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Exhibit 10.5
AMENDED AND RESTATED
CLIFTON SAVINGS BANK
CHANGE IN CONTROL AGREEMENT
This AGREEMENT ("Agreement") as
amended and restated, is hereby entered
into as of December 17, 2008, by and between CLIFTON SAVINGS BANK
(the "Bank"),
a federally-chartered financial institution, with its principal
offices at 1433
Van Houten Avenue, Clifton, New Jersey 07015, and CHRISTINE R.
PIANO
("Executive").
WHEREAS, the Bank and Executive
entered into a change in control agreement
as of March 17, 2004; and
WHEREAS, the Bank recognizes the
substantial contributions of Executive
and wishes to protect her position with the Bank in the event of a
change in
control of the Bank or Clifton Savings Bancorp, Inc. (the
"Company"), a
federally-chartered corporation and the holding company of the
Bank, for the
period provided for in this Agreement; and
WHEREAS, Executive and the Board of
Directors of the Bank desire to enter
into an amended and restated agreement setting forth the terms and
conditions of
payments due to Executive in the event of a change in control and
the related
rights and obligations of each of the parties and to bring the
Agreement into
compliance with Section 409A of the Internal Revenue Code of 1986,
as amended
(the "Code"), and the regulations and guidance issued with respect
to Section
409A of the Code.
NOW, THEREFORE, in consideration of
the promises and mutual covenants
herein contained, it is hereby agreed as follows:
1. TERM OF AGREEMENT.
(a) The term of this Agreement shall
be (i) the initial term, consisting
of the period commencing on the date of this Agreement (the
"Effective Date")
and ending on March 17, 2011, plus (ii) any and all extensions of
the initial
term made pursuant to this Section 1.
(b) Commencing as of March 17, 2009,
and as of each anniversary
thereafter, the Board of Directors of the Bank (the "Board of
Directors") may
extend the term of this Agreement for an additional one (1) year
period beyond
the then effective expiration date, provided that Executive shall
not have given
at least sixty (60) days' written notice of her desire that the
term not be
extended.
2. CHANGE IN CONTROL.
(a) Upon the occurrence of a Change
in Control of the Bank or the Company
(as herein defined) followed at any time during the term of this
Agreement by
the termination of Executive's employment in accordance with the
terms of this
Agreement, other than for Just Cause, as defined in Section 2(c) of
this
Agreement, the provisions of Section 3 of this Agreement shall
apply. Upon the
occurrence of a Change in Control, Executive shall have the right
to elect to
voluntarily terminate her employment at any time during the term of
this
Agreement for Good Reason. For purposes of this Agreement, "Good
Reason" shall
mean the occurrence of any of the following events without the
Employee's
consent:
(i) The assignment to Executive of duties that constitute a
material
diminution of Executive's authority, duties, or responsibilities
(including
reporting requirements);
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(ii) A material diminution in Executive's Base Salary;
(iii) Relocation of Executive to a location outside a radius of
twenty-five (25) miles of the Bank's Clifton, New Jersey office;
or
(iv) Any other action or inaction by the Bank that constitutes
a
material breach of this Agreement;
provided, that within ninety (90) days after the initial
existence
of such event, the Bank shall be given notice and an opportunity,
not less than
thirty (30) days, to effectuate a cure for such asserted "Good
Reason" by
Executive. Executive's resignation hereunder for Good Reason shall
not occur
later than one hundred fifty (150) days following the initial date
on which the
event Executive claims constitutes Good Reason occurred.
(b) For purposes of this Agreement,
a "Change in Control" of the Bank or
Company shall mean one of the following events:
(i) there occurs a change in control of the Bank, as defined or
determined either by the Bank's primary federal regulator or under
regulations
promulgated by such regulator;
(ii) as a result of, or in connection with, a merger or other
business combination, sale of assets or contested election, the
persons who were
directors of the Bank before such transaction or event cease to
constitute a
majority of the Board of Directors of the Bank or its
successor;
(iii) the Bank transfers all or substantially all of its assets
to
another corporation or entity which is not an affiliate of the
Bank;
(iv) the Bank is merged or consolidated with another corporation
or
entity and, as a result of such merger or consolidation, less than
60% of the
equity interest in the surviving or resulting corporation is owned
by the former
shareholders or depositors of the Bank;
(v) the Company merges into or consolidates with another
corporation, or merges another corporation into the Company and, as
a result,
less than a majority of the combined voting power of the resulting
corporation
immediately after the merger or consolidation is held by persons
who were
stockholders of the Company immediately before the merger or
consolidation;
(vi) the Company files, or is required to file, a report on
Schedule
13D, or another form or schedule required under Sections 13(d) or
14(d) of the
Securities Exchange Act of 1934, disclosing that the filing person
or persons
acting in concert has or have become the beneficial owner(s) of 25%
or more of a
class of the Company's voting securities, except for beneficial
ownership of
Company voting shares held in a fiduciary capacity by an entity of
which the
Company directly or indirectly owns 50% or more of its outstanding
voting
securities;
(vii) during any period of two consecutive years, individuals
who
constitute the Company's Board of Directors at the beginning of the
two-year
period cease for any reason to constitute at least a majority
thereof, provided
that any person becoming a director subsequent to the date hereof
whose election
was approved by a vote of at least two-thirds (?) of the directors
who were
directors at the beginning of the two-year period shall be deemed
to have also
been a director at the beginning of such period; or
(viii) the Company sells to a third party all or substantially
all
of its assets.
