severance Payment. All applicable payroll taxes and withholding will be applied. Severance
Payments and benefits payable under this Plan will not be treated as compensation for purposes of
calculating benefits under any other employee benefit plan maintained by the Company.



Notwithstanding any other provision in this Agreement, for purposes of this Agreement,
“termination of employment” shall mean “Separation from Service” as defined in Code Section 409A
and the Treasury Regulations thereunder, such that First Niagara and the CEO reasonably anticipate
that the level of bona fide services the CEO would perform after termination would permanently
decrease to a level that is less than 50% of the average level of bona fide services performed
(whether as an employee or an independent contractor) over the immediately preceding 36-month
period.



Notwithstanding anything in this Agreement to the contrary, if the CEO is a Specified Employee
(within the meaning of Treasury Regulations §1.409A-1(i)), then, to the extent necessary to avoid
penalties under Code Section 409A, no payment shall be made to the CEO prior to the first day of
the seventh month following the date of termination in excess of the “permitted amount” under Code
Section 409A. For these purposes, the “permitted amount” shall be an amount that does not exceed
two times the lesser of: (i) the sum of CEO’s annualized compensation based upon the annual rate of
pay for services provided to First Niagara for the calendar year preceding the year in which occurs
the date of termination or (ii) the maximum amount that may be taken into account under a
tax-qualified plan pursuant to Code Section 401(a)(17) for the calendar year in which occurs the
date of termination. Payment of the “permitted amount” shall be made in accordance with regular
payroll practices. Any payment in excess of the permitted amount shall be made to the CEO on the
first day of the seventh month following the date of termination.



Section 3.4. Forfeitures of Benefits. The CEO will forfeit his right to any unpaid
Severance Payments benefits if he is reemployed by the Company.


 


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Section 3.5. Effect of Regulatory Actions. Any actions by First Niagara under this
Agreement must comply with the law, including regulations and other interpretive action, of
the Federal Deposit Insurance Act, Federal Deposit Insurance Corporation, or other entities
that supervise any of the activities of First Niagara. Specifically, any payments to the CEO by
First Niagara, whether pursuant to this Agreement or otherwise, are subject to and conditioned upon
their compliance with Section 18(k) of the Federal Deposit Insurance Act, 12 U.S.C. Section
1828(k), and the regulations promulgated thereunder in 12 C.F.R. Part 359. 



Section 3.6. Golden Parachute Adjustments. Notwithstanding anything in this Agreement
or any other agreement to the contrary:



(a) In the event First Niagara (or its successor) and the CEO both determine, based upon the
advice of the independent public accountants for First Niagara, that part or all of the
consideration, compensation or benefits to be paid to the CEO under this Agreement constitute
“parachute payments” under Code Section 280G(b)(2) then, if the aggregate present value of such
parachute payments, singularly or together with the aggregate present value of any consideration,
compensation or benefits to be paid to the CEO under any other plan, arrangement or agreement which
constitute “parachute payments” (collectively, the “Parachute Amount”) exceeds 2.99 times the CEO’s
“base amount,” as defined in Code Section 280G(b)(3) (the “Executive Base Amount”), the amounts
constituting “parachute payments” which would otherwise be payable to or for the benefit of the CEO
shall be reduced to the extent necessary so that the Parachute Amount is equal to 2.99 times the
CEO Base Amount (the “Reduced Amount”); provided that such amounts shall not be so reduced if the
CEO determines, based upon the advice of an independent public accounting firm (which may, but need
not be the independent public accountants of First Niagara), that without such reduction the CEO
would be entitled to receive and retain, on a net after tax basis (including, without limitation,
any excise taxes payable under Code Section 4999), an amount which is greater than the amount, on a
net after tax basis, that the CEO would be entitled to retain upon Executive’s receipt of the
Reduced Amount.



(b) If the determination made pursuant to subsection (a) above results in a reduction of the
payments that would otherwise be paid to the CEO except for the application of this Section, then
the CEO may then elect, in the CEO’s sole discretion, which and how much of any particular
entitlement shall be eliminated or reduced and shall advise First Niagara in writing of the CEO’s
election within ten days of the determination of the reduction in payments; provided, however, that
if it is determined that such election by the CEO shall be in violation of Code Section 409A, or if
no such election is made by the CEO within such ten-day period, the allocation of the required
reduction shall be pro-rata.. If no such election is made by the CEO within such ten-day period,
First Niagara may elect which and how much of any entitlement shall be eliminated or reduced and
shall notify the CEO promptly of such election. Within ten days following such determination and
the elections hereunder, First Niagara shall pay or distribute to or for the benefit of the CEO
such amounts as are then due to the CEO under this Agreement and shall promptly pay or distribute
to or for the benefit of the CEO in the future such amounts as become due to the CEO under this
Agreement.


