Exhibit 10.4
AMENDED AND
RESTATED
BV FINANCIAL, INC.
EMPLOYMENT
AGREEMENT
THIS
AGREEMENT, originally entered into the
12 th day of January, 2005 (the
“Agreement”), by and between BV FINANCIAL, INC.,
a federally-chartered corporation (the “Company”) and
CAROLYN M. MROZ (“Executive”), is amended and
restated in its entirety as of December 18, 2008. References
to the “Bank” herein shall mean BAY-VANGUARD FEDERAL
SAVINGS BANK, a federally chartered savings
institution.
W I T N E S S E T
H
WHEREAS, Executive serves in a position of substantial
responsibility;
WHEREAS, the Company wants to continue to assure
Executive’s services for the term of this
Agreement;
WHEREAS, Executive is willing to continue to serve in the
employ of the Company during the term of this Agreement;
and
WHEREAS, the parties desire to amend and restate the
Agreement in order to bring it into compliance with
Section 409A of the Internal Revenue Code.
NOW, THEREFORE,
in consideration of the mutual
covenants contained in this Agreement, and upon the other terms and
conditions provided for in this Agreement, the parties hereby agree
as follows:
1. Employment .
The Company will employ Executive as
President and Chief Executive Officer. Executive will perform all
duties and shall have all powers commonly incident to the offices
of President and Chief Executive Officer or which, consistent with
those offices, the board of directors of the Company delegate to
Executive. Executive also agrees to serve, if elected, as an
officer and/or director of any subsidiary of the Company and to
carry out the duties and responsibilities reasonably appropriate to
that position.
2. Location and Facilities
. Executive will be
furnished with the working facilities and staff customary for the
positions of President and Chief Executive Officer. The location of
such facilities and staff will be at the principal administrative
offices of the Company or the Bank, or at such other site or sites
customary for such offices.
3. Term .
(a) The term of this Agreement shall
include (i) the initial term, consisting of the period
commencing on the date of this Agreement (the “Effective
Date”) and ending on January 12, 2011, plus
(ii) any and all extensions of the initial term made pursuant
to this Section 3.
(b) Commencing on July 1, 2009
(the “Renewal Date”), and continuing on each
anniversary thereafter, the disinterested members of the boards of
directors of the Bank and the Company may extend the term of this
Agreement for an additional year so that the remaining term of the
Agreement again becomes thirty-six (36) months (from the
Renewal Date), unless Executive elects not to extend the term of
this Agreement by giving written notice of her intentions in
accordance with Section 19 of this Agreement. Each year, the
Board of Directors of the Company (the “Board”) will
review Executive’s performance for purposes of determining
whether to extend the term of this Agreement and will include the
rationale and results of its
review in the minutes of its meeting. Executive
shall receive notice as soon as possible after such review as to
whether the Agreement will be extended for an additional
year.
4. Base Compensation
.
(a) The Company agrees to pay the
Executive an annual base salary of $151,980 payable in accordance
with the customary payroll practices of the Bank.
(b) Each year, the Board will review
the level of Executive’s base salary, based upon factors they
deem relevant, in order to determine whether to maintain or
increase Executive’s base salary.
5. Bonuses .
Executive will participate in
discretionary bonuses or other incentive compensation programs the
Company may sponsor or award from time to time to other senior
management employees.
6. Benefit Plans
. Executive will
participate in life insurance, medical, dental, pension, profit
sharing, other retirement and stock-based compensation plans and
other programs and arrangements that the Company may sponsor or
maintain for the benefit of its employees. Executive will also be
reimbursed for all out-of-pocket expenses associated with
Executive’s annual medical physical.
7. Vacation and Leave
.
(a) Executive may take vacation and
other leave in accordance with the Company’s policy for
senior executives or otherwise as approved by the Board.
(b) In addition to paid vacations
and other leave, the Board may grant Executive a leave of absence,
with or without pay, at such time or times and upon such terms and
conditions as the Board may determine in its discretion.
