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Exhibit 10.13
EXECUTION COPY
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AMENDED AND RESTATED ONE-YEAR CHANGE OF CONTROL AGREEMENT
This
AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT (the
"Agreement")
is made and entered into as of ______________________ by and among
Westfield
Bank, a savings bank organized and operating under the laws of the
Commonwealth
of Massachusetts having an office at 141 Elm Street, Westfield,
Massachusetts
01085 (the "Bank"), WESTFIELD FINANCIAL, INC., a business
corporation organized
and existing under the laws of the Commonwealth of Massachusetts
and having an
office at 141 Elm Street, Westfield, Massachusetts 01085 (the
"Company") and
__________________ (the "Officer").
INTRODUCTORY STATEMENT
The Board
of Directors of the Bank has concluded that it is in the best
interests of the Bank, the Company and their prospective
shareholders to
establish a working environment for the Officer which minimizes the
personal
distractions that might result from possible business combinations
in which the
Company or the Bank might be involved. To this end, the Bank has
decided to
provide the Officer with assurance that his compensation will be
continued for
a minimum period of one (1) year following termination of
employment as defined
in Treasury Regulation Section 1.409A-1(h)(1)(ii) (the "Assurance
Period") if
his employment terminates under specified circumstances related to
a business
combination. The Board of Directors of the Bank has decided to
formalize this
assurance by entering into this Change of Control Agreement with
the Officer.
The Board of Directors of the Company has authorized the Company to
guarantee
the Bank's obligations under this Agreement.
The terms
and conditions which the Bank, the Company and the Officer have
agreed to are as follows.
AGREEMENT
Section 1.
Effective Date; Term; Change of Control and Pending Change of
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Control Defined.
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(a) This
Agreement shall take effect as of the date written above (the
"Effective Date") and shall be in effect during the period (the
"Term")
beginning on the Effective Date and ending on the first anniversary
of the date
on which the Bank notifies the Officer of its intent to discontinue
the
Agreement (the "Initial Expiration Date") or, if later, the first
anniversary
of the latest Change of Control or Pending Change of Control, as
defined below,
that occurs after the Effective Date and before the Initial
Expiration Date.
(b) For
all purposes of this Agreement, a "Change of Control" shall be
deemed to have occurred upon the happening of any of the following
events:
(i) the consummation of a reorganization, merger or
consolidation
of the
Company with one (1) or more other persons, other than a
transaction following which:
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(A) at least 51% of the equity ownership interests of the
entity resulting from such transaction are beneficially owned
(within the meaning of Rule 13d-3 promulgated under the
Securities
Exchange Act of 1934, as amended ("Exchange Act")) in
substantially
the same relative proportions by persons who, immediately prior
to
such transaction, beneficially owned (within the meaning of
Rule
13d-3 promulgated under the Exchange Act) at least 51% of the
outstanding equity ownership interests in the Company; and
(B) at least 51% of the securities entitled to vote generally
in the election of directors of the entity resulting from such
transaction are beneficially owned (within the meaning of Rule
13d-3 promulgated under the Exchange Act) in substantially the
same
relative proportions by persons who, immediately prior to such
transaction, beneficially owned (within the meaning of Rule
13d-3
promulgated under the Exchange Act) at least 51% of the
securities
entitled to vote generally in the election of directors of the
Company;
(ii) the acquisition of all or substantially all of the assets
of
the
Company or beneficial ownership (within the meaning of Rule
13d-3
promulgated under the
Exchange Act) of 25% or more of the outstanding
securities
of the Company entitled to vote generally in the election of
directors
by any person or by any persons acting in concert;
(iii) a complete liquidation or dissolution of the Company;
(iv) the occurrence of any event if, immediately following such
event, at
least 50% of the members of the Board of Directors of the
Company do
not belong to any of the following groups:
(A) individuals who were members of the Board of Directors of
the Company on the date of this Agreement; or
(B) individuals who first became members of the Board of
Directors of the Company after the date of this Agreement
either:
(1) upon election to serve as a member of the Board of
Directors of the Company by affirmative vote of
three-quarters of the members of such board, or of a
nominating committee thereof, in office at the time of such
first election; or
(2) upon election by the shareholders of the Board of
Directors of the Company to serve as a member of such board,
but only if nominated for election by
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affirmative vote of three-quarters of the members of the
Board of Directors of the Company, or of a nominating
committee thereof, in office at the time of such first
nomination;
provided, however, that such individual's election or
nomination
did not result from an actual or threatened election contest
(within the meaning of Rule 14a-11 of Regulation 14A
promulgated
under the Exchange Act) or other actual or threatened
solicitation
of proxies or consents (within the meaning of Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) other than by
or
on behalf of the Board of Directors of the Company; provided,
however, that this section 1(b)(iv) shall only apply if the
Company
is not majority owned by Westfield Mutual Holding Company; or
(v) any event which would be described in section 1(b)(i),
(ii),
(iii) or
(iv) if the term "Bank" were substituted for the term "Company"
therein.
