Exhibit 10.8
Form of Employment Agreement between NBT Bancorp Inc.
and Peter Corso made as of October 18, 2001
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of
October 18, 2001, by and between PETER J. CORSO ("Executive") and NBT BANCORP
INC., a Delaware corporation having its principal office in Norwich, New York
("NBTB") and NBT Bank, National Association ("NBT Bank");
W I T N E S S E T H T H A T :
WHEREAS, upon the terms and subject to the conditions set forth in the
Agreement and Plan of Merger, dated as of June 19, 2001 by and between CNB
Financial Corp., a New York corporation ("CNB") and NBTB (the "Merger
Agreement"), CNB will merge into NBTB (the "Merger");
WHEREAS, commencing on the first day following the consummation of the
Merger pursuant to the Merger Agreement (the "Effective Time"), the Executive
will assume the duties of President and Chief Operating Officer of Central
National Bank, a Division of NBT Bank (the "Division');
WHEREAS, NBTB desires to secure the continued employment of Executive,
subject to the provisions of this Agreement;
WHEREAS, because of Executive's abilities and his knowledge of, and
reputation in, markets where CNB conducts its business, NBTB and NBT Bank have
determined that it is essential to obtain a commitment from Executive to provide
consulting services to NBT Bank and not to compete against NBTB or any of its
affiliates or to solicit to employ certain of their officers in accordance with
the terms hereof; and
WHEREAS, Executive is desirous of entering into the Agreement upon the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements hereinafter set forth, intending to be legally bound, the parties
agree as follows:
1. Employment; Responsibilities and Duties.
(a) NBT Bank hereby agrees to employ, and NBTB hereby agrees
to cause NBT Bank to employ, Executive as President and Chief Operating Officer
of the Division and any successor during the Term of Employment (as hereinafter
defined) and Executive hereby agrees to serve as the President and Chief
Operating Officer of the Division during the Term of Employment. Executive shall
report directly to the Chief Executive Officer of NBT Bank and shall have such
executive duties, responsibilities, and authority as determined by the Chief
Executive Officer of NBT Bank.
(b) Executive shall devote his full working time and best
efforts to the performance of his responsibilities and duties hereunder. During
the Term of Employment, Executive shall not, without the prior written consent
of the Chief Executive Officer of NBT Bank, render services as an employee,
independent contractor, or otherwise, whether or not compensated, to any person
or entity other than NBTB or its affiliates; provided that Executive may, where
involvement in such activities does not individually or in the aggregate
significantly interfere with the performance by Executive of his duties or
violate the provisions of sections 4, 5 and 6 hereof, (i) render services to
charitable organizations, (ii) manage his personal investments, and (iii) with
the prior permission of the Chief Executive Officer of NBT Bank, hold such other
directorships or part-time academic appointments or have such other business
affiliations as would otherwise be prohibited under this section 1.
2. Term of Employment.
(a) The term of Executive's employment under this Agreement
("Term of Employment") shall be the period commencing on the date of the
consummation of the merger between NBTB and CNB (the "Commencement Date") and
continuing until the Termination Date, which shall mean the earliest to occur
of:
(i) the third anniversary of the Commencement
Date, unless the Term of Employment shall be extended by the mutual agreement
of the parties hereto;
(ii) the death of Executive;
(iii) Executive's inability to perform his duties
hereunder, as a result of physical or mental disability as reasonably determined
by the personal physician of Executive, for a period of at least 180 consecutive
days or for at least 180 days during any period of twelve consecutive months
during the Term of Employment;
(iv) the discharge of Executive by NBT Bank "for
cause," which shall mean one or more of the following:
(A) any willful or gross misconduct by
Executive with respect to the business and affairs of NBT Bank, or with respect
to any of its affiliates for which Executive is assigned material
responsibilities or duties;
(B) the conviction of Executive of a
felony (after the earlier of the expiration of any applicable appeal period
without perfection of an appeal by Executive or the denial of any appeal as to
which no further appeal or review is available to Executive) whether or not
committed in the course of his employment by NBT Bank;
(C) Executive's willful neglect,
failure, or refusal to carry out his duties hereunder in a reasonable manner
(other than any such failure resulting from disability or death or from
termination by Executive for Good Reason, as hereinafter defined) after a
written demand for substantial performance is delivered to Executive that
specifically identifies the manner in which NBTB believes that Executive has not
substantially performed his duties and Executive has not resumed substantial
performance of his duties on a continuous basis within thirty days of receiving
such demand; or
(D) the breach by Executive of any
representation or warranty in section 6(a) hereof or of any agreement contained
in section 1, 6, or 7 hereof, which breach is material and adverse to NBTB or
any of its affiliates for which Executive is assigned material responsibilities
or duties;
(v) Executive's resignation from his position as
President and Chief Operating Officer of the Division for any reason; or
(vi) the termination of Executive's employment by
NBT Bank "without cause," which shall mean the termination of Executive's
employment by NBT Bank for any reason other than those set forth in subsections
(i), (ii), (iii) or (iv) of this section 2(a), upon the thirtieth day following
notice to Executive.
