AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.7.6
AMENDED
AND RESTATED EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (this "Agreement") was originally made and entered into
as
of June 1, 2004 and is hereby amended and restated as of January 3, 2006 by
and
between NewAlliance Bank, a Connecticut savings bank (the "Bank"), and ▇▇▇▇▇
▇.
▇▇▇▇▇▇▇▇▇ (the "Executive").
W
I T N E
S S E T H :
WHEREAS,
the Bank has converted from the mutual to the stock form of organization (the
"Conversion") and has concurrently become a wholly owned subsidiary of
NewAlliance Bancshares, Inc., a business corporation organized under the laws
of
the State of Delaware (the "Company");
WHEREAS,
the Executive shall hereby be employed as Executive Vice President, Corporate
Communications and Investor Relations of the Bank;
WHEREAS,
the Company and the Bank desire to ensure that the Company and the Bank are
assured of the continued availability of the Executive's services as provided
in
this Agreement, with the Bank also referred to herein as the "Employer";
and
WHEREAS,
the Executive is willing to serve the Company and the Bank on the terms and
conditions hereinafter set forth;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
conditions hereinafter set forth, the Employer and the Executive hereby agree
as
follows:
SECTION
1. EFFECTIVE
DATE; EMPLOYMENT.
This
Agreement shall be effective on the date first written above (the "Effective
Date"). The Bank agrees to employ the Executive, and the Executive hereby agrees
to such employment, during the period and upon the terms and conditions set
forth in this Agreement.
SECTION
2. EMPLOYMENT
PERIOD.
(a)
The
terms and conditions of this Agreement shall be and remain in effect during
the
period of two years beginning on the Effective Date and ending on the second
anniversary of the Effective Date (the "Initial Term"), plus such extensions,
if
any, as are provided pursuant to Section 2(b) hereof (the "Employment
Period").
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(b)
Except as provided in Section 2(c), prior to the first annual anniversary of
the
date first above written and each annual anniversary thereafter, the Boards
of
Directors of the Employer shall consider and review (after taking into account
all relevant factors, including the Executive's performance and any
recommendation of the Chief Executive Officer) a one-year extension of the
term
of this Agreement, and the term shall continue to extend each year (beginning
with the first annual anniversary date) if the Board of Directors so approve
such extension unless the Executive gives written notice to the Employer of
the
Executive's election not to extend the term, with such notice to be given not
less than ninety (90) days prior to any such anniversary date. If the Board
of
Directors elects not to extend the term, it shall give written notice of such
decision to the Executive not less than ninety (90) days prior to any such
anniversary date. If the Executive does not receive such notice, the Executive
may, by written notice given at any time during the ninety (90) days prior
to
the relevant anniversary date, request from the Board of Directors written
confirmation that the term has been extended and, if such confirmation is not
received by the Executive within thirty (30) days after the request therefor
is
made, the Executive may treat the term as having not been extended. Upon
termination of the Executive's employment with the Employer for any reason
whatsoever, any annual extensions provided pursuant to this Section 2(b), if
not
theretofore discontinued, shall automatically cease. In addition, no annual
renewals shall extend beyond the Executive's 65th
birthday, and in no event shall the Employment Period extend beyond the
Executive's 65th
birthday.
(c)
Nothing in this Agreement shall be deemed to prohibit the Employer at any time
from terminating the Executive's employment during the Employment Period with
or
without notice for any reason, provided,
however,
that the
relative rights and obligations of the Employer and the Executive in the event
of any such termination, including any requirements with respect to prior notice
of such termination, shall be determined under this Agreement.
SECTION
3. DUTIES.
Throughout
the Employment Period, the Executive shall serve as Executive Vice President,
Corporate Communications and Investor Relations of the Bank, having such power,
authority and responsibility and performing such duties as are prescribed by
or
under the Bylaws of the Bank and as are customarily associated with such
position or, irrespective of the office, title or other designation, if any,
a
position with responsibilities and powers substantially identical to such
position with the Bank. During the Initial Term (and thereafter in the
discretion of the Chief Executive Officer), the Executive shall report directly
to the Chief Executive Officer of the Bank. The Executive shall devote his
full
business time, attention, skills and efforts (other than during weekends,
holidays, vacation periods, and periods of illness or leaves of absence and
other than as permitted or contemplated by Section 7 hereof) to the business
and
affairs of the Employer and shall use his best efforts to advance the interests
of the Employer.
SECTION
4. CASH
AND
OTHER COMPENSATION.
(a)
In
consideration for the services to be rendered by the Executive hereunder, the
Bank shall pay to him a salary of two hundred twelve thousand dollars ($212,000)
annually ("Base Salary") as of the date of restatement of this Agreement. The
Executive's Base Salary shall be payable in approximately equal installments
in
accordance with the Bank's customary payroll practices for senior officers.
Base
Salary shall include any amounts of compensation deferred by the Executive
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(b)
The
Executive shall be entitled to participate in an equitable manner with all
other
executive officers of the Employer in discretionary bonuses to executive
officers as authorized by the Bank Board. No other compensation provided for
in
this Agreement shall be deemed a substitute for the Executive's right to
participate in such bonuses when and as declared by the Bank Board. In
connection with the foregoing, under the terms of the Bank's Executive Short
Term Incentive Plan (the "ESTIP"), annual cash bonuses can be awarded to the
Executive in an amount equal to up to 200% of the Executive's Base Salary (the
amount shall be pro-rated for the year ended December 31, 2004 based on the
Effective Date) as in effect at the start of the ESTIP's plan year to which
the
bonus relates. The Compensation Committee of the Bank Board shall make an annual
determination of the exact percentage of Base Salary to be used with respect
to
the possible bonus, if any, to be paid to the Executive for the relevant plan
year and shall notify the Executive by the end of January of the ESTIP's plan
year to which such percentage shall be applicable, commencing January
2005.
