CHANGE IN CONTROL AGREEMENT
This
Change in Control Agreement (this "Agreement") is made effective as
of
October 1, 2007 (the
"Effective
Date"), by and between Beacon Federal, a
federally chartered
savings association with its principal office in East
Syracuse, New York (the "Bank") and Lisa Jones ("Executive").
WHEREAS, Executive
currently serves in the position of Vice President
Accounting/Operations of the Bank, a position of substantial
responsibility; and
WHEREAS, the Bank
wishes to provide
economic assurances
to Executive in
certain circumstances, as specified herein;
NOW,
THEREFORE, in
consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the
parties hereto
agree as follows:
1. TERM OF
AGREEMENT
This
Agreement shall commence as of the Effective
Date and shall continue
thereafter for a
period of one (1) year. Commencing on the first anniversary
date of this Agreement (the "Anniversary Date"), and continuing on each
Anniversary Date
thereafter,
the term of this
Agreement shall renew for an
additional year such that the remaining term of this Agreement is
always one (1)
year, unless written notice of non-renewal (a "Non-Renewal
Notice") is
provided
to Executive
at least thirty (30)
days and not more than sixty (60) days prior
to any such
Anniversary Date, in
which case the term of this Agreement shall
become fixed and shall end one (1) year following such Anniversary
Date.
2. TERMINATION
OF EMPLOYMENT
This
Agreement provides for certain payments and benefits to Executive
only
in the event
of a Change in Control (as defined below) followed by the
termination of
Executive's employment
with the Bank, as set
described in this
Section 2.
(a)
Upon the occurrence
of a Change in
Control during the term of this
Agreement followed by
Executive's (i)
involuntary
termination of
employment,
other than for Cause
(as defined
below) within one year after the Change in
Control or (ii) voluntary termination of employment for Good
Reason (as defined
below), the provisions of Section 3 shall apply. Upon the
occurrence of a Change
in Control during the term of this Agreement, Executive shall have the right
to
elect to terminate employment with the Bank by resignation within
one year after
any of the following events, each of which shall constitute "Good
Reason": (A) a
demotion, loss of
title, office or
significant authority
(in each case, other
than as a result of
the fact that the Bank
is merged into
another entity in
connection with the
Change in Control and
will not operate as a
stand-alone,
independent entity); (B) a reduction in his annual compensation or
benefits; or
(C) relocation of his
principal place of
employment by more than 50 miles from
its location immediately prior to the Change in Control; provided,
however, that
the Executive
must provide at least
30 days prior written
notice to the Bank
given within a
reasonable
period of time (not to
exceed, except in case
of a
continuing breach,
90 days) after the
event giving rise to the right to elect;
<PAGE>
provided, however,
that the Bank
shall have at least 30 days to
remedy the
situation.
(b)
The term "Change in Control" shall mean any of the following events,
but shall not include a conversion of the Bank from mutual to stock
form:
(i) a change in control of the Bank or any holding company of the Bank
of a nature that would be required to be reported in response to
Item 5.01(a) of
the current
report on Form 8-K, as
in effect on the date
hereof, pursuant
to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); or
(ii) a change in control of the Bank or any holding company of the
Bank
within the meaning of the Home Owners' Loan Act, as amended, and applicable
rules and regulations
promulgated
thereunder, as in
effect at the time of the
Change in Control; or
(iii) any of the following events, upon which a Change in Control
shall
be deemed to have occurred:
(A) any "person" (as the term is used in Sections 13(d) and
14(d)
of the Exchange Act)
is or becomes the
"beneficial owner" (as
defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of
securities of the Bank
or the Bank's holding
company representing
25% or more of the
combined voting
power of such outstanding securities, except for any securities
purchased by an
employee stock ownership plan or trust established by the Bank;
or
(B) individuals
who constitute the Board on the
Effective Date
(the "Incumbent
Board") cease for any reason to constitute a majority thereof,
provided that any person becoming a director subsequent to the Effective
Date
whose election
was approved by a vote of at least three-quarters of the
directors comprising
the Incumbent Board,
or whose nomination
for election by
stockholders of the
Bank or the Bank's holding company was approved by the same
Nominating Committee serving under an Incumbent Board, shall be,
for purposes of
this subsection
(B), considered as though they were members of the
Incumbent
Board; or
(C) a sale of all or substantially all the assets of the Bank or
the Bank's holding company, or a plan of reorganization,
merger,
consolidation,
or similar transaction
occurs in which the
security holders of the Bank or the
Bank's holding company
immediately prior to the consummation of the transaction
do not own at least
50.1% of the
securities
of the surviving entity to be
outstanding upon consummation of the transaction; or
(D) a proxy statement is issued soliciting proxies from
stockholders of the Bank or the Bank's holding company by someone
other than the
current management
of the Bank or the Bank's holding company, seeking
stockholder approval of a plan of reorganization, merger or
consolidation of the
Bank or the Bank's
holding company,
or similar
transaction
with one or more
corporations as a
result of which the outstanding shares of the class of
securities then
subject to the plan are to be exchanged for or converted into
cash or property
or securities not issued by the Bank or the
Bank's holding
company; or
2
<PAGE>
(E) a tender
offer is made for 25% or more of the voting
securities of the Bank or the Bank's holding company and stockholders owning
beneficially or of record 25% or more of the outstanding
securities of the
Bank
or the Bank's holding
company have tendered or offered to sell their
shares
pursuant to such tender offer and such tendered shares have been
accepted by the
tender offeror.
(c)
Even if a Change in Control shall occur during the term of this
Agreement, Executive
shall not have the right to receive termination benefits
pursuant to Section 3 upon termination of employment for Cause.
Termination for
"Cause" shall mean
termination
because of
Executive's
personal dishonesty,
incompetence, willful
misconduct,
breach of fiduciary
duty involving personal
profit, material
breach of the Bank's Code of Ethics, material violation of the
Sarbanes-Oxley
requirements for
officers of public
companies, if
applicable,
that in the reasonable
opinion of the Chief Executive Officer will likely cause
substantial financial
harm or substantial
injury to the reputation of the Bank
of any holding company
of the Bank, willfully
engaging in actions
that in the
reasonable opinion of
the Chief Executive Officer will likely cause substantial
financial harm or
substantial
injury t
