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Exhibit
10.2
CHANGE
IN CONTROL SEVERANCE AGREEMENT
THIS
CHANGE IN CONTROL SEVERANCE AGREEMENT (the “Agreement”)
is made and entered into as of this ____ day of ________________,
2007 (the “Commencement Date”), by and between
FIRST SAVINGS BANK NORTHWEST (which, together with any successor
thereto which executes and delivers the assumption agreement
provided for in Section 5(a) hereof or which otherwise becomes
bound by all of the terms and provisions of this Agreement by
operation of law, is hereinafter referred to as the “Savings
Bank”), and _______________________ (the
“Employee”).
WHEREAS,
the Employee is currently serving as
_______________________________; and
WHEREAS,
the board of directors of the Savings Bank (the
“Board”) recognizes that the possibility of a change in
control of the Savings Bank or of its holding company, First
Financial Northwest, Inc. (the “Company”), may exist
and that such possibility, and the uncertainty and questions which
it may raise among management, may result in the departure or
distraction of key management to the detriment of the Savings Bank,
the Company and its stockholders; and
WHEREAS,
the Board believes it is in the best interests of the Savings Bank
to enter into this Agreement with the Employee in order to assure
continuity of management of the Savings Bank and to reinforce and
encourage the continued attention and dedication of the Employee to
the Employee’s assigned duties without distraction in the
face of potentially disruptive circumstances arising from the
possibility of a change in control of the Company and/or the
Savings Bank, although no such change is now contemplated;
and
WHEREAS,
the Board has approved and authorized the execution of this
Agreement with the Employee;
NOW,
THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements of the parties herein, it is AGREED as
follows:
1.
Certain Definitions .
(a) The
term “Change in Control” means (1) an offeror other
than the Company purchases shares of stock of the Company or the
Savings Bank pursuant to a tender or exchange offer for such
shares; (2) an event of a nature that results in the acquisition of
control of the Company or the Savings Bank within the meaning of
the Savings and Loan Holding Company Act under 12 U.S.C.
Section 1467a and 12 C.F.R. Part 574 (or any successor statute or
regulation) or requires the filing of a notice with the Office of
Thrift Supervision (“OTS”) or the Federal Deposit
Insurance Corporation (“FDIC”); (3) any person (as the
term is used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934 (“Exchange Act”)) that is or becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act)
directly or indirectly of securities of the Company or the Savings
Bank representing 25% or more of the combined voting power of the
Company’s or the Savings Bank’s outstanding securities;
(4) individuals who are members of the board of directors of the
Company immediately following the Commencement Date or who are
members of the Board immediately following the Commencement Date
(in each case, the”Incumbent Board”) cease for any
reason to constitute at least a majority thereof, provided
that any person becoming a director
subsequent
to the Commencement Date whose election was approved by a vote of
at least three-quarters of the directors comprising the Incumbent
Board or whose nomination for election by the Company’s
stockholders was approved by the nominating committee serving under
an Incumbent Board, shall be considered a member of the Incumbent
Board; or (5) consummation of a plan of reorganization, merger,
acquisition, consolidation, sale of all or substantially all of the
assets of the Company or a similar transaction in which the Company
is not the resulting entity, provided that the term
“Change in Control” shall not include an acquisition of
securities by an employee benefit plan of the Savings Bank or the
Company.
(b) The
term “Commencement Date” means the date of this
Agreement.
(c) The
term “Consolidated Subsidiaries” means any subsidiary
or subsidiaries of the Company (or its successors) that are part of
the affiliated group (as defined in Section 1504 of the Internal
Revenue Code of 1986, as amended (the “Code”), without
regard to subsection (b) thereof) that includes the Savings Bank,
including but not limited to the Company.
(d) The
term “Date of Termination” means the date upon which
the Employee ceases to serve as an employee of the Savings
Bank.
(e) The
term “Involuntary Termination” means the termination of
the employment of Employee (i) by the Savings Bank, without his
express written consent; or (ii) by the Employee by reason of a
material diminution of or interference with his duties,
responsibilities or benefits, including (without limitation) any of
the following actions unless consented to in writing by the
Employee: (1) a requirement that the Employee be based at any
place other than Renton, Washington, or within a radius of 35 miles
from the location of the Savings Bank’s administrative
offices as of the Commencement Date, except for reasonable travel
on Company or Savings Bank business; (2) a material demotion of the
Employee; (3) a material reduction in the number or seniority of
personnel reporting to the Employee or a material reduction in the
frequency with which, or in the nature of the matters with respect
to which such personnel are to report to the Employee, other than
as part of a Savings Bank- or Company-wide reduction in staff; (4)
a reduction in the Employee’s salary or a material adverse
change in the Employee’s perquisites, benefits, contingent
benefits or vacation, other than as part of an overall program
applied uniformly and with equitable effect to all members of the
senior management of the Savings Bank; (5) a material permanent
increase in the required hours of work or the workload of the
Employee; or (6) any purported termination of the Employee’s
employment, except for Termination for Cause (and, if applicable,
the requirements of Section 1(f) hereof), which purported
termination shall not be effective for purposes of this
Agreement. The term “Involuntary Termination”
does not include Termination for Cause, retirement or suspension or
temporary or permanent prohibition from participation in the
conduct of the Savings Bank’s affairs under Section 8 of the
Federal Deposit Insurance Act.
(f) The
terms “Termination for Cause” and “Terminated for
Cause” mean termination of the employment of the
Employee
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