EXHIBIT 10.5(a)
Amended and Restated Employee Severance Compensation Plan of Flushing Savings
Bank, FSB
EMPLOYEE SEVERANCE COMPENSATION PLAN
OF
FLUSHING SAVINGS BANK, FSB
(Amended and restated effective as of July 18, 2000)
1. PURPOSE. The purpose of this Employee Severance Compensation Plan
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(the "Plan") is to provide an equitable measure of compensation for eligible
employees of Flushing Savings Bank, FSB (the "Bank") or Flushing Financial
Corporation (the "Holding Company") whose employment has been terminated within
one year after a Change of Control.
2. DEFINITIONS.
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(a) "Cause" means intentional engagement in dishonest conduct,
insubordination, willful misconduct, breach of fiduciary duty involving personal
profit, intentional failure to perform duties, or commission of an act which
would constitute a felony.
(b) "Change of Control" means:
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(i) the acquisition of all or substantially all of
the assets of the Bank or the Holding Company by any person or entity,
or by any persons or entities acting in concert;
(ii) the occurrence of any event if, immediately
following such event, a majority of the members of the Board of
Directors of the Bank or the Holding Company or of any successor
corporation shall consist of persons other than Current Members (for
these purposes, a "Current Member" shall mean any member of the Board
of Directors of the Bank or the Holding Company as of the Effective
Date of the Conversion and any successor of a Current Member whose
nomination or election has been approved by a majority of the Current
Members then on the Board of Directors);
(iii) the acquisition of beneficial ownership,
directly or indirectly (as provided in Rule 13d-3 under the Securities
Exchange Act of 1934 (the "Act"), or any successor rule), of 25% or
more of the total combined voting power of all classes of stock of the
Bank or the Holding Company by any person or group deemed a person
under Section 13(d)(3) of the Act; or
(iv) approval by the stockholders of the Bank or
the Holding Company of an agreement providing for the merger or
consolidation of the Bank or the Holding Company with another
corporation where the stockholders of the Bank or the Holding Company,
immediately prior to the merger or consolidation, would not
beneficially own, directly or indirectly, immediately after the merger
or consolidation, shares entitling such stockholders to 50% or more of
the total combined voting power of all classes of stock of the
surviving corporation.
(c) "Effective Date of the Conversion" means the day on which
the conversion of the Bank from the mutual to capital stock form of ownership
becomes effective.
(d) "Disability" means termination under circumstances in
which the employee would qualify for disability benefits under one or more
disability programs maintained by the Holding Company or the Bank.
(e) "Good Reason" means a reduction by the Bank or the Holding
Company in the employee's Pay, as in effect immediately prior to a Change of
Control.
(f) "Pay" means the regular hourly wage of an employee or, if
the employee is salaried, the annual base salary of the employee, as in effect
immediately prior to a Change of Control, and does not include in either case
overtime, bonuses, or other premium wage payments.
3. ELIGIBILITY. An employee shall be eligible to receive the
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severance payment described in Section 4 of this Plan if:
(a) the employee was employed by the Bank or the Holding
Company immediately prior to a Change of Control,
(b) the employee is not a party to an employment agreement nor
a special termination agreement with the Bank or the Holding Company on the date
of termination of the employee's employment,
(c) the employee completed at least one year of service with
the Bank or the Holding Company prior to termination of the employee's
employment,
(d) the employee's employment was terminated within one year
following a Change of Control, and
(e) the employee's employment was terminated (i) by the Bank
or the Holding Company other than by reason of the death, or Disability of the
employee and other than for Cause, or (ii) by the employee for Good Reason.
4. BENEFITS.
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(a) Employees eligible pursuant to Section 3 shall be entitled
to receive from the Bank a cash lump sum severance payment equal to two weeks of
Pay for each full year of continuous service completed with the Bank or the
Holding Company or any predecessor of the Bank, up to a maximum benefit of 26
weeks of Pay.
(b) The severance payment described above in paragraph (a)
shall be payable in addition to, and not in lieu of, all other accrued or vested
or earned but deferred compensation, rights, options, or other benefits which
may be owed to the employee following termination.
(c) No employee shall be required to mitigate, by seeking
employment or otherwise, the amount of any payment that the Bank becomes
obligated to make under this Plan, and amounts to be paid to an employee
pursuant to this Plan shall not be reduced by reason of the employee's obtaining
other employment or receiving similar payments or benefits from another
employer.
5. WITHHOLDING. The Bank shall have the right to deduct from all
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payments under this Plan any taxes required by law to be withheld from such
payments.
6. NO RIGHT TO EMPLOYMENT. Nothing in this Plan shall be construed as
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giving any person the right to be retained in the employment of the Bank or the
Holding Company, nor shall it affect the right of the Bank or the Holding
Company to terminate an employee's employment with or without Cause.
7. AMENDMENT AND TERMINATION. The Board of Directors of the Bank may
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amend or terminate this Plan at any time prior to a Change of Control. This Plan
may not be amended or terminated at any time after a Change of Control in any
manner adverse to an employee without the consent of such employee.
8. NONASSIGNABILITY. Benefits under this Plan may not be assigned by
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the employee. The terms and conditions of this Plan shall be binding on the
successors and assigns of the Bank.
9. SEVERABILITY. In the event that any provision of this Plan shall be
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held to be invalid or unenforceable for any reason, in whole or in part, the
remaining provisions of this Plan shall be unaffected thereby and shall remain
in full force and effect to the fullest extent permitted by law.
10. CONSTRUCTION. The Board of Directors of the Bank shall have sole
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and full authority to interpret and construe this Plan. Any such interpretation
or construction shall be final and conclusive.
11. GOVERNING LAW. This Plan shall be governed by the laws of the
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State of New York, without reference to conflicts of law principles.
12. GUARANTEE. The Holding Company shall guarantee the payment by
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the Bank of any benefits to which an employee is entitled under this Plan.
13. EFFECTIVE DATE. This Plan shall be effective as of the Effective
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Date of the Conversion.
