Exhibit 10.18
Form of Employment Agreement between
NBT Bancorp Inc. and Michael J. Chewens made as of January 1,
2005.
EMPLOYMENT
AGREEMENT
This EMPLOYMENT AGREEMENT (the
"Agreement") made and entered into as of the first day of January
2005 , by and between MICHAEL J. CHEWENS
("Executive") and NBT BANCORP INC., a Delaware corporation having
its principal office in Norwich, New York ("NBTB")
W I T N E S S E T H T
H A T :
WHEREAS, Executive is an senior executive vice
president and the chief financial officer of NBTB and NBT Bank,
National Association, a national banking association which is a
wholly-owned subsidiary of NBTB ("NBT Bank");
WHEREAS, NBTB desires to secure the continued
employment of Executive, subject to the provisions of this
Agreement; and
WHEREAS, Executive is desirous of entering into
the Agreement for such periods and upon the terms and conditions
set forth herein;
NOW, THEREFORE, in consideration of the premises
and mutual covenants and agreements hereinafter set forth,
intending to be legally bound, the parties agree as
follows:
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1.
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Employment;
Responsibilities and Duties.
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(a) NBTB hereby
agrees to employ Executive and to cause NBT Bank and any successor
organization to NBT Bank to employ Executive, and Executive hereby
agrees to serve as a senior executive vice president and the chief
financial officer of NBTB and NBT Bank, and of any successor
organization to NBTB or NBT Bank, as applicable, during the Term of
Employment. Executive shall have such executive duties,
responsibilities, and authority as shall be set forth in the bylaws
of NBTB and NBT Bank or as may otherwise be determined by NBTB.
During the Term of Employment, Executive shall report directly to
the chief executive officer of NBTB.
(b) Executive
shall devote his full working time and best efforts to the
performance of his responsibilities and duties hereunder. During
the Term of Employment, Executive shall not, without the prior
written consent of the chief executive officer of NBTB, render
services as an employee, independent contractor, or otherwise,
whether or not compensated, to any person or entity other than NBTB
or its affiliates; provided that Executive may, where involvement
in such activities does not individually or in the aggregate
significantly interfere with the performance by Executive of his
duties or violate the provisions of section 4 hereof, (i) render
services to charitable organizations, (ii) manage his personal
investments, and (iii) with the prior permission of the chief
executive officer of NBTB , hold such other
directorships or part-time academic appointments or have such other
business affiliations as would otherwise be prohibited under this
section 1.
(a) The term of
this Agreement ("Term of Employment") shall be the period
commencing on the date of this Agreement (the "Commencement Date")
and continuing until the Termination Date, which shall mean the
earliest to occur of:
(i) January 1,
2008, provided, however, that on January 1, 2006 and on each
January 1 thereafter, the Term of Employment shall be extended by
one additional year;
(ii) the death of
Executive;
(iii)
Executive's inability to perform his duties hereunder, as a result
of physical or mental disability as reasonably determined by the
personal physician of Executive, for a period of at least 180
consecutive days or for at least 180 days during any period of
twelve consecutive months during the Term of Employment;
or
(iv)
the discharge of Executive by NBTB "for cause," which shall mean
one or more of the following:
(A) any willful
or gross misconduct by Executive with respect to the business and
affairs of NBTB or NBT Bank, or with respect to any of its
affiliates for which Executive is assigned material
responsibilities or duties;
(B) the
conviction of Executive of a felony (after the earlier of the
expiration of any applicable appeal period without perfection of an
appeal by Executive or the denial of any appeal as to which no
further appeal or review is available to Executive) whether or not
committed in the course of his employment by NBTB;
(C) Executive's
willful neglect, failure, or refusal to carry out his duties
hereunder in a reasonable manner (other than any such failure
resulting from disability or death or from termination by Executive
for Good Reason, as hereinafter defined) after a written demand for
substantial performance is delivered to Executive that specifically
identifies the manner in which NBTB believes that Executive has not
substantially performed his duties and Executive has not resumed
substantial performance of his duties on a continuous basis within
thirty days of receiving such demand; or
(D) the breach
by Executive of any representation or warranty in section 6(a)
hereof or of any agreement contained in section 1, 4, 5, or 6(b)
hereof, which breach is material and adverse to NBTB or any of its
affiliates for which Executive is assigned material
responsibilities or duties; or
(v) Executive's
resignation from his position as senior executive vice president
and chief financial officer of NBTB or NBT Bank other than for
"Good Reason," as hereinafter defined; or
(vi) the termination of
Executive's employment by NBTB "without cause," which shall be for
any reason other than those set forth in subsections (i), (ii),
(iii), (iv), or (v) of this section 2(a), at any time, upon the
thirtieth day following notice to Executive; or
(vii) Executive's
resignation for "Good Reason."
"Good Reason"
shall mean, without Executive's express written consent,
reassignment of Executive to a position other than senior
executive vice president and chief
financial officer of NBTB or NBT Bank other than for "Cause," or a
decrease in the amount or level of Executive's salary or benefits
from the amount or level established in section 3
hereof.
(b) In the event
that the Term of Employment shall be terminated for any reason
other than that set forth in section 2(a)(vi) or 2(a)(vii) hereof,
Executive shall be entitled to receive, upon the occurrence of any
such event:
(i) any salary
(as hereinafter defined) payable pursuant to section 3(a)(i) hereof
which shall have accrued as of the Termination Date; and
(ii) such rights as
Executive shall have accrued as of the Termination Date under the
terms of any plans or arrangements in which he participates
pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to
section 3(g) hereof, and the right to receive the cash equivalent
of paid annual leave and sick leave accrued as of the Termination
Date pursuant to section 3(d) hereof, and
(c) In the event
that the Term of Employment shall be terminated for the reason set
forth in section 2(a)(vi) or 2(a)(vii) hereof, Executive shall be
entitled to receive:
(i) any salary
payable pursuant to section 3(a)(i) hereof which shall have accrued
as of the Termination Date, and, for the period commencing on the
date immediately following the Termination Date and ending upon and
including the latest of the third anniversary of the Commencement
Date or the date to which the Term of Employment shall (as of the
Termination Date) have automatically extended itself under section
2(a)(i) hereof, salary payable at the rate established pursuant to
section 3(a)(i) hereof, in a manner consistent with the normal
payroll practices of NBTB with respect to executive personnel as
presently in effect or as they may be modified by NBTB from time to
time;
(ii) such rights as
Executive may have accrued as of the Termination Date under the
terms of any plans or arrangements in which he participates
pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to
section 3(g) hereof, and the right to receive the cash equivalent
of paid annual leave and sick leave accrued as of the Termination
Date pursuant to section 3(d) hereof; and
(iii)
if, within eighteen (18) months following the Termination Date,
Executive should sell his principal residence in the Binghamton
Rand McNally Metropolitan Area as determined by Rand McNally &
Company (the "Binghamton RMA") and relocate to a place outside of
the Binghamton RMA, (A) reimbursement for any shortfall between the
net proceeds on the sale of his principal residence and the
purchase price plus improvements, including direct, necessary and
reasonable transaction costs incurred in connection with such
purchase, as determined by the controller’s division of NBT
Bank, for such residence, and including direct, necessary and
reasonable expenses, as determined by the finance division of NBT
Bank, incurred to prepare the residence for sale, (B) reimbursement
for direct, necessary and reasonable expenses, as determined by the
finance division of NBT Bank, incurred in connection with the sale
of such residence not already included as part of the reimbursement
under (A) above, and (C) an amount necessary to pay all federal,
state and local income taxes resulting from any reimbursement made
pursuant to (A) and (B) (including any additional federal, state
and local income taxes resulting from the payment hereunder of such
taxes), the intent being that Executive shall be paid an additional
amount (the “Gross-Up”) such that the net amount
retained by the Executive, after deduction of such federal, state
and local income taxes resulting from the reimbursement under (A)
and (B) shall be equal to the amount of the reimbursement under (A)
and (B) before payment of such taxes; for purposes of determining
the amount of the Gross-Up, Executive shall be deemed to pay
federal, state and local income taxes at the highest marginal rate
of taxation in effect in the calendar year in which the
reimbursement is made. Amounts due under this subsection shall be
paid as soon as administratively practicable, but in no event later
than ninety (90) days after the date of the sale of
Executive’s principal residence.
Notwithstanding the foregoing, in the event the
Executive is reimbursed, entitled to reimbursement, or is paid any
amounts by an entity or entities other than NBTB or NBT Bank of any
affiliate or successor thereof (the “Third Party”), for
any amounts for which Executive has received, or is entitled to
receive, reimbursement under (A) or (B) above with respect to the
sale of his principal residence or any Gross-Up under (C) above,
the Executive agrees:
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(3)
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with regard to
amounts already paid by NBTB or NBT Bank or any affiliate or
successor thereof (hereinafter referred to collectively as the
“Company”), the Executive shall notify the Company of
all amounts received or due from the Third Party, and shall
reimburse the Company in an amount equal to the amount so received
or due from the Third Party up to the amount the Company paid to
the Executive under (A), (B), and (C) above; and
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(4)
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with regard to
amounts due but not yet paid by the Company to the Executive, the
Executive shall notify the Company of any amounts received or due
from the Third Party, and the Executive agrees that the Company
shall reduce the amount due under (A), (B), and (C) above by the
amount the Executive has been paid or is entitled to be paid by the
Third Party up to the amount due the Executive from the
Company.
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(d) Any
provision of this section 2 to the contrary notwithstanding, in the
event that the employment of Executive with NBTB is terminated in
any situation described in section 3 of the change-in-control
letter agreement dated July 23, 2001 between NBTB and Executive
(the "Change-in-Control Agreement") so as to entitle Executive to a
severance payment and other benefits described in section 3 of the
Change-in-Control Agreement, then Executive shall be entitled to
receive the following, and no more, under this section
2:
(i) any salary
payable pursuant to section 3(a)(i) hereof which shall have accrued
as of the Termination Date;
(ii) such rights as
Executive shall have accrued as of the Termination Date under the
terms of any plans or arrangements in which he participates
pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to
section 3(g) hereof, and the right to receive the cash equivalent
of paid annual leave and sick leave accrued as of the Termination
Date pursuant to section 3(d) hereof;
(iii) the severance
payment and other benefits provided in the Change- in-Control
Agreement; and
(iv) if, within
eighteen (18) months following the Termination Date, Executive
should sell his principal residence in the Binghamton RMA and
relocate to a place outside of the Binghamton RMA, (A)
reimbursement for any shortfall between the net proceeds on the
sale of his principal residence and the purchase price plus
improvements, including direct, necessary and reasonable
transaction costs incurred in connection with such purchase, as
determined by the finance division of NBT Bank, for such residence,
and including direct, necessary and reasonable expenses, as
determined by the controller’s division of NBT Bank, incurred
to prepare the residence for sale, (B) reimbursement for direct,
necessary and reasonable expenses, as determined by the finance
division of NBT Bank, incurred in connection
with the sale of such residence not already included as part of the
reimbursement under (A) above, and (C) the Gross-Up, the intent
being that the net amount retained by the Executive, after
deduction of such federal, state and local income taxes resulting
from the reimbursement under (A) and (B) shall be equal