 


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(c) As a result of the uncertainty in the application of Section 280G of the Code at the time
of a determination hereunder, it is possible that payments will be made by First Niagara which
should not have been made under clause (a) of this Section (an “Overpayment”) or that additional
payments which are not made by First Niagara pursuant to clause (a) of this Section should have
been made (an “Underpayment”). In the event that there is a final determination by the Internal
Revenue Service, a final determination by a court of competent jurisdiction or a change in the
provisions of the Code or regulations pursuant to which an Overpayment arises, any such Overpayment
shall be treated for all purposes as a loan to the CEO which the CEO shall repay to First Niagara
together with interest at the applicable Federal rate provided for in Code Section 7872(f)(2). In
the event that there is a final determination by the Internal Revenue Service, a final
determination by a court of competent jurisdiction or a change in the provisions of the Code or
regulations pursuant to which an Underpayment arises under this Agreement, any such Underpayment
shall be promptly paid by First Niagara to or for the benefit of the CEO, together with interest at
the applicable Federal rate provided for in Code Section 7872(f)(2).



The calculations required by clause (a) of this Section will be made by First Niagara’s
independent accounting firm engaged immediately prior to the event that triggered the payment, in
consultation with First Niagara’s outside legal counsel, and for purposes of making the calculation
the accounting firm may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the application of Code Sections
280G and 4999, provided that the accounting firm’s determinations must be made with substantial
authority (within the meaning of Code Section 6662).



ARTICLE IV.

ADMINISTRATION OF PLAN




Section 4.1. Appointment of Plan Administrator and Responsibility for Administration of
Plan. First Niagara shall serve as Plan Administrator and shall administer this Plan in
accordance with its terms. The Plan Administrator may designate other persons to carry out the
responsibilities to control and manage the operation of the Plan.



Section 4.2. Agents. The Plan Administrator may employ such agents, including counsel,
as it may deem advisable for the administration of the Plan.



Section 4.3. Compensation. The Company shall pay all the expenses of the Plan
Administrator. The Company shall indemnify any employees of the Company to whom responsibilities
have been delegated under Section 4.1 against any liability incurred in the course of
administration of the Plan, except liability arising from their own gross negligence or willful
misconduct.



Section 4.4. Records. The acts and decisions of the Plan Administrator shall be duly
recorded. The Plan Administrator shall make a copy of this Plan available for examination
by the CEO during the business hours of First Niagara.


 


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Section 4.5. Defect or Omission. The Plan Administrator shall refer any material
defect, omission or inconsistency in the Plan to the Board of Directors of First Niagara for such
action as may be necessary to correct such defect, supply such omission or reconcile such
inconsistency.



Section 4.6. Liability. Except for their own negligence, willful misconduct or breach
of fiduciary duty, neither the Plan Administrator nor any agents appointed by the Plan
Administrator shall be liable to anyone for any act or omission in the course of the administration
of the Plan.



Section 4.7. Contributions and Financing. All benefits required to be paid by the
Company under the Plan shall be paid as due directly by the Company from its general assets.



Section 4.8. Claims Procedure. The claims procedure set forth in this paragraph is
the exclusive method of resolving disputes that arise under the Plan.



(a) Written Claim. Any person asserting any rights under this Plan must submit a
written claim to the Compensation Committee of First Niagara’s Board of Directors (the
“Committee”). The Committee shall render a decision within a reasonable period of time from the
date on which the Committee received the written claim, not to exceed 90 days, unless an extension
of time is necessary due to reasonable cause.




(b) Denial of Claim. If a claim is denied in whole or in part, the claimant must be provided with the following information:




(1) A statement of specific reasons for the denial of the claim;




(2) References to the specific provisions of the Plan on which the denial is
based;




(3) A description of any additional material or information necessary to
perfect the claim with an explanation of why such material information is
necessary;




(4) An explanation of the claims review procedures with a statement that the
claimant must request review of the decision denying the claim within 30
days following the date on which the claimant received such notice.



(c) Review of Denial. The claimant may request that the First Niagara Board of
Directors review the denial of a claim. A request for review must be in writing and must be
received by the Board of Directors within 30 days of the date on which the claimant received
written notification of the denial of the claim. The Board of Directors will render a decision
with respect to a written request for review within 60 days from the date on which the Board of
Directors received the request for review. If the request for review is denied in whole or in
part, the Board of Directors must mail the claimant a written decision that includes a statement of
the reasons for the decision.


 


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ARTICLE V.

MISCELLANEOUS PROVISIONS




Section 5.1. Plan Terms are Legally Enforceable. The Company intends that the terms of
this Plan, including those relating to coverage and benefits, are legally enforceable.



Section 5.2. Plan Exclusively Benefits CEO. The Company intends that the Plan is
maintained for the exclusive benefit of the CEO.



Section 5.3. Illegality of Particular Provision. The illegality of any particular
provision of the Plan shall not affect the other provisions, and the Plan shall be construed in all
other respects as if such invalid provision were omitted.



