FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
Exhibit
10.19
FIRST
AMENDMENT TO
THIS
FIRST AMENDMENT (“First Amendment”), made and entered into as of December 16,
2008 by and between Xxxxxx Xxxxx, a resident of the State of Alabama
(“Employee”), and Peachtree Bank, an Alabama bank (“Employer”).
W I T N E
S S E T H:
WHEREAS,
Employer currently employs Employee as its President and Chief Executive Officer
pursuant to that certain employment agreement between Employer and Employee
dated as of October 31, 2006 (the “Employment Agreement”);
WHEREAS,
Employer and Employee desire to continue such employment;
WHEREAS,
Employer and Employee desire to amend the agreement to provide that the term of
the agreement will be extended for one additional year as of each October 31 if
Employer and Employee agree to so extend it within thirty (30) days prior to the
applicable October 31; and
WHEREAS, Employer and Employee now
desire to amend the Employment Agreement primarily so that the payments and
benefits under the Employment Agreement comply with, or are exempt from, the
rules of Section 409A of the Internal Revenue Code of 1986, as
amended;
NOW,
THEREFORE, in consideration of the continued employment of Employee by Employer,
of the premises and the mutual promises and covenants contained herein, and of
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, agree to
modify the Employment Agreement as follows, effective as of January 1,
2009:
1.
By adding the following to the end of the
existing Section 2:
“The term
of this Agreement shall expire at the end of such three (3)-year period, unless
the parties agree, at least thirty (30) days in advance of the expiration of
such term, to extend the term for one (1) additional year beginning on the third
anniversary of the Effective Date. If the term of this Agreement is
extended as of any anniversary of the Effective Date, then the term may be
extended for one (1) additional year as of the next anniversary of the Effective
Date if the parties agree to extended it at least thirty (30) days in advance of
the time the term would otherwise expire.”
2.
By adding the following to the end of the
existing Section 4:
“All
reimbursements shall be paid as soon as administratively practicable, but in no
event shall any reimbursement be paid after the last day of the taxable year
following the taxable year in which the expense was incurred, nor shall the
amount of reimbursable expenses incurred or in-kind benefits provided in one
taxable year affect the expenses eligible for reimbursement or the in-kind
benefits provided, as applicable, in any other taxable year. The
right to a reimbursement or an in-kind benefit under this Agreement will not be
subject to liquidation or exchange for another benefit.”
3. By
deleting the existing Section 12.6 and substituting therefor the
following:
“12.6 If
this Agreement and Employee’s employment are terminated pursuant to either
Section 12.2 or Section 12.3, then Employer, as Employer’s sole remaining
obligation under this Agreement, shall pay to Employee in a lump sum within
thirty (30) days following Employee’s termination of employment an amount equal
to the sum of the following: (i) Employee’s Base Salary for the remaining months
of the term of this Agreement at the Base Salary rate then in effect; (ii) the
cost of COBRA health continuation coverage for Employee for the lesser of (a)
the remaining months of the term of this Agreement or (b) eighteen (18) months;
and (iii) the cost for term life insurance coverage provided by the Employer to
the Employee for the remaining months of the term of this Agreement based on the
monthly cost of premiums for such coverage in effect on the effective date of
termination.”
4.
By adding the following new Section 12.8:
“12.8 Notwithstanding
anything in this Agreement to the contrary (i) Employee shall be treated as
having incurred a termination of employment hereunder, and shall be entitled to
payments and benefits under Section 12.6 or 15.2, as applicable, only if he has
incurred a ‘separation from service,’ within the meaning of Section 409A of the
Internal Revenue Code, as amended (the ‘Code’), from Employer and all affiliated
companies that, together with Employer, constitute the ‘service recipient’
within the meaning of regulations issued under Code Section 409A; and (ii) if
Employee is a ‘specified employee’ within the meaning of Code Section 409A, at
the date of his termination of employment, then any payments made in connection
with Employee’s termination of employment that would result in a tax under Code
Section 409A if paid during the first six (6) months after termination of
employment shall be withheld, starting with the payments latest in time during
such six (6) month period, and paid to Employee during the seventh month
following the date of his termination of employment.”
5.
By adding the following immediately before the phrase
“(‘Termination of Employment’)” in Section 15.2: “and Employee contemporaneously
or subsequently resigns”.
6.
By deleting the last sentence of Section 15.2 and
substituting therefor the following:
“In the
event the Aggregate Severance is required to be reduced pursuant to this
Section, the portions of the Aggregate Severance paid or provided latest in time
will be reduced first and if portions of the Aggregate Severance to be paid or
provided at the same time must be reduced, noncash benefits will be reduced
before cash payments.”
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7.
By deleting the first sentence of the existing Section
15.3 and substituting therefor the following:
“During
the remaining term of this Agreement following the effective date of a Change in
Control, if Employer takes any of the following actions and Employee
contemporaneously or subsequently resigns, such resignation shall be deemed to
be a termination by Employer without Cause.”
8.
By deleting the last sentence of the existing
Section 15.3 and substituting therefor the following:
“In any
such event, upon Employee’s contemporaneous or subsequent resignation, Employee
shall be entitled to all payments provided for in Section 15.2 of this
Agreement.”
IN
WITNESS WHEREOF, the parties have executed this First Amendment as of the day
and year first written above.
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“Employee”
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||||
| /s/ Xxxx X. Xxxxx | /s/ Xxxxxx Xxxxx |
(SEAL)
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||
|
Witness
|
Xxxxxx
Xxxxx
|
|||
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“Employer”
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ATTEST
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Peachtree
Bank
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By:
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/s/ Xxxx Xxxxx | |||
| /s/ Xxxxxxx X. Hertha |
Its:
|
Executive Vice President | ||
|
(CORPORATE
SEAL)
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