(b) In the event that the Term of Employment shall be
terminated by reason of an event described in section 2(a)(i) - 2(a)(iv) hereof,
Executive shall be entitled to, upon the occurrence of any such event:
(i) receive any salary (as hereinafter defined)
payable pursuant to section 3(a)(i) hereof which shall have accrued as of the
Termination Date; and
(ii) such rights as Executive shall have accrued
as of the Termination Date under the terms of any plans or arrangements in which
he participates pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to section 3(b)(vi)
hereof, and the right to receive the cash equivalent of paid annual leave and
sick leave accrued as of the Termination Date pursuant to section 3(b)(ii)
hereof.
(c) In the event that the Term of Employment shall be
terminated by reason of an event other than an event described in section
2(a)(i) - 2(a)(iv) hereof, Executive shall be entitled to:
(i) receive any salary payable pursuant to
section 3(a)(i) hereof which shall have accrued as of the Termination Date;
(ii) such rights as Executive may have accrued
as of the Termination Date under the terms of any plans or arrangements in which
he participates pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to section 3(b)(vi)
hereof, and the right to receive the cash equivalent of paid annual leave and
sick leave accrued as of the Termination Date pursuant to section 3(b)(ii)
hereof;
(iii) if the Termination Date occurs during the
first year of the Term of Employment, then in consideration of Executive's past
services, Executive's agreement to provide consulting services under section 4
hereof, and Executive's covenants under sections 5 and 6 hereof, Executive shall
be entitled to a lump-sum cash payment equal to $525,000;
(iv) if the Termination Date occurs during the
second year of the Term of Employment, then in consideration of Executive's past
services, Executive's agreement to provide consulting services under section 4
hereof, and Executive's covenants under sections 5 and 6 hereof, Executive shall
be entitled to receive a lump sum cash payment equal to the sum of (A) the
undiscounted remainder of his base annual compensation during the second year of
the Term of Employment (assuming Executive remained employed by NBT Bank for the
entirety of such second year) and (B) an undiscounted amount equal to eighteen
months of additional annual base compensation at the then current rate; and
(v) if the Termination Date occurs after the
second year of the Term of Employment, then in consideration of Executive's past
services and his covenants under sections 5 and 6 hereof, Executive shall be
entitled to receive a lump sum cash payment equal to the undiscounted amount of
Executive's annual base compensation (at the rate in effect immediately prior to
the Termination Date) that would have been payable to Executive assuming
Executive remained employed by NBT Bank for the greater of (i) one year after
the Termination Date or (ii) the date after the third anniversary of the
Commencement Date, if any, agreed to by the parties hereto.
(d) In the event that the employment of Executive with NBT
Bank is terminated in any situation described in section 3 of the
change-in-control letter agreement dated as of the date hereof (but effective as
of the Effective Time) between NBTB and Executive (the "Change-in-Control
Agreement") so as to entitle Executive to a severance payment and other benefits
described in section 3 of the Change-In-Control Agreement, then notwithstanding
the provisions of section 2 (c) hereof, Executive shall be entitled to the
following, and no more, under this section 2:
(i) any salary payable pursuant to section 3(a)
(i) hereof which shall have accrued as of the Termination Date;
(ii) such rights as Executive shall have accrued
as of the Termination Date under the terms of any plans or arrangements in which
he participates pursuant to section 3(b) hereof, any right to reimbursement for
expenses accrued as of the Termination Date payable pursuant to section 3(b)(vi)
hereof, and the right to receive the cash equivalent of paid annual leave and
sick leave accrued as of the Termination Date pursuant to section 3(b)(ii)
hereof; and
(iii) the severance payment and other benefits
provided in the Change-in-Control Agreement.