SECTION
5. EMPLOYEE
BENEFIT PLANS AND PROGRAMS.
(a)
During the Employment Period, the Executive shall be treated as an employee
of
the Bank and shall be entitled to participate in and receive benefits under
any
and all qualified or non-qualified retirement, pension, savings or
profit-sharing plans covering employees of the Bank (including but not limited
to the Company's Employee Stock Ownership Plan (the "ESOP"), the Bank's defined
benefit Pension Plan, the Bank's 401(k) Profit Sharing Plan, the Bank's 2004
Supplemental Executive Retirement Plan and any other similar plans that may
be
adopted in the future), any and all group life, health (including
hospitalization, medical and major medical), dental, accident and long-term
disability insurance plans, and any other employee benefit and compensation
plans (including, but not limited to, the ESTIP and any incentive compensation
plans or program or any stock benefit plans) as may from time to time be
maintained by, or cover employees of, the Bank, in accordance with the terms
and
conditions of such employee benefit plans and programs and compensation plans
and programs and consistent with the Bank's customary practices. Nothing paid
to
the Executive under any such plan or program will be deemed to be in lieu of
other compensation to which the Executive is entitled under this
Agreement.
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(b)
During the Employment Period, the Bank shall provide the Executive with an
expense allowance ("Expense Allowance") equal to $500 per month to pay for
the
costs of an automobile. Such Expense Allowance shall take into account the
federal and state income tax effect on Executive of receipt of such allowance.
In the event that with respect to a given calendar year occurring during the
term of this Agreement, the Executive believes that he drove during such year
Business Miles (as hereinafter defined) in excess of the Covered Business Miles
(as hereinafter defined) in connection with the business of the Bank and wishes
to seek reimbursement as provided herein for such excess, within 45 days after
the end of such calendar year, the Executive shall provide information to the
Bank (as well as any additional information as the Bank may reasonably request
in order to review the Executive’s claim) with respect to the number of miles
driven in the such calendar year in connection with the business of the Bank
(“Business Miles”). In the event the number of Business Miles driven during such
calendar year is determined by the Bank to be more than 3,600 (the amount shall
be pro-rated for the year ended December 31, 2004 based on the Effective Date)
(“Covered Business Miles”), the Bank will provide Executive an additional
reimbursement within 45 days of such determination for the Business Miles in
excess of the Covered Business Miles at the rate of $0.375 per mile
(“Reimbursement Rate”). The Expense Allowance, the Covered Business Miles and
the Reimbursement Rate shall be reviewed annually by the Compensation Committee
of the Bank Board and, if increased, shall be reflected in an addendum hereto.
Notwithstanding the foregoing, nothing herein shall be deemed to impose upon
the
Bank or obviate the Executive's obligation, legal or otherwise, to maintain
liability insurance with respect to the Executive's personal use of an
automobile.
(c)
The
Bank shall provide and pay for a parking space for Executive in the Bank's
main
office parking garage or, if such space shall become unavailable due to tenant
commitments or otherwise, in an alternative convenient closed parking
garage.
(d)
The
Executive shall be entitled to paid holidays and paid vacations consistent
with
the Bank's policy for executive officers.
(e)
The
Bank shall provide during the term of this Agreement, subject to the limitations
set forth herein, for the Executive to receive, at the Employer's expense,
the
services of a tax professional and a personal financial planning professional
(which may be the same person or entity for both services) (the "Tax Service
Professional") selected by the Employer and reasonably satisfactory to the
Executive. Subject to the limitations set forth herein, if the Employer does
not
specify a Tax Services Professional reasonably acceptable to the Executive,
the
Executive will be entitled to use the services of a Tax Services Professional
of
his choosing and seek reimbursement by the Employer for the reasonable cost
of
such Tax Service Professional actually incurred by the Executive. The services
to be provided shall include (i) the preparation of all required federal, state
and local personal income tax returns, (ii) advice with respect to federal,
state and local income tax treatment of cash and other forms of compensation
paid to the Executive by the Employer and (iii) investment and retirement
counseling and estate planning. Notwithstanding the foregoing, the annual cost
to the Employer of providing the services to the Executive of such Tax Service
Professional, whether such Tax Service Professional is selected by the Employer
or the Executive, shall not exceed $2,000 (the "Annual Cost"), prior to any
adjustment for income tax effects of reimbursement for such expense.
Reimbursement of the Executive for the Annual Cost shall take into account
the
federal and state income tax effect on the Executive of receipt of such Annual
Cost. The Annual Cost shall be reviewed annually by the Compensation Committee
of the Bank Board and, if increased, shall be reflected in an addendum
hereto.
