|
Exhibit
10.9
DAVID W. CURTIS SUPPLEMENTAL
COMPENSATION
AGREEMENT
THIS AGREEMENT is made and
entered into as of the first (1st) day of May, 2002 by and
between The Community Bank (hereinafter called the
“Bank”), its subsidiaries and affiliates and David W.
Curtis (hereinafter called the “Executive”).
WITNESSETH:
WHEREAS, the Executive has
been in the employ of the Bank and is now serving the Bank as its
President and Chief Executive Officer; and
WHEREAS, because of the
Executive’s experience, knowledge of affairs of the Bank, and
reputation and contacts in the industry, the Bank deems the
Executive’s continued employment with the Bank important for
its future growth; and
WHEREAS, it is the desire of
the Bank and in its best interest that the Executive’s
service be retained; and
WHEREAS, in order to induce
the Executive to continue in the employ of the Bank and to enhance
retirement income, the Bank has entered into this Agreement to
provide him or his beneficiaries certain benefits in accordance
with the terms and conditions hereinafter set forth;
NOW, THEREFORE, in
consideration of services performed in the past and to be performed
in the future as well as of the mutual promises and covenants
herein contained, it is agreed as follows:
ARTICLE ONE
| 1.01 |
Employment. The Board of Directors of the Bank may
employ the Executive in such capacity as the Bank may from time to
time determine. Notwithstanding anything contained herein, this
Agreement is not an agreement of employment and shall not be deemed
to confer upon the Executive any rights to continue his employment
with the Bank. Nothing herein shall restrict the right of the
Executive to enter into an agreement with the Bank concerning any
terms and conditions of his employment. |
The benefits provided by this
Agreement are not part of any salary reduction plan or an
arrangement deferring a bonus or a salary increase. The Executive
has no option to take any current payment or bonus in lieu of these
salary continuation benefits.
ARTICLE TWO
|
2.01
|
Normal Retirement
Benefits. If the Executive shall continue in the employment of
the Bank until his sixty-seventh (67 th ) birthday (“Normal
Retirement Date”), and subject to Section 5.03, he shall
be entitled to a retirement benefit paid by the Bank commencing on
the first day of the month next following the termination for any
reason, other than death, of his employment with the Bank on or at
any time after such Normal Retirement Date and continuing during
his lifetime, payable monthly, in the annual amount of
$100,000.
|
| 2.02 |
Accrued Benefit. As used herein the term “Accrued
Benefit” shall mean, in any case in which the
Executive’s employment with the Bank is terminated for any
reason prior to the Normal Retirement Date, the product of
(a) $100,000 multiplied by (b) a fraction, the numerator
of which is the actual number of full calendar months of employment
with the Bank completed by the Executive as of the date of such
termination, and the denominator of which is the total number of
full calendar months of employment with the Bank that the Executive
would have completed had he continued his employment with the Bank
until the Normal Retirement Date. |
| 2.03 |
Optional Forms of Payment. In lieu of the lifetime
payments provided in Section 2.01 above, or whenever an
Accrued Benefit is payable under this Agreement, with the sole
approval of the Bank, the Executive may request in the calendar
year prior to the calendar year in which payments are to begin an
optional form of payment which shall be the actuarial equivalent of
the said lifetime payments and which shall be any optional form
other than a lump sum which is provided the Executive under the
terms of the Bank’s qualified pension plan. |
2
ARTICLE
THREE
| 3.01 |
Death of Executive During Employment. Should the
Executive die while actively employed with the Bank, whether before
or after the Normal Retirement Date, or should he die while
disabled and receiving benefits from the Bank’s long term
disability plan, the Executive’s named beneficiary, if any,
shall be entitled to receive ninety (90) percent of an amount
equal to (a) the total proceeds of Policy No. 56601291
issued by New York Life Insurance and Annuity Corporation or any
substitute therefor, less (b) the cash surrender value of such
policy as of the date of his death, paid in one lump sum, and no
further benefits shall be paid or payable under this
Agreement. |
| 3.02 |
Death of Executive After Termination of Employment. Upon
the Executive’s death following the termination of his
employment for any reason, other than termination for Cause as
defined in Section 5.04 below, whether such termination occurs
before or after the Normal Retirement Date, the Executive’s
named beneficiary, if any, shall be entitled to receive fifty
(50) percent of an amount equal to the product of
(a) 0.90 and (b) the difference between (i) the
total proceeds of Policy No. 56601291 issued by New York Life
Insurance and Annuity Corporation or any substitute therefore and
(ii) the cash surrender value of such policy as of the date of
his death, paid in one lump sum, and no further benefits shall be
paid or payable under this “Agreement other than as may be
required in accordance with the terms of any optional form of
payment that the Executive may have chosen prior to his death, with
the approval of the Bank, pursuant to Section 2.03
above. |
| 3.03 |
Death Benefit Forfeiture. Anything to the contrary in
this Agreement not withstanding, the death benefit provided in
either Section 3.01 or Section 3.02 above shall become
null and void should the Bank not receive for any reason the
