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Exhibit 10.9
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EXECUTIVE
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT
(the "Agreement") is between Bank Rhode Island, a financial
institution organized under the laws of the State of Rhode Island
with its executive offices located at One Turks Head Place,
Providence, Rhode Island 02903 (the "Bank"), Bancorp Rhode Island,
Inc., a corporation organized under the laws of the State of Rhode
Island and sole shareholder of the Bank (the "Company") and Mark J.
Meiklejohn of Kingston, Rhode Island (the "Executive").
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IT IS MUTUALLY AGREED by the
parties as follows:
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1.
Employment;
Duties
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1.1
Responsibilities and Authority . (a) The Bank
hereby employs Executive to serve as Executive Vice President and
Chief Lending Officer of the Bank, and Executive hereby accepts
such employment. Executive shall have the duties, responsibilities,
authorities and powers normally incident to such office. At all
times, however, Executive's activities and authority with respect
to such offices will be subject to supervision, control and
direction by the Board of Directors of the Bank (the "Board"), by
the Executive Committee of the Board, and by the President and
Chief Executive Officer of the Bank (the "Chief Executive Officer")
and Executive agrees to carry out such duties and responsibilities
as any of them may from time to time reasonably assign to
Executive. Executive shall report from time to time or routinely,
upon request, to the Chief Executive Officer or the Chief Executive
Officer's designee as to the current status of any of Executive's
assigned duties and responsibilities.
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(b) The
Company hereby employs Executive to serve as Vice President of the
Company and such other offices and positions as the Company may
determine, and Executive hereby accepts such employment. Executive
shall have the duties, responsibilities, authorities and powers
normally incident to such offices. At all times, however,
Executive's activities and authority with respect to such offices
will be subject to supervision, control and direction by the Board
of Directors of the Company (the "Company Board") or by the
Executive Committee of the Company Board, and Executive hereby
agrees to carry out such duties and responsibilities as either of
them may from time to time reasonably assign to Executive.
Executive shall report from time to time or routinely, upon
request, to the Chief Executive Officer of the Company or such
Chief Executive Officer's designee as to the current status of any
of Executive's assigned duties and responsibilities.
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1.2
Compensation . The Bank shall pay Executive a base salary at
the rate of One Hundred Eighty Thousand Dollars ($180,000) per year
commencing on the date hereof payable on a bi-weekly basis, or at
such higher rate as shall be determined from time to time by the
Board or the Compensation Committee of the Board. In addition to
Executive's base salary, Executive shall be entitled to receive
payments under any incentive compensation or bonus program (as in
effect from time to time), which the Bank may establish for its
employees and/or senior executives, in such amounts as are provided
by such programs.
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<PAGE >
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1.3
Employee Benefits . As a full-time employee of the Bank,
Executive shall be eligible to participate in any and all employee
benefit plans generally available to full-time employees of the
Bank, including non-contributory plans and, at Executive's option,
contributory plans.
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1.4
Grant of Stock Options . Executive shall receive stock
options to purchase shares of the Company's common stock in such
number, at an exercise price and on such other terms as may be
approved by the Compensation Committee of the Company Board, in its
sole discretion. Any such options will become exercisable on a
schedule no less favorable than generally provided with respect to
options granted to executives of the Bank (other than the Chief
Executive Officer), with such vesting to accelerate on a Change in
Control (as defined in Section 3.2).
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1.5 Vacation . Executive
shall be entitled to five weeks of vacation during each year of
employment, such vacation to be taken in accordance with the Bank's
customary vacation policies and at such times and intervals as are
mutually agreed upon by Executive and the Bank. Executive shall be
entitled to holiday time and sick leave in accordance with the then
existing policies of the Bank, as in effect from time to time.
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1.6
Reimbursement of Expenses .
(a) Executive shall be
reimbursed by the Bank for reasonable business expenses incurred by
him incident to his employment upon presentation of appropriate
vouchers, receipts, and other supporting documents required by the
Bank.
