Exhibit 10.13(a)
December 15, 2008
Robert H. Wischnowsky
3 Catalpa Way
Coventry, Rhode Island 02816
Dear Mr. Wischnowsky:
Bancorp Rhode Island, Inc. (the “
Company ”) anticipates entering into a Securities
Purchase Agreement (the “ Participation Agreement
”), with the United States Department of Treasury (“
Treasury ”) that provides for the Company’s
participation in the Treasury’s TARP Capital Purchase Program
(the “ CPP ”). If the Company does not
participate or ceases at any time to participate in the CPP, this
letter shall be of no further force and effect.
For the Company to participate in the CPP
and as a condition to the closing of the investment contemplated by
the Participation Agreement, the Company is required to establish
specified standards for incentive compensation to its senior
executive officers and to make changes to its compensation
arrangements. To comply with these requirements, and in
consideration of the benefits that you will receive as a result of
the Company’s participation in the CPP, you agree as
follows:
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(1)
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No Golden Parachute Payments . The Company is prohibiting
any golden parachute payment to you during any “CPP Covered
Period”. A “ CPP Covered Period ” is any
period during which (A) you are a senior executive officer and
(B) Treasury holds an equity or debt position acquired from
the Company in the CPP.
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(2)
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Recovery of Bonus and Incentive Compensation. Any bonus and
incentive compensation paid to you during a CPP Covered Period is
subject to recovery or “clawback” by the Company if the
payments were based on materially inaccurate financial statements
or any other materially inaccurate performance metric criteria.
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(3)
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Compensation Program
Amendments. Each of the Company’s compensation, bonus,
incentive and other benefit plans, arrangements and agreements
(including golden parachute, severance and employment agreements)
(collectively, “ Benefit Plans ”) with
respect to you is hereby amended to the extent necessary to give
effect to provisions (1) and (2). For reference, certain
affected Benefit Plans are set forth in Appendix A to this
letter.
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In addition, the Company is required to
review its Benefit Plans to ensure that they do not encourage
senior executive officers to take unnecessary and excessive risks
that threaten the
Robert H. Wischnowsky
December 15, 2008
Page 2
value of the Company. To the extent any
such review requires revisions to any Benefit Plan with respect to
you, you and the Company agree to negotiate such changes promptly
and in good faith.