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(f)
The
Executive shall move his principal residence to the New Haven area as soon
as
practicable. In connection therewith, the Bank shall (i) reimburse the Executive
for reasonable temporary housing, meals and related costs incurred for a period
up to ninety (90) days after the Effective Date (which period may be extended
beyond ninety (90) days with the prior written consent of the Chief Executive
Officer), subject to a budget approved by the Chief Financial Officer of the
Bank; (ii) provided the Executive purchases a primary residence in the New
Haven
area within two years following the Effective Date, reimburse the Executive
for
all reasonable moving, packing, unpacking and housekeeping set up costs
associated with such move, subject to a budget approved by the Chief Financial
Officer of the Bank; and (iii) provided the Executive purchases a primary
residence in the New Haven area within two years following the Effective Date,
reimburse the Executive for all reasonable closing costs and fees in connection
with the Executive's purchase of a primary residence in the New Haven area
(including costs related to mortgage financing, legal, and title, but excluding
any broker's commission), subject to a budget approved by the Chief Financial
Officer of the Bank.
SECTION
6. INDEMNIFICATION
AND INSURANCE.
(a)
During the Employment Period and for a period of six years thereafter, the
Employer shall cause the Executive to be covered by and named as an insured
under any policy or contract of insurance obtained by it to insure its directors
and officers against personal liability for acts or omissions in connection
with
service as an officer or director of the Employer or service in other capacities
at the request of the Employer. The coverage provided to the Executive pursuant
to this Section 6 shall be of the same scope and on the same terms and
conditions as the coverage (if any) provided to other officers or directors
of
the Employer or any successors.
(b)
To
the maximum extent permitted under applicable law, the Employer shall indemnify
the Executive against and hold the Executive harmless from any costs,
liabilities, losses and exposures that may be incurred by the Executive in
his
capacity as a director or officer of the Employer or any subsidiary or
affiliate.
SECTION
7. OUTSIDE
ACTIVITIES.
The
Executive may (a) serve as a member of the boards of directors of such business,
community and charitable organizations as the Executive may disclose to and
as
may be approved by the Employer (which approval shall not be unreasonably
withheld), and (b) perform duties as a trustee or personal representative or
in
any other fiduciary capacity, provided
that
in each
case such service shall not materially interfere with the performance of the
Executive's duties under this Agreement or present any conflict of interest.
The
Executive may also engage in personal business and investment activities which
do not materially interfere with the performance of the Executive's duties
hereunder, provided
that
such
activities are not prohibited under any code of conduct or investment or
securities trading policy established by the Employer and generally applicable
to all similarly situated executives. If the Executive is discharged or
suspended, or is subject to any regulatory prohibition or restriction with
respect to participation in the affairs of the Bank, the Executive shall not
directly or indirectly provide services to or participate in the affairs of
the
Bank in a manner inconsistent with the terms of such discharge or suspension
or
any applicable regulatory order.
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SECTION
8. WORKING
FACILITIES AND EXPENSES.
It
is
understood by the parties that the Executive's principal place of employment
shall be at the Bank's principal executive office located in New Haven,
Connecticut, or at such other Bank Board approved location within 50 miles
of
the address of such principal executive office, or at such other location as
the
Employer and the Executive may mutually agree upon. The Employer shall provide
the Executive at his principal place of employment with a private office,
secretarial services and other support services and facilities suitable to
his
position with the Employer and necessary or appropriate in connection with
the
performance of his assigned duties under this Agreement. The Employer shall
reimburse the Executive for his ordinary and necessary business expenses
attributable to the Employer's business, including, without limitation, the
Executive's travel and entertainment expenses incurred in connection with the
performance of his duties for the Employer under this Agreement, in each case
upon presentation to the Employer of an itemized account of such expenses in
such form as the Employer may reasonably require.
SECTION
9. TERMINATION
OF EMPLOYMENT WITH BENEFITS.
(a)
Subject to Sections 9(b) and 9(c), the Executive shall be entitled to the
benefits described in Section 9(b) in the event that:
(i)
his
employment with the Bank terminates during the Employment Period as a result
of
the Executive's voluntary resignation within six full calendar months
following:
(A)
the
failure of the Bank Board to appoint or re-appoint the Executive to the
positions with the Bank stated in Section 3 of this Agreement;
(B)
the
expiration of a 30-day period following the date on which the Executive gives
written notice to the Employer of its material failure, whether by amendment
of
the Certificate of Incorporation or Bylaws of the Bank, or by action of the
Bank
Board, the Bank's shareholder(s), or otherwise, to vest in the Executive the
functions, duties or responsibilities prescribed in Section 3 of this Agreement,
unless, during such 30-day period, the Employer cures such failure;
(C)
the
expiration of a 30-day period following the date on which the Executive gives
written notice to the Employer of their material breach of any term, condition
or covenant contained in this Agreement (including, without limitation, any
reduction of the Executive's rate of Base Salary in effect from time to time
and
any change in the terms and conditions of any compensation or benefit program
in
which the Executive participates which, either individually or together with
other changes, has a material adverse effect on the aggregate value of his
total
compensation package), unless, during such 30-day period, the Employer cures
such failure;
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(D)
a
Bank Board approved change in the Executive's principal place of employment
by a
distance in excess of 50
miles
from the Bank's principal executive office in New Haven,
Connecticut;
(E)
the
liquidation, dissolution, bankruptcy or insolvency of the Company or the Bank;
or
(F)
the
termination of the Executive's employment by the Bank for reasons other than
those specified in Section 10 hereof; or
(ii)
the
Executive's employment with the Employer is terminated by the Bank during the
Employment Period for any reason other than for "cause," death or ADisability,"
as provided in Section 10(a).