8. Expense Payments and
Reimbursements . The
Company will reimburse Executive for all reasonable out-of-pocket
business expenses incurred in connection with her services under
this Agreement. Executive must substantiate the payment of all
expenses in accordance with applicable policies of the
Company.
9. Automobile Allowance,
Cellular Phone and Conference Attendance .
During the term of this Agreement,
the Company will reimburse Executive for all costs associated with
the business use of any automobile. Executive agrees to comply with
reasonable reporting and expense limitations on the use of any
automobile as may be established by the Company from time to time,
and the Company will include any amount of income attributable to
Executive’s personal use of an automobile on
Executive’s Forms W-2. The Company will also provide
Executive with a cellular phone and will pay (or reimburse
Executive) for all reasonable expenses related to the business use
of such phone. In addition to the foregoing, Executive and his or
her spouse, will be entitled to attend such conferences as may be
approved by the Board of Directors of the Bank from time to
time.
10. Loyalty and
Confidentiality .
(a) During the term of this
Agreement, Executive shall: (i) devote all her business time,
attention, skill, and efforts to the faithful performance of her
duties as President and Chief Executive Officer of the Company;
provided, however, that from time to time, Executive may serve on
the boards of directors of, and hold any other offices or positions
in, companies or organizations that will not present any conflict
of interest with the Bank or the Company or any of their
affiliates, and that will not unfavorably affect the performance
of
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Executive’s employment duties with the
Company, and that will not violate any applicable statute or
regulation. Executive shall not engage in any business or activity
contrary to the business affairs or interests of the Bank or the
Company.
(b) Nothing contained in this
Agreement prevents or limits Executive’s right to invest in
the capital stock or other securities of any business dissimilar
from that of the Bank or the Company, or, solely as a passive,
minority investor, in any business.
(c) Executive agrees to maintain the
confidentiality of any and all information concerning the operation
or financial status of the Bank and Company; the names or addresses
of any borrowers, depositors and other customers; any information
concerning or obtained from such customers; and any other
information concerning the Bank or the Company which she gains or
of which she becomes aware during the course of her employment with
the Company. Executive further agrees that, unless required by law
or specifically permitted by the Board in writing, she will not
disclose to any person or entity, either during or subsequent to
her employment, any of the above-mentioned information not
generally known to the public, nor shall she use the information in
any way other than for the benefit of the Company.
11. Termination and
Termination Pay . Subject to Section 12 of this Agreement,
Executive or the Company may terminate Executive’s employment
under the following circumstances:
(a) Death . Executive’s
employment under this Agreement shall terminate upon her death
during the term of this Agreement, in which event Executive’s
estate shall receive the compensation due to Executive through the
last day of the calendar month in which her death
occurred.
(b) Retirement . This
Agreement shall terminate upon Executive’s retirement under
the retirement benefit plan or plans in which she participates
pursuant to Section 6 of this Agreement or otherwise.
Notwithstanding the foregoing, in the event the Executive retires
on or after the attainment of age 65, the Company will provide
the Executive with medical coverage for five (5) years
following her retirement date.
(c) Disability .
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(i)
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The Board or
Executive may terminate Executive’s employment after having
determined Executive has suffered a Disability. For purposes of
this Agreement, “Disability” means a physical or mental
infirmity that impairs Executive’s ability to substantially
perform her duties under this Agreement and results in Executive
becoming eligible for long-term disability benefits under any
long-term disability plans of the Company (or, if no such benefits
exist, that impairs Executive’s ability to substantially
perform her duties under this Agreement for a period of at least
one hundred eighty (180) consecutive days). The Board, in good
faith, shall determine whether or not Executive becomes and
continues to be permanently disabled for purposes of this
Agreement, based upon competent medical advice and other factors
that the Board reasonably believes to be relevant. As a condition
to any benefits, the Board may require Executive to submit to
physical or mental evaluations and tests as the Board or its
medical experts deem reasonably appropriate.