proceeds of Policy Number 56601291 issued by New York Life
Insurance and Annuity Corporation or any policy substituted
therefore. |
ARTICLE
FOUR
| 4.01 |
Disability of Executive. In the event the Executive
becomes disabled and is receiving benefits from the Bank’s
long term disability plan, he shall continue to accrue months of
employment service during such period of disability, including
during any waiting period required by the Bank’s long term
disability plan, for purpose of calculating any Accrued Benefit
under Section 2.02 of this Agreement. This continuing accrual
of employment service shall terminate effective with the last month
for which such disability benefits are paid. |
ARTICLE
FIVE
| 5.01 |
Termination of Service or Discharge. In the event that
the Executive’s employment with the Bank is terminated for
any reason prior to the Normal Retirement Date, whether such
termination is initiated by
|
3
| |
the Bank or by the Executive, other than
any such termination within twenty-four (24) months following
a reorganization (as defined in Section 10.01) or any such
termination resulting from death, disability or Cause as defined in
Section 5.04 below, and subject to the limitations set forth
further below in this Section 5.01 and in Section 5.03,
the Executive shall be entitled to an annual benefit payable
monthly commencing at the Normal Retirement Date or any earlier
date as may be approved by the Bank and continuing for his
lifetime, which shall be his Accrued Benefit determined in
accordance with Section 2.02 above as of the date of his
termination of employment. Such Accrued Benefit shall be multiplied
by a percentage based on the following table (for purposes of this
Agreement, the Anniversary shall occur on May 1
st
of each year with the first
Anniversary on May 1, 2003:
|
|
|
|
|
|
Anniversary of this
Agreement
|
|
Percentage Multiple |
|
|
Before second
|
|
0 |
% |
|
After second, before third
|
|
40 |
% |
|
After third, before fourth
|
|
60 |
% |
|
After fourth, before fifth
|
|
80 |
% |
|
After fifth
|
|
100 |
% |
In addition to the foregoing
provisions of this Section 5.01, any early retirement payment
that may be paid to the Executive under this Section 5.01
shall be further reduced by five-ninths (5/9) of one
(1) percent for each month prior to age sixty-seven
(67) that such benefits commence, up to sixty
(60) months, and by five-eighteenths (5/18) of one
(1) percent for each additional month over sixty
(60) months that such commencement of benefits precedes
Executive’s age sixty-seven (67).
| 5.02 |
[This Section Intentionally Blank] |
| 5.03 |
Employment by Competition. Anything to the contrary in
this Agreement notwithstanding, in the event of termination of the
Executive’s employment with the Bank for any reason, payments
that might otherwise be due and payable under the terms of this
Agreement will be forfeited and this Agreement shall become null
and void should the Executive become an owner or partner or be
employed in any way, including employment as a consultant, by a
competitor of the Bank (as determined by a vote of two-thirds of
the Bank’s outside directors), which has an office within
twenty-five (25) miles of any branch or other office of the
Bank, at any time within twenty-four months following any such
termination of employment with the Bank. |
| 5.04 |
Forfeiture. Anything to the contrary in this Agreement
notwithstanding, benefits under this Agreement shall be forfeited
and all rights of the Executive and his beneficiaries shall become
null and
|
4
| |
void, if the
Executive’s employment is terminated for Cause and such
forfeiture is confirmed by the applicable vote of the Bank’s
Board of Directors set forth in each case below. For purposes of
this Agreement, Cause shall mean:
|
| |
A. |
Conviction for a felony (requires vote of two-thirds of the
Bank’s outside directors); |
| |
B |
Failure, after written notification, to perform the duties
reasonably assigned to Executive in accordance with the custom and
practice of the Bank (requires vote of two-thirds of the
Bank’s outside directors); or |
| |
C. |
Gross negligence/or willful misconduct by the Executive in the
execution of his duties (require vote of two-thirds of the
Bank’s outside directors). |
ARTICLE SIX
| 6.01 |
Interest. Unless otherwise expressly provided herein,
any reference to “interest” shall be a variable rate of
interest which shall be the rate of interest on 90-day U.S.
Treasury Bills determined at the first auction of each calendar
month or part thereof during the period of which interest is to be
applied to any obligation hereunder. |
ARTICLE
SEVEN
| 7.01 |
Alienability. Neither the Executive, his widow, nor any
other beneficiary under this Agreement shall have any power or
right to transfer, assign, anticipate, hypothecate, mortgage,
commute, modify, or otherwise encumber in advance any of the
benefits payable hereunder, nor shall any of said benefits be
subject to seizure for the payment of any debts, judgments, alimony
or separate maintenance, owed by the Executive or his beneficiary
or any of them, or be transferable by operation of law in the event
of bankruptcy, or otherwise. |
ARTICLE
EIGHT
| 8.01 |
Participation in Other Plans. Nothing contained in this
Agreement shall be construed to alter, abridge, or in any manner
affect the rights and privileges of the Executive to participate in
and be covered by any pension, profit-sharing, group insurance,
bonus or any other employee plan or plans which the Bank may have
or hereafter have. |
5
ARTICLE
NINE
| 9.01 |
Funding. The Bank reserves the absolute right at its
s |
|
