AMENDED AND RESTATED WESBANCO BANK, INC. SALARY CONTINUATION AGREEMENT [WITH CHANGE IN CONTROL PROVISION]
EXHIBIT
10.5
AMENDED
AND RESTATED
WESBANCO
BANK, INC.
[WITH
CHANGE IN CONTROL PROVISION]
THIS
AMENDED AND RESTATED SALARY CONTINUATION AGREEMENT
is made
this _____ day of _________, 2005, by and between WESBANCOBANK,
INC., a
state-chartered commercial bank located in Wheeling, West Virginia (the
"Company") and {NAME}
(the
"Executive").
WITNESSETH
WHEREAS,
the parties had entered into a Salary Continuation Agreement dated [Date],
to
encourage the Executive to remain an employee of the Company, under which the
Company was willing to provide salary continuation benefits to the Executive
from its general assets under certain circumstances;
WHEREAS,
the parties intend here by to conform the Salary Continuation Agreement with
the
Section 409A of the Code (as defined herein) and guidance issued thereunder
and
to restate the Salary Continuation Agreement to include both the conforming
changes for the Section 409A and the amendment.
AGREEMENT
The
Executive and the Company agree as follows:
Article
1
Definitions
Whenever
used in this Agreement, the following words and phrases shall have the meanings
specified:
1.1
"Change
of Control Event" shall
be
deemed to have occurred as of the first day that any one or more of the
following conditions shall have been satisfied, followed by Termination of
Employment within the time period hereinafter specified:
(a) Final
regulatory approval is obtained for any Person (other than those Persons in
control of the Company as of the Effective Date, or other than a trustee or
other fiduciary holding securities under an employee benefit plan of the Company
or a corporation owned directly or indirectly by the stockholders of the Company
in substantially the same proportions as their ownership of stock of the
Company), becomes the Beneficial Owner, directly or indirectly, or securities
of
the Company representing thirty five percent (35%) or more of the combined
voting power of the Company's then outstanding securities; or
(b) During
any period of two (2) consecutive years (not including any period prior to
the
execution of this Agreement), individuals who at the beginning of such period
constitute the Board of the Company (and any new Director, whose election by
the
Company's stockholders was approved by a vote of at least two-thirds (2/3)
of
the Directors then still in office who either were Directors at the beginning
of
the period or whose election or nomination
for election was so approved), cease for any reason to constitute a majority
thereof; or
(c) Final
regulatory approval is obtained with respect to: (A) a plan of complete
liquidation of the Company; or (B) an agreement for the sale or disposition
of
all or substantially all the Company's assets; or (C) a merger, consolidation,
or reorganization of the Company with or involving any other corporation, other
than a merger, consolidation, or reorganization that would result in the voting
securities of the Company outstanding immediately prior thereto continuing
to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity), at least fifty percent (50%) of the
combined voting power of the voting securities of the Company (or such surviving
entity) outstanding immediately after such merger, consolidation, or
reorganization.
However,
in no event shall a Change in Control Event be deemed to have occurred, with
respect to the Executive, if the Executive is part of a purchasing group which
consummates the Change in Control Event transaction. The Executive shall be
deemed "part of a purchasing group" for purposes of the preceding sentence
if
the Executive is an equity participant in the purchasing company or group
(except for: (i) passive ownership of less than three percent (3%) of the stock
of the purchasing company; or (ii) ownership of equity participation in the
purchasing company or group which is otherwise not significant, as determined
prior to the Change in Control Event by a majority of the non-employee
continuing Directors of the Company, as applicable).
The
occurrence of a Change in Control Event as defined above shall also then be
followed within three (3) years by the Executive's Termination of Employment
for
reasons other than death, Disability or retirement.
Notwithstanding
the foregoing, no event or combination of events shall constitute a Change
in
Control Event if and to the extent that event or combination of events would
not
constitute a Change in Control Event under Section 409A of the Code or the
guidance published thereunder as then in effect.
1.2
"Code"
means
the
Internal Revenue Code of 1986, as amended.
1.3
"Disability"
means,
if
the Executive is covered by a Company sponsored disability policy, total
disability as defined in such policy without regard to any waiting period.
If
the Executive is not covered by such a policy, Disability means the Executive
suffering a sickness, accident or injury which, in the judgment of a physician
satisfactory to the Company, prevents the Executive from performing
substantially all of the Executive's normal duties for the Company. As a
condition to receiving any Disability benefits, the Company may require the
Executive to submit to such physical or mental evaluations and tests as the
Company's Board of Directors deems appropriate. Nothwithstanding the foregoing,
in any case in which Section 409A may apply, a Disability will not be deemed
to
occur
2
unless
the Executive is unable to engage in substantial gainful activity for a period
of 12 months due to a medically determinable physical or mental impairment
or,
due to such impairment, is receiving disability benefits for a period of three
months under a plan provided by the company to its employees.