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(c) Executive shall not have the
right to receive termination benefits
pursuant to Section 3 hereof upon termination for Just Cause. The
term "Just
Cause" shall mean termination because of Executive's personal
dishonesty,
incompetence, willful misconduct, any breach of fiduciary duty
involving
personal profit, intentional failure to perform stated duties,
willful violation
of any law, rule, regulation (other than traffic violations or
similar
offenses), final cease and desist order, or any material breach of
any provision
of this Agreement. Notwithstanding the foregoing, Executive shall
not be deemed
to have been terminated for Just Cause unless and until there shall
have been
delivered to her a copy of a resolution duly adopted by the
affirmative vote of
not less than three-fourths (3/4) of the members of the Board of
Directors at a
meeting of the Board of Directors called and held for that purpose
(after
reasonable notice to Executive and an opportunity for her, together
with
counsel, to be heard before the Board of Directors), finding that,
in the good
faith opinion of the Board of Directors, Executive was guilty of
conduct
justifying termination for Just Cause and specifying the
particulars thereof in
detail. Executive shall not have the right to receive compensation
or other
benefits for any period after termination for Just Cause. During
the period
beginning on the date of the Notice of Termination for Just Cause
pursuant to
Section 4 hereof through the Date of Termination, stock options
granted to
Executive under any stock option plan shall not be exercisable nor
shall any
unvested awards granted to Executive under any stock benefit plan
of the Bank,
the Company or any subsidiary or affiliate thereof, vest. At the
Date of
Termination, such stock options and related limited rights and any
such unvested
awards, shall become null and void and shall not be exercisable by
or delivered
to Executive at any time subsequent to such termination for Just
Cause.
3. TERMINATION BENEFITS.
(a) Upon the occurrence of a Change
in Control, followed at any time
during the term of this Agreement by the voluntary (in accordance
with Section
2(a) of this Agreement) or involuntary termination of Executive's
employment,
other than a termination for Just Cause, the Bank shall be
obligated to pay
Executive, or in the event of her subsequent death, her beneficiary
or
beneficiaries, or her estate, as the case may be, a sum equal to
two (2) times
the following items:
(i) the average of any taxable income included by the Bank or
the
Company on Executive's Form W-2 or reflected on a Form 1099
provided by the Bank
or the Company to Executive, excluding A) income attributable to
Executive's
exercise of a non-statutory stock option, B) income related to
Executive's
disqualifying disposition of an incentive stock option to acquire
Company common
stock, or C) income related to the distribution of benefits under
any
tax-qualified or non-tax-qualified retirement or deferred
compensation plan or
arrangement sponsored by the Company or the Bank, during each of
the five (5)
most recently completed calendar years preceding the Change in
Control.
(ii) the sum of the average of the value of the deferrals,
allocations, or contributions made by Executive or on behalf of
Executive by the
Bank, during each of the five (5) most recently completed calendar
years
preceding the Change in Control, under the Bank's employee stock
ownership and
401(k) savings plans. For purposes of this clause (ii), the value
of allocations
made to Executive under the employee stock ownership plan or the
supplemental
executive retirement plan shall be valued by reference to the fair
market value
of Company common stock as of the date of allocation.
The Bank shall pay the aggregate sum of these amounts to
Executive
in a single lump sum payment (without any mitigation) no later than
ten (10)
business days following Executive's termination of employment.
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(b) Upon the occurrence of a Change
in Control and Executive's termination
of employment in connection therewith, to the extent that the Bank
continues to
offer any life, medical, health, dental and disability insurance
coverage or
arrangements in which Executive or her dependents participated
immediately prior
to the Change in Control (each being a "Welfare Plan"), Executive
and her
covered dependents shall
