Exhibit 10(b)
BANKNORTH GROUP, INC.
AMENDED AND RESTATED SEVERANCE
AGREEMENT
This Amended and
Restated Severance Agreement (this “Agreement”) is made
and entered into as of the 1st day of January, 2004, by and between
Banknorth Group, Inc. (the “Company”) and
(the
“Executive”);
W I T N E S S E T H:
WHEREAS, the
Company and the Executive are parties to a certain Amended and
Restated Severance Agreement dated January 1, 2003 (as
amended, the “Prior Agreement”); and
WHEREAS, the
Company and the Executive wish to amend and restate the Prior
Agreement in its entirety as hereinafter set forth;
NOW, THEREFORE, in
consideration of the foregoing, the mutual covenants and agreements
herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
Company and the Executive hereby agree, and amend and restate the
Prior Agreement in its entirety, as follows:
1. Definitions
(a)
Accrued Benefits means:
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(i) All
salary earned or accrued through the date the Executive’s
employment is terminated;
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(ii) reimbursement
for any and all monies advanced in connection with the
Executive’s employment for reasonable and necessary expenses
incurred by the Executive through the date the Executive’s
employment is terminated;
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(iii) any and
all other compensation previously earned by the Executive and
deferred under or pursuant to any deferred compensation plan or
plans of the Company then in effect together with any interest or
deemed earnings thereon;
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(iv) any
bonus earned by the Executive for a Year or other performance
period ending prior to the Year or other performance period in
which employment terminates, but not yet paid to the Executive,
under any bonus or incentive compensation plan or plans in which
the Executive is a participant;
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(v) to the
extent not previously paid to the Executive for the Year in which
employment terminates, a pro rata portion of the maximum Annual
Bonus payable to the Executive for the Year in which employment
terminates under any bonus or incentive compensation plan or plans
of the Company in which the Executive is a participant, determined
as if the Executive had remained in employment for the full Year
and prorated based upon weeks, including partial weeks, of
employment during that Year;
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(vi) to the
extent not previously paid to the Executive for the
“Performance Period” (as defined in the EIP) in which
employment terminates, a pro rata Long-Term Incentive Award in an
amount determined as described in Section 5 of the
EIP;
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(vii) to the
extent not previously paid or provided to the Executive, all other
payments and benefits to which the Executive may be entitled under
the terms of any applicable compensation or benefit plan, program
or arrangement of the Company.
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(b)
Act means the Securities Exchange Act of 1934, as
amended.
(c)
Affiliate of any specified person means any other person
that, directly or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under direct or indirect
common control with such specified person. For the purposes of this
definition, “control” means the possession, direct or
indirect, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership
of voting securities, by contract or otherwise, and the terms
“controlling” and “controlled” have
meanings correlative to the foregoing.
(d)
Annual Bonus means any bonus or incentive award under any
bonus or incentive compensation plan, program or arrangement of the
Company in which the Executive is a participant the performance
period for which is or was initially scheduled to be one year or
less.
(e)
Annual Compensation means the sum of:
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(i) the
Executive’s annual base salary at the rate in effect on the
date of a termination of employment as described in Section 3
or in Section 7(d) (or, in the event of a termination for
“Good Reason” under Section 1(q)(i)(A) below, the
annual base salary as in effect immediately before the actions
giving rise to Good Reason); plus
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(ii) the
greatest of the Annual Bonuses, if any, either paid or accrued in
the year in which termination occurs, or in any of the three
immediately preceding years.
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(f) Base
Amount means an amount equal to the Executive’s
Annualized Includable Compensation for the Base Period as defined
in Section 280G(d)(1) and (2) of the Code (as hereinafter
defined).
(g)
Benefit Computation Base means either (i) the Benefit
Computation Base as defined in the Supplemental Retirement
Agreement between Executive and the Company or (ii) if there
is no Supplemental Retirement Agreement between the Executive and
the Company, the “Average Annual Compensation” as
defined and used in the Retirement Plan, solely for purposes of
calculating the Executive’s benefit under the Banknorth
Group, Inc. Supplemental Retirement Plan as affected by this
Agreement.
(h)
Bonus (whether or not capitalized) means any bonus or
incentive award (including any Annual Bonus or Long-Term Incentive
Award) under any bonus or incentive compensation plan, program or
arrangement of the Company in which the Executive is a
participant.