1.4
"Early Terminationæmeans
the
Termination of Employment before Normal Retirement Age for reasons other than
death, Disability, Termination for Cause or following a Change in Control
Event.
1.5
"Early
Termination Date" means
the
month, day and year in which Early Termination occurs.
1.6
"Effective Date" means
[Date],
for the
initial Salary Continuation Agreement and the _____ day of _________, 2005
for
this Amended and Restated Salary Continuation Agreement.
1.7
"Normal Retirement Age" means
the
Executive's 65th birthday.
1.8
"Normal
Retirement Date" means
the
later of the Normal Retirement Age or Termination of Employment.
1.9
"Plan
Year" means
a
twelve-month period commencing on [anniversary
of initial agreement]
and
ending on [day
before the anniversary]
of each
year. The initial Plan Year shall commence on the effective date of this
Agreement.
1.10
"Salary"
means
the
annual remuneration the Executive receives as base salary, but before deductions
authorized by the Executive or required by law to be withheld from the Executive
by the Company such as income taxes or Social Security taxes.
1.11
"Termination
for Cause" See
Section 5.2.
1.12
"Termination of Employment" means
that the Executive ceases to be employed by the Company for any reason
whatsoever other than by reason of a leave of absence, which is approved by
the
Company. For purposes of this Agreement, if there is a dispute over the
employment status of the Executive or the date of the Executive's Termination
of
Employment, the Company shall have the sole and absolute right to decide the
dispute.
Article
2
Lifetime
Benefits
2.1
Normal Retirement Benefit. Upon
Termination of Employment on or after the Normal Retirement Age for reasons
other than death, the Company shall pay to the Executive the benefit described
in this Section 2.1 in lieu of any other benefit under this
Agreement.
2.1.1.
Amount
of Benefit. The
annual benefit under this Section 2.1 is (_________
Thousand ________ Hundred ______Dollars).
2.1.2
Payment of Benefit. The
Company shall pay the annual benefit to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following the Executive's Normal Retirement Date. The annual benefit shall
be
paid to the Executive for 10 years.
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2.2
Early Termination/Retirement Benefit. Upon
Early Termination/Retirement, the Company shall pay to the Executive the benefit
described in this Section 2.2 in lieu of any other benefit under this
Agreement.
2.2.1
Amount of Benefit. The
benefit under this Section 2.2 is the Early Termination/Retirement Annual.
Benefit set forth in Schedule A for the Plan Year ending immediately prior
to
the Termination of Employment, determined by vesting the Executive in 100
percent of the Accrual Balance. Any increase in the annual benefit under Section
2.1.1 shall require the recalculation of this benefit on Schedule
A.
2.2.2
Payment of Benefit. The
Company shall pay the annual benefit to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following Normal Retirement Age. The annual benefit shall be paid to the
Executive
for 10 years. The Company, in its sole and absolute discretion, may begin annual
payments or make a lump sum payment of this benefit at any time, calculating
the
present value of said benefit using a discount rate equal to the 10-Year U.S.
Treasury Xxxx rate and monthly compounding.
2.3
Disability Benefit. If
the
Executive terminates employment due to Disability prior to Normal Retirement
Age, the Company shall pay to the Executive the benefit described in this
Section 2.3 in lieu of any other benefit under this Agreement.
2.3.1
Amount
of Benefit. The
annual benefit under this Section 2.3 is the Disability Annual Benefit set
forth
in Schedule A for the Plan Year ending immediately prior to the date in which
the Termination of Employment occurs, determined by vesting the Executive in
the
Normal Retirement Benefit. Any increase in the annual benefit under Section
2.1.1 would require the recalculation of this benefit on Schedule
A.
2.3.2
Payment of Benefit. The
Company shall pay the annual benefit to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following Normal Retirement Age. The annual benefit shall be paid to the
Executive for 10 years.
2.4
Change in Control Event Benefit. Upon
a
Change
in Control Event,
the
Company shall pay to the Executive the benefit described in this Section 2.4
in
lieu of any other benefit under this Agreement.
2.4.1
Amount
of Benefit. The
annual benefit under this Section 2.4 is the Change of Control
Annual Benefit set forth in Schedule A for the
Plan
Year ending immediately prior to
the
date in which Termination of Employment occurs, determined by vesting the
Executive in the Normal Retirement Benefit. Any increase in the annual benefit
under Section 2.1.1 would require the recalculation of this benefit on Schedule
A.
