Exhibit 10.2
CHANGE IN CONTROL,
CONFIDENTIALITY,
AND NONCOMPETITION AGREEMENT
THIS CHANGE IN CONTROL, CONFIDENTIALITY AND NONCOMPETITION
AGREEMENT is made and entered into this _____ day of December,
2008 by and between BAR HARBOR BANKSHARES , a Maine
corporation with its headquarters located in Bar Harbor, Maine
(hereinafter, "the Company"), and CHERYL CURTIS , a resident
of Bar Harbor, Maine (hereinafter, "the Executive").
W I T N E S S E T
H:
WHEREAS, Bar Harbor Banking and Trust Company is a wholly-owned
first tier banking subsidiary of Bar Harbor Bankshares, and Bar
Harbor Trust Services is a second tier non-depository trust company
subsidiary of Bar Harbor Bankshares; and
WHEREAS, the Executive is an employee of the Employer; and
WHEREAS, the Employer wishes to retain the services of the
Executive; and
WHEREAS, the Executive and the Company entered into a change in
control, confidentiality and noncompetition agreement dated
____________; and
WHEREAS, the Executive and the Company wish to amend and restate
such change in control, confidentiality and noncompetition
agreement so that the provisions of this Agreement will supersede
the change in control, confidentiality and noncompetition agreement
dated _____________.
NOW, THEREFORE, the parties hereto do hereby agree as
follows:
1.
DEFINTIONS.
1.1. Bank shall mean Bar Harbor
Banking and Trust Company.
1.2. Base Compensation shall mean
the annual base salary payable by the Employer to the Executive,
excluding any bonuses, incentive compensation and other forms of
additional compensation.
1.3 Cause shall be deemed to
exist only in the event the Executive is convicted by a court of
competent jurisdiction of a felony involving dishonesty or fraud on
the part of the Executive in his or her relationship with the
Employer.
1.4. Change in Control shall mean
the occurrence of any one of the following events:
(a) Any person, including a
group (as such term is used in Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) becomes the
beneficial owner (as determined pursuant to Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of Bar Harbor
Bankshares representing more than fifty percent (50%) of the
combined voting power of Bar Harbor Bankshares' then outstanding
securities, other than as a result of an issuance of securities
initiated by Bar Harbor Bankshares in the ordinary course of its
business; or
(b) Bar Harbor Bankshares
is party to a Business Combination (as hereinafter defined) unless,
following consummation of the Business Combination, more than fifty
percent (50%) of the outstanding voting securities of the resulting
entity are beneficially owned, directly or indirectly, by the
holders of Bar Harbor Bankshares' outstanding voting securities
immediately prior to the Business Combination in substantially the
same proportions as those existing immediately prior to the
Business Combination; or
(c) The stockholders of Bar
Harbor Bankshares approve a plan of complete liquidation of Bar
Harbor Bankshares or an agreement for the sale or disposition by
Bar Harbor Bankshares of all or substantially all of Bar Harbor
Bankshares' assets to another person or entity that is not a wholly
owned subsidiary of Bar Harbor Bankshares.
For purposes of this Section 1.4, a Business Combination means
any cash tender or exchange offer, merger or other business
combination, sale of stock, or sale of all or substantially all of
the assets, or any combination of the foregoing transactions.
For purposes of this Section 1.4, a Change in Control shall
exclude any internal corporate change, reorganization or other such
event, which occurred prior to or may occur following the date of
this Agreement.
1.5. Code shall mean the Internal
Revenue Code of 1986, as amended, and as it may be amended from
time to time, together with the rules and regulations promulgated
under such code.
1.6. Company shall mean Bar Harbor
Bankshares.
1.7. Date of Termination shall
mean:
(a) If the Executive incurs
a separation from service for Disability, thirty (30) days after
Notice of Termination for Disability is given by the Employer to
the Executive and the Executive shall not have returned to the
performance of his duties on a full-time basis during such thirty
(30) day period;
(b) If the Executive's
service is separated by the Employer for Cause or by the Executive
for Good Reason, the date on which the Executive separates from
service with the Employer; and
(c) If the Executive incurs
a separation from service for any other reason, the date on which
the Executive incurs a separation from service with the
Employer.
Whether the Executive has incurred a separation from service is
determined based on whether the facts and circumstances indicate
that the Employer and the Executive reasonably anticipated that no
further services would be performed after a certain date.
1.8. Disability shall mean a
condition: (a) which causes the Executive to be unable to
engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be
expected to result in death or which can be expected to last for a
continuous period of not less than twelve months; or (b) which
results in the Executive receiving, by reason of any medically
determinable physical or mental impairment which can be expected to
result in death or which can be expected to last for a continuous
period of not less than twelve months, income replacement benefits
for a period of not less than three months under an accident and
health plan covering employees of the Employer. Disability
shall be deemed to exist only when the disability has been
certified to the Board of Directors of the Company by a licensed
physician approved by the Board of Directors of the Company.
1.9. Employer shall mean either
the Company, the Bank or Trust Services (whichever entity is the
employer of the Executive).
