Exhibit
10.1
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John C.
Warren
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Direct Dial (401)
348-1226
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Chairman and
Chief Executive Officer
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Fax Number (401) 348-1404
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July 28,
2005
Mr. Galan G.
Daukas
31 Old Redding
Road
Weston, CT
06883
Dear
Galan,
I am very
pleased to offer you a key position on Washington Trust management
team. This letter will confirm the terms of our employment
offer.
I.
Title and Position Summary
Your title will
be Executive Vice President of Wealth Management of Washington
Trust Bancorp, Inc. and The Washington Trust Company. You will be
responsible for managing the Wealth Management division, which will
consist of the Bank’s Trust and Investment area, Phoenix
Investment Management group, and Weston Financial. This position is
critical to our success in 2005 and beyond.
This position
will report directly to Jack Treanor, President and Chief Operating
Officer. You will have an office in Providence, RI, and will have
access to office space in Westerly, RI.
II.
Starting Date
You have agreed
to commence your employment on August 30, 2005.
III.
Salary
Your annual
salary will be $285,000, paid in biweekly increments of $10,961.54.
You will be eligible for a salary review on January 1,
2007.
IV.
Annual Performance Plan
Beginning in
2006, you will be eligible to participate in the Annual Performance
Plan. The target bonus payment for Executive Vice Presidents under
the Plan is 30% of salary. Plan payments are based upon Bank
performance (ROE, Net Earnings, and EPS) and an assessment of your
individual performance.
V.
Business Building Incentive Plan
Beginning in
2006, you will be eligible to receive a Business Building Incentive
to reward you as your Division achieves and exceeds performance
targets. Key concepts include:
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§
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Performance
will be measured in terms of achieving targeted growth rates in
pre-tax earnings, revenues, and net new assets under management
(funded balances), with each metric having equal
weighting.
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§
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Performance
goals will be mutually agreed upon, and will likely mirror your
Division’s budget. Performance will be assessed based upon
the combined performance of Phoenix Investment Management, Weston
Financial, and Trust & Investment Services.
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§
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There is a
target payment of $200,000, with range of 0% to 150% based upon
actual performance. Goal achievement for the three metrics must
average at least 80% in order to qualify for a plan payment.
Performance achievement is modified by a sliding scale as
follows.
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Performance vs.
Plan
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Payout as a % of
Target
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< 80%
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0%
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80.0% to 82.4%
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50.0%
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82.5% to 87.4%
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62.5%
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87.5% to 92.4%
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75.0%
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92.5% to 97.4%
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87.5%
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97.5% to 102.4%
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100.0%
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102.5% to 107.4%
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112.5%
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107.5% to 112.4%
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125.0%
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112.5% to 117.4%
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137.5%
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117.5% +
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150%
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VI.
Equity Compensation
You will be
eligible for equity grants in such number, at such times and on
such terms as may be approved by the Compensation Committee of the
Board of Directors (the "Compensation Committee"), in its sole
discretion. These grants typically occur annually, and at the EVP
level, have a target value of 35% of salary modified for your
individual performance.
VII.
One-Time Signing Bonus and Equity Grant
In recognition
that you are forfeiting bonus and equity compensation
wit
