Exhibit B
Agreement
This Agreement is made this ___ day of February, 1999 among Xxxxxxxx X.
Xxxxxxx ("Xxxxxxx"), having an office at 000 Xxxxx Xxxx, Xxxxxxxxxx, XX 00000,
the "Xxxxxxx Group" as that term is defined in paragraph 9, and CNY Financial
Corporation ("CNY"), having an office at One North Main Street, Cortland, New
York.
1. CNY shall increase the size of its Board of Directors by one and appoint
Xxxxxxx to the resulting vacancy, for a term commencing at the March
meeting of the Board of Directors and ending at the Annual Meeting of
Stockholders scheduled for April 28, 1999. The Board shall nominate Xxxxxxx
for election at that Annual Meeting for a term expiring in 2002. The Board
shall solicit proxies for his election along with the solicitation of
proxies by the Board for the other two nominees nominated by the Board.
2. CNY shall take such action as may be necessary to add Xxxxxxx as a director
of CSB for a term comparable to his term as a director of CNY as set forth
in Section 1.
3. The Xxxxxxx Group, as defined below, shall vote all stock of CNY owned or
controlled by any of them as of the record date for the 1999 Annual Meeting
of Stockholders in favor of the election of Xxxxxxx and in favor of the
election of the two other nominees for directorships nominated by the Board
of Directors, currently expected to be Xxxxxxx X. Xxxxx and Xxxxxx X.
Xxxxxxx.
4. The Xxxxxxx Group will not acquire any shares of common stock of CNY which
would cause its percentage ownership of the issued and outstanding common
stock of CNY to exceed 9.9% on or before the Annual Meeting of Stockholders
held in the year 2000.
5. The Board of Directors of CNY will propose at the 1999 Annual Meeting of
Stockholders two stock-based compensation plans - a stock option plan and a
restricted stock plan (the "PRRP"), as described in the prospectus for
CNY's initial public offering. The Xxxxxxx Group will vote all shares of
stock of CNY owned or controlled by any of them as of the record date for
the 1999 Annual Meeting of Stockholders in favor of those two plans. The
Xxxxxxx Group also agrees that if the Board proposes amendments to those
plans to be voted on at a subsequent meeting of stockholders to permit
accelerated vesting in the event of retirement or a change in control, the
Xxxxxxx Group will vote all shares of stock of CNY owned or controlled by
any of them in favor of those amendments. For the purposes of the preceding
sentence, retirement shall mean ceasing to be a director, employee or
officer of CNY and the Company other than removal for cause.
6. The Xxxxxxx Group will not engage in a solicitation in opposition to
management of CNY or submit any of their own proposals for stockholder
approval without Board approval. This provision shall not apply to the
nomination of directors and the solicitation of proxies for such nominees,
or any other matter arising at, the Annual Meeting of Stockholders to be
held in 2000 or thereafter. Nothing contained in this paragraph shall be
interpreted to prohibit Xxxxxxx from voting, as a director, in such manner
as he deems appropriate on any matter which may come before the Board of
Directors or any committee of CNY or the Bank, nor shall the same prohibit
him from including, in any disclosure by CNY under the Securities Exchange
Act of 1934, any statement explaining his vote if he is required to include
such an explanation in such disclosure.
7. The Xxxxxxx Group concurs that, subject to whatever fiduciary duties may
exist as required by the Employee Retirement Income Security Act, as
amended, unallocated ESOP shares and unallocated "PRRP" shares may be voted
in accordance with the terms of the plans, which generally provide, or will
provide, that unallocated shares will be voted pro rata in the same
percentage as the votes cast by the holders of allocated shares who
exercise their right to direct the voting of allocated shares.
8. The Xxxxxxx Group will not take any action indirectly, or induce any other
person or entity to take any action which, if taken directly by the member
of the Xxxxxxx Group, would be in violation of this agreement, nor will the
Xxxxxxx Group take any action which would reasonably be anticipated to
thwart any of the provisions of this Agreement. All the members of the
Xxxxxxx Group individually, and all members of limited liability companies,
partners of partnerships, stockholders, directors and officers of
corporations, trustees and beneficiaries of trusts, and other persons
holding comparable positions in any other entities, making up the Xxxxxxx
Group shall be personally bound by the provisions of this Agreement which
by their terms are applicable to the Xxxxxxx Group. The members of the
Xxxxxxx Group agree not to seek to use the press or other public
pronouncements to publicly air disputes with the Company through and
including December 31, 1999.
9. The term "the Xxxxxxx Group" shall mean Xxxxxxx & Associates, LLC, Xxxxxxx
Investment Partnership, L.P., Xxxxxxx Investment Partnership II, L.P.,
Xxxxxxx & Associates II, LLC, Kerrimatt, L.P., Federal Holdings, LLC,
Xxxxxxx Xxxxxxx, The Benchmark Company, Inc., Benchmark Partners, LP,
Xxxxxxxx Di Paolo, Xxxxxx Xxxxxxx, Xxxxxxxx X. Xxxxxxx, Xxxxxx Place Corp.,
Xxxxxxx Xxxxxxxxx, Xxxxxx Xxxxxxxxx, Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxxxx,
Xxxxxxx Xxxx, Xxxxxxx Xxxx, Seidecal Associates, LLC, Xxxxx Xxxx and Xxxx
Xxxxxxx.
10. Xxxxxxx hereby represents and warrants that he has the authority to bind
all of the members of the Xxxxxxx Group to this Agreement and that by his
signature below he binds himself and all of such other members of the
Xxxxxxx Group. CNY Financial Corporation
_____________________________
Xxxxxxxx X. Xxxxxxx, personally and
By:____________________________ As agent for the persons and entities
Xxxxxx X. Xxxxxxx, President named in paragraph 9, other than those form
who separate signatures are provided below
_______________________________ _____________________________
Xxxxxxx Xxxxxxx, personally and on Xxxxxx Xxxxxxx
behalf of The Benchmark Company, Inc.
and Benchmark Partners, LP _____________________________
Xxxxxxxx Di Paolo