2.4.2
Payment of Benefit. The
Company shall pay the annual benefit to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following Normal Retirement Age. The annual benefit shall be paid to the
Executive for 10 years.
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2.5
Section
409A of the Code. If,
in
the opinion of the Company, Section 409A of the Code applies to payments of
any
benefit under this Article 2, the Company may defer the initial payment of
benefits subject to Section 409A of the Code until the date which is the first
day of the month next following the month in which falls the six month
anniversary of the event giving rise to payments.
Article
3
Death
Benefits
3.1
Death
Benefit. If
the
Executive dies while in the active service of the Company, the Company shall
pay
to the Executive's beneficiary the benefit described in the Split Dollar
Agreement and Endorsement attached as Addendum A between the Company and the
Executive in lieu of any other benefit payable hereunder. The Company shall
not
pay a death benefit under this Section 3.1 if the Executive is entitled to
a
Lifetime Benefit under Article 2.
3.2
Death During Benefit Period. If
the
Executive dies after any Lifetime Benefit payments have commenced under this
Agreement but before receiving all such payments, the Company shall pay the
remaining benefits to the Executive's beneficiary at the same time and in the
same amounts they would have been paid to the Executive had the Executive
survived and no death benefit shall be payable under this Article
3.
3.3
Death
After Termination of Employment But Before Benefit Payments Commence.
If
the
Executive is entitled to any Lifetime Benefit payments under this Agreement,
but
dies prior to the commencement of said benefit payments, the Company shall
pay
the benefit payments to the Executive's beneficiary that the Executive was
entitled to prior to death except that the benefit payments shall commence
on
the first day of the month following the date of the Executive's
death.
Article
4
Beneficiaries
4.1
Beneficiary Designations. The
Executive shall designate a beneficiary by filing a written designation with
the
Company. The Executive may revoke or modify the designation at any time by
filing a new designation. However, designations will only be effective if signed
by the Executive and accepted by the Company during the Executive's lifetime.
The Executive's beneficiary designation shall be deemed automatically revoked
if
the beneficiary predeceases the Executive, or if the Executive names a spouse
as
beneficiary and the marriage is subsequently dissolved. If the Executive dies
without a valid beneficiary designation, all payments shall be made to the
Executive's estate.
4.2
Facility of Payment. If
a
benefit is payable to a minor, to a person declared incapacitated, or to a
person incapable of handling the disposition of his or her property, the Company
may pay such benefit to the guardian, legal representative or person having
the
care or custody of such minor, incapacitated person or incapable person. The
Company may require proof of incapacity, minority or guardianship as it may
deem
appropriate prior to distribution of the benefit. Such distribution shall
completely discharge the Company from all liability with respect to such
benefit.
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Article
5
General
Limitations
5.1
Excess Parachute Payment. Notwithstanding
any provision of this Agreement to the contrary, the Company shall not pay
any
benefit under this Agreement to the extent the benefit would create an excise
tax under the excess parachute rules of Section 28OG of the Code, but
recognizing that only the excess of the Change in Control Benefit need be taken
into account for purposes of Section 280G of the Code.
5.2
Termination for Cause. Notwithstanding
any provision of this Agreement to the contrary,
the Company shall not pay any benefit under this Agreement if the Company
terminates the
Executive's employment for:
(a) Gross
negligence or gross neglect of duties;
(b) Commission
of a felony or a crime involving moral turpitude; or
(c) Fraud,
disloyalty, dishonesty or willful violation of any law or significant Company
policy committed in connection with the Executive's employment and resulting
in
an adverse effect on the Company.
5.3
Suicide
or Misstatement. The
Company shall not pay any benefit under this Agreement if the Executive commits
suicide within two years after the date of this Agreement, or if the Executive
has made any material misstatement of fact on any application for life insurance
purchased by the Company thereby precluding coverage under any policies of
insurance contemplated hereunder.
Article
6
Claims
and Review Procedures
6.1
Claims
Procedure. The
Company shall notify any person or entity that makes a claim under this
Agreement (the "Claimant") in writing, within 90 days of Claimant's written
application for benefits, of his or her eligibility or noneligibility for
benefits under theAgreement.