1.10. Exemption Amount shall mean two times
the lesser of: (a) the Executive’s annualized
compensation based on the Executive’s annual rate of pay for
the calendar year preceding the calendar year in which the Date of
Termination occurs; or (b) the limitation on compensation set forth
in Code Section 401(a)(17) for the calendar year in which the Date
of Termination occurs.
1.11. Good Reason shall mean one or more of
the following events arising without the consent of the
Executive:
(a) a material diminution in the
Executive’s Base Compensation;
(b) a material
diminution in the Executive’s authority, duties or
responsibilities;
(c) a material
diminution in the authority, duties or responsibilities of the
person to whom the Executive is required to report;
(d) a material
diminution in the budget over which the Executive retains
authority;
(e) a material change
in the geographic location at which the Executive must perform his
services; or
(f) any other
action or inaction that constitutes a material breach by the
Company of the Agreement or any other agreement under which the
Executive provides services.
In order for a separation from service to occur for Good Reason,
the separation from service must occur within two years following
the initial existence of the event constituting Good Reason.
1.12. Key Employee shall mean an employee who
is: (a) an officer of the Company, the Bank or Trust
Services whose earnings from the Company, the Bank and Trust
Services exceed $145,000 (as adjusted under Code Section 416(i)(1)
for calendar years beginning after December 31, 2007); (b) an owner
of more than a five percent (5%) interest in the Company, the Bank
or Trust Services; or (c) an owner of more than a one percent (1%)
interest in the Company, the Bank or Trust Services whose earnings
from the Company, the Bank and Trust Services exceed $150,000.
1.13. Notice of Termination shall mean the
notice provided pursuant to Section 3.
1.14. Trust Services shall mean Bar Harbor
Trust Services.
2.
SEVERANCE BENEFITS.
In the event that: (a) the Employer separates the Executive's
service prior to age 65 other than as a result of Disability and
other than for Cause, or the Executive separates his or her service
prior to age 65 for Good Reason; and (b) the Executive's separation
from service occurs in anticipation of or within one year after a
Change in Control, then the Employer shall pay the Executive the
severance benefits described in this Section 2. The
Executive's separation from service shall be deemed to be in
anticipation of a Change in Control if it occurs within the twelve
(12) month period prior to the occurrence of the Change in
Control.
Notwithstanding the foregoing, if
the payment of the severance benefits would result in an excess
parachute payment as defined under Code Section 280G, then the
amount of the severance benefits to be paid to the Executive shall
be reduced to an amount equal to the maximum dollar amount that can
be paid to the executive without causing the payment of an excess
parachute payment.
The severance benefits described in this Section 2 shall equal
the following:
(a) The Executive shall
receive a severance payment equal to 1.0 times the
Executive’s Base Compensation, determined as of the Date of
Termination.
(i) Subject to
the provisions of Section 2(a)(ii), the Executive’s severance
payment shall be paid in twelve equal installments beginning on the
first day of the month following the Executive’s Date of
Termination.
(ii) Notwithstanding
the provisions of Section 2(a)(i), if the Executive is a Key
Employee on the Executive’s Date of Termination, then any
portion of the severance payment that would be payable within the
first six months following the Executive’s Date of
Termination without regard to this Section 2(a)(ii) and that does
not exceed the Exemption Amount shall be paid in six equal
installments beginning on the first day of the month following the
Executive’s Date of Termination. Any portion of the
severance payment that would be payable within the first six months
following the Executive’s Date of Termination without regard
to this Section 2(a)(ii) and that exceeds the Exemption Amount
shall be paid in a lump sum on the first day of the month that is
six months after the Executive’s Date of Termination.
Any portion of the severance payment that would be payable after
the first six months following the Executive’s Date of
Termination without regard to this Section 2(a)(ii) shall be paid
in six equal installments beginning on the first day of the month
that is six months after the Executive’s Date of
Termination.
(b) The Executive and his
or her dependents shall continue to be eligible to receive the same
medical, health, dental and life insurance benefits which the
Executive is eligible to receive on the Date of Termination. The
Executive shall be required to make the same premium contributions
that he or she was required to make immediately prior to the Date
of Termination. The ability of the Executive and his or her
dependents to receive such benefits shall continue until the twelve
month anniversary of the Executive’s Date of Termination.
(c) In the event of a
Change in Control, all stock options granted but unexercised under
the Bar Harbor Bankshares and Subsidiaries Incentive Stock Option
Plan of 2000 or any other equity plan shall become 100% vested
immediately prior to such Change in Control. These grants
will remain subject to all of the other terms and conditions in the
Bar Harbor Bankshares and Subsidiaries Incentive Stock Option Plan
of 2000 or any other equity plan.
The Executive shall not be required to mitigate the amount of
any severance benefits described in this Section 2 by seeking other
employment.
3. NOTICE
OF TERMINATION.
Any separation of the Executive's service by the Employer due to
Disability or for Cause, or by the Executive due to Good Reason,
shall be communicated by written Notice of Termination to the other
party. A Notice of Termination must indicate the specif
