EXHIBIT 10.10
Supplemental Executive Retirement Agreement
THIS AGREEMENT is made this 20th day of March , between Slade's Ferry
Bancorp, a Massachusetts Corporation, with its principal place of business
in Somerset, Massachusetts, hereafter referred to as the Employer, or the
Corporation, and Mary Lynn Lenz, President and Chief Executive Officer of
the Corporation hereafter referred to as the Employee.
Employee is employed by the Corporation and its subsidiary, Slade's
Ferry Bank ("the Bank"), in key positions and the Corporation wishes to
provide additional incentive to retain the services of Employee until her
retirement.
THEREFORE, in consideration of these premises and the mutual promises
and obligation set forth hereafter, Mary Lynn Lenz as Employee and the
Corporation as Employer agree as follows:
1. The Corporation agrees that, if Employee remains continuously
employed by the Corporation and/or its subsidiary Bank until her
retirement, in such offices and capacities as she may be elected to by the
Board of Directors of either entity, or in any such offices, roles, and
capacities which she otherwise holds on behalf of the Corporation and/or
its subsidiary Bank, at such compensation as may be mutually agreed upon,
the Corporation and/or Bank will pay and the Employee shall be entitled to
receive additional compensation in the amount of $3,000.00 per month for
one hundred twenty (120) months commencing on the first day of the first
month following her retirement.
2. (a) The Corporation agrees that the Employee may retire from full-
time employment upon the first day of the month immediately following her
62nd birthday, or at any time prior thereto after completing fifteen years
continuous employment with the Corporation if she becomes permanently and
totally disabled as defined in paragraph (b) or at anytime following her
62nd birthday, but not later than the first day of February following her
70th birthday hereinafter referred to as the Retirement Date.
(b) Employee shall be deemed to have become permanently and totally
disabled if and when the Board of Directors of the Corporation determines,
on the basis of medical or other evidence satisfactory to it, that the
Employee qualifies as disabled under any applicable Long-Term disability
plan, policy or program provided or utilized by the Corporation or Bank or
under the Social Security Act (42 U.S.C. section 1382) as amended for the
purpose of supplemental security income.
3. (a) The Corporation agrees that, in the event of the death of the
Employee after completing fifteen years of continuous employment with the
Corporation and prior to the Retirement Date while employed by the
Corporation, it will pay to her surviving spouse, if any, or, if none, in
equal shares to her children then living and deceased children leaving
issue then living by right of representation, or to such other persons as
she may have designated, or if none, to her estate, $3,000.00 per month for
one hundred and twenty (120) consecutive months commencing upon the first
day of the first month following the date of death of the Employee. If
any beneficiary should die prior to the receipt of all such payments, any
remaining payments shall be made to such beneficiary's estate.
4. The Corporation agrees to pay to or for the benefit of Employee from
the date of her retirement and thereafter for and during the term of her
natural life such amounts as are required for the employer contribution to
provide medical health insurance coverage comparable to that provided
immediately before her retirement, supplemental to Medicare as it may be
amended, in the form of Blue Cross/Blue Shield Medex Gold or its
substantial equivalent according to the schedule of contribution by the
Corporation or the Bank and the Employee as is in effect for the
Corporation's (or the Bank's, if provided through the Bank) employees
generally at the time of Employee's retirement.
The Corporation agrees to pay to or for the benefit of Employee's
spouse, such amounts as are required according to the schedule of
contribution by the Corporation or the Bank and the Employee, as amended
from time to time, to provide master medical health insurance in effect at
the Corporation or the Bank and available to employees generally, or its
equivalent, for Employee's spouse until he attains the age of 65 years or
obtains coverage under the Medicare program, whichever first occurs, and
thereafter to pay such amounts as are required under such schedule of
contribution as is in effect at that time to provide comparable medical
health insurance coverage supplemental to Medicare as it may be amended, in
the form of Blue Cross/Blue Shield Medex Gold, or its substantial
equivalent, for and during the term of his natural life.
5. Employee's rights and benefits under this agreement are in addition
to and not a substitute for Employee's rights and benefits under the
Corporation or Bank's other retirement, disability or benefit plans.
Subject to the terms of the group life insurance policy in force at the
time of retirement, the Bank will continue to include the Employee in the
current group life insurance policy in force at the time of retirement.
