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Exhibit 10.3
VALLEY BANK
TWO YEAR CHANGE IN CONTROL AGREEMENT
This AGREEMENT ("Agreement") is hereby entered into as
November 21, 2006, by and between VALLEY BANK, a commercial
bank organized and existing by virtue of the laws of the State of
Connecticut (the "Bank") with its principal place of business at
Four Riverside Avenue, Bristol, Connecticut 06011, and ANTHONY
M. MATTIOLI ("Executive"). This Agreement will be effective as
of the date of consummation of the transaction (the "Effective
Date") contemplated in the Agreement and Plan of Merger by and
between New England Bancshares, Inc., New England Bancshares
Acquisition, Inc. and First Valley Bancorp, Inc. dated November 21,
2006 (the "Merger"). For purposes of this Agreement, references to
the Company shall mean NEW ENGLAND BANCSHARES, INC.
WHEREAS , the Bank recognizes the importance of Executive
to the Bank’s operations and wishes to protect his position
with the Bank in the event of a Change in Control of the Bank for
the period provided for in this Agreement; and
WHEREAS , Executive and the Board of Directors of the
Bank (the "Board") desire to enter into an 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.
WHEREAS , Executive acknowledges upon execution of this
Agreement and consummation of the Merger, he will not be entitled
to any benefits provided under the Change in Control Agreement by
and between the Bank and Executive dated October 1, 2004.
NOW, THEREFORE , in consideration of the promises and
mutual covenants herein contained, it is hereby agreed as
follows:
1. Term of Agreement.
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(a) The term of this Agreement shall be (i) the initial
term, consisting of the period commencing on the Effective Date and
ending on the second anniversary of the Effective Date, plus
(ii) any and all extensions of the initial term made pursuant
to this Section 1.
(b) The term of this Agreement shall be extended for one day
each day so that a constant twenty-four (24) calendar month
term shall remain in effect, until such time as the Board or
Executive elects not to extend the term of the Agreement by giving
written notice to the other party in accordance with the terms of
this Agreement, in which case the term of this Agreement shall be
fixed and shall end on the second anniversary of the date of such
written notice.
(c) Notwithstanding anything in this Section to the contrary,
this Agreement shall terminate if Executive or the Bank terminates
Executive’s employment prior to a Change in Control.
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2. Change in Control.
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(a) Upon the occurrence of a Change in Control (as defined in
Section 2(b) of this Agreement) 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 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 his employment at any
time during the term of this Agreement following an event
constituting "Good Reason."
"Good Reason" means, unless Executive has consented in writing
thereto, the occurrence following a Change in Control, of any of
the following:
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(i)
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the assignment to Executive of any duties
materially inconsistent with Executive’s position, including
any material change in status, title, authority, duties or
responsibilities or any other action that results in a material
diminution in such status, title, authority, duties or
responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and
that is remedied by the Bank reasonably promptly after receipt of
notice thereof given by the Executive;
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(ii)
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a reduction by the Bank of the Executive’s
base salary in effect immediately prior to the Change in
Control;
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(iii)
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the relocation of the Executive’s office to
a location more than twenty (20) miles from its location as of
the date of this Agreement;
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(iv)
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the taking of any action by the Bank that would
materially adversely affect the Executive’s overall
compensation and benefits package, unless such changes to the
compensation and benefits package are made on a non-discriminatory
basis to all employees of the Bank; or
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(v)
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the failure of the Bank to obtain the assumption
in writing of the Bank’s obligation to perform this Agreement
by any successor to all or substantially all of the assets of the
Bank within thirty (30) days after a reorganization, merger,
consolidation, sale or other disposition of assets of the
Bank.
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(i)
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Any person shall become the beneficial owner,
directly or indirectly, of securities representing twenty percent
(20%) or more of the combined voting power of the then
outstanding securities of the Company or the Bank (as used in this
subparagraph (i)), the term "beneficial ownership" shall have the
meaning ascribed to that term from time to time under
the
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rules and regulations promulgated by the Federal
Deposit Insurance Corporation ("FDIC") (currently codified as
12 C.F.R. Section 335.403 or any similar, successor
statute and rules); a "person" shall include any natural person,
corporation, partnership, trust, association or any group of
persons, whose ownership of the Company’s or the Bank’s
securities would be required to be reported collectively pursuant
to rules and regulations of the FDIC; and "affiliate" shall mean a
person that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, the person specified, pursuant to the rules and
regulations of the FDIC.
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(ii)
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The Bank or the Company shall be a party to any
merger or consolidation with another corporation, association or
business entity, which merger or consolidation shall be consummated
or shall sell, exchange or transfer all or substantially all of its
respective assets to some other person (as "person" is defined in
subparagraph (i), above), except in any such case in a transaction
in which immediately after such merger or consolidation or such
sale, exchange or transfer, the shareholders of the Bank or the
Company, in their capacities as such and as a result thereof, shall
own at least fifty percent (50%) in voting power of the then
outstanding securities of the Bank or the Company or of any
surviving corporation or business entity pursuant to any such
merger (or of its parent), the consolidated corporation or business
entity in any such consolidation or of all the persons or their
parents to which such sale, exchange of transfer of assets is made;
or
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(iii)
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During the period of one year, individuals who at
the beginning of any such period constitute the Directors of the
Bank or the Company shall have ceased for any reason to constitute
at least a majority thereof unless the election, or the nomination
for election by the Bank’s or the Company’s
shareholders, of each new director of the Bank or the Company was
approved by a vote of at least two-thirds of the Directors of the
Bank or the Company (as applicable) then still in office who were
Directors of the Bank at the beginning of such period, provided,
that a majority is composed of Directors who were Directors before
the occurrence of an event which would otherwise constitute a
Change in Control (the "Continuing Directors"), together with any
Directors whose election was approved by a majority of the
Continuing Directors in office at that time, may specifically
determine in the good faith exercise of their judgment that such
event does not constitute a Change in Control because it is not
likely to change the existing management, personnel or management
policies of the Bank or the Company.
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Notwithstanding the foregoing, a merger or
combination of Valley Bank with or into Enfield Federal Savings and
Loan Association or any other affiliate of the Company shall not
constitute a Change in Control for purposes of this
Agreement.
(c) Executive shall not have the right to receive
termination benefits pursuant to Section 3 hereof upon
termination for Cause. The term "Cause" shall mean termination
because of Executive’s personal dishonesty, incompetence,
willful misconduct, any breach of fiduciary duty
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