Notwithstanding the foregoing provisions of this section 2(d), the Executive may
at any time prior to the payment of any severance or other benefits under
section 3 of the Change-In-Control Agreement elect in writing to waive his
rights under the Change-in-Control Agreement, in which case this Agreement shall
apply to Executive without regard to the foregoing provisions of this section
2(d). In the event that Executive becomes entitled to the severance and other
benefits under section 3 of the Change-in-Control Agreement, NBTB shall promptly
(and in all events within three business days) notify Executive in writing of
Executive's right to waive his rights under the Change-in-Control Agreement and,
unless otherwise directed by the Executive in writing, no severance payments or
other benefits under section 3 of the Change in Control Agreement shall be paid
to Executive until ten business days after the providing of written notice by
NBTB to Executive. If Executive does not waive his rights under the
Change-in-Control Agreement and receives severance or other benefits under
section 3 of the Change-in-Control Agreement, sections 4 and 5 of this Agreement
shall cease to apply and Executive shall have no obligation thereunder.
3. Compensation. For the services to be performed by
Executive for NBT Bank under this Agreement, Executive shall be compensated in
the following manner:
(a) Salary. During the Term of Employment:
(i) NBT Bank shall pay Executive a salary,
which, on an annual basis, shall not be less than $175,000 during the Term of
Employment. Salary shall be payable in accordance with the normal payroll
practices of NBTB with respect to executive personnel as presently in effect or
as they may be modified by NBTB from time to time.
(ii) Executive shall be entitled to minimum
annual salary increases of 7 percent during the Term of Employment, and in
addition, if the term of this agreement is extended as per Section 2(a)(i),
shall be eligible to be considered for further salary increases, upon review, in
accordance with the compensation policies of NBTB with respect to executive
personnel as presently in effect or as they may be modified by NBTB from time to
time.
(iii) Executive shall be eligible to be considered
for performance bonuses of up to 50 percent of salary, in accordance with the
compensation policies of NBTB with respect to executive personnel as presently
in effect or as they may be modified by NBTB from time to time.
(b) Employee Benefit Plans or Arrangements. During the Term
of Employment, Executive shall be entitled to participate in all employee
benefit plans of NBTB and its affiliates, as presently in effect or as they may
be modified from time to time, under such terms as may be applicable to officers
of Executive's rank employed by NBTB or its affiliates, including, without
limitation, plans providing retirement benefits, stock options, medical
insurance, life insurance, disability insurance, and accidental death or
dismemberment insurance, provided that there be no duplication of such benefits
as are provided under any other provision of this Agreement.
(i) Stock Options. Each January or February annually during the Term
of Employment, NBTB will cause Executive to be granted a non-statutory
("non-qualified") stock option (each an "Option") to purchase the number of
shares of the common stock of NBTB, $0.01 par value (the "NBTB Common Stock"),
pursuant to the NBT Bancorp Inc. 1993 Stock Option Plan, as amended, or any
appropriate successor plan (the "Stock Option Plan"), computed by dividing 200
percent of the annualized salary of Executive on the date of grant of the Option
by the "Fair Market Value" of NBTB Common Stock (as defined in the Stock Option
Plan). The option exercise price per share of the shares subject to each Option
shall be Fair Market Value, and the terms, conditions of exercise, and vesting
schedule of such Option shall be as set forth in section 8 of the Stock Option
Plan.
(ii) Vacation and Sick Leave. During the Term of
Employment, Executive shall be entitled to paid annual vacation periods and sick
leave in accordance with the policies of NBTB as in effect as of the
Commencement Date or as may be modified by NBTB from time to time as may be
applicable to officers of Executive's rank employed by NBTB or its affiliates,
but in no event less than four weeks of paid vacation each year during the Term
of Employment.
(iii) Automobile. During the Term of Employment,
Executive shall be entitled to the use of an automobile (whose value shall not
exceed $40,000), owned by NBTB or an affiliate of NBTB, the make, model and year
of which automobile shall be appropriate to an officer of Executive's rank, and
which will be replaced every three years (or earlier if the accumulated mileage
exceeds 50,000 miles) with a new automobile whose value shall not exceed the sum
of $40,000 escalated by an amount calculated by the controller's division of
NBTB to adjust for the effect of inflation upon the $40,000 (an "Inflation
Adjustment"). Executive shall be responsible for all expenses of ownership and
use of such automobile, subject to reimbursement of expenses for business use in
accordance with section 3(b)(vi).