(b)
Subject to Section 9(c), and provided that no Change in Control (as defined
in
Section 11(a) hereof) has occurred, the Employer shall pay and provide to the
Executive (or, in the event of his subsequent death, to his estate) the
following severance benefits for the period beginning on the date that his
employment terminates and ending on either (i) the last day of the Employment
Period or (ii) 24 months subsequent to the date of termination, whichever period
is greater (the "Severance Benefits Period"):
(i)
his
earned but unpaid Base Salary (including, without limitation, all items which
constitute wages under applicable law and the payment of which is not otherwise
provided for in this Section 9(b)) as of the date of the termination of his
employment, such payment to be made at the time and in the manner prescribed
by
law applicable to the payment of wages but in no event later than 30 days after
termination of employment;
(ii)
the
benefits, if any, to which he is entitled under the employee benefit plans
and
programs and compensation plans and programs maintained for the benefit of
the
Bank's officers and employees (such benefits not to include the expense
allowance provided by Section 5(b)) through the date of the termination of
his
employment;
(iii)
continued group life, health, dental, accident and long term disability
insurance benefits, in addition to that provided pursuant to Section 9(b)(ii),
and after taking into account the coverage provided by any subsequent employer,
if and to the extent necessary to provide for the Executive, for the Severance
Benefits Period, coverage equivalent to the coverage to which he would have
been
entitled under such plans if he had continued to be employed during such period
at the highest annual rate of Base Salary achieved during the Employment Period;
7
provided,
however,
in the
event that such benefits cannot be provided, in whole or in part, to the
Executive as a non-employee subsequent to termination of employment, the
Employer, at its option, may instead contribute to the Executive's privately
obtained comparable coverage such that the Executive is not required to pay
any
more for such benefits than the Executive was required to pay immediately
preceding the date of termination; and
provided further,
that if
the provision of any of the benefits covered by this Section 9(b)(iii) would
trigger the 20% excise tax and interest penalties under Section 409A of the
Internal Revenue Code (the “Code”), then the benefit(s) that would trigger such
tax and interest penalties shall not be provided (the “Excluded Benefits”), and
in lieu of the Excluded Benefits the Employer shall pay to the Executive,
in a
lump sum within 30 days following termination of employment or within 30
days
after such determination should it occur after termination of employment,
a cash
amount equal to the cost to the Employer of providing the Excluded
Benefits;
(iv)
a
lump sum cash amount, payable within 30 days following termination of
employment, equal to the present value of (A) the Executive's Annual
Compensation (as hereinafter defined) multiplied by (B) a fraction which is
either (1) the number of days left in the Employment Period if the Executive
had
not been terminated or (2) 730, whichever is greater, divided by 365, using
a
discount rate equal to the short-term applicable federal rate (determined under
Section 1274(d) of the Code) as published by the Internal Revenue Service (the
“IRS”) for the month in which the termination of employment occurs, compounded
monthly;
(v)
a
lump sum cash amount equal to the present value, determined by using a discount
rate equal to the short-term applicable federal rate (determined under Section
1274(d) of the Code) as published by the IRS for the month in which the
termination of employment occurs, of the pro rata portion of any target bonus
awarded to the Executive under the Bank's Executive Incentive Plan (the "EIP")
(or such other short-term incentive compensation plan(s) that the Employer
may
adopt subsequent to the date hereof as a replacement therefor) which relates
to
the calendar year in which such termination occurs; provided
that
such pro
rata portion will be calculated by multiplying the amount of the target bonus
by
a fraction the numerator of which is the number of days elapsed in the calendar
year as of the date of termination and the denominator is 365; provided,
further,
that
such pro rated target bonus shall be paid within 30 days following termination
of employment;
(vi)
a
lump sum cash amount, payable within 30 days following termination of
employment, equal to the present value, determined by using a discount rate
equal to the short-term applicable federal rate (determined under Section
1274(d) of the Code) as published by the IRS for the month in which the
termination of employment occurs, of the excess, if any, of:
(A)
the
value of the aggregate benefits to which he would be entitled under any and
all
qualified defined benefit pension plans and non-qualified plans related thereto
maintained by, or covering employees of, the Bank if he were 100% vested
thereunder and had continued to be employed during the Severance Benefits Period
at the highest annual rate of Base Salary achieved during the Employment Period;
over
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(B)
the
value of the benefits to which he is actually entitled under such defined
benefit pension plans as of the date on which his employment terminates; such
present values to be determined using the mortality tables prescribed under
Section 415(b)(2)(E)(v) of the Code; and
(vii)
a
lump sum cash amount, payable within 30 days following termination of
employment, equal to the present value, determined by using a discount rate
equal to the short-term applicable federal rate (determined under Section
1274(d) of the Code) as published by the IRS for the month in which the
termination of employment occurs, of the additional employer contributions
to
which he would have been entitled under any and all qualified defined
contribution plans and non-qualified plans related thereto maintained by, or
covering employees of, the Bank as if he were 100% vested thereunder and had
continued to be employed during the Severance Benefits Period at the highest
annual rate of Base Salary achieved during the Employment Period and making
the
maximum amount of employee contributions, if any, required or permitted under
such plan or plans, provided that no payments shall be made pursuant to this
subsection (vi) with respect to the Company's ESOP if the ESOP is terminated
effective as of a date within one year of the date of the termination of the
Executive's employment, with the Executive to reimburse the Employer for any
such payments previously made.