If the Company determines that the Claimant is not eligible for benefits or
full
benefits, the notice shall set forth (1) the specific reasons for such denial,
(2) a specific reference to the provisions of the Agreement on which the denial
is based, (3) a description of any additional information or material necessary
for the Claimant to perfect his or her claim, and a description of why it is
needed, and (4) an explanation of this Agreement's claims review procedure
and
other appropriate information as to the steps to be taken if the Claimant wishes
to have the claim reviewed. If the Company determines that there are special
circumstances requiring
additional time to make a decision, the Company shall notify the Claimant of
the
special circumstances and the date by which a decision is expected to be made,
and may extend the time for up to an additional 90 days.
6.2
Review Procedure.
If
the
Claimant is determined by the Company not to be eligible for benefits, or if
the
Claimant believes that he or she is entitled to greater or different benefits,
the Claimant shall have the opportunity to have such claim reviewed by the
Company by filing a petition for review with the Company within 60 days after
receipt of, the notice issued by the Company. Said
6
petition
shall state the specific reasons which the Claimant believes entitle him or
her
to benefits or to greater or different benefits. Within 60 days after receipt
by
the Company of the petition, the Company shall afford the Claimant (and counsel,
if any) an opportunity to present his
or
her position to the Company verbally or in writing, and the Claimant (or
counsel) shall have the right to review the pertinent documents. The Company
shall notify the Claimant of its decision in writing within the 60-day period,
stating specifically the basis of its decision, written in a manner calculated
to be understood by the Claimant and the specific provisions of the Agreement
on
which the decision is based. If, because of the need for a hearing, the 60-day
period is not sufficient, the decision may be deferred for up to another 60
days
at the election of the Company, but notice of this deferral shall be given
to
the Claimant.
Article
7
Amendments
and Termination
This
Agreement may be amended or terminated only by a written agreement signed by
the
Company and the Executive.
Article
8
Miscellaneous
8.1
Binding
Effect. This
Agreement shall bind the Executive and the Company, and their beneficiaries,
survivors, executors, successors, administrators and transferees.
8.2
No
Guarantee of Employment. This
Agreement is not an employment policy or contract. It does not give the
Executive the right to remain an employee of the Company, nor does it interfere
with the Company's right to discharge the Executive. It also does not require
the Executive to remain an employee nor interfere with the Executive's right
to
terminate employment at any time.
8.3
Non-Transferability.
Benefits
under this Agreement cannot be sold, transferred, assigned, pledged, attached
or
encumbered in any manner.
8.4
Reorganization. The
Company shall not merge or consolidate into or with another company, or
reorganize, or sell substantially all of its assets to another company, firm,
or
person unless such succeeding or continuing company, firm, or person agrees
to
assume and discharge the obligations of the Company under this Agreement. Upon
the occurrence of such event, the term "Company" as used in this Agreement
shall
be deemed to refer to the successor or survivor Company.
8.5
Tax
Withholding. The
Company shall withhold any taxes that are required to be withheld from the
benefits provided under this Agreement.
8.6
Applicable
Law. The
Agreement and all rights hereunder shall be governed by the laws of the State
of
West Virginia, except to the extent preempted by the laws of the United States
of America.
7
8.7
Unfunded Arrangement. The
Executive and any designated beneficiary are general unsecured creditors of
the
Company for the payment of benefits under this Agreement. The benefits represent
the mere promise by the Company to pay such benefits. The rights to benefits
are
not subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any
insurance on the Executive's life is a general asset of the Company to which
the
Executive and beneficiary have no preferred or secured claim.
8.8
Entire
Agreement. This
Agreement constitutes the entire agreement between the Company and the Executive
as to the continuation of salary following his separation from employment,
provided, if the Executive is then a party to an employment agreement and/or
a
Change in Control Agreement, each such agreement shall be given force and effect
in accordance with their respective terms. No rights are granted to the
Executive by virtue of this Agreement other than those specifically set forth
herein.
8.9
Administration.
The
Company shall have powers which are necessary to administer this Agreement,
including but not limited to:
(a) Interpreting
the provisions of the Agreement;
(b) Establishing
and revising the method of accounting for the Agreement;
(c) Maintaining
a record of benefit payments; and
(d) Establishing
rules and prescribing any forms necessary or desirable to administer the
Agreement.
8.10
Named
Fiduciary. The
Company shall be the named fiduciary and plan administrator under this
Agreement. It may delegate to others certain aspects of the management and
operational responsibilities including the employment of advisors and the
delegation of ministerial duties to qualified individuals.
IN
WITNESS WHEREOF,
the
Executive and the Company have signed this Agreement.
EXECUTIVE: COMPANY
WESBANCO
BANK, INC.
_________________________________ By_________________________________
[NAME]
Title________________________________
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