In no event, however, shall a Change of Control be deemed to have
occurred as a
result of (i) 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 or
(ii) the conversion of Westfield Mutual Holding Company to a stock
form company
and the issuance of additional shares of the Company in connection
therewith.
For purposes of this section 1(b), the term "person" shall have the
meaning
assigned to it under Sections 13(d)(3) or 14(d)(2) of the Exchange
Act.
(c) For
purposes of this Agreement, a "Pending Change of Control" shall
mean: (i) the signing of a definitive agreement for a transaction
which, if
consummated, would result in a Change of Control; (ii) the
commencement of a
tender offer which, if successful, would result in a Change of
Control; or
(iii) the circulation of a proxy statement seeking proxies in
opposition to
management in an election contest which, if successful, would
result in a
Change of Control; provided, however, that the Change of Control
contemplated
does, in fact, occur.
Section 2.
Discharge Prior to a Pending Change of Control.
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The Bank
may discharge the Officer at any time prior to the occurrence
of
a Pending Change of Control for any reason or for no reason. In
such event:
(a) The Bank shall pay to the Officer (or, in the event of his
death, his
estate) his earned but unpaid compensation (including, without
limitation, salary and all other items which constitute wages
under
applicable
law) as of the date of his termination of employment. This
payment
shall be made at the time and in the manner prescribed by law
applicable to
the payment of wages but in no event later than thirty (30)
days after
the date of the Officer's termination of employment.
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(b) The Bank shall provide the benefits, if any, due to the
Officer
(or, in
the event of his death, his estate, surviving dependents or his
designated
beneficiaries) under the employee benefit plans and programs
and
compensation plans and programs maintained for the benefit of
the
officers and
employees of the Bank. The time and manner of payment or
other
delivery of these benefits and the recipients of such benefits
shall be
determined according to the terms and conditions of the
applicable
plans and programs; provided, however, that such benefits
shall be
paid within 2 1/2 months following the end of the taxable year
of the
Officer, Bank or the Company, whichever is longer, in which the
termination event occurs.
The payments and benefits described in sections 2(a) and (b) shall
be referred
to in this Agreement as the "Standard Termination Entitlements." In
addition,
the Officer, the Company and the Bank agree that the termination
benefits
described in this sections 2(a) and (b) are intended to be exempt
from Section
409A ("Section 409A") of the Internal Revenue Code of 1986 (the
"Code")
pursuant to Treasury Regulation Section 1.409A-1(b)(4) as
short-term deferrals.
Section 3.
Termination of Employment Due to Death.
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The
Officer's employment with the Bank shall terminate, automatically
and
without any further action on the part of any party to this
Agreement, on the
date of the Officer's death. In such event, the Bank shall pay and
deliver to
his estate and surviving dependents and beneficiaries, as
applicable, the
Standard Termination Entitlements.
Section 4.
Termination Due to Disability after Change of Control or
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Pending Change of Control.
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The Bank
may terminate the Officer's employment during the Term and
after
the occurrence of a Change of Control or a Pending Change of
Control upon a
determination, by a majority vote of the members of the Board of
Directors of
the Bank, acting in reliance on the written advice of a medical
professional
acceptable to it, that the Officer is suffering from a physical or
mental
impairment which, at the date of the determination, has prevented
the Officer
from performing his assigned duties on a substantially full-time
basis for a
period of at least ninety (90) days during the period of one (1)
year ending
with the date of the determination or is likely to result in death
or prevent
the Officer from performing his assigned duties on a substantially
full-time
basis for a period of at least ninety (90) days during the period
of one (1)
year beginning with the date of the determination. In such
event:
(a) The Bank shall pay and deliver to the Officer (or in the
event
of his
death before payment, to his estate and surviving dependents
and
beneficiaries, as applicable) the Standard Termination
Entitlements.