The
Executive's "Annual Compensation" for purposes of this Agreement shall be deemed
to mean the sum of (i) the Executive's Base Salary in effect as of the date
of
termination of his employment and (ii) the greater of (A) the average of the
cash incentive compensation earned by the Executive from the Employer or any
subsidiary or affiliate thereof during the three calendar years immediately
preceding the calendar year in which the date of termination occurs or (B)
the
amount of the Executive's target bonus under the EIP (or such other short-term
incentive compensation plan(s) that the Employer may adopt subsequent to the
date hereof as a replacement therefor) for the calendar year in which the
termination occurs; provided,
however,
for
purposes of clause (ii) bonuses earned under the Bank's Performance Unit Plan
will not be included in cash incentive compensation for purposes of determining
average cash incentive compensation (or with respect to Section 11(b), the
highest level of cash incentive compensation).
The
Employer and the Executive further agree that the Employer may condition the
payments and benefits (if any) due under Sections 9(b)(iii), (iv), (v), (vi)
and
(vii) on the receipt of the Executive's resignation from any and all positions
which he holds as an officer, director or committee member with respect to
the
Employer or any of its subsidiaries or affiliates and to the execution of a
general release by the Executive.
(c)
The
Executive shall not be required to mitigate the amount of any benefits provided
pursuant to the provisions of Section 9(b) by seeking other employment or
otherwise. However, if the Executive becomes or is employed by another employer
subsequent to the first year following termination, any compensation received
by
the Executive subsequent to the first year following termination through the
end
of the Severance Benefits Period shall be offset dollar for dollar against
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SECTION
10. TERMINATION
WITHOUT ADDITIONAL EMPLOYER LIABILITY.
(a)
In
the event that the Executive's employment with the Employer shall terminate
during the Employment Period on account of:
(i)
the
discharge of the Executive for "cause," which, for purposes of this Agreement,
shall mean a discharge because the Bank Board determines that the Executive
has:
(A) willfully failed to perform his assigned duties under this Agreement,
other than any failure resulting from the Executive's incapacity due to physical
or mental injury or illness; (B) committed an act involving moral turpitude
in
the course of his employment with the Employer and its subsidiaries or
affiliates; (C) engaged in willful misconduct; (D) breached his fiduciary duties
for personal profit; (E) willfully violated, in any material respect, any law,
rule or regulation (other than traffic violations or similar offenses), written
agreement or final cease-and-desist order with respect to his performance of
services for the Bank, as determined by the Bank Board; or (F) materially
breached the terms of this Agreement and failed to cure such material breach
during a 15-day period following the date on which the Bank Board gives written
notice to the Executive of the material breach;
(ii)
the
Executive's voluntary resignation from employment (including voluntary
retirement) with the Bank for reasons other than those specified in Section
9(a)(i); or
(iii)
the
death of the Executive while employed by the Bank, or the termination of the
Executive's employment because of "Disability" as defined in Section 10(c)
below;
then
in
any of the foregoing events, the Employer shall have no further obligations
under this Agreement, other than (A) the payment to the Executive of his earned
but unpaid compensation as of the date of the termination of his employment,
(B)
the payment to the Executive of the benefits to which he is entitled under
all
applicable employee benefit plans and programs and compensation plans and
programs as of the date of termination of his employment, and (C) the provision
of such other benefits, if any, to which he is entitled as a former employee
under the Bank's and/or the Company's employee benefit plans and programs and
compensation plans and programs.
(b)
For
purposes of this Section 10, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Employer. Any
act, or failure to act, based upon authority given pursuant to a resolution
duly
adopted by the Bank Board or based upon the written advice of counsel for the
Employer shall be conclusively
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(c)
"Disability" shall be deemed to have occurred if the Executive: (i) is unable
to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result
in
death or can be expected to last for a continuous period of not less than 12
months, or (ii) is, by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income replacement
benefits for a period of not less than three months under an accident and health
plan covering employees of the Bank.
(d)
During any period in which the Executive is absent due to physical or mental
injury or disease, the Employer may, without breaching this Agreement, appoint
another person or persons to act as interim Executive Vice President pending
the
Executive's return to his duties on a full-time basis hereunder or his
termination as a result of such Disability. Prior to the Executive's employment
being terminated due to Disability under Section 10(e) hereof, the Executive
shall continue to receive his full Base Salary, bonuses and other benefits
to
which he is entitled under this Agreement, including continued participation
in
all employee benefit plans and programs.
(e)
The
Employer may provide notice to the Executive in writing that they intend to
terminate the Executive's employment under this Agreement, with the termination
date to be on or after the date that the Executive is deemed to have a
Disability. At the time his employment hereunder is terminated due to
Disability, (i) the Executive shall not be entitled to any payments or benefits
pursuant to Sections 4 and 5 hereof for periods subsequent to such date of
termination, and (ii) the Executive shall become entitled to receive the
Disability payments that may be available under any applicable long-term
disability plan or other benefit plan.
SECTION
11. PAYMENTS
UPON A CHANGE IN CONTROL.
(a)
The
term "Change in Control" shall mean a change in the ownership of the Company,
a
change in the effective control of the Company or a change in the ownership
of a
substantial portion of the assets of the Company as provided under Section
409A
of the Code, as amended from time to time, and any IRS guidance, including
Notice 2005-1, and regulations issued in connection with Section 409A of the
Code. In no event, however, shall a Change in Control be deemed to have occurred
as a result of any acquisition of securities or assets of the Company, the
Bank,
or a subsidiary of either of them, by the Company, the Bank, or any subsidiary
of either of them, or by any employee benefit plan maintained by any of
them.