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(ii)
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In the event of her Disability,
Executive shall no longer be obligated to perform services under
this Agreement. The Company will pay Executive, as Disability pay,
an amount equal to one hundred percent (100%) of
Executive’s weekly rate of base salary in effect as of the
date of her termination of employment due to Disability. The
Company will make Disability payments on a monthly basis commencing
on the
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first day of the month following
the effective date of Executive’s termination of employment
due to Disability and ending on the earlier of: (A) the date
she returns to full-time employment at the Company in the same
capacity as she was employed prior to her termination for
Disability; (B) her death; (C) her attainment of age 65;
or (D) the date the Agreement would have expired had
Executive’s employment not terminated by reason of
Disability. The Company will reduce Disability pay otherwise due to
Executive under this provision by the amount of any short- or
long-term disability benefits payable to Executive under any other
disability programs sponsored by the Company. In addition, during
any period of Executive’s Disability, the Company shall
continue to provide Executive and her dependents, to the greatest
extent possible, all benefits (including, without limitation,
benefits under retirement plans and medical, dental and life
insurance plans) provided to Executive and her dependents prior to
her Disability, on the same terms as if Executive remained actively
employed by the Company.
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(d) Termination for Cause
.
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(i)
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The board of
directors of the Company may, by written notice to Executive in the
form and manner specified in this paragraph, immediately terminate
Executive’s employment at any time, for “Cause”.
Executive shall have no rights to receive compensation or other
benefits for any period after termination for Cause, except for
already vested benefits. Termination for “Cause” shall
mean termination because of, in the good faith determination of the
Board, Executive’s:
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(4)
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Breach of
fiduciary duty involving personal profit;
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(5)
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Intentional
failure to perform duties under this Agreement;
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(6)
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Willful
violation of any law, rule or regulation (other than traffic
violations or similar offenses) that reflects adversely on the
reputation of the Bank or the Company, any felony conviction, any
violation of law involving moral turpitude, or any violation of a
final cease-and-desist order; or
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(7)
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Material breach
by Executive of any provision of this Agreement.
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(ii)
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Notwithstanding
the foregoing, Executive’s termination for Cause will not
become effective unless the Company has delivered to Executive a
copy of a resolution duly adopted by the affirmative vote of a
majority of the entire membership of the board, at a meeting of the
board called and held for the purpose of finding that, in the good
faith opinion of the Board (after reasonable notice to Executive
and an opportunity for Executive to be heard before the board with
counsel), Executive was guilty of the conduct described above and
specifying the particulars of her conduct.
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(e) Voluntary Termination by
Executive . In addition to her other rights to terminate
employment under this Agreement, Executive may voluntarily
terminate employment during the term of this Agreement upon at
least sixty (60) days prior written notice to the board. Upon
Executive’s voluntary termination, Executive will receive
only her compensation, vested rights and employee benefits up to
the date of her termination of employment.
(f) Without Cause or With Good
Reason .
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(i)
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In addition to
termination pursuant to Sections 11(a) through 11(e), the Board,
may, upon providing written notice to Executive, immediately
terminate her employment at any time for a reason other than Cause
(a termination “Without Cause”) and Executive may, upon
providing written notice to the Board, terminate her employment
under this Agreement for “Good Reason” as defined below
(a termination “With Good Reason”).
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(ii)
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Subject to
Section 12 of this Agreement, in the event of her termination
of employment under this Section 11(f), Executive shall
receive her base salary for the remaining term of the Agreement
paid in one lump sum within ten (10) calendar days of her
termination. Executive shall also receive, for the remaining term
of the Agreement, the benefits she would have received under any
retirement programs (whether tax-qualified or non-qualified) in
which she participated prior to her termination (with the amount of
benefits determined by reference to the benefits Executive received
or which the Company accrued on her behalf during the twelve
(12) months preceding her termination). Executive shall also
continue to participate in any health (including medical and
dental), life, disability or similar insurance coverage or benefit
plans for the remaining term of the Agreement, upon terms no less
favorable than the most favorable terms provided to senior
executives of the Company during such period.
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(iii)
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For the
purposes of this Agreement “Good Reason” shall mean the
occurrence
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