(b) In addition to the Standard Termination Entitlements, the
Bank
shall
continue to pay the Officer his base salary, at the annual rate
in
effect for
him immediately prior to the termination of his employment,
during a
period ending on the earliest of: (i) the expiration of ninety
(90) days
after the date of termination of his employment; (ii) the date
on which
long-term disability insurance benefits are first payable to
him
under any
long-term disability insurance plan covering employees of the
Bank (the
"LTD Eligibility Date"); (iii) the date of his
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death;
(iv) the expiration of the Assurance Period (the "Initial
Continuation Period"); and (v) within 2 1/2 months following the
end of
the
taxable year of the Officer, Bank or the Company, whichever is
longer, in
which the termination event occurs. If the end of the Initial
Continuation Period is neither the LTD Eligibility Date nor the
date of
his death,
the Bank shall continue to pay the Officer his base salary, at
an annual
rate equal to sixty percent (60%) of the annual rate in effect
for him
immediately prior to the termination of his employment, during
an
additional
period ending on the earliest of the LTD Eligibility Date, the
date of
his death and the expiration of the Assurance Period.
A termination of employment due to disability under this section 4
shall be
effected by a notice of termination given to the Officer by the
Bank and shall
take effect on the later of the effective date of termination
specified in such
notice or the date on which the notice of termination is deemed
given to the
Officer.
The
Officer, the Company and the Bank agree that the termination
benefits
described in section 4(b) are intended to be exempt from Section
409A pursuant
to Treasury Regulation Section 1.409A-1(b)(4) as short-term
deferrals.
Section 5.
Discharge with Cause after Change of Control or Pending Change
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of Control.
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(a) The
Bank may terminate the Officer's employment with "Cause" during
the Term and after the occurrence of a Change of Control or Pending
Change of
Control, but a termination shall be deemed to have occurred with
"Cause" only
if:
(i) the Board of Directors of the Bank and the Board of
Directors
of the
Company, by separate majority votes of their entire membership,
determine
that the Officer should be discharged because of personal
dishonesty, incompetence, willful misconduct, breach of fiduciary
duty
involving
personal profit, intentional failure to perform stated duties,
willful
violation of any law, rule or regulation (other than traffic
violations
or similar offenses) or final cease and desist order, or any
material
breach of this Agreement; and
(ii) at least forty-five (45) days prior to the vote
contemplated
by section
1(b)(i), the Bank has provided the Officer with notice of its
intent to
discharge the Officer for Cause, detailing with particularity
the facts
and circumstances which are alleged to constitute Cause (the
"Notice of
Intent to Discharge"); and
(iii) after the giving of the Notice of Intent to Discharge and
before the
taking of the vote contemplated by section 5(a)(i), the
Officer
(together with his legal counsel, if he so desires) is afforded
a
reasonable
opportunity to make both written and oral presentations before
the Board
of Directors of the Bank for the purpose of refuting the
alleged
grounds for Cause for his discharge; and
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(iv) after the vote contemplated by section 5(a)(i), the Bank
has
furnished
to the Officer a notice of termination which shall specify the
effective
date of his termination of employment (which shall in no event
be earlier
than the date on which such notice is deemed given) and
include a
copy of a resolution or resolutions adopted by the Board of
Directors
of the Bank, certified by its corporate secretary and signed by
each
member of the Board of Directors voting in favor of adoption of
the
resolution(s), authorizing the termination of the Officer's
employment
with Cause
and stating with particularity the facts and circumstances
found to
constitute Cause for his discharge (the "Final Discharge
Notice").
(b) If the
Officer is discharged with Cause during the Term and after a
Change of Control or Pending Change of Control, the Bank shall pay
and provide
to him (or, in the event of his death, to his estate, his
surviving
beneficiaries and his dependents) the Standard Termination
Entitlements only.
Following the giving of a Notice of Intent to Discharge, the Bank
may
temporarily suspend the Officer's duties and authority and, in such
event, may
also suspend the payment of salary and other cash compensation, but
not the
Officer's participation in retirement, insurance and other employee
benefit
plans. If the Officer is not discharged, or is discharged without
Cause, within
forty-five (45) days after the giving of a Notice of Intent to
Discharge,
payments of salary and cash compensation shall resume, and all
payments
withheld during the period of suspen