(iv) Country Club Dues. During the Term of Employment, Executive
shall be reimbursed for dues and assessments incurred in relation to Executive's
membership at a country club mutually agreed upon by Executive and the Chief
Executive Officer of NBT Bank.
(v) Withholding. All compensation to be paid to
Executive hereunder shall be subject to required withholding and other taxes.
(vi) Expenses. During the Term of Employment,
Executive shall be reimbursed for reasonable travel and other expenses incurred
or paid by Executive in connection with the performance of his services under
this Agreement, upon presentation of expense statements or vouchers or such
other supporting information as may from time to time be requested, in
accordance with such policies of NBTB as are in effect as of the Commencement
Date and as may be modified by NBTB from time to time, under such terms as may
be applicable to officers of Executive's rank employed by NBTB or its
affiliates.
4. Consulting Services
(a) In the event that Executive's employment terminates
hereunder during the first two years of the Term of Employment and Executive
becomes entitled to a payment under either section 2(c)(iii) or 2(c)(iv) hereof,
Executive shall, during the Consulting Period (as hereinafter defined), be
available to render such consulting services to NBTB or NBT Bank as they may
reasonably request of Executive from time-to-time relating to their business and
operations. The services requested of Executive by NBTB and NBT Bank during the
Consulting Period shall be scheduled in consultation with Executive and shall be
of a scope so as to not materially interfere with Executive's engaging in
full-time employment after the Employment Term. NBTB or NBT Bank shall promptly
reimburse Executive for all expenses incurred by Executive in the performance of
Executive's consulting duties, including travel and subsistence expenses,
recognizing that Executive's home may not be in the geographic area where NBTB
and NBT Bank conduct business. Executive shall perform his duties under this
section 4(a) as an independent contractor to NBTB and NBT Bank.
(b) For purposes of this Agreement, the term "Consulting
Period" shall mean (i) if Executive's employment terminates hereunder during the
first year of the Employment Term and Executive becomes entitled to the payment
described in section 2(c)(iii) hereof, the period beginning on the date of
Executive's termination of employment with NBT Bank and ending on the second
anniversary of such termination of employment, and (ii) if Executive's
employment terminates hereunder during the second year of the Employment Term
and Executive becomes entitled to the payment described in section 2(c)(iv)
hereof, the period beginning on the date of Executive's termination of
employment with NBT Bank and ending on the second anniversary of the Merger.
(c) In consideration for Executive's covenants under this
section 4 and under sections 5 and 6 hereof, NBTB or NBT Bank shall, in addition
to any lump sum payment provided for by Section 2(c)(iii) and 2(c)(iv), as
applicable, provide to Executive for a three year period following the date of
Executive's termination of employment with NBT Bank, at no cost to Executive,
life insurance and health insurance (collectively, "Welfare Benefits") that are
not less favorable in all respects to those that Executive was receiving
immediately prior to the Termination Date; provided, however, that the medical
coverage provided shall be family medical coverage that also covers Executive's
spouse and any dependents. Executive will be entitled to elect to change his
level of coverage and/or his choice of coverage options with respect to the
Welfare Benefits provided by NBTB or NBT Bank to Executive to the same extent
that actively employed senior executives of NBTB and NBT Bank are permitted to
make such changes.
5. Covenant Not to Compete.
(a) The parties acknowledge: (i) that as a result of the Merger, NBT Bank
and NBTB will be engaged in the business of banking in those markets where CNB
currently conducts its banking business; (ii) that Executive has developed
special expertise and a recognized reputation in CNB's markets and business; and
(iii) that if Executive were to undertake efforts in competition with NBT Bank
and NBTB in CNB's current market areas or solicit for employment officers of CNB
the result would be substantial and irreparable damage to NBT Bank and NBTB.
(b) During the Restricted Period, Executive shall not solicit
any business (other than business in an area outside of twenty miles in which
NBTB or any of its subsidiaries is competitively engaged), customers or
prospective customers of NBTB or any of its subsidiaries whom Executive has
served or solicited during the course of his employment by CNB.