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(b)
Executive shall be reimbursed
by the Company for reasonable business expenses incurred by him
incident to his employment by the Company upon presentation of
appropriate vouchers, receipts, and other supporting documents
required by the Company.
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1.7
Duty to Perform Services . So long as Executive is employed
by the Company or the Bank, Executive agrees to devote his full
business and productive time, skill, and energy diligently,
loyally, effectively, and to the best of his ability to the
rendering of services to the Company and the Bank, and will exert
his best efforts in the rendering of such services. This provision
will not prohibit Executive from:
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(a) making
passive investments or serving as a fiduciary with respect to
direct family investments;
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(b) serving
on the board of directors of any company, provided that
Executive shall not render any material services with respect to
the operations or affairs of any such company and provided
further that serving on such board of directors does not
otherwise violate the terms of this Agreement, including, but not
limited to, the provisions of Section 4.2 herein; or
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(c) engaging
in religious, charitable or other community or non-profit
activities which do not impair Executive's ability to fulfill his
duties and responsibilities to the Company and Bank.
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<PAGE 2>
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Executive agrees that in the rendering of all services to the
Company and the Bank and in all aspects of his employment, he will
comply with all directives, policies, standards, and regulations
from time to time established by the Company or the Bank or by
applicable law.
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1.8
Death or Disability .
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(a) Death . In the event
of Executive's death during the term of his employment under this
Agreement, the Bank shall immediately pay to Executive's designated
beneficiary any salary accrued but unpaid as of the date of death.
Upon payment of the aforementioned sums, the Bank's obligations to
make further salary payments shall terminate. This provision shall
not be construed to negate any rights Executive may have to death
benefits under any employee benefit or welfare plan of the Company
or the Bank in which he may from time to time be a participant or
under any other written agreement with the Company or Bank which
specifically provides for such benefits.
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(b)
Disability . In the event of Executive's "disability" (as
defined below) during the term of his employment under this
Agreement, the Bank shall continue to pay Executive his base salary
(reduced by any benefits Executive is entitled to receive under any
state or federal disability insurance program, such as Rhode Island
temporary disability insurance or federal social security) for a
period of six months from the date of "disability". For purposes of
this Agreement, "disability" shall mean a good faith determination
by the Board that Executive is unable for any reason, either
physical or mental, to perform the duties required of him
hereunder.
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1.9
Term of Employment . The term of Executive's employment
under this Agreement shall commence on the date hereof and shall
continue, unless sooner terminated pursuant to the provisions of
this Agreement, for a period of one year (the "Term"), which Term
shall automatically renew on each successive one year anniversary
hereafter commencing with the first anniversary hereof unless any
party shall have given written notice to the other parties of such
party's election not to extend the Term within ninety (90) calendar
days prior to any anniversary date.
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1.10
Termination . This Agreement and the rights of the parties
hereunder will terminate (subject to the provisions of Section 1.11
below) upon the occurrence of one of the following:
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(a) Upon
the Executive's death or disability as provided in Section 1.8
above;
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(b) For
Cause as provided in Section 3.5, immediately upon the giving of
notice by the Company or the Bank or at such later time as such
notice may specify or as may be required by Section 3.5;
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(c) At
the election of the Executive for Good Reason (as hereinafter
defined) as provided in Section 2.2; or
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<PAGE 3>
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(d)
Upon expiration of the Term,
following notice by any party not to renew the Term as provided in
Section 1.9.
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1.11
Termination and Survival . The provisions of Section 1.8,
Sections 2 and 3 and Sections 4.1, 4.2, 4.4, 4.5, 4.6, 4.7, 4.8,
4.9, 4.10, 4.11 and 4.12 hereof shall remain in full force and
effect and shall continue to be enforceable in accordance with
their terms beyond termination of employment and beyond expiration
of this Agreement, except as otherwise agreed in writing by
Executive and the Company and the Bank.
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2.
Severance .