11
(b)
If
the Executive's employment by the Employer shall be terminated subsequent to
a
Change in Control and during the term of this Agreement by (i) the Employer
for
other than Cause, Disability, Retirement or the Executive's death or (ii) the
Executive for any of the reasons specified in Subsections (A) through (F)
inclusive, of Section 9(a)(i) hereof, then the Employer shall pay to the
Executive, a severance benefit in a lump sum payment, within five (5) days
after
the effective time of such termination of employment equal to the sum of (i)
three times his Base Salary as of the date of termination of his employment,
(ii) three times the highest level of cash incentive compensation earned by
the
Executive from the Employer or any subsidiary thereof in any one of the three
calendar years immediately preceding the year in which the termination occurs
and (iii) the amounts specified in Sections 9(b)(i), (ii), (v), (vi) and (vii)
(notwithstanding any contrary language contained therein with respect to payment
being over a longer time period) except in calculating the amount of such
benefits, to the extent applicable, the Severance Benefits Period will be for
a
period of three years commencing on the date of the termination of the
Executive's employment. In addition, for purposes of calculating the amount
due
pursuant to clause (ii) above, bonuses earned under the Bank's Performance
Unit
Plan will not be included in calculating the highest level of cash incentive
compensation. In addition, the Employer shall provide the Executive with the
benefits provided for in Section 9(b)(iii) for the Severance Benefits Period,
as
adjusted above to be for a period of three years subsequent to termination
of
employment, subject to compliance with the last proviso clause contained in
such
subsection. In the event that the Employer is unable to provide the benefits
set
forth in said Section 9(b)(iii) due to the change in the Executive's status
to
that of a non-employee, the Employer shall include in the lump sum payment
due
pursuant to the terms of this Section 11(b) the value of the benefits required
to be provided by said Section 9(b)(iii) for the Severance Benefits Period
as
amended by this Section 11(b). The severance and other benefits payable pursuant
to this Section 11(b) shall not be subject to reduction pursuant to the
provisions of Section 9(c).
SECTION
12. LIMITATION
ON CHANGE IN CONTROL PAYMENT.
In
the
event that:
| (i) |
the
aggregate payments or benefits to be made or afforded to the Executive
pursuant to this Agreement, together with other payments and benefits
which the Executive has a right to receive from the Employer, which
are
deemed to be parachute payments as defined in Section 280G of the Code,
or
any successor thereof (the "Termination Benefits"), would be deemed
to
include an "excess parachute payment" under Section 280G of the Code;
and
|
| (ii) |
if
such Termination Benefits were reduced to an amount (the "Non-Triggering
Amount"), the value of which is one dollar ($1.00) less than an amount
equal to three (3) times the Executive's "base amount," as determined
in
accordance with said Section 280G and the Non-Triggering Amount less
the
product of the marginal rate of any applicable state and federal income
tax and the Non-Triggering Amount would be greater than the aggregate
value of the Termination Benefits (without such reduction) minus (i)
the
amount of tax required to be paid by the Executive thereon by Section
4999
of the Code and further minus (ii) the product of the Termination Benefits
and the marginal rate of any applicable state and federal income
tax,
|
12
then
the
Termination Benefits shall be reduced to the Non-Triggering Amount. If the
Termination Benefits are required to be reduced, the cash severance shall be
reduced first, followed by a reduction in the fringe benefits to be provided
in
kind.
SECTION
13. SOURCE
OF
PAYMENTS.
All
payments provided in this Agreement shall be timely paid in cash or check from
the general funds of the Bank.
SECTION
14. COVENANT
NOT TO COMPETE.
In
the
event the Executive's employment with the Employer is terminated for any reason
prior to the expiration of the Employment Period (except as set forth below),
the Executive hereby covenants and agrees that for a period of two years
following the date of his termination of employment with the Employer (or,
if
less, for the Severance Benefits Period), he shall not, without the written
consent of the Employer, become an officer, employee, consultant, director
or
trustee of any savings bank, savings and loan association, savings and loan
holding company, bank or bank holding company, or any direct or indirect
subsidiary or affiliate of any such entity, that entails working within any
county in which the Company or the Bank maintains an office as of the date
of
termination of the Executive's employment. This section shall not be applicable
if the Executive is terminated upon or within one year subsequent to a Change
in
Control, provided that such termination is for reasons other than Cause as
defined in Section 10(a)(i) hereof.
SECTION
15. CONFIDENTIALITY.
Unless
he
obtains the prior written consent of the Employer, the Executive shall at all
times keep confidential and shall refrain from using for the benefit of himself,
or any person or entity other than the Employer or its subsidiaries or
affiliates, any material document or information obtained from the Employer
or
its subsidiaries or affiliates, in the course of his employment with any of
them
concerning their properties, operations or business (unless such document or
information is readily ascertainable from public or published information or
trade sources or has otherwise been made available to the public through no
fault of his own) until the same ceases to be material (or becomes so
ascertainable or available); provided,
however,
that
nothing in this Section 15 shall prevent the Executive, with or without the
Employer's consent, from participating in or disclosing documents or information
in connection with any judicial or administrative investigation, inquiry or
proceeding or the Company's public reporting requirements to the extent that
such participation or disclosure is required under applicable
law.