(c) During the Restricted Period, Executive shall not,
directly or indirectly, either for Executive's own benefit or purpose or for the
benefit or purpose of any person or entity other than NBTB or any of its
subsidiaries, employ or offer to employ, call on, or actively interfere with
NBTB's or any of its subsidiaries' relationship with, or attempt to divert or
entice away, any officer of NBTB or any of its subsidiaries who was an officer
of CNB or any of its subsidiaries immediately prior to the Merger.
(d) The term "Restricted Period shall mean (a) if there is a
Consulting Period, the period beginning on the first day of the Consulting
Period and ending on the first anniversary of the last day of the Consulting
Period, and (b) if there is no Consulting Period, the period beginning on
Executive's Termination Date and ending on the date that is six months after
such Termination Date.
(e) The parties hereto agree that the amount of the lump-sum
payment paid to Executive pursuant to Section 2(c)(ii), (c)(iii), or (c)(iv), as
applicable, that is allocable to services or consideration provided by Executive
other than pursuant to Sections 4, 5 and 6 hereof is less than $135,000.
6. Confidential Business Information; Non-Competition.
(a) Executive acknowledges that certain business methods,
creative techniques, and technical data and the like of NBTB and its affiliates
are deemed by NBTB to be and are in fact confidential business information of
NBTB or its affiliates or are entrusted to third parties. Such confidential
information includes but is not limited to procedures, methods, sales
relationships developed while in the service of NBTB or its affiliates,
knowledge of customers and their requirements, marketing plans, marketing
information, studies, forecasts and surveys, competitive analyses, mailing and
marketing lists, new business proposals, lists of vendors, consultants, and
other persons who render service, or provide material to NBTB or CNB or their
affiliates, and compositions, ideas, plans, and methods belonging to or related
to the affairs of NBTB or CNB or their affiliates. In this regard, NBTB asserts
proprietary rights in all of its business information and that of its affiliates
except for such information as is clearly in the public domain. Notwithstanding
the foregoing, information that would be generally known or available to persons
skilled in Executive's fields shall be considered to be "clearly in the public
domain" for the purposes of the preceding sentence. Executive agrees that he
will not disclose or divulge to any third party, except as may be required by
his duties hereunder, by law, regulation, or order of a court or government
authority, or as directed by NBTB, nor shall he use to the detriment of NBTB or
its affiliates or use in any business or on behalf of any business competitive
with or substantially similar to any business of NBTB or CNB or their
affiliates, any confidential business information obtained during the course of
his employment by CNB or NBT Bank. The foregoing shall not be construed as
restricting Executive from disclosing such information to the employees of NBTB
or CNB or their affiliates. On or before the Termination Date, Executive shall
promptly deliver to NBTB any and all tangible, confidential information in his
possession.
(b) Executive acknowledges and agrees that irreparable injury
will result to NBTB and its affiliates in the event of a breach of any of the
provisions of section 5 hereof or this section 6 (the "Designated Provisions")
and that NBTB will have no adequate remedy at law with respect thereto.
Accordingly, in the event of a material breach of any Designated Provision, and
in addition to any other legal or equitable remedy NBTB may have, NBTB shall be
entitled to the entry of a preliminary and permanent injunction (including,
without limitation, specific performance) by a court of competent jurisdiction
in Chenango County, New York, to restrain the violation or breach thereof by
Executive, and Executive submits to the jurisdiction of such court in any such
action.
(c) It is the desire and intent of the parties that the
provisions of section 5 hereof and this section 6 shall be enforced to the
fullest extent permissible under the laws and public policies applied in each
jurisdiction in which enforcement is sought. Accordingly, if any particular
provision of section 5 hereof or this section 6 shall be adjudicated to be
invalid or unenforceable, such provision shall be deemed amended to delete
therefrom the portion thus adjudicated to be invalid or unenforceable, such
deletion to apply only with respect to the operation of such provision in the
particular jurisdiction in which such adjudication is made. In addition, should
any court determine that the provisions of section 5 hereof or this section 6
shall be unenforceable with respect to scope, duration, or geographic area, such
court shall be empowered to substitute, to the extent enforceable, provisions
similar hereto or other provisions so as to provide to NBTB, to the fullest
extent permitted by applicable law, the benefits intended by section 5 hereof
and this section 6.