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2.1 Severance Benefit .
In the event of a termination of Executive's employment by the
Company or the Bank without Cause (as such term is defined in
Section 3.5) at any time, or in the event of termination of
Executive's employment by him for Good Reason (as defined in
Section 2.2), the Bank will (a) continue to pay Executive his base
salary (the "Severance Benefit") then in effect for a twelve (12)
month period commencing on the date of termination (the "Severance
Period"), and (b) provide Executive (at the Bank's cost) with the
medical, dental and life insurance coverage generally available to
full-time employees during the Severance Period or as required by
law, whichever is longer. The Bank shall also provide Executive
with outplacement assistance for a period of six months at no
charge. Notwithstanding anything herein to the contrary, the Bank
shall have no obligation to pay the Severance Benefit to Executive
in the event his employment is terminated with Cause by the Company
or the Bank or voluntarily by him without Good Reason. Any
Severance Benefit paid under this Section 2.1 shall be credited
against any amounts due Executive under Section 3 as a result of a
Change in Control.
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2.2 "Good
Reason" Defined. For purposes of this Agreement "Good Reason" shall
mean the Company or the Bank giving written notice of its election
not to renew this Agreement on any anniversary date as permitted
under Section 1.9 and its failure to offer and enter into a
new employment agreement with Executive on terms which are
substantially similar to those of his employment existing
immediately prior to such notice of non-renewal (other than a
reduction of fringe benefits required by law or applicable to all
employees generally) provided, however, that Good Reason
shall not be deemed to have occurred unless prior to Executive's
termination of employment for Good Reason, he shall give not less
than 30 days written notice to the Company and the Bank of his
intent to terminate for Good Reason stating the basis of the Good
Reason sufficient to permit the Company or the Bank to alleviate
the basis of such Good Reason prior to termination, and the Company
and the Bank have not done so within such 30 day period, and
further provided, that Executive's continuing to work
following notice of non-renewal by the Company or the Bank and in
the absence of entering into a new employment agreement shall be
without prejudice to his right to claim termination for Good
Reason, absent written agreement between Executive and the Company
or the Bank to the contrary.
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3.
Change in Control .
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3.1 Purpose . In order
to allow Executive to consider the prospect of a Change in Control
(as defined in Section 3.2) in an objective manner and in
consideration of the services
<PAGE 4>
rendered and to be rendered by him to the Company and the Bank,
the Bank is willing to provide, subject to the terms of this
Agreement, certain severance benefits to protect Executive from the
consequences of a Terminating Event (as defined in Section 3.4)
occurring subsequent to a Change in Control.
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3.2 Change in Control .
A "Change in Control" will be deemed to have occurred if: (i) a
Takeover Transaction is effectuated; or (ii) the Company commences
substantive negotiations with a third party with respect to a
Takeover Transaction if within twelve (12) months of the
commencement of such negotiations, the Company enters into a
definitive agreement with respect to a Takeover Transaction with
any party with which negotiations were originally commenced; or
(iii) any election of directors of the Company occurs (whether by
the directors then in office or by the shareholders at a meeting or
by written consent) where a majority of the directors in office
following such election are individuals who were not nominated by a
vote of two-thirds of the members of the board of directors
immediately preceding such election; or (iv) either the Company or
the Bank effectuates a complete liquidation.
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3.3 Takeover Transaction
. A "Takeover Transaction" shall mean:
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(a) The acquisition of voting
securities of the Company by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")),
other than by the Company or its subsidiaries or any employee
benefit plan (or related trust) of the Company or its subsidiaries,
which theretofore did not beneficially own (within the meaning of
Rule 13d-3 promulgated under the Exchange Act), securities
representing 30% or more of the voting power of all outstanding
shares of voting securities of the Company, if such acquisition
results in such individual, entity or group owning securities
representing more than 30% of the voting power of all outstanding
voting securities of the Company; provided, that any acquisition by
a corporation with respect to which, following such
acquisition,
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