CHANGE OF CONTROL
AGREEMENT
THIS CHANGE OF
CONTROL AGREEMENT (this “Agreement”) is entered into as
of the 14th day of January, 2009, by and between Camco Financial
Corporation, a Delaware corporation (“Camco”), and
James E. Brooks (the “Employee”);
WHEREAS, the
Employee is employed as the Chief Financial Officer of Camco and
its wholly-owned subsidiary, Advantage Bank (the
“Bank”);
WHEREAS, as a
result of the skill, knowledge and experience of the Employee,
Camco believes it is in the best interest of Camco and its
stockholders to provide the Employee with a sense of security and
fair treatment to encourage the Employee to remain an employee of
Camco;
WHEREAS, Camco and
the Employee desire to enter into this Agreement to set forth their
understanding as to their respective rights and obligations in the
event of the termination of Employee’s employment under the
circumstances set forth in this Agreement.
NOW, THEREFORE, in
consideration of the premises and mutual covenants herein
contained, Camco and the Employee hereby agree as
follows:
1.
Term . The term of this Agreement shall commence on
January 14, 2009, and shall end January 31, 2010, subject
to extension and to earlier termination as provided herein (the
“Term”). Prior to each anniversary of the date of this
Agreement, the Board of Directors of Camco shall review the
performance of the Employee. In connection with such annual review,
the Term of this Agreement shall be extended for a one-year period
beyond the then-effective expiration date, provided the Board of
Directors of Camco, in its sole discretion, determines in a duly
adopted resolution that this Agreement should be
extended.
2.
Termination of Employment .
(a)
Termination by Camco in Connection with a Change of Control
. In the event that the employment of the Employee is terminated by
Camco, the Bank or their respective successors or assigns, during
the Term for any reason other than Just Cause within six months
prior to a Change of Control (hereinafter defined) or within one
year after a Change of Control, then the following shall
occur:
(i) Camco shall
promptly, but in no event more than 60 days following the
Employee’s date of termination, pay to the Employee or to his
beneficiaries, dependents or estate an amount equal to two times
the Employee’s annual base compensation as most recently set
prior to the occurrence of the Change of Control;
(ii) The Employer
shall pay the premiums required to maintain coverage for the
Employee and his eligible dependents under the health insurance
plan of Camco or the Bank in which the Employee is a participant
immediately prior to the Change of Control in accordance with the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended,
until the earliest of (A) the second anniversary of the
termination of the Employee’s employment or (B) the date
on which the Employee is eligible to be included in another
employer’s benefit plans as a full-time employee.
Notwithstanding the foregoing, any amounts or benefits that will be
paid or provided under this Section 2(a)(ii) after completion
of the time period described in Treasury Regulation
§1.409A-1(b)(9)(v)(B) shall be subject to the following
requirements: (X) the amount of expenses eligible for
reimbursement or benefits provided during any taxable year of the
Employee may not affect the expenses eligible for reimbursement or
benefits to be provided in any other taxable year of the Employee;
(Y) any reimbursement of an eligible expense shall be made on
or before the last day of the taxable year of the Employee
following the taxable year of the Employee in which the expense was
incurred; and (Z) the right to such reimbursement or benefit
may not be subject to liquidation or exchange for another benefit;
and
(iii) The Employee
shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or
otherwise, nor shall any amounts received from other employment or
otherwise by the Employee offset in any manner the obligations of
Camco hereunder, except as specifically stated in subparagraph
(b).
For purposes of
this Agreement, the term “Just Cause” means the
Employee’s personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit,
intentional failure or refusal to perform the duties and
responsibilities assigned in this Agreement, willful violation of
any law, rule, regulation (other than traffic violations or similar
offenses) or final cease-and-desist order, conviction of a felony
or for fraud or embezzlement, or material breach of any provision
of this Agreement. For purposes of this Agreement, any reference to
the Employee’s “termination” or
“termination of employment” shall mean the
Employee’s “separation from service”, within the
meaning of Section 409A of the Internal Revenue Code of 1986,
as amended (“Code”) from Camco and all entities with
whom Camco would be considered a single employer under Sections
414(b) and (c) of the Code.
(b)
Termination by the Employee in Connection with a Change of
Control . The Employee may voluntarily terminate his employment
pursuant to this Agreement within twelve months following a Change
of Control and shall be entitled to compensation as set forth in
Section 2(a) of this Agreement in the event that:
(i) the present
capacity or circumstances in which the Employee is employed
immediately prior to the completion of the Change of Control are
materially changed, in the reasonable opinion of the Employee
(including, without
-2-
limitation, a
material reduction in responsibilities or authority or a reduction
in salary);
(ii) the Employee
is required to move his personal residence, or perform his
principal executive functions, more than thirty-five
(35) miles
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