Section 5.4. Applicable Laws. To the extent not pre-empted by the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), the Plan shall be governed by the laws of the
State of New York.



Section 5.5. Non-Guaranty of Employment. Nothing in this Plan shall be construed as
granting the CEO a right to continued employment with the Company.



Section 5.6. Coverage of Plan by Organization Under Common Control. The Plan is
adopted by First Niagara and covers any Organization Under Common Control with First Niagara. The
term “Organization Under Common Control” means (i) an Affiliated Corporation, (ii) a Related
Business, (iii) an Affiliated Service Organization or (iv) any other entity required to be
aggregated with First Niagara pursuant to Section 414(o) of the Code and the regulations
thereunder. The term “Affiliated Corporation” means any corporation that is a member of a
controlled group of corporations as defined in Section 414(b) of the Code, which includes First
Niagara. The term “Related Business” means any trade or business included in a group of trade or
businesses with First Niagara which are under common control, as defined in Section 414(c) of the
Code. The term “Affiliated Service Organization” means any service organization which is a member
of an affiliated service group, as defined in Section 414(m) of the Code, which includes First
Niagara.


 


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ARTICLE VI.

AMENDMENT AND TERMINATION




First Niagara intends to maintain this Plan indefinitely, but reserves the right to amend,
modify or terminate the Plan at any time. First Niagara may make modifications or amendments to
the Plan that are necessary or appropriate to maintain the Plan as a plan meeting the requirements
of the applicable provisions of ERISA.



ARTICLE VII.

POST TERMINATION OBLIGATIONS




Section 7.1. The CEO hereby covenants and agrees that, for a period of one (1) year following
his termination of employment with First Niagara, he shall not, without the written consent of
First Niagara, either directly or indirectly:



(i) solicit, offer employment to, or take any other action intended (or that a reasonable
person acting in like circumstances would expect) to have the effect of causing any officer or
employee of First Niagara, or any of its subsidiaries or affiliates, to terminate his or her
employment and accept employment or become affiliated with, or provide services for compensation in
any capacity whatsoever to, any business whatsoever that competes with the business of First
Niagara, or any of its direct or indirect subsidiaries or affiliates or has headquarters or offices
within 100 miles of the locations in which First Niagara, or any of its direct or indirect
subsidiaries or affiliates, has business operations or has filed an application for regulatory
approval to establish an office;



(ii) become an officer, employee, consultant, director, independent contractor, agent, sole
proprietor, joint venturer, greater than 5% equity owner or stockholder, partner or trustee of any
savings bank, savings and loan association, savings and loan holding company, credit union, bank or
bank holding company, insurance company or agency, any mortgage or loan broker or any other entity
competing with First Niagara or its affiliates in the same geographic locations where First Niagara
or its affiliates has material business interests; or



(iii) solicit, provide any information, advice or recommendation or take any other action
intended (or that a reasonable person acting in like circumstances would expect) to have the effect
of causing any customer of First Niagara or any of its direct or indirect subsidiaries or
affiliates to terminate an existing business or commercial relationship with First Niagara.



Section 7.2. The CEO shall, upon reasonable notice, furnish such information and assistance to
First Niagara as may reasonably be required by First Niagara, in connection with any litigation in
which it or any of its subsidiaries or affiliates is, or may become, a party; provided, however,
that the CEO shall not be required to provide information or assistance with respect to any
litigation between the CEO and First Niagara or any of its subsidiaries or affiliates.


 


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Section 7.3. All payments and benefits to the CEO under this Plan shall be subject to the
CEO’s compliance with this Article VII. The parties hereto, recognizing that irreparable injury
will result to First Niagara, its business and property in the event of the CEO’s breach of this
Article VII, agree that, in the event of any such breach by the CEO, First Niagara will be
entitled, in addition to any other remedies and damages available, to an injunction to restrain the
violation hereof by the CEO and all persons acting for or with the CEO. The CEO represents and
admits that the CEO’s experience and capabilities are such that the CEO can obtain employment in a
business engaged in other lines and/or of a different nature than First Niagara, and that the
enforcement of a remedy by way of injunction will not prevent the CEO from earning a livelihood.
Nothing herein will be construed as prohibiting First Niagara from pursuing any other remedies
available to them for such breach or threatened breach, including the recovery of damages from the
CEO.



IN WITNESS WHEREOF, the parties have duly executed this Plan as of the date first above
written.



	 	 	 	 	 
	 	FIRST NIAGARA FINANCIAL GROUP, INC.

 	 
	December 15, 2008 	By:  	/s/ Sharon D. Randaccio
 	 
	Date	 	  Sharon D. Randaccio 	 
	 	 	Chair, Compensation Committee 	 
	 
	 	CHIEF EXECUTIVE OFFICER

 	 
	December 12, 2008 	/s/ John R. Koelmel
 	 
	Date	                        John R. Koelmel 	 
	 	President & CEO 	 




 


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