EXHIBIT 10.7
THIS EMPLOYMENT AGREEMENT IS THE SAME FOR XXXXX X. XXXX.
XXXXXX X. XXXXXX
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), is made and entered into
as of October 1, 2002 (the "Effective Date"), by and between ST. XXXXXX CAPITAL
CORPORATION, a Delaware corporation (the "Employer"), and XXXXXX X. XXXXXX (the
"Executive").
RECITALS
A. The Employer wishes to continue to employ the Executive as the
Senior Vice President, Chief Financial Officer and Secretary of the Company and
the Senior Vice President, Chief Financial Officer, Secretary of the Board of
Directors and Cashier of St. Xxxxxx Capital Bank, the Employer's subsidiary
Indiana state bank (the "Bank"), for a specified term and the Executive is
willing to continue such employment upon the terms and conditions hereinafter
set forth.
B. The Employer owns all of the issued and outstanding capital stock of
the Bank.
C. The Employer recognizes that circumstances may arise in which a
change of control of the Employer through acquisition or otherwise may occur
thereby causing uncertainty of employment without regard to the competence or
past contributions of the Executive which uncertainty may result in the loss of
valuable services of the Executive and the Employer and the Executive wish to
provide reasonable security to the Executive against changes in the employment
relationship in the event of any such change of control.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements hereinafter contained, it is covenanted and agreed by and between
the parties hereto as follows:
AGREEMENTS
SECTION 1. POSITION AND DUTIES. The Employer hereby employs the
Executive as the Senior Vice President, Chief Financial Officer and Secretary of
the Company and Senior Vice President, Chief Financial Officer, Secretary of the
Board of Directors and Cashier of the Bank or in such other senior executive
capacity or capacities as shall be mutually agreed between the Employer and the
Executive. During the period of the Executive's employment hereunder, the
Executive shall devote his best efforts and full business time, energy, skills
and attention to the business and affairs of the Employer. The Executive's
duties and authority shall consist of and include all duties and authority
customarily performed and held by persons holding equivalent positions with
business organizations similar in nature and size to the Employer, as such
duties and authority are reasonably defined, modified and delegated from time to
time by the Board of Directors of the Employer (the "Board"). The Executive
shall have the powers necessary to perform the duties assigned to him and shall
be provided such supporting services, staff, secretarial and other assistance,
office space and accoutrements as shall be reasonably necessary and appropriate
in the light of such assigned duties.
SECTION 2. COMPENSATION. As compensation for the services to be
provided by the Executive hereunder, the Executive shall receive the following
compensation, expense reimbursement and other benefits:
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(a) BASE COMPENSATION. The Executive shall receive an
aggregate annual minimum base salary at the rate of Ninety Nine Thousand Dollars
($99,000) payable in installments in accordance with the regular payroll
schedule of the Employer. Such base salary shall be subject to review annually
commencing in 2003 and shall be maintained or increased during the term of this
Agreement in accordance with the Employer's established management compensation
policies and plans.
(b) REIMBURSEMENT OF EXPENSES. The Executive shall be
reimbursed, upon submission of appropriate vouchers and supporting
documentation, for all travel, entertainment and other out-of-pocket expenses
reasonably and necessarily incurred by the Executive in the performance of his
duties hereunder and shall be entitled to attend seminars, conferences and
meetings relating to the business of the Employer consistent with the Employer's
established policies in that regard.
(c) OTHER BENEFITS. The Executive shall be entitled to all
benefits specifically established for him and, when and to the extent he is
eligible therefor, to participate in all plans and benefits generally accorded
to senior executives of the Employer, including, but not limited to, pension,
profit-sharing, supplemental retirement, incentive compensation, bonus,
disability income, split-dollar life insurance, group life, medical and
hospitalization insurance, and similar or comparable plans, and also to
perquisites extended to similarly situated senior executives, provided, however,
that such plans, benefits and perquisites shall be no less than those made
available to all other employees of the Employer.
(d) VACATIONS. The Executive shall be entitled to an annual
vacation in accordance with the vacation policy of the Employer which vacation
shall be taken at a time or times mutually agreeable to the Employer and the
Executive; provided, however, that the Executive shall be entitled to at least
twenty (20) days of paid vacation annually.
(e) WITHHOLDING. The Employer shall be entitled to withhold
from amounts payable to the Executive hereunder, any federal, state or local
withholding or other taxes or charges which it is from time to time required to
withhold. The Employer shall be entitled to rely upon the opinion of its legal
counsel with regard to any question concerning the amount or requirement of any
such withholding.
SECTION 3. CONFIDENTIALITY AND LOYALTY. The Executive acknowledges that
during the course of his employment he may produce and have access to material,
records, data, trade secrets and information not generally available to the
public regarding the Employer and its Affiliates (collectively, "Confidential
Information"). Accordingly, during and subsequent to termination of this
Agreement, the Executive shall hold in confidence and not directly or indirectly
disclose, use, copy or make lists of any such Confidential Information, except
to the extent that such information is or thereafter becomes lawfully available
from public sources, or such disclosure is authorized in writing by the
Employer, required by a law or any competent administrative agency or judicial
authority, or otherwise as reasonably necessary or appropriate in connection
with the performance by the Executive of his duties hereunder. All records,
files, documents and other materials or copies thereof relating to the business
of the Employer and its Affiliates which the Executive shall prepare or use,
shall be and remain the sole property of the Employer, shall not be removed from
the premises of the Employer or its Affiliates, as the case may be, without the
written consent of the Employer's President, except as reasonably necessary or
appropriate in connection with the performance by the Executive of his duties
hereunder, and shall be promptly returned to the Employer upon termination of
the Executive's employment hereunder. The Executive agrees to abide by the
reasonable policies of the Employer, as in effect from time to time, respecting
avoidance of interests conflicting with those of the Employer and its
Affiliates. For purposes of this Agreement, "Affiliate" means with respect to a
specified entity, any individual or entity that directly or indirectly controls,
is directly or indirectly controlled by, or is directly or indirectly under
common control with such specified entity, including, but not limited to, the
Bank.
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SECTION 4. TERM AND TERMINATION.
(a) TERM. The Executive's employment hereunder shall be for a
term of one (1) year commencing on the Effective Date, and shall automatically
extend for one (1) additional year on each subsequent anniversary of the
Effective Date, unless terminated by either party effective as of the last day
of the then current one-year period by written notice to that effect delivered
to the other not less than thirty (30) days prior to the anniversary of such
Effective Date.
(b) TERMINATION WITHOUT CAUSE. Either the Employer or the
Executive may terminate this Agreement and the Executive's employment hereunder
for any reason by delivering written notice of termination to the other party no
less than thirty (30) days before the effective date of termination, which date
will be specified in the notice of termination. If the Executive voluntarily
terminates his employment under this Agreement other than pursuant to Section
4(d) (Constructive Discharge) or Section 4(h) (Termination Upon Change of
Control), then the Employer shall only be required to pay the Executive such
base salary as shall have accrued through the effective date of such termination
and none of the Employer or any of its Affiliates (including the Bank) shall
have any further obligations to the Executive.
(c) PREMATURE TERMINATION.
(i) In the event of the termination of this Agreement
by the Employer prior to the last day of the then current term for any reason
other than a termination in accordance with the provisions of Section 4(e)
(Termination for Cause), then notwithstanding any mitigation of damages by the
Executive, the Employer shall pay the Executive the sum of: (A) the amount of
the Executive's annual base salary then payable to the Executive; plus (B) the
value of any bonus or incentive payments the Executive would have received had
he remained employed (based upon the aggregate bonus and/or incentive payment
the Executive received during the Employer's most recently ended fiscal year);
plus (C) the amount of the contributions that would have been made or credited
by the Employer under all employee retirement plans for the benefit of the
Executive (based upon the aggregate contributions made or credited by the
Employer under all employee retirement plans for the benefit of the Executive
for the most recently ended fiscal year of the Employer). In addition, the
Employer shall continue to provide coverage for the Executive under any health,
life and disability insurance programs maintained by the Employer, for twelve
(12) months; provided, however, that the continued payment of these amounts by
the Employer shall not offset or diminish any compensation or benefits accrued
as of the date of termination.
(ii) Payment to the Executive will be made on a
monthly basis over the twelve (12) month period immediately following the
Executive's termination of employment. At the election of the Employer, payments
may be made in a lump sum. Such payments shall not be reduced in the event the
Executive obtains other employment following the termination of employment by
the Employer.
(iii) If the Employer is not in compliance with its
minimum capital requirements or if the payments required under subsection (i)
above would cause the Employer's capital to be reduced below its minimum capital
requirements, such payments shall be deferred until such time as the Employer is
in capital compliance.
(d) CONSTRUCTIVE DISCHARGE. If at any time during the term of
this Agreement, except in connection with a termination pursuant to Section 4(e)
(Termination for Cause), the Executive is Constructively Discharged (as
hereinafter defined), then the Executive shall have the right, by written notice
given to the Employer not later than ninety (90) days after such Constructive
Discharge, to terminate his services hereunder, effective as of thirty (30) days
after the date of such notice, and the Executive shall have no rights or
obligations under this Agreement other than as provided in this Section 4(d),
Section 3 (Confidentiality and Loyalty) and Section 5 (Non-Competition
Covenant). In such event, the Executive shall be entitled to a lump sum payment
of compensation and benefits and continuation of the health, life and disability
insurance as if such termination of his employment were pursuant to Section 4(c)
(Premature Termination), provided, however, that if the Executive is
Constructively Discharged, after or
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in connection with, a Change of Control of the Employer, as provided in Section
4(h) (Termination Upon Change of Control), then the Executive shall be entitled
to elect to receive the compensation provided for in Section 4(h) in lieu of the
benefits provided for in this Section 4(d).
For purposes of this Agreement, the Executive shall be "Constructively
Discharged" upon the occurrence of any one of the following events:
(i) The Executive is not re-elected or is removed
from the positions with the Employer set forth in Section 1 (Position and
Duties), other than as a result of the Executive's election or appointment to
positions of equal or superior scope and responsibility; or
(ii) The Executive shall fail to be vested by the
Employer with the powers, authority and support services of any of said offices;
or
(iii) The Employer shall notify the Executive that
the employment term of the Executive will not be extended or further extended,
as set forth in Section 4(a) (Term); or
(iv) The Employer changes the primary employment
location of the Executive to a place that is more than fifty (50) miles from the
primary employment location as of the Effective Date of this Agreement; or
(v) The Employer otherwise commits a material breach
of its obligations under this Agreement.
(e) TERMINATION FOR CAUSE. This Agreement may be terminated
for cause as hereinafter defined. "Cause" shall mean: (i) the Executive's death;
(ii) the Executive's Permanent Disability, which shall mean the Executive's
inability, as a result of physical or mental incapacity, substantially to
perform his duties hereunder for a period of six (6) consecutive months; (iii) a
material violation by the Executive of any applicable material law or regulation
respecting the business of the Employer; (iv) the Executive being found guilty
of a felony or an act of dishonesty in connection with the performance of his
duties as an officer of the Employer, or which disqualifies the Executive from
serving as an officer or director of the Employer; (v) the willful or negligent
failure of the Executive to perform his duties hereunder in any material
respect; or (vi) the Executive engages in one or more violations of Employer's
policies or procedures or directives of the Board and that have a material
adverse effect on the Employer; or (vii) the Executive is removed or suspended
from banking pursuant to Section 8(e) of the Federal Deposit Insurance Act, as
amended (the "FDIA"), or any other applicable state or federal law. The
Executive shall be entitled to at least thirty (30) days' prior written notice
of the Employer's intention to terminate his employment for any cause (except
the Executive's death) specifying the grounds for such termination, a reasonable
opportunity to cure any conduct or act, if curable, alleged as grounds for such
termination, and a reasonable opportunity to present to the Board his position
regarding any dispute relating to the existence of such cause. In the event of a
dispute regarding the Executive's Permanent Disability, each of the Executive
and the Employer shall choose a physician who together will choose a third
physician to make a final determination thereof. Upon a termination of the
Executive's employment with the Employer for Cause, the Executive shall be
entitled to receive from the Employer only such payments as are due and owing to
the Executive as of the effective date of such termination. If the Executive's
employment is terminated pursuant to this Section, then the Employer shall only
be required to pay the Executive such base salary as shall have accrued through
the effective date of such termination and neither the Employer nor any of its
Affiliates shall have any further obligations to the Executive.
(f) PAYMENTS UPON DEATH. In the event payments are due and
owing under this Agreement at the death of the Executive, payment shall be made
to such beneficiary as the Executive may designate in writing, or failing such
designation, to the executor of his estate, in full settlement and satisfaction
of all claims and demands on behalf of the Executive.
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(g) PAYMENTS PRIOR TO PERMANENT DISABILITY. The Executive
shall be entitled to the compensation and benefits provided for under this
Agreement for any period during the term of this Agreement and prior to the
establishment of the Executive's Disability during which the Executive is unable
to work due to a physical or mental infirmity. Notwithstanding anything
contained in this Agreement to the contrary, until the date specified in a
notice of termination relating to the Executive's Disability, the Executive
shall be entitled to return to his positions with the Employer as set forth in
this Agreement in which event no Disability of the Executive will be deemed to
have occurred.
(h) TERMINATION UPON CHANGE OF CONTROL.
(i) In the event of a Change of Control (as defined
below) of the Employer and the termination of the Executive's employment under
either A or B below, the Executive shall be entitled to receive in lieu of any
other payments provided for in this Agreement a lump sum payment equal to one
and a half (1.5) times the sum of: (1) his base salary then payable; (2) the
value of any bonus or incentive payments the Executive would have received had
he remained employed (based upon the aggregate bonus and/or incentive payment
the Executive received during the Employer's most recently ended fiscal year);
and (3) the value of the contributions that would have been made or credited by
the Employer under all employee retirement plans for the benefit of the
Executive (based upon the aggregate contributions made or credited by the
Employer under all employee retirement plans for the benefit of the Executive
for the most recently ended fiscal year of the Employer). The Employer shall
also continue to provide coverage for the Executive under any health, life and
disability insurance programs for one (1) year following such termination.
Payments under this paragraph shall be subject to the limits of Section
4(h)(iii). The following shall constitute termination of the Executive's
employment within the meaning of this Section 4(h):
A. The Executive terminates his employment
under this Agreement by a written notice to that effect delivered to the Board
within the one (1) year period immediately following the Change of Control.
B. This Agreement is terminated by the
Employer or its successor within either the six (6) month period immediately
preceding the Change of Control or the one (1) year period immediately following
the Change of Control.
(ii) For purposes of this Section, the term "Change
of Control" shall mean the following:
A. The consummation of the acquisition by
any person (as such term is defined in Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act")) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the 0000 Xxx) of
thirty-three percent (33%) or more of the combined voting power of the then
outstanding voting securities of the Employer; or
B. The individuals who, as of the date of
this Agreement, are members of the Board cease for any reason to constitute a
majority of the Board, unless the election, or nomination for election by the
stockholders, of any new director was approved by a vote of a majority of the
Board, and such new director shall, for purposes of this Agreement, be
considered as a member of the Board; or
C. Approval by stockholders of: (1) a merger
or consolidation to which the Employer is a party if the stockholders
immediately before such merger or consolidation do not, as a result of such
merger or consolidation, own, directly or indirectly, more than sixty-seven
percent (67%) of the combined voting power of the then outstanding voting
securities of the entity resulting from such merger or consolidation in
substantially the same proportion as their ownership of the combined voting
power of the Employer's voting securities outstanding immediately before such
merger or consolidation;
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or (2) a complete liquidation or dissolution or an agreement for the sale or
other disposition of all or substantially all of the assets of the Employer.
Notwithstanding the foregoing, a Change of Control shall not be deemed to occur
solely because fifty-one percent (51%) or more of the combined voting power of
the Employer's then outstanding securities is acquired by: (1) a trustee or
other fiduciary holding securities under one or more employee benefit plans
maintained for employees of the entity; or (2) any corporation which,
immediately prior to such acquisition, is owned directly or indirectly by the
stockholders in the same proportion as their ownership of stock immediately
prior to such acquisition.
(iii) It is the intention of the Employer and the
Executive that no portion of any payment under this Agreement, or payments to or
for the benefit of the Executive under any other agreement or plan, be deemed to
be an "Excess Parachute Payment" as defined in Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), or its successors. It is agreed
that the present value of and payments to or for the benefit of the Executive in
the nature of compensation, receipt of which is contingent on the Change of
Control of the Employer, and to which Section 280G of the Code applies (in the
aggregate "Total Payments") shall not exceed an amount equal to one dollar less
than the maximum amount which the Employer may pay without loss of deduction
under Section 280G(a) of the Code. Present value for purposes of this Agreement
shall be calculated in accordance with Section 280G(d)(4) of the Code. Within
ninety (90) days following the earlier of (A) the giving of the notice of
termination or (B) the giving of notice by the Employer to the Executive of its
belief that there is a payment or benefit due the Executive which will result in
an excess parachute payment as defined in Section 280G of the Code, the
Executive and the Employer, at the Employer's expense, shall obtain the opinion
of such legal counsel and certified public accountants as the Executive may
choose (notwithstanding the fact that such persons have acted or may also be
acting as the legal counsel or certified public accountants for the Employer),
which opinions need not be unqualified, which sets forth (A) the amount of the
includable compensation of the Executive for the base period, as determined
under Section 280G of the Code, (B) the present value of Total Payments and (C)
the amount and present value of any excess parachute payments. In the event that
such opinions determine that there would be an excess parachute payment, the
payment hereunder or any other payment determined by such counsel to be
includable in Total Payments shall be modified, reduced or eliminated as
specified by the Executive in writing delivered to the Employer within sixty
(60) days of his receipt of such opinions or, if the Executive fails to so
notify the Employer, then as the Employer shall reasonably determine, so that
under the bases of calculation set forth in such opinions there will be no
excess parachute payment. The provisions of this subsection, including the
calculations, notices and opinions provided for herein shall be based upon the
conclusive presumption that (A) the compensation and benefits provided for in
Section 2 (Compensation) and (B) any other compensation earned by the Executive
pursuant to the Employer's compensation programs which would have been paid in
any event, are reasonable compensation for services rendered, even though the
timing of such payment is triggered by the Change of Control; provided, however,
that in the event such legal counsel so requests in connection with the opinion
required by this subsection, the Executive and the Employer shall obtain, at the
Employer's expense, and the legal counsel may rely on in providing the opinion,
the advice of a firm of recognized executive compensation consultants as to the
reasonableness of any item of compensation to be received by the Executive. In
the event that the provisions of Sections 280G and 4999 of the Code are repealed
without succession, this subsection shall be of no further force or effect.
(i) REGULATORY SUSPENSION AND TERMINATION.
(i) If the Executive is suspended from office and/or
temporarily prohibited from participating in the conduct of the Employer's
affairs by a notice served under Section 8(e)(3) (12 U.S.C. Section 1818(e)(3))
or 8(g) (12 U.S.C. Section 1818(g)) of the FDIA, the Employer's obligations
under this contract shall be suspended as of the date of service, unless stayed
by appropriate proceedings. If the charges in the notice are dismissed, the
Employer may in its discretion (A) pay the Executive all or part of
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the compensation withheld while their contract obligations were suspended and
(B) reinstate (in whole or in part) any of the obligations which were suspended.
(ii) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Employer's affairs by an
order issued under Section 8(e) (12 U.S.C. Section 1818(e)) or 8(g) (12 U.S.C.
Section 1818(g)) of the FDIA, all obligations of the Employer under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.
(iii) If the Employer is in default as defined in
Section 3(x) (12 U.S.C. Section 1813(x)(1)) of the FDIA, all obligations of the
Employer under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.
(iv) All obligations of the Employer under this
contract shall be terminated, except to the extent determined that continuation
of the contract is necessary for the continued operation of the institution by
the Federal Deposit Insurance Corporation (the "FDIC"), at the time the FDIC
enters into an agreement to provide assistance to or on behalf of the Employer
under the authority contained in Section 13(c) (12 U.S.C. Section 1823(c)) of
the FDIA, or when the Employer is determined by the FDIC to be in an unsafe or
unsound condition. Any rights of the parties that have already vested, however,
shall not be affected by such action.
SECTION 5. NON-COMPETITION COVENANT.
(a) RESTRICTIVE COVENANT. The Employer and the Executive have
jointly reviewed the customer lists and operations of the Employer and have
agreed that the primary service area of the Employer's lending and deposit
taking functions in which the Employer has and will actively participate extends
separately to an area which encompasses a fifty (50) mile radius from the main
office of the Employer (the "Restrictive Area"). Therefore, as an essential
ingredient of and in consideration of this Agreement and the payment of the
amounts described in Section 2 (Compensation), the Executive hereby agrees that,
except with the express prior written consent of the Employer, for a period of
one (1) year after the termination of the Executive's employment with the
Employer (the "Restrictive Period"), he will not directly or indirectly compete
with the business of the Employer, including, but not by way of limitation, by
directly or indirectly owning, managing, operating, controlling, financing, or
by directly or indirectly serving as an employee, officer or director of or
consultant to, or by soliciting or inducing, or attempting to solicit or induce,
any employee or agent of the Employer to terminate employment with the Employer
and become employed by any person, firm, partnership, corporation, trust or
other entity which owns or operates, a bank, savings and loan association,
credit union or similar financial institution (a "Financial Institution") within
the Restrictive Area (the "Restrictive Covenant"). If the Executive violates the
Restrictive Covenant and the Employer brings legal action for injunctive or
other relief, the Employer shall not, as a result of the time involved in
obtaining such relief, be deprived of the benefit of the full period of the
Restrictive Covenant. Accordingly, the Restrictive Covenant shall be deemed to
have the duration specified in this Section 5(a) computed from the date the
relief is granted but reduced by the time between the period when the
Restrictive Period began to run and the date of the first violation of the
Restrictive Covenant by the Executive. In the event that a successor assumes and
agrees to perform this Agreement, this Restrictive Covenant shall continue to
apply only to the main office of the Employer as it existed immediately before
such assumption and shall not apply to any of the successor's other offices. The
foregoing Restrictive Covenant shall not prohibit the Executive from owning
directly or indirectly capital stock or similar securities which are listed on a
securities exchange or quoted on the Nasdaq Stock Market which do not represent
more than five percent (5%) of the outstanding capital stock of any Financial
Institution.
(b) REMEDIES FOR BREACH OF RESTRICTIVE COVENANT. The Executive
acknowledges that the restrictions contained in Section 3 (Confidentiality and
Loyalty) and Section 5(a) (Restrictive
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Covenant) of this Agreement are reasonable and necessary for the protection of
the legitimate business interests of the Employer, that any violation of these
restrictions would cause substantial injury to the Employer and such interests,
that the Employer would not have entered into this Agreement with the Executive
without receiving the additional consideration offered by the Executive in
binding himself to these restrictions and that such restrictions were a material
inducement to the Employer to enter into this Agreement. In the event of any
violation or threatened violation of these restrictions, the Employer, in
addition to and not in limitation of, any other rights, remedies or damages
available to the Employer under this Agreement or otherwise at law or in equity,
shall be entitled to preliminary and permanent injunctive relief to prevent or
restrain any such violation by the Executive and any and all persons directly or
indirectly acting for or with him, as the case may be.
SECTION 6. INTERCORPORATE TRANSFERS. If the Executive shall be
voluntarily transferred to an affiliate of the Employer, such transfer shall not
be deemed to terminate or modify this Agreement and the employing corporation to
which the Executive shall have been transferred shall, for all purposes of this
Agreement, be construed as standing in the same place and stead as the Employer
as of the date of such transfer. For purposes of this Agreement, an affiliate of
the Employer shall mean any corporation directly or indirectly controlling,
controlled by, or under common control with the Employer.
SECTION 7. INTEREST IN ASSETS. Neither the Executive nor his estate
shall acquire hereunder any rights in funds or assets of the Employer, otherwise
than by and through the actual payment of amounts payable hereunder; nor shall
the Executive or his estate have any power to transfer, assign, anticipate,
hypothecate or otherwise encumber in advance any of said payments; nor shall any
of such payments be subject to seizure for the payment of any debt, judgment,
alimony, separate maintenance or be transferable by operation of law in the
event of bankruptcy, insolvency or otherwise of the Executive.
SECTION 8. INDEMNIFICATION.
(a) INSURANCE. The Employer shall provide the Executive
(including his heirs, personal representatives, executors and administrators)
for the term of this Agreement with coverage under a standard directors' and
officers' liability insurance policy at its expense.
(b) HOLD HARMLESS. In addition to the insurance coverage
provided for in paragraph (a) of this Section, the Employer shall hold harmless
and indemnify the Executive (and his heirs, executors and administrators) to the
fullest extent permitted under applicable law against all expenses and
liabilities reasonably incurred by him in connection with or arising out of any
action, suit or proceeding in which he may be involved by reason of his having
been an officer of the Employer (whether or not he continues to be an officer at
the time of incurring such expenses or liabilities), such expenses and
liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements.