(d) Life Insurance. In light of the unusual abilities and
experience of Executive, NBTB or NBT Bank in their discretion may apply for and
procure as owner and for its own benefit insurance on the life of Executive, in
such amount and in such form as NBTB or NBT Bank may choose. NBTB or NBT Bank,
as applicable, shall make all payments for such insurance and shall receive all
benefits from it. Executive shall have no interest whatsoever in any such policy
or policies but, at the request of NBTB or NBT Bank, as applicable, shall submit
to medical examinations and supply such information and execute such documents
as may reasonably be required by the insurance company or companies to which
NBTB or NBT Bank, as applicable, has applied for insurance.
7. Representations and Warranties.
(a) Executive represents and warrants to NBTB that his
execution, delivery, and performance of the Agreement will not result in or
constitute a breach of any term, covenant, condition, or provision of any
commitment, contract, or other agreement or instrument, including, without
limitation, any other employment agreement, to which Executive is or has been a
party.
(b) Executive shall indemnify, defend, and hold harmless NBTB
for, from, and against any and all losses, claims, suits, damages, expenses, or
liabilities, including court costs and counsel fees, which NBTB has incurred or
to which NBTB may become subject insofar as such losses, claims, suits, damages,
expenses, liabilities, costs, or fees arise out of or are based upon any failure
of any representation or warranty of Executive in section 7(a) hereof to be true
and correct when made.
8. Notices. All notices, consents, waivers, or other communications
which are required or permitted hereunder shall be in writing and deemed to have
been duly given if delivered personally or by messenger, transmitted by telex or
telegram, by express courier, or sent by registered or certified mail, return
receipt requested, postage prepaid. All communications shall be addressed to the
appropriate address of each party as follows:
If to NBTB or NBT Bank:
NBT Bancorp Inc.
52 South Broad Street
Norwich, New York 13815
Attention: Mr. Daryl R. Forsythe
Chairman, President and
Chief Executive Officer
With a required copy, in the case of a notice to NBT Bancorp Inc. or NBT Bank,
to:
Brian D. Alprin, Esq.
Duane, Morris & Heckscher LLP
1667 K Street, N.W., Suite 700
Washington, D.C. 20006
If to Executive:
Mr. Peter J. Corso
11 Kingsbury Ave.
St. Johnsville, NY 13452
All such notices shall be deemed to have been given on the date delivered,
transmitted, or mailed in the manner provided above.
9. Assignment. Neither party may assign this Agreement or any
rights or obligations hereunder without the consent of the other party.
10. Governing Law. This Agreement shall be governed by, construed, and
enforced in accordance with the laws of the State of New York, without giving
effect to the principles of conflict of law thereof. The parties hereby
designate Chenango County, New York to be the proper jurisdiction and venue for
any suit or action arising out of this Agreement. Each of the parties consents
to personal jurisdiction in such venue for such a proceeding and agrees that it
may be served with process in any action with respect to this Agreement or the
transactions contemplated thereby by certified or registered mail, return
receipt requested, or to its registered agent for service of process in the
State of New York. Each of the parties irrevocably and unconditionally waives
and agrees, to the fullest extent permitted by law, not to plead any objection
that it may now or hereafter have to the laying of venue or the convenience of
the forum of any action or claim with respect to this Agreement or the
transactions contemplated thereby brought in the courts aforesaid.
11. Entire Agreement. This Agreement constitutes the entire
understanding among NBTB, NBT Bank and Executive relating to the subject matter
hereof. Any previous agreements or understandings between the parties hereto or
between Executive and CNB or any of its affiliates regarding the subject matter
hereof, including without limitation the terms and conditions of employment,
compensation, benefits, retirement, competition following employment, and the
like, are merged into and superseded by this Agreement. Neither this Agreement
nor any provisions hereof can be modified, changed, discharged, or terminated
except by an instrument in writing signed by the party against whom any waiver,
change, discharge, or termination is sought.
12. Illegality; Severability.
(a) Anything in this Agreement to the contrary
notwithstanding, this Agreement is not intended and shall not be construed to
require any payment to Executive which would violate any federal or state
statute or regulation, including without limitation the "golden parachute
payment regulations" of the Federal Deposit Insurance Corporation codified to
Part 359 of title 12, Code of Federal Regulations.
(b) If any provision or provisions of this Agreement
shall be held to be invalid, illegal, or unenforceable for any reason
whatsoever:
(i) the validity, legality, and enforceability
of the remaining provisions of this Agreement (including, without limitation,
each portion of any section of this Agreement containing any such provision held
to be invalid, illegal, or unenforceable) shall not in any way be affected or
impaired thereby; and
(ii) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, each portion of any
section of this Agreement containing any such provisions held to be invalid,
illegal, or unenforceable) shall be construed so as to give effect to the intent
manifested by the provision held invalid, illegal, or unenforceable.
13. Arbitration. Subject to the right of each party hereto to seek
specific performance (which right shall not be subject to arbitration), if a
dispute arises out of or related to this Agreement, or the breach thereof, such
dispute shall be referred to arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). A dispute
subject to the provisions of this section will exist if either party notifies
the other party in writing that a dispute subject to arbitration exists and
states, with reasonable specificity, the issue subject to arbitration (the
"Arbitration Notice"). The parties agree that, after the issuance of the
Arbitration Notice, the parties will try in good faith to resolve the dispute by
mediation in accordance with the Commercial Rules of Arbitration of AAA between
the date of the issuance of the Arbitration Notice and the date the dispute is
set for arbitration. If the dispute is not settled by the date set for
arbitration, then any controversy or claim arising out of this Agreement or the
breach hereof shall be resolved by binding arbitration and judgment upon any
award rendered by arbitrator(s) may be entered in a court having jurisdiction.
Any person serving as a mediator or arbitrator must have at least ten years'
experience in resolving commercial disputes through arbitration. In the event
any claim or dispute involves an amount in excess of $100,000, either party may
request that the matter be heard by a panel of three arbitrators; otherwise all
matters subject to arbitration shall be heard and resolved by a single
arbitrator. The arbitrator shall have the same power to compel the attendance of
witnesses and to order the production of documents or other materials and to
enforce discovery as could be exercised by a United States District Court judge
sitting in the Northern District of New York. In the event of any arbitration,
each party shall have a reasonable right to conduct discovery to the same extent
permitted by the Federal Rules of Civil Procedure, provided that such discovery
shall be concluded within ninety days after the date the matter is set for
arbitration. In the event of any arbitration, the arbitrator or arbitrators
shall have the power to award reasonable attorney's fees to the prevailing
party. Any provision in this Agreement to the contrary notwithstanding, this
section shall be governed by the Federal Arbitration Act and the parties have
entered into this Agreement pursuant to such Act.
14. Certain Expenses. NBTB shall pay to Executive all legal fees and
expenses (but not taxes, penalties or interest on taxes or penalties) incurred
by Executive (a) in seeking to obtain or enforce any provision of this Agreement
or (b) in connection with any tax audit or proceeding to the extent attributable
to the application of section 4999 of the Code to any payment or benefit
provided hereunder or under other plans and programs of CNB, NBTB or any of
their affiliates. Such payments shall be made within five (5) business days
after delivery of Executive's written requests for payment accompanied with such
evidence of fees and expenses incurred as NBTB reasonably may require.
15. Consent to Retirement Annuity Contribution. NBTB hereby consents,
for purposes of the Merger Agreement, to CNB taking all necessary and
appropriate actions prior to the Merger to (i) cause an aggregate of $25,000 to
be contributed to one or both of the annuity contracts (as specified by
Executive) held under the Supplemental Retirement Annuity Agreement (the "SRAA")
between Executive and CNB, dated May 15, 2000, (ii) cause the transfer of such
annuity contracts to a "rabbi trust," the terms of which shall provide for the
payment of benefits to Executive and his beneficiaries in accordance with the
terms of the SRAA, and (iii) amend the SRAA as necessary or appropriate to
reflect such actions.
16. Affiliation. A company will be deemed to be "affiliated"
with NBTB or CNB according to the definition of "Affiliate" set forth in Rule
12b-2 of the General Rules and Regulations under the Securities Exchange Act of
1934, as amended.
17. Headings. The section and subsection headings herein have
been inserted for convenience of reference only and shall in no way modify or
restrict any of the terms or provisions hereof.
18. Termination. This Agreement shall terminate in the event that
the Merger Agreement terminates in accordance with Section 12 thereof.
IN WITNESS WHEREOF, the parties hereto executed or caused this
Agreement to be executed as of the day and year first above written.
NBT BANCORP INC.
By: /S/ Daryl R. Forsythe
Daryl R. Forsythe
Chairman, President and
Chief Executive Officer
NBT BANK, NATIONAL ASSOCIATION
By: /S/ Daryl R. Forsythe
Daryl R. Forsythe
Chairman and Chief Executive Officer
PETER J. CORSO
/S/ Peter J. Corso