13
SECTION
16. SOLICITATION.
The
Executive hereby covenants and agrees that, for a period of two years following
his termination of employment with the Employer for any reason, he shall not,
without the written consent of the Employer, either directly or
indirectly:
(a)
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 the Employer or any of its subsidiaries
or
affiliates to terminate his employment and accept employment or become
affiliated with, or provide services for compensation in any capacity whatsoever
to, any savings bank, savings and loan association, bank, bank holding company,
savings and loan holding company, or other institution engaged in the business
of accepting deposits, making loans or doing business within the counties
specified in Section 14;
(b)
provide any information, advice or recommendation with respect to any such
officer or employee to any savings bank, savings and loan association, bank,
bank holding company, savings and loan holding company, or other institution
engaged in the business of accepting deposits, making loans or doing business
within the counties specified in Section 14, that is intended, or that a
reasonable person acting in like circumstances would expect, to have the effect
of causing any officer or employee of the Employer or any of its subsidiaries
or
affiliates to terminate his employment and accept employment or become
affiliated with, or provide services for compensation in any capacity whatsoever
to, any savings bank, savings and loan association, bank, bank holding company,
savings and loan holding company, or other institution engaged in the business
of accepting deposits, making loans or doing business within the counties
specified in Section 14; or
(c)
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 the Company or the Bank
to
terminate an existing business or commercial relationship with the Company
or
the Bank.
SECTION
17. NO
EFFECT
ON EMPLOYEE BENEFIT PLANS OR PROGRAMS.
The
termination of the Executive's employment during the Employment Period or
thereafter, whether by the Employer or by the Executive, shall have no effect
on
the vested rights of the Executive under the Bank's qualified or non-qualified
retirement, pension, savings, thrift, profit-sharing or stock bonus plans,
group
life, health (including hospitalization, medical and major medical), dental,
accident and long term disability insurance plans, or other employee benefit
plans or programs, or compensation plans or programs in which the Executive
was
a participant.
14
SECTION
18. SUCCESSORS
AND ASSIGNS.
(a)
This
Agreement is personal to each of the parties hereto, and no party may assign
or
delegate any of its rights or obligations hereunder without first obtaining
the
written consent of the other parties; provided,
however,
that the
Employer will require any successor or assign (whether direct or indirect,
by
purchase, merger, consolidation or otherwise) to all or substantially all of
the
business and/or assets of the Employer, by an assumption agreement in form
and
substance satisfactory to the Executive, to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Employer would be required to perform it if no such succession or assignment
had
taken place. Failure of the Employer to obtain such an assumption agreement
prior to the effectiveness of any such succession or assignment shall be a
breach of this Agreement and shall entitle the Executive to compensation from
the Employer in the same amount and on the same terms as the compensation
pursuant to Sections 9 or 11 hereof. For purposes of implementing the provisions
of this Section 18(a), the date which any such succession becomes effective
shall be deemed the date of termination of the Executive's
employment.
(b)
This
Agreement and all rights of the Executive hereunder shall inure to the benefit
of and be enforceable by the Executive's personal and legal representatives,
executors, administrators, successors, heirs, distributees, devises and
legatees.
SECTION
19. NOTICES.
Any
communication required or permitted to be given under this Agreement, including
any notice, direction, designation, consent, instruction, objection or waiver,
shall be in writing and shall be deemed to have been given at such time as
it is
delivered personally, or five days after mailing if mailed, postage prepaid,
by
registered or certified mail, return receipt requested, addressed to such party
at the address listed below or at such other address as one such party may
by
written notice specify to the other party:
|
If
to the Executive:
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▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇
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At
the address last appearing
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on
the personnel records of
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the
Employer
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If
to the Employer:
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NewAlliance
Bank
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▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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(or
the address of the Bank's principal executive office, if
different)
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Attention:
Chairman of the Board
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15
|
with
a copy, in the case of a notice to the Employer, to:
|
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Elias,
Matz, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
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▇▇▇
▇▇▇▇
▇▇▇▇▇▇, ▇.▇.
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▇▇▇▇▇▇▇▇▇▇,
▇.▇. ▇▇▇▇▇
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Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
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▇▇▇▇▇▇
▇. ▇▇▇▇▇, Esq.
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SECTION
20. INDEMNIFICATION
FOR ATTORNEYS' FEES.
(a)
The
Employer shall indemnify, hold harmless and defend the Executive against
reasonable costs, including legal fees and expenses, incurred by him in
connection with or arising out of any action, suit or proceeding in which he
may
be involved, as a result of his efforts, in good faith, to defend or enforce
the
terms of this Agreement. For purposes of this Agreement, any settlement
agreement which provides for payment of any amounts in settlement of the
Employer's obligations hereunder shall be conclusive evidence of the Executive's
entitlement to indemnification hereunder, and any such indemnification payments
shall be in addition to amounts payable pursuant to such settlement agreement,
unless such settlement agreement expressly provides otherwise.
(b)
The
Employer's obligation to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action
which
the Employer may have against the Executive or others. Unless it is determined
that a claim made by the Executive was either frivolous or made in bad faith,
the Employer agrees to pay as incurred, to the full extent permitted by law,
all
legal fees and expenses which the Executive may reasonably incur as a result
of
or in connection with his consultation with legal counsel or arising out of
any
action, suit, proceeding or contest (regardless of the outcome thereof) by
the
Employer, the Executive or others regarding the validity or enforceability
of,
or liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Executive
about
the amount of any payment pursuant to this Agreement), plus in each case
interest on any delayed payment at the applicable federal rate provided for
in
Section 7872(f)(2)(A) of the Code. This Section 20(b) shall apply whether such
consultation, action, suit, proceeding or contest arises before, on, after
or as
a result of a Change in Control.
