Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Effective January 17, 2024, BayCom Corp (the “Company”) and its wholly owned subsidiary, United Business Bank (the “Bank”), entered into amendments to its amended and restated employment agreements with each of the following executive officers: (1) George Guarini, the President and Chief Executive Officer of the Company and the Bank, (2) Janet King, the Senior Executive Vice President and Chief Operating Officer of the Company and the Bank, and (3) Keary Colwell, the Senior Executive Vice President, Chief Administrative officer, Chief Financial Officer and Corporate Secretary of the Company and the Bank.
The agreements were amended and restated to (a) revise Section 1.1 of each agreement to extend the term of the employment agreements to March 5, 2027, (b) revise Section 2.1 of Ms. Colwell’s agreement to reflect her also being the Chief Administrative Officer, (c) revise Section 3.1 of each agreement to reflect the executive’s current annual base salary, (d) revise Section 3.3 of the agreements for Ms. King and Ms. Colwell regarding annual restricted stock grants, (e) revise Sections 6.2 and 6.3 of each agreement with respect to providing continued health insurance benefits following a termination of employment, (f) revise the notice period in Section 6.3 of each agreement, (g) revise the first sentence of Section 6.5 of each agreement to add a reference to the Company in the definition of “Payments,” and (h) add language to Section 7.1 of each agreement to reflect a recent opinion of the National Labor Relations Board. The term of each agreement will automatically extend for an additional year on each annual anniversary date of the agreements, unless either party gives notice that the extensions will cease.
Each employment agreement provides for, among other things, a minimum annual base salary of $724,131 for Mr. Guarini and $417,768 for each of Ms. King and Ms. Colwell (subject to adjustments as may be determined by our Board of Directors), incentive bonuses, an $800 monthly automobile allowance, and group insurance benefits, as well as a group life insurance benefit payable to the executive’s designated beneficiary in an amount equal to the executive’s then-current annual base salary and participation in any retirement, profit-sharing, salary deferral, medical expense reimbursement and other similar plans we may establish for our employees. Each agreement generally provides for indemnification of the executive to the maximum extent permitted by law and applicable regulations for any expenses incurred by the executive, and for any judgments, awards, fines or penalties imposed against the executive, in any proceeding relating to the executive’s actions (or our actions) while an agent of ours. Each agreement also provides for the advancement of expenses to the executive and coverage under a director and officer liability insurance policy.
Each employment agreement also provides for an annual restricted stock grant (“Annual Award”) in the first quarter of each year for a number of shares of common stock equal to 25% of the executive’s base salary as of the end of the preceding calendar year, divided by the fair market value of our common stock as of the date of grant”), provided that sufficient shares are available under the Company’s 2017 Omnibus Incentive Plan or any subsequent plan. These annual grants will vest at the rate of 20% per year over a five-year period, with the initial vesting occurring on the one-year anniversary of the date of grant.
The employment agreements provide that the Annual Awards will become fully vested upon either (1) a termination of the executive’s employment due to death or disability or by the Bank without cause, (2) a change in control as defined in our 2017 Omnibus Equity Incentive Plan (or any applicable subsequent plan) if no replacement award (as defined in the employment agreements) is provided to the executive, or (3) the executive terminates his or her employment for “good reason” as defined below.
Each agreement provides that if, within one year following a change in control, the executive’s employment is terminated without cause or the executive terminates his or her employment for “good reason,” then the executive will be entitled to a lump sum cash severance payment and the continuation of the executive’s health insurance benefits for a period of 24 months on the same terms as if the executive had remained employed by the Bank during such period. The severance pay in connection with a change in control would be equal to three times the sum of (a) the executive’s then-current annual base salary, (b) any incentive bonus paid to the executive with respect to the preceding year, and (c) the grant date value of the executive’s annual restricted stock award for the year in which the termination occurs or, if the termination occurs before the annual grant is made for such year, the grant date value of the annual restricted stock award for the immediately preceding calendar year. In addition, if we terminate the agreement without cause prior to a change in control, the Bank will (1) pay the aggregate cash amount in the preceding sentence over 24 months (12 months for Ms. King and Ms. Colwell) in equal monthly installments, and (2) for a period of 24 months continue to provide the executive with health insurance benefits on the same terms as if the executive had remained employed by the Bank during such period. The term “good reason” means any of the following: (1) a material permanent reduction in the executive’s total compensation or benefits; (2) a material permanent
