EXHIBIT 99.1
EXECUTION COPY
RESTITUTION AND SETTLEMENT AGREEMENT
THIS RESTITUTION AND SETTLEMENT AGREEMENT (this "Agreement"), dated
November 21, 2003, is entered by and among GOLD BANC CORPORATION, INC., a Kansas
corporation ("Gold Banc"), GOLD BANK, a Kansas state chartered bank ("Gold
Bank-Kansas"), and XXXXXXX X. XXXXXXX ("Xxxx Xxxxxxx").
RECITALS
A. Xxxx Xxxxxxx formerly served as the Chairman of the Board, President and
Chief Executive Officer of Gold Bank-Kansas and Chairman of the Board and
Chief Executive Officer of Gold Banc.
B. Gold Banc has alleged and Xxxx Xxxxxxx has denied that during the course of
his employment, Xxxx Xxxxxxx misappropriated funds from Gold Bank-Kansas.
C. On May 20, 2003, Xxxx Xxxxxxx entered into a Restitution Agreement with Gold
Bank-Kansas pursuant to which he paid $2,252,931 of restitution to Gold
Bank-Kansas.
D. On August 8, 2003, counsel for Gold Bank-Kansas sent a demand letter (the
"Demand Letter") to counsel for Xxxx Xxxxxxx setting forth additional claims and
demanding additional restitution, including reimbursement of certain
investigative expenses.
E. The parties hereto extensively and cooperatively negotiated the additional
claims in the Demand Letter and now desire to resolve and settle such claims
without litigation.
F. Pursuant to the terms of this Agreement, Xxxx Xxxxxxx agrees to exercise
certain vested stock options and agrees to sell all of his shares of Gold Banc
stock (other than his ESOP shares).
G. With the intent of complete cooperation and without admitting any wrongdoing
or liability, Xxxx Xxxxxxx agrees to pay $1.2 million to Gold Bank-Kansas from
the proceeds of the sale of his stock.
AGREEMENT
ACCORDINGLY, in consideration of the premises, the mutual covenants
and agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
1. Definitions. As used herein, the following terms shall have the
-----------
following meanings:
"ADEA Release" shall mean the release of any and all age
discrimination claims by Xxxx Xxxxxxx as set forth in the release attached
hereto as Exhibit D.
"Affiliate" of any Person shall mean (a) any other Person which,
directly or indirectly, controls or is controlled by or is under common control
with such Person and (b) any officer or director of such Person. A Person shall
be deemed to be "controlled by" any other Person if such Person possesses,
directly or indirectly, power to vote five percent (5%) or more of the
securities (on a fully diluted basis) having ordinary voting power for the
election of directors or managers or power to direct or cause the direction of
the management and policies of such Person whether by contract or otherwise.
"Baird" shall mean Xxxxxx X. Xxxxx & Co. Incorporated.
"Baird Account" shall mean Xxxx Xxxxxxx'x personal securities
account, #0000-0000-0, with Xxxxx.
"Xxxxx Shares" shall mean the 64,176 shares of common stock of Gold
Banc previously held in Xxxx Xxxxxxx'x Baird Account, which were sold prior to
the date hereof.
"Closing Date" shall mean a date mutually agreed by the parties
hereto, but in no event later than December 12, 2003.
"Continuing Contracts" shall mean the obligations, contracts,
agreements and plans that continue by or among the parties after the Closing
Date, including this Agreement, the Xxxxxxx Mortgage, the ESOP Plan, the 401(k)
Plan, the Xxxx Xxxxxxx Confidentiality Agreements, the Security Agreement and
the Control Agreement.
"Contracts and Other Agreements" shall mean all contracts,
agreements, understandings, indentures, notes, bonds, loans, instruments,
leases, subleases, mortgages, franchises, licenses, commitments or binding
arrangements, express or implied, oral or written, whether or not enforceable.
"401(k) Plan" shall mean the Gold Banc Corporation, Inc. Employees'
401(k) Plan.
"ESOP Plan" shall mean the Gold Banc Corporation, Inc. Employee
Stock Ownership Plan and Trust.
"ESOP Shares" shall mean the shares of Gold Banc stock that are
beneficially owned by Xxxx Xxxxxxx under the ESOP Plan.
"Exercise Price" of an Option Share shall mean the exercise price per
share for the related Xxxxxxx Option, as described in Section 4 (a) below.
"GBK Shares" shall mean the 82,727 shares of common stock in Gold
Banc currently represented by five (5) stock certificates held by Gold
Bank-Kansas for Xxxx Xxxxxxx.
"Gold Banc Entities" shall mean Gold Banc and all of its
subsidiaries, and all of their respective current and former shareholders,
directors, officers, employees, agents, attorneys, accountants and
representatives, and all predecessors and successors of the foregoing entities.
2
"Governmental Body" shall mean any (a) national, state, county, city,
town, village, district or other jurisdiction of any nature; (b) federal, state,
local, municipal, foreign, or other government; (c) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, department, official, or entity and any court or other tribunal); (d)
multi-national organization or body; or (e) body exercising, or entitled to
exercise, any administrative, executive judicial, legislative, police,
regulatory, or taxing authority or power of any nature.
"Xxxxxxx Account" shall mean the personal money market (NOW) account
of Xxxx Xxxxxxx at Gold Bank-Kansas (Account No. 1003006573).
"Xxxxxxx Mortgage" shall mean the outstanding residential mortgage
loan, #1031000375-101, from Gold Bank-Kansas, that is secured by a mortgage on
Xxxx Xxxxxxx'x personal residence located at 0000 Xxxx 000xx Xxxxxx, Xxxxxxx,
Xxxxxx 00000.
"Xxxxxxx Options" shall have the meaning set forth in Section 4
below.
"Kansas Loan" shall mean the personal loan, #10310001193-501, from
Gold Bank-Kansas to Xxxx Xxxxxxx.
"Lien" shall mean any lien, pledge, claim, charge, security interest
or encumbrance of any nature whatsoever.
"Market Value of an Option Share" shall mean the closing price of the
common stock of Gold Banc on the NASDAQ on the Option Exercise Date.
"Xxxx Xxxxxxx Confidentiality Agreements" shall mean each of the Gold
Banc Corporation Corporate Director Confidentiality Agreement, executed in April
2001, and the Gold Banc Employee Confidentiