AGREEMENT
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This agreement (the "Agreement") made as of the 12th day of
July, 1996, is between MERCANTILE-SAFE DEPOSIT AND TRUST COMPANY
("Merc-Safe"), a corporation with its principal place of business
at 2 Xxxxxxx Plaza, P. O. Xxx 0000, Xxxxxxxxx, Xxxxxxxx 00000, and
XXXXX X. XXXXXXX, an individual residing at 000 Xxxxxxxxxx Xxxx,
Xxxxxxxxx, Xxxxxxxx 00000. MERCANTILE BANKSHARES CORPORATION
("Mercshares"), a corporation with its principal place of business
at 0 Xxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000, joins in this
Agreement as to certain agreements to which it is a party. This
Agreement governs certain matters with respect to Xx. Xxxxxxx'x
anticipated retirement and the provision of services by Xx.
Xxxxxxx to Merc-Safe thereafter, which services are mutually
agreed to be of substantial value.
1. Retirement. Xx. Xxxxxxx is currently a member of the
Board of Directors and a Vice President of Mercshares and is Vice
Chairman of the Board of Directors and an executive officer of
Merc-Safe. Effective November 1, 1996 (or earlier at the request
of Merc-Safe), Xx. Xxxxxxx'x line management responsibilities will
cease but his other duties shall continue without change in
compensation or benefits. On December 31, 1996, Xx. Xxxxxxx will
cease his service as a director of Mercshares and will retire as
an officer and employee of Mercshares and Merc-Safe ceasing to be
eligible for benefits available to active employees, and becoming
eligible for all retirement and supplemental retirement benefits
under the applicable agreements with and retirement benefits of
Mercshares and Merc-Safe. Xx. Xxxxxxx'x Deferred Compensation
Agreement made as of September 30, 1982, as subsequently amended,
will be further amended by a Sixth Amendment executed
simultaneously with this Agreement. On December 31, 1996, Xx.
Xxxxxxx'x Executive Employment Agreement dated March 13, 1984 (as
subsequently amended) and his Executive Severance Agreement dated
December 31, 1989, with Mercshares and Merc-Safe, shall terminate.
2. Service on Board of Merc-Safe. From and after January
1, 1997, Xx. Xxxxxxx will, for such period of time prior to
December 31, 2001 as Merc-Safe shall request, serve as a non-
employee Director and as a non-employee Vice Chairman of the Board
of Merc-Safe.
3. Retention as Consultant. For a five-year period
commencing January 1, 1997 and ending December 31, 2001, Merc-Safe
hereby retains Xx. Xxxxxxx as a consultant ("Consultant") and
Consultant hereby agrees to provide the consulting services
described in this Agreement.
4. Services to be Provided. In addition to his service as
a Director of Merc-Safe and in his capacity as Vice Chairman of
the Board, Consultant shall, with respect to Merc-Safe's Trust
Division, consult in the formulation of investment policies and
security selection, assist in facilitation of client service,
attend reasonable numbers of client and prospective client
presentations and provide guidance and assistance to portfolio
managers of certain accounts (the "Accounts"). The initially
selected Accounts are listed in Appendix A, which is part of this
Agreement. Such services are expected to include, at Merc-
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Safe's request, attendance at meetings of the Investment Policy and
Strategy Committee, the Equity Research Council and MSD&T Funds,
Inc. The precise scope of these services shall be as determined
by mutual agreement of Consultant and Merc-Safe from time to time.
In view of the proprietary interest of Merc-Safe and
considerations of confidentiality, such services shall be
conducted exclusively for Merc-Safe, but nothing herein contained
shall preclude Consultant from engaging in other business
activities or from attending to personal affairs and those of his
family. Consultant will make himself available to devote such
time as shall be appropriate to provide the services described
above, it being agreed, however, that the services need not be
provided on a full-time basis and further agreed that Consultant
shall have reasonable latitude for other activities and vacation
time.
5. Compensation and Related Matters. The fee for services
which the Consultant shall perform hereunder shall be One Hundred
Twenty-Five Thousand Dollars ($125,000) per year, payable in
monthly installments, continuing throughout the five-year term of
this Agreement, notwithstanding Consultant's disability or death.
In the case of death, payments shall be made to one or more
beneficiaries designated by Consultant in writing from time to
time or, failing such designations, to his estate.
Consultant will be furnished with suitable office facilities
and secretarial services and will be reimbursed for reasonable
expenses incurred in providing his services, but Consultant will
not be required to provide the services on the premises of Merc-
Safe except when necessary for attendance at meetings.
6. Stock Options. The Option Agreement between Consultant
and Mercshares dated August 23, 1995 will be amended, as to any of
Consultant's stock options which would have first become
exercisable on March 14, 1997 if Consultant were employed by Merc-
Safe on that date, to provide that such options will be
exercisable as if December 31, 1996 were Consultant's normal
retirement date instead of an early retirement date.
7. Independent Contractor. In rendering services
hereunder, the Consultant shall be a self-employed professional
person who is acting solely as a Director and independent
contractor and not as an agent, employee or partner of Merc-Safe
for any purpose. The Consultant shall have no authority to bind
Merc-Safe in any contractual manner, nor to represent to others
that the relationship between Merc-Safe and the Consultant is
other than as a Director or Vice Chairman of the Board of Merc-
Safe or as otherwise stated herein. The Consultant shall control
the conduct and means of performing the services required under
this Agreement. Accordingly, it is recognized by the parties that
there will be no withholding by Merc-Safe, and the Consultant
shall be responsible for payment of all taxes arising out of the
activities of the Consultant, unless and to the extent such
withholding is required under any existing or future tax law with
respect to payments to independent contractors.
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8. Indemnification of Consultant. Merc-Safe agrees that
the Consultant shall be indemnified as a Director of Merc-Safe to
the same extent as other Directors, and with respect to his
consulting services, shall have no liability for any business
decisions, actions, policies and practices of Merc-Safe, and
agrees to indemnify and hold the Consultant harmless from and
against any claim by any third party with regard to Merc-Safe's
decisions, actions, policies or practices.
9. Termination of Agreement. Merc-Safe shall have the
right to terminate this Agreement if Consultant shall commit
uncured material illegal acts or uncured material breaches of his
duties as a Director or of this Agreement, provided, that if
Merc-Safe believes Consultant has committed such acts or breaches
it shall provide written notice thereof to Consultant and shall
provide thirty (30) days after delivery of such notice for
Consultant to cure such specified acts or breaches.
Consultant may terminate this Agreement by written notice to
Merc-Safe if Merc-Safe commits uncured material breaches of this
Agreement, provided that if Consultant believes such a material
breach has been committed, he shall provide written notice thereof
to Merc-Safe and provide thirty (30) days after delivery of such
notice to cure the breach. Such a termination by Consultant shall
not affect his right to receive the payments provided for in
Section 5 of this Agreement.
This agreement may also be terminated by mutual written
consent of Merc-Safe and the Consultant.
10. Miscellaneous.
(a) This Agreement constitutes the entire agreement
between the parties with respect to the services provided for
herein, and does not affect Consultant's entitlement to
compensation or benefits for services performed prior to the date
of this Agreement or provided pursuant to any other agreement
between or among the parties. This Agreement may not be amended
or any provision hereof waived except for a document signed by all
parties hereto.
(b) This Agreement is made in and shall be governed by
and construed in accordance with the laws of the State of
Maryland, excluding principles of conflicts of law.
(c) Any notice given under this Agreement shall be
deemed given when delivered in person or by registered or
certified mail, postage prepaid, return receipt requested, or by
other delivery service providing evidence of receipt to the party
to whom such notice is to be given, at the addresses stated at the
beginning of this Agreement or at such other address as either
party shall hereafter designate to the other in writing.
(d) This Agreement shall become effective upon its
approval by the Compensation Committee of Mercshares, the
Committee on Executive Compensation, Promotion and Retirement of
Merc-Safe and by the Board of Directors of Merc-Safe (which
approval may be by the Trust Executive and Banking Executive
Committees of the Board of Directors of Merc-Safe), and shall be
binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns.
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To evidence their agreement to the terms stated in this
Agreement, the parties hereto have signed this Agreement or caused
it to be signed by their duly authorized representatives as of the
day and year stated at the beginning of this Agreement.
ATTEST: MERCANTILE-SAFE DEPOSIT
AND TRUST COMPANY
/s/ XXXX X. XXXXXX By: /s/ X. XXXXXXX XXXXXXX
XXXX X. XXXXXX X. XXXXXXX XXXXXXX
Secretary Chairman and Chief
Executive Officer
WITNESS:
/s/ XXXX X. XXXXXX /s/ XXXXX X. XXXXXXX
XXXXX X. XXXXXXX
ATTEST: MERCANTILE BANKSHARES CORPORATION
/s/ XXXX X. XXXXXX By: /s/ X. XXXXXXX XXXXXXX
XXXX X. XXXXXX X. XXXXXXX XXXXXXX
Secretary Chairman and Chief
Executive Officer
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Date of Approval of Compensation Date of Approval of Committee
Committee of Mercantile Bankshares on Executive Compensation,
Corporation Promotion and Retirement of
Mercantile-Safe Deposit and
Trust Company
July 17, 1996 July 17, 1996
/s/ Xxxx X. Xxxxxx /s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx, Secretary Xxxx X. Xxxxxx, Secretary
Effective Date of Agreement per approval of the Trust Executive
and Banking Executive Committees of the Board of Directors of
Mercantile-Safe Deposit and Trust Company
July 24, 1996
/s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx, Secretary
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