6. In the event that the Employee should die on or after the Retirement
Date, but prior to receipt of any amount to which she is entitled hereunder
pursuant to Paragraph 1, or of all such amounts, any amounts remaining
unpaid shall be paid to such beneficiary or beneficiaries as the Employee
may designate by filing with the Corporation a notice in writing, but in
the absence of any such designation, such unpaid amounts shall be so paid
to her surviving spouse, if any, or, if none, in equal shares to her
children then living and deceased children leaving issue then living by
right of representation, and if none, then to her estate.
7. Whenever the Employee's beneficiaries (other than her, her spouse's,
or any beneficiary's estate) shall be entitled to receive any amount
hereunder, the amount shall be paid to such beneficiaries in monthly
installments: (a) over a period of ten (10) years, in the event that no
monthly installment payments have theretofore commenced to the Employee, or
(b) for the balance of the ten (10) year period (commencing with the first
such installment so received by the Employee), on the same due dates, in
the event payment of monthly installments shall have theretofore commenced
to the Employee.
2
8. Notwithstanding any other provision of this Agreement to the
contrary, the Employee shall have the right, with the consent of the
Corporation, to elect that payment of the amounts due hereunder be made (a)
over a longer period than one hundred and twenty (120) months or (b) as a
life annuity (with or without refund).
9. Notwithstanding any other provision of this Agreement to the
contrary, following her retirement, the Employee shall have the right,
without the consent of the Corporation, to demand immediate distribution to
her, in cash or in kind of an amount equal to the value of the Supplemental
Executive Retirement Account determined as of the date of such demand,
following completion after her retirement of any three (3) successive
fiscal years of the Corporation in which the book value of the Corporation
shall have been successively decreased or any one or more successive fiscal
year(s) in which the book value of the Corporation shall have decreased by
a total of more than 33-1/3%
10. As used herein the term "Value of the Account" shall mean an amount
equal to the sum of the monthly remaining payments for the remaining period
of payment discounted at the prime lending rate as published in the Wall
Street Journal on the first Monday after the event triggering the
valuation.
11. Except as otherwise expressly provided in this Agreement, Employee
agrees on behalf of herself and of her executors and administrators, heirs,
legatees, distributes, and any other person or, persons claiming any
benefits under her under this Agreement that this Agreement and its rights,
interests, and benefits shall not be assigned, transferred, pledged, or
hypothecated in any way by Employee or any executor, administrators, heir,
legatee, distributee, or other person claiming under Employee by virtue of
this Agreement, and shall not be subject to execution, attachment, or
similar process. Any attempted assignment, transfer, pledge or
hypothecation, or other disposition of this Agreement or of such rights,
interests, and benefits contrary to the above provisions, or the levy of
any attachment or similar process thereupon, shall be null and void and
without effect.
12. This Agreement does not constitute an employment agreement. Nothing
contained in this Agreement shall be construed to be a contract of
employment for any term of years, nor as conferring upon the Employee the
right to continue to be employed by the Corporation or the Bank in her
present capacity, or in any other capacity. It is expressly understood by
the parties hereto that this Agreement relates exclusively to additional
compensation for the Employee's services, which compensation is payable
after her retirement from full-time service with the Corporation and the
Bank or her death, and is not intended to be an employment contract. The
benefits payable under this Agreement shall be independent of, and in
addition to, any benefits under any other employment agreement that may
exist from time to time between the parties hereto, or any other
compensation payable by the Corporation to the Employee whether as salary
or otherwise. In the event that Employee's employment is terminated for
any reason other than her death or retirement under the provision of
paragraphs 2 and 3 hereof, this Agreement shall automatically terminate and
the Corporation shall have no further obligation hereunder.
13. The rights of the Employee under this Agreement and of any
beneficiary of the Employee shall be solely those of an unsecured creditor
of the Corporation, and neither the Employee nor
3
any beneficiary of the Employee shall have or acquire any interest, rights
or claims to any property or assets of the Corporation by virtue of this
Agreement except as set forth in paragraph 16(b). The Corporation's
obligation hereunder, except as set forth in paragraph 16(b), shall be an
unfunded and unsecured promise to pay money in the future.
