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Exhibit
10.6
A MENDED
AND R ESTATED E
MPLOYMENT A GREEMENT
This Amended and Restated
Employment Agreement (“the Agreement”) is made and
entered into as of November 28, 2007 (the “Effective
Date”) by and between Rome Bancorp, Inc., a business
corporation organized and existing under the laws of the State of
Delaware and having an office at 100 West Dominick Street, Rome,
New York 13440-5810 (the “Company”) and Charles M.
Sprock, an individual residing at 1843 North James Street, Rome,
New York 13440 (the “Executive”).
W I
T N E S
S E T H
:
W
HEREAS , the Executive currently serves as
President and Chief Executive Officer of the Company, the holding
company for The Rome Savings Bank (the
“Bank”);
W
HEREAS , the Company desires to assure for
itself the continued availability of the Executive’s services
as provided in this Agreement and the ability of the Executive to
perform such services with a minimum of personal distraction in the
event of a pending or threatened Change of Control (as hereinafter
defined); and
W
HEREAS , the Executive is willing to continue to
serve the Company on the terms and conditions hereinafter set
forth;
N OW , T
HEREFORE , in consideration of the premises and
the mutual covenants and conditions hereinafter set forth, the
Company and the Executive hereby agree as follows:
Section 1.
Employment .
The Company agrees to
continue to employ the Executive, and the Executive hereby agrees
to such continued employment, during the period and upon the terms
and conditions set forth in this Agreement.
Section 2.
Employment Period; Remaining Unexpired Employment Period
.
(a) The terms and conditions
of this Agreement shall be and remain in effect during the period
of employment established under this section 2 (“Employment
Period”). The Employment Period shall be for an initial term
of three (3) years beginning on the Effective Date and ending
on the third anniversary date of this Agreement (each, an
“Anniversary Date”), plus such extensions, if any, as
are provided pursuant to section 2(b).
(b) Except as provided in
section 2(c) and subject to section 11(b), beginning on the
Effective Date, the Employment Period shall automatically be
extended for one (1) additional day each day, unless either
the Company or the Executive elects not to extend the Agreement
further by giving written notice thereof to the other party, in
which case the Employment Period shall end on the third anniversary
of the date on which such written notice is given. For all purposes
of this Agreement, the term “Remaining Unexpired Employment
Period” as of any date shall mean the period beginning on
such date and ending on the last day of the Employment Period
taking into account any extensions under this section 2(b). Upon
termination of the Executive’s employment with the Company
for any reason whatsoever, any daily extensions provided pursuant
to this section 2(b), if not theretofore discontinued, shall
automatically cease.
(c) Nothing in this Agreement
shall be deemed to prohibit the Company at any time from
terminating the Executive’s employment during the Employment
Period with or without notice for any reason; provided,
however , that the relative rights and obligations of the
Company and the Executive in the event of any such termination
shall be determined under this Agreement.
Section 3.
Duties .
The Executive shall serve as
President and Chief Executive Officer of the Company, having such
power, authority and responsibility and performing such duties as
are prescribed by or under the By-Laws of the Company and as are
customarily associated with such position. The Executive shall
devote his full business time and attention (other than during
weekends, holidays, approved vacation periods, and periods of
illness or approved leaves of absence) to the business and affairs
of the Company and shall use his best efforts to advance the
interests of the Company.
Section 4. Cash
Compensation .
In consideration for the
services to be rendered by the Executive hereunder, the Company
shall continue to pay to him a salary at an annual rate of
$250,000, payable in approximately equal installments in accordance
with the Company’s customary payroll practices for senior
officers. Prior to each Anniversary Date, the Board of Directors of
the Company (“Board”) shall review the
Executive’s annual rate of salary at such times during the
Employment Period as it deems appropriate, but not less frequently
than once every twelve (12) months, and may, in its
discretion, approve an increase therein. In addition to salary, the
Executive may receive other cash compensation from the Company for
services hereunder at such times, in such amounts and on such terms
and conditions as the Board may determine from time to
time.
Section 5.
Employee Benefit Plans and Programs .
During the Employment Period,
the Executive shall be treated as an employee of the Company and
shall be entitled to participate in and receive benefits under any
and all qualified or non-qualified retirement, pension, savings,
profit-sharing or stock bonus plans, any and all group life, health
(including hospitalization, medical and major medical), dental,
accident and long term disability insurance plans, and any other
employee benefit and compensation plans (including, but not limited
to, any incentive compensation plans or programs, stock option and
appreciation rights plans and restricted stock plans) as may from
time to time be maintained by, or cover employees of, the Company
in accordance with the terms and conditions of such employee
benefit plans and programs and compensation plans and programs and
consistent with the Company’s customary practices.
Section 6.
Indemnification and Insurance .
(a) During the Employment
Period and for a period of six (6) years thereafter, the
Company shall cause the Executive to be covered by and named as an
insured under any
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policy or contract of insurance obtained
by it to insure its directors and officers against personal
liability for acts or omissions in connection with service as an
officer or director of the Company or service in other capacities
at the request of the Company. The coverage provided to the
Executive pursuant to this section 6 shall be of the same scope and
on the same terms and conditions as the coverage (if any) provided
to other officers or directors of the Company.
(b) To the maximum extent
permitted under applicable law, during the Employment Period and
for a period of six (6) years thereafter, the Company shall
indemnify the Executive against and hold him harmless from any
costs, damages, losses and exposures arising out of a bona fide
action, suit or proceeding in which he may be involved by reason of
his having been a director or officer of the Company to the fullest
extent and on the most favorable terms and conditions that similar
indemnification is offered to any director or officer of the
Company or any subsidiary or affiliate thereof.
(c) The Executive, the
Company and the Bank agree that the termination benefits described
in this Section 6 are intended to be exempt from
Section 409A of the Internal Revenue Code (“Section
409A”) pursuant to Treasury Regulation
Section 1.409A-1(b)(10) as certain indemnification and
liability insurance plans.
Section 7.
Outside Activities .
The Executive may serve as a
member of the boards of directors of such business, community and
charitable organizations as he may disclose to and as may be
approved by the Board (which approval shall not be unreasonably
withheld); provided, however , that such service shall not
materially interfere with the performance of his duties under this
Agreement. The Executive may also engage in personal business and
investment activities which do not materially interfere with the
performance of his duties hereunder; provided, however ,
that such activities are not prohibited under any code of conduct
or investment or securities trading policy established by the
Company and generally applicable to all similarly situated
Executives. The Executive may also serve as an officer or director
of the Bank on such terms and conditions as the Company and the
Bank may mutually agree upon, and such service shall not be deemed
to materially interfere with the Executive’s performance of
his duties hereunder or otherwise result in a material breach of
this Agreement. If the Executive is discharged or suspended, or is
subject to any regulatory prohibition or restriction with respect
to participation in the affairs of the Bank, he shall continue to
perform services for the Company in accordance with this Agreement
but shall not directly or indirectly provide services to or
participate in the affairs of the Bank in a manner inconsistent
with the terms of such discharge or suspension or any applicable
regulatory order.
Section 8.
Working Facilities and Expenses .
The Executive’s
principal place of employment shall be at the Company’s
executive offices at the address first above written, or at such
other location within fifty (50) miles of the address at which
the Company shall maintain its principal executive offices, or at
such other location as the Company and the executive may mutually
agree upon. The Company shall provide the Executive at his
principal place of employment with a private office, secretarial
services and other support services and facilities suitable to his
position with the Company and necessary or appropriate in
connection with the performance of his assigned duties under
this
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Agreement. The Company shall reimburse
the Executive for his ordinary and necessary business expenses,
including, without limitation, the Executive’s travel and
entertainment expenses incurred in connection with the performance
of his duties under this Agreement, in each case upon presentation
to the Company of an itemized account of such expenses in such form
as the Company may reasonably require.
Section 9.
Termination of Employment with Severance Benefits
.
(a) The Executive shall be
entitled to the severance benefits described in section 9(b) in the
event that:
(i) his employment with the
Company terminates during the Employment Period as a result of the
Executive’s voluntary resignation within ninety
(90) days following:
(A) the failure of the Board
to appoint or re-appoint or elect or re-elect the Executive to the
position with the Company stated in section 3 of this
Agreement;
(B) if the Executive is a
member of the Board, the failure of the shareholders of the Company
to elect or re-elect the Executive to the Board or the failure of
the Board (or the nominating committee thereof) to nominate the
Executive for such election or re-election;
(C) the expiration of a
thirty (30)-day period following the date on which the Executive
gives written notice to the Company of its material failure,
whether by amendment of the Company’s Certificate of
Incorporation, the Company’s By-Laws, action of the Board or
the Company’s shareholders or otherwise, to vest in the
Executive the functions, duties, or responsibilities prescribed in
section 3 of this Agreement, unless, during such thirty (30)-day
period, the Company cures such failure; or
(D) the expiration of a
thirty (30)-day period following the date on which the Executive
gives written notice to the Company of its material breach of any
term, condition or covenant contained in this Agreement (including,
without limitation any reduction of the Executive’s rate of
base salary in effect from time to time and any change in the terms
and conditions of any compensation or benefit program in which the
Executive participates which, either individually or together with
other changes, has a material adverse effect on the aggregate value
of his total compensation package), unless, during such thirty
(30)-day period, the Company cures such failure; or
(E) a change in the
Executive’s principal place of employment for a distance in
excess of fifty (50) miles from the Company’s principal
office in Rome, New York; or
(ii) the Executive’s
employment with the Company is terminated by the Company for any
reason other than for “cause” as provided in section
11(a).
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(b) Upon the occurrence of
any of the events described in section 9(a) of this Agreement, the
Company shall pay and provide to the Executive (or, in the event of
his death thereafter and prior to payment, to his
estate):
(i) his earned but unpaid
salary (including, without limitation, all items which constitute
wages under applicable law and the payment of which is not
otherwise provided for in this section 9(b)) as of the date of the
termination of his employment with the Company and the Bank, such
payment to be made at the time and in the manner prescribed by law
applicable to the payment of wages but in no event later than
thirty (30) days after termination of employment, as defined
in Treasury Regulation Section 1.409A-1(h)(1)(ii);
(ii) the benefits, if any, to
which he is entitled as a former employee under the employee
benefit plans and programs and compensation plans and programs
maintained for the benefit of the Company’s and the
Bank’s officers and employees;
(iii) continued group life,
health (including hospitalization, medical and major medical),
dental, accident and long term disability insurance coverage in
addition to that provided pursuant to section 9(b)(ii), for the
Remaining Unexpired Employment Period, equivalent to the coverage
to which he would have been entitled under such plans (as in effect
on the date of his termination of employment, or, if his
termination of employment occurs after a Change of Control, on the
date of such Change of Control, whichever benefits are greater), if
he had continued working for the Company and the Bank during the
Remaining Unexpired Employment Period at the highest annual rate of
salary achieved during the Employment Period, but taking into
account any coverage provided from any subsequent employer. In
addition, notwithstanding the foregoing, if the provision of any of
the benefits covered by this Section 9(b)(iii) would trigger
the 20% tax and interest penalties under Section 409A of the
Internal Revenue Code (“Section 409A”), then the
benefit(s) that would trigger such tax and interest penalties shall
not be provided (collectively, the “Excluded
Benefits”), and in lieu of the Excluded Benefits the Company
shall pay to the Executive, in a lump sum within thirty
(30) days following termination of employment or within thirty
(30) days after such determination should it occur after
termination of employment, a cash amount equal to the economic
equivalent (as defined as the present value of the full monthly
premium cost over the remaining unexpired term using the 120%
discount rate of the short-term applicable federal rate as put
forth in the IRS Regulations) of such Excluded Benefits;
(iv) within thirty
(30) days following the Executive’s termination of
employment with the Company or the Bank, a lump sum payment, in an
amount equal to the present value of the salary (excluding any
additional payments made to the Executive in lieu of the use of an
automobile) that the Executive would have earned if he had
continued working for the Company and the Bank during the Remaining
Unexpired Employment Period at the highest annual rate of salary
achieved during the Employment Period, where such present value is
to be determined using a discount rate equal to the applicable
short-term federal rate prescribed under section 1274(d) of the
Internal Revenue Code of 1986, as amended (“Code”),
compounded using the compounding periods corresponding to the
Company’s regular payroll periods for its officers, such lump
sum to be paid in lieu of all other payments of salary provided for
under this Agreement in respect of the period following any such
termination;
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(v) within thirty
(30) days following the Executive’s termination of
employment with the Company or the Bank, a lump sum payment in an
amount equal to the present value of the additional employer
contributions to which he would have been entitled under any and
all qualified and non-qualified defined contribution plans
maintained by the Company or the Bank in which Executive
participates, as if he were 100% vested thereunder and had
continued working for the Company and the Bank during the Remaining
Unexpired Employment Period at the highest annual rate of salary
achieved during the Employment Period and making the maximum amount
of employee contributions, if any, required under such plan or
plans, such present value to be determined on the basis of a
discount rate, compounded using the compounding period that
corresponds to the frequency with which employer contributions are
made to the relevant plan, equal to the applicable short-term
federal rate prescribed under section 1274(d) of the
Code;
(vi) the payments that would
have been made to the Executive under any cash or stock bonus or
long-term or short-term cash incentive compensation plan maintained
by, or covering employees of, the Company or the Bank if he had
continued working for the Company and the Bank during the Remaining
Unexpired Employment Period and had earned the maximum bonus or
incentive award in each calendar year that ends during the
Remaining Unexpired Employment Period, such payments to be equal to
the product of:
(A) the maximum percentage
rate at which an award was ever available to the Executive under
such incentive compensation plan; multiplied by
(B) the salary that would
have been paid to the Executive during each such calendar year at
the highest annual rate of salary achieved during the Employment
Period;
such payments to be made (without
discounting for early payment) within thirty (30) days
following the Executive’s termination of
employment;
(vii) at the election of the
Company, upon the surrender of options or appreciation rights
issued to the Executive under any stock option and appreciation
rights plan or program maintained by, or covering employees of, the
Company or the Bank, a lump sum payment in an amount equal to the
product of:
(A) the excess of
(I) the fair market value of a share of stock of the same
class as the stock subject to the option or appreciation right,
determined as of the date of termination of employment, over (II)
the exercise price per share for such option or appreciation right,
as specified in or under the relevant plan or program; multiplied
by
(B) the number of shares with
respect to which options or appreciation rights are being
surrendered.
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For purposes of this section
9(b)(vii), the Executive shall be deemed fully vested in all
options and appreciation rights under any stock option or
appreciation rights plan or program maintained by, or covering
employees of, the Company or the Bank, even if he is not vested
under such plan or program; and
(viii) at the election of the
Company, upon the surrender of any shares awarded to the Executive
under any restricted stock plan maintained by, or covering
employees of, the Company or the Bank, a lump sum payment in an
amount equal to the product of:
(A) the fair market value of
a share of stock of the same class of stock granted under such
plan, determined as of the date of the Executive’s
termination of employment; multiplied by
(B) the number of shares
which are being surrendered.
For purposes of this section
9(b)(viii), the Executive shall be deemed fully vested in all
shares awarded under any restricted stock plan maintained by, or
covering employees of, the Company or the Bank, even if he is not
vested under such plan.
The Company and the Executive
hereby stipulate that the damages which may be incurred by the
Executive following any such termination of employment are not
capable of accurate measurement as of the date first above written
and that the payments and benefits contemplated by this section
9(b) constitute reasonable damages under the circumstances and
shall be payable without any requirement of proof of actual damage
and without regard to the Executive’s efforts, if any, to
mitigate damages. The Company and the Executive further agree that
the Company may condition the payments and benefits (if any) due
under sections 9(b)(iii), (iv), (v), (vi), (vii) and
(viii) on the receipt of the Executive’s resignation
from any and all positions which he holds as an officer, director
or committee member with respect to the Company, the Bank or any
subsidiary or affiliate of either of them.
(c) The Executive, the
Company and the Bank acknowledge that each of the payments and
benefits promised to you under this Agreement must either comply
with the requirements of Section 409A and the regulations
thereunder or qualify for an exception from compliance. To that
end, the Executive, the Company and the Bank agree that the
termination benefits described in Section 9(b) are intended to
be exempt from Section 409A pursuant to Treasury Regulation
Section 1.409A-1(b)(4) as short-term deferrals.
Section 10.
Death and Disability Benefits .
(a) In the event the
Executive’s employment with the Company terminates during the
Employment Period because of the Executive’s death, then the
Company shall pay to the Executive’s designated beneficiary
for the one (1) year period following Executive’s death,
periodic payments equal in the aggregate to the Executive’s
annual base salary as in effect on the date of his death. For the
one (1) year period following Executive’s death,
Executive’s dependents, as defined under the group health
(including hospitalization, medical and major medical) and dental
plans sponsored by the Company or the Bank from time to time, shall
be provided continued coverage under such plans, provided that they
continue to remit to the Company or Bank, as the case may be, any
premium payments Executive was required to pay for
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such coverage prior to his death. The
continued coverage provided under this section 10 shall be in
addition to, and shall not count as, coverage required to be
provided under any applicable law. For the purposes of this
Agreement, Executives designated beneficiary shall be the person
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