Exhibit
10.2
The following
executive officers have a change of control agreement with 1
st Security Bank of
Washington (the “Bank”), the wholly-owned, operating
subsidiary of the Registrant, in the form attached:
Steven Haynes
Drew Ness
CHANGE OF CONTROL
AGREEMENT
THIS AGREEMENT is entered into as of the _____ day of __________,
200__ (the "Effective Date") by and between 1 ST SECURITY BANK OF WASHINGTON (the
“Bank”), a Washington chartered savings bank, and
_______________________ (the “Executive”).
WITNESSETH:
WHEREAS, Executive is the ____________________ of the Bank, and as
such is a key officer whose continued dedication, availability,
advice and counsel to the Bank is deemed important to the Board of
Directors of the Bank;
WHEREAS, the Bank wish to retain the services of Executive free
from any distractions or conflicts that could arise as a result of
a change in control of the Bank;
NOW, THEREFORE, to assure the Bank of Executive’s continued
dedication, the availability of his advice and counsel to the Board
of Directors of the Bank free of any distractions resulting from a
change of control, and for other good and valuable consideration,
the receipt and adequacy whereof each party hereby acknowledges,
the Bank and Executive hereby agree as follows:
1.
TERM OF AGREEMENT : This Agreement shall remain in effect
until cancelled by either party hereto, upon not less than 24
months prior written notice to the other party. The execution of
this Agreement shall automatically cancel and void any change in
control or severance agreements which otherwise might be in effect
between Executive and the Bank.
2.
CHANGE OF CONTROL : If there is a Change of Control of the
Bank during the term of this Agreement, Executive shall be entitled
to a severance payment in the event the Executive suffers an
Involuntary Termination within six (6) months preceding or 12
months after the Change in Control, unless such termination is for
Cause. The amount of such severance payment shall equal
[_________(__)] months of Executive’s then current
salary and shall be paid in a lump sum within 45 days of the date
of Executive’s Involuntary Termination, subject to the
restrictions set forth in paragraph 12 of this Agreement.
3.
LIMITATION OF BENEFITS : It is the intention of the parties
that no payment be made or benefit provided to the Executive that
would constitute an “excess parachute payment” within
the meaning of Section 280G of the Code and any regulations
thereunder, thereby resulting in a loss of an income tax deduction
by the Bank or the imposition of an excise tax on the Executive
under Section 4999 of the Code. If the independent accountants
serving as auditors for the Bank immediately prior to the date of a
Change of Control determine that some or all of the payments or
benefits scheduled under this Agreement, when combined with any
other payments or benefits provided to the Executive on a Change of
Control by the Bank, and any affiliate of the Bank required to be
aggregated with the Bank under Section 280G of the Code, would
constitute nondeductible excess parachute payments by the Bank
under Section 280G of the Code, then the payments or benefits
scheduled under this Agreement will be reduced to one dollar less
than the maximum amount which may be paid or provided without
causing any such payments or benefits scheduled under this
Agreement or otherwise provided on a Change of Control to be
nondeductible. The determination made as to the reduction of
benefits or payments required hereunder by the independent
accountants shall be binding on the parties. The Executive shall
have the right to designate within a reasonable period which
payments or benefits scheduled under this Agreement
will be reduced;
provided, however, that if no direction is received from the
Executive, the Bank shall implement the reductions under this
Agreement in its discretion.
4.
LITIGATION - OBLIGATIONS - SUCCESSORS :
(a) If
litigation shall be brought or arbitration commenced to challenge,
enforce or interpret any provision of this Agreement, and such
litigation or arbitration does not end with judgment in favor of
the Bank, the Bank hereby agrees to indemnify the Executive for his
reasonable attorney’s fees and disbursements incurred in such
litigation or arbitration.
(b) The
Bank’s obligation to pay the Executive the compensation and
benefits and to make the arrangements provided herein shall be
absolute and unconditional and shall not be affected by any
circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the Bank may
have against him or anyone else. All amounts payable by the Bank
hereunder shall be paid without notice or demand. The
Executive shall not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment
or otherwise.
(c) The
Bank will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Bank, by
agreement in form and substance satisfactory to the Executive, to
expressly assume and agree to perform this Agreement in its
entirety. Failure of the Bank to obtain such agreement
prior to the effectiveness of any such succession shall be a breach
of this Agreement and shall entitle the Executive to the
compensation described in Section 2. As used in this
Agreement, the “Bank” shall mean 1 st Security Bank of Washington and
any successor to its business and/or assets as aforesaid which
executes and delivers the agreement provided for in this Section
4(c) or which otherwise becomes bound by all the terms and
provisions of this Agreement by operation of law.
5.
NOTICES : For the purposes of this Agreement, notices and
all other communications provided for in the Agreement shall be in
writing and shall be deemed to have been duly given when delivered
or mailed by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
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If to the
Executive:
If to the Bank:
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or at such other
address as any party may have furnished to the other in writing in
accordance herewith, except that notices of change of address shall
be effective only upon receipt.
6.
MODIFICATION - WAIVERS - APPLICABLE LAW : No provisions of
this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing, signed
by the Executive and on behalf of the Bank by such officer as may
be specifically designated by the Board of Directors of the Bank.
No waiver by either party hereto at any time of any breach by the
other party hereto of, or in compliance with,