14. Hereafter, either during her full-time employment or while she is
receiving any benefits under this Agreement, Employee agrees that she will
not enter into competition with the Corporation or the Bank, directly or
indirectly, within the Town of Somerset or a fifty (50) mile radius
thereof, either as a director, officer, employee, agent, consultant,
partner or any other capacity with any business which is in substantial
competition with the Corporation or the Bank. The reasonable judgment of a
majority of the Board of Directors that such competition exists shall be
conclusive for the purposes of this Agreement. This provision shall not be
construed to prevent the Employee from owning shares in any publicly traded
corporation for investment purposes.
15. In the event that Employee should violate the provisions of Article
14 hereof, and should she continue to do so without adequate cause for a
period thirty of days after the Corporation shall have requested her in
writing to refrain from an action prohibited by said Article 14, Employee
agrees that no further payments shall be due her, her spouse, or any other
designated beneficiary under this Agreement and that the Corporation shall
have no further obligation whatsoever hereunder. Any disputes hereunder
shall be referred to arbitration pursuant to Article 17 hereof.
16. (a) The Corporation agrees that it will not merge or consolidate with
any other corporation or organization, or permit its business to be taken
over by any other organization, unless and until the succeeding or
continuing corporation or other organization shall expressly assume the
rights and obligations of the Corporation herein set forth. The
Corporation further agrees that it will not cease its business activities
or terminate its existence, other than as heretofore set forth in this
Article, without having made adequate provision for the fulfilling of its
obligations hereunder.
(b) In the event of a change of control (as defined below) of the
Corporation, Employee shall have the right (exercisable within 90 days of
the change of control) to require the Corporation to immediately fund the
unpaid portion of Employee's compensation hereunder by establishing an
irrevocable trust account with an independent corporate Trustee which is a
national or state charted bank with Trustee powers located in Massachusetts
or Rhode Island, funded with an amount which will be sufficient to meet all
of Employer's obligations hereunder. The terms of the Trust shall meet the
requirements of the Internal Revenue Service for "rabbi trusts" and shall
generally provide as set forth herein modified or expanded as necessary to
meet said IRS requirements. The Trust fund shall be held and managed by
the Trustee for the exclusive purpose of providing the compensation
hereunder to Employee hereunder and the Trustee shall act as agent of the
Corporation by making payments of benefits to the Employee in accordance
with the terms hereof. Any and all expenses and taxes incurred by reason
of the Trust and its income shall be paid by the Corporation. After all
benefits payable hereunder have been paid to the Employee or her
beneficiaries or after this agreement has otherwise properly terminated
under its terms, any amounts remaining in the Trust account shall revert to
4
Corporation. Except for the rights of creditors in the event of
Corporation's bankruptcy or receivership, Corporation shall have no right
to reclaim amounts contributed to the Trust hereunder until all benefits
have been paid or this Agreement has properly terminated under its terms.
In the event of Corporation's bankruptcy or receivership, the Trustee
shall, upon proper notice, deliver all assets held hereunder to the Trustee
in bankruptcy or the duly court appointed receiver for the benefit of the
general creditors (including Employee) of Corporation.
"Change of Control" as used herein means any merger or consolidation
with or acquisition by any other organization, the sale of substantially
all the assets of the Corporation to another person or organization, or the
acquisition directly or indirectly of 20% or more of the common stock of
the Corporation by one or more persons or organizations acting in concert.
17. Unless otherwise provided in this Agreement, any controversy or claim
arising out of or relating to this contract, or the breach thereof, shall
be settled by arbitration in accordance with the Rules of the American
Arbitration Association, and judgment upon the award rendered by the
Arbitrator(s) may be entered in any Court having jurisdiction thereof. The
Corporation agrees that it will pay Employee's costs including reasonable
attorneys' fees in connection with any controversy or claim hereunder in
which Employee prevails or in which the Arbitrator(s) or court determine
that the Corporation should pay such costs.
18. This Agreement shall be binding upon and inure to the benefit of the
parties, the Corporation's successors and assigns, and the Employee's
heirs, beneficiaries, executors and administrators.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first written above.
Slade's Ferry Bancorp
Attest: /s/ Isola A. Anctil By: /s/ Kenneth R. Rezendes
------------------- ---------------------------
Secretary (Title: Vice Chair )
/s/ Mary Lynn D. Lenz
---------------------
Mary Lynn Lenz
5