SECTION
21. SEVERABILITY.
A
determination that any provision of this Agreement is invalid or unenforceable
shall not affect the validity or enforceability of any other provision hereof.
SECTION
22. WAIVER.
Failure
to insist upon strict compliance with any of the terms, covenants or conditions
hereof shall not be deemed a waiver of such term, covenant or condition. A
waiver of any provision of this Agreement must be made in writing, designated
as
a waiver, and signed by the party against whom its enforcement is sought. Any
waiver or relinquishment of any right or power hereunder at any one or more
times shall not be deemed a waiver or relinquishment of such right or power
at
any other time or times.
16
SECTION
23. COUNTERPARTS.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, and all of which shall constitute one and the same
Agreement.
SECTION
24. GOVERNING
LAW.
This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the State of Connecticut applicable to contracts entered into and to
be
performed entirely within the State of Connecticut, except to the extent that
federal law controls.
SECTION
25. HEADINGS
AND CONSTRUCTION.
The
headings of sections in this Agreement are for convenience of reference only
and
are not intended to qualify the meaning of any section. Any reference to a
section number shall refer to a section of this Agreement, unless otherwise
stated.
SECTION
26. ENTIRE
AGREEMENT; MODIFICATIONS.
This
instrument contains the entire agreement of the parties relating to the subject
matter hereof, and supersedes in its entirety any and all prior agreements,
understandings or representations relating to the subject matter hereof. No
modifications of this Agreement shall be valid unless made in writing and signed
by the parties hereto; provided, however, that if the Employer determines,
after
a review of the final regulations issued under Section 409A of the Code and
all
applicable IRS guidance, that this Agreement should be further amended to avoid
triggering the tax and interest penalties imposed by Section 409A of the Code,
the Employer may amend this Agreement to the extent necessary to avoid
triggering the tax and interest penalties imposed by Section 409A of the
Code.
SECTION
27. REQUIRED
REGULATORY PROVISIONS.
Notwithstanding
anything herein contained to the contrary, any payments to the Executive by
the
Employer, 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.
17
SECTION
28. DISPUTE RESOLUTION.
(a)
In
the event of any dispute, claim, question or disagreement arising out of or
relating to this Agreement or the breach hereof, the parties hereto shall use
their best efforts to settle such dispute, claim, question or disagreement.
To
this effect, they shall consult and negotiate with each other, in good faith,
and, recognizing their mutual interests, attempt to reach a just and equitable
solution satisfactory to both parties.
(b)
If
they do not reach such a solution within a period of thirty (30) days, then
the
parties agree first to endeavor in good faith to amicably settle their dispute
by mediation under the Commercial Mediation Rules of the American Arbitration
Association (the "AAA"), before resorting to arbitration.
(c)
Thereafter, any unresolved controversy or claim arising out of or relating
to
this Agreement or the breach thereof, upon notice by any party to the other,
shall be submitted to and finally settled by arbitration in accordance with
the
Commercial Arbitration Rules (the "Rules") of the AAA in effect at the time
demand for arbitration is made by any such party. The parties shall mutually
agree upon a single arbitrator within thirty (30) days of such demand. In the
event that the parties are unable to so agree within such thirty (30) day
period, then within the following thirty (30) day period, one arbitrator shall
be named by each party. A third arbitrator shall be named by the two arbitrators
so chosen within ten (10) days after the appointment of the first two
arbitrators. In the event that the third arbitrator is not agreed upon, he
shall
be named by the AAA. Arbitration shall occur in New Haven, Connecticut or such
other location as may be mutually agreed to by the parties.
(d)
The
award made by all or a majority of the panel of arbitrators shall be final
and
binding, and judgment may be entered based upon such award in any court of
law
having competent jurisdiction. The award is subject to confirmation,
modification, correction or vacation only as explicitly provided in Title 9
of
the United States Code. The prevailing party shall be entitled to receive any
award of pre- and post-award interest as well as attorney's fees incurred in
connection with the arbitration and any judicial proceedings related thereto.
The parties acknowledge that this Agreement evidences a transaction involving
interstate commerce. The United States Arbitration Act and the Rules shall
govern the interpretation, enforcement, and proceedings pursuant to this
Section. Any provisional remedy which would be available from a court of law
shall be available from the arbitrators to the parties to this Agreement pending
arbitration. Either party may make an application to the arbitrators seeking
injunctive relief to maintain the status quo, or may seek from a court of
competent jurisdiction any interim or provisional relief that may be necessary
to protect the rights and property of that party, until such times as the
arbitration award is rendered or the controversy otherwise
resolved.
18
IN
WITNESS WHEREOF, the Bank has caused this Agreement to be executed by their
duly
authorized officers and the Executive has hereunto set his hand, all as of
the
date of the restatement of this Agreement.
THIS
AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE
PARTIES.
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/s/
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▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, Executive
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ATTEST:
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NEWALLIANCE
BANK
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By:
/s/
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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By:
/s/
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇
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Name:
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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Name:
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇
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Title:
Assistant
Secretary
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Title:
Chairman,
President and Chief Executive
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Officer
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[Seal]
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19