(c) ADVANCEMENT OF EXPENSES. In the event the Executive
becomes a party, or is threatened to be made a party, to any action, suit or
proceeding for which the Employer has agreed to provide insurance coverage or
indemnification under this Section, the Employer shall, to the full extent
permitted under applicable law, advance all expenses (including reasonable
attorneys' fees), judgments, fines and amounts paid in settlement (collectively
"Expenses") incurred by the Executive in connection with the investigation,
defense, settlement, or appeal of any threatened, pending or completed action,
suit or proceeding, subject to receipt by the Employer of a written undertaking
from the Executive: (i) to reimburse the Employer for all Expenses actually paid
by the Employer to or on behalf of the Executive in the event it shall be
ultimately determined that the Executive is not entitled to indemnification by
the Employer for such Expenses; and (ii) to assign to the Employer all rights of
the Executive to indemnification, under any policy of directors' and officers'
liability insurance or otherwise, to the extent of the amount of Expenses
actually paid by the Employer to or on behalf of the Executive.
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SECTION 9. GENERAL PROVISIONS.
(a) SUCCESSORS; ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of the Executive, the Employer and his and its
respective personal representatives, successors and assigns, and any successor
or assign of the Employer shall be deemed the "Employer" hereunder. The Employer
shall require any successor to all or substantially all of the business and/or
assets of the Employer, whether directly or indirectly, by purchase, merger,
consolidation, acquisition of stock, or otherwise, by an agreement in form and
substance satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as the Employer
would be required to perform if no such succession had taken place.
(b) ENTIRE AGREEMENT; MODIFICATIONS. This Agreement
constitutes the entire agreement between the parties respecting the subject
matter hereof, and supersedes all prior negotiations, undertakings, agreements
and arrangements with respect thereto, whether written or oral. Except as
otherwise explicitly provided herein, this Agreement may not be amended or
modified except by written agreement signed by the Executive and the Employer.
(c) ENFORCEMENT AND GOVERNING LAW. The provisions of this
Agreement shall be regarded as divisible and separate; if any of said provisions
should be declared invalid or unenforceable by a court of competent
jurisdiction, the validity and enforceability of the remaining provisions shall
not be affected thereby. This Agreement shall be construed and the legal
relations of the parties hereto shall be determined in accordance with the laws
of the State of Indiana without reference to the law regarding conflicts of law.
(d) ARBITRATION. Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration,
conducted before a panel of three arbitrators sitting in a location selected by
the Executive within twenty-five (25) miles from the location of the main office
of the Employer, in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award in
any court having jurisdiction; provided, however, that the Executive shall be
entitled to seek specific performance of his right to be paid through the date
of termination during the pendency of any dispute or controversy arising under
or in connection with this Agreement.
(e) LEGAL FEES. All reasonable legal fees paid or incurred by
the Executive pursuant to any dispute or question of interpretation relating to
this Agreement shall be paid or reimbursed by the Employer if the Executive is
successful on the merits pursuant to a legal judgment, arbitration or
settlement.
(f) WAIVER. No waiver by either party at any time of any
breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by the other party, shall be deemed a waiver of
any similar or dissimilar provisions or conditions at the same time or any prior
or subsequent time.
(g) NOTICES. Notices pursuant to this Agreement shall be in
writing and shall be deemed given when received; and, if mailed, shall be mailed
by United States registered or certified mail, return receipt requested, postage
prepaid; and if to the Employer, addressed to the principal headquarters of the
Employer, attention: Chairman; or, if to the Executive, to the address set forth
below the Executive's signature on this Agreement, or to such other address as
the party to be notified shall have given to the other.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
ST. XXXXXX CAPITAL CORPORATION XXXXXX X. XXXXXX
By: /s/ Xxxx X. Xxxxxxxxx /s/ Xxxxxx X. Xxxxxx
---------------------------- ---------------------------
Xxxx X. Xxxxxxxxx 50600 Pine Row Court
Chief Executive Officer and Xxxxxxx, XX 00000
Chairman of the Board
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