(i)
Cause means (i) the executive’s conviction of, or
plea of nolo contendere to, a felony; or (ii) willful and
intentional misconduct, willful neglect, or gross negligence in the
performance of the Executive’s duties, which has caused a
demonstrable and serious injury to the Company, monetary or
otherwise.
The
Executive shall be given written notice that the Company intends to
terminate the Executive’s employment for Cause. Such written
notice shall specify the particular acts, or failures to act, on
the basis of which the decision to so terminate employment was
made.
In
the case of a termination for Cause as described in clause (ii),
above, the Executive shall be given the opportunity within thirty
(30) days of the receipt of such notice to meet with the Board
to defend such acts, or failures to act, prior to termination. The
Company may suspend
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the Executive’s title and
authority pending such meeting, and such suspension shall not
constitute “Good Reason,” as defined in subsection
(n) below.
(j)
“Change in Control” of the Company shall mean a
Change in Control of a nature that would be required to be reported
in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Act or any successor
thereto, provided that without limiting the foregoing, a Change in
Control of the Company also shall mean the occurrence of any of the
following events:
(i) any
“person” (as defined under Section 3(a)(9) of the
Act) or “group” of persons (as provided under
Section 13d-3 of the Act) is or becomes the “beneficial
owner” (as defined in Rule 13d-3 or otherwise under the
Act), directly or indirectly (including as provided in
Rule 13d-3(d)(1) of the Act), of capital stock of the Company
the holders of which are entitled to vote for the election of
directors (“voting stock”) representing that percentage
of the Company’s then outstanding voting stock (giving effect
to the deemed ownership of securities by such person or group, as
provided in Rule 13d-3(d)(1) of the Act, but not giving effect
to any such deemed ownership of securities by another person or
group) equal to or greater than twenty-five percent (25%) of all
such voting stock;
(ii) during
any period of twenty four consecutive months, individuals who at
the beginning of such period constituted the Board of Directors of
the Company (including for this purpose any new director whose
election or nomination for election by the Company’s
shareholders was approved by a vote of at least a majority of the
directors then still in office who were directors at the beginning
of such period) cease for any reason to constitute at least
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majority of the Board of
Directors of the Company (excluding any Board seat that is vacant
or otherwise unoccupied).
(iii) there
shall be consummated any consolidation, merger, stock for stock
exchange or similar transaction (collectively, “Merger
Transactions”) involving securities of the Company in which
holders of voting stock of the Company immediately prior to such
consummation own, as a group, immediately after such consummation,
voting stock of the Company (or, if the Company does not survive
the Merger Transaction, voting securities of the corporation
surviving such transaction) having less than 50% of the total
voting power in an election of directors of the Company (or such
other surviving corporation).
(k)
Code means the Internal Revenue Code of 1986, as
amended.
(l)
Disability means a disability entitling the Executive to
payments under the Company’s long-term disability plan
applicable to the Executive.
(m) Early
Retirement Benefit means the “Early Retirement
Benefit” or “Early Retirement/Termination of Service
Benefit” as defined in the SERP Agreement.
(n)
Effective Date means the date this Agreement is executed by
the parties.
(o)
EIP means the Banknorth Group, Inc. Executive Incentive Plan
as amended and in effect from time to time, and any successor
plan.
(p)
Employment Period means a period commencing on the date of a
Change in Control of the Company and ending on the earlier of
(i) the last day of the twenty-fourth month following the
month in which the Change in Control occurs or (ii) the
Executive’s Normal Retirement Date.
(q) Good
Reason means:
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(i) any
breach of this Agreement by the Company, including without
limitation (A) any reduction during the Employment Period in
the amount of the Executive’s base salary or aggregate
benefits as in effect from time to time, (B) failure to
provide the Executive with the same fringe benefits that were
provided to the Executive immediately prior to a Change in Control
of the Company, or with a package of fringe benefits (including
paid vacations) that, though one or more of such benefits may vary
from those in effect immediately prior to such a Change in Control,
is substantially comparable in all material respects to such fringe
benefits taken as a whole, or (C) any other breach by the
Company of its obligations contained in Section 6
below;
(ii) without
the Executive’s express written consent, the assignment to
the Executive of any duties which are materially inconsistent with
the Executive’s positions, duties, responsibilities and
status immediately prior to the Change in Control of the Company, a
material change in the Executive’s reporting
responsibilities, titles or offices as an employee as in effect
immediately prior to the Change in Control, or a significant
reduction in the Executive’s title, duties or
responsibilities, or in the level of the Executive’s support
services as in effect immediately prior to the Change in
Control;
(iii) the
relocation of the Executive’s principal place of employment,
without the Executive’s written consent, to a location
outside the same metropolitan area in which the Executive was
employed at the time of such Change in Control, or the imposition
of any requirement that the Executive spend more than ninety
(90) business days per year at a location other than such
principal place of employment; or
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(iv) any
purported termination of the Executive’s employment for Cause
or Disability which is not effected pursuant to a Notice of
Termination satisfying the requirements of paragraph
(t) below.
Upon the
occurrence of any of the events described in (i), (ii), (iii), or
(iv) above, the Executive shall give the Company written
notice that such event constitutes Good Reason, and the Company
shall thereafter have thirty (30) days in which to cure. If
the Company has not cured in that time, the event shall constitute
Good Reason.
(r)
Long-Term Incentive Award means an incentive award under the
EIP the performance period for which is or was initially scheduled
to be in excess of one year.
(s)
Normal Retirement Date means Normal Retirement Date as
defined in the Retirement Plan.
(t)
Notice of Termination shall mean a notice which shall
indicate the specific termination provision relied upon in this
Agreement and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
Executive’s employment under the provision so
indicated.
(u)
Person or Group means a “person” or
“group,” as defined in Section 1(j)(i)
hereof.
(v) Plan
Year with respect to any of the Retirement Plan or the 401(k)
Plan, the “plan year” as defined in such
plan.
(w)
Retirement Plan means the Banknorth Group, Inc. Retirement
Plan, as amended and in effect from time to time and any successor
plan.
(x) SERP
Agreement means either (i) the Supplemental Retirement
Agreement between the Executive and the Company or (ii) if
there is no Supplemental Retirement
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Agreement between the Executive
and the Company, the Banknorth Group, Inc. Supplemental Retirement
Plan, as amended.
(y)
Year means a calendar year unless otherwise specifically
provided.
(z)
401(k) Plan means the Banknorth Group, Inc. 401(k) Plan
dated January 1, 2001, as amended, which plan constitutes a
continuation and merger of the Banknorth Group, Inc. Thrift
Incentive Plan and the Banknorth Group, Inc. Profit Sharing and
Employee Stock Ownership Plan.
2.
Term of Agreement .
This Agreement
shall begin on the Effective Date and shall continue until the
third anniversary of such date, provided that, on the first
anniversary of the Effective Date, and on each succeeding
anniversary, the term shall be renewed for an additional period of
one year unless either party has given written notice that the term
is not so renewed, which notice must be delivered to the other
party at least ninety (90) days prior to the date of any such
renewal, and further provided that if a Change in Control of the
Company occurs during such term, the term shall in all events
continue through the last day of the Employment Period. This
Agreement is also subject to earlier termination as provided in
Section 3 below. All rights and obligations hereunder shall
survive to the extent necessary to the intended enforcement
thereof.
3.
Termination of Employment Prior to a Change in Control
.
(a) The
Company and the Executive shall each retain the right to terminate
the employment of the Executive at any time prior to a Change in
Control of the Company. In the event the Executive’s
employment is terminated prior to a Change in Control of the
Company,
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this Agreement shall, except as
provided in subsection (b) below, be terminated and of no
further force and effect, and any and all rights and obligations of
the parties hereunder shall cease.
(b) If
the Executive’s employment is terminated by the Company prior
to the occurrence of a Change in Control of the Company, and if it
can be shown that the Executive’s termination (i) was at
the direction or request of a third party that had taken steps
reasonably calculated to effect the Change in Control of the
Company thereafter, or (ii) otherwise occurred in connection
with, or in anticipation of, the Change in Control of the Company,
the Executive shall have the rights described in Section 7(d)
below, as if a Change in Control of the Company had occurred on the
date immediately preceding such termination.
4.
Employment Following a Change in Control .
If
a Change in Control of the Company occurs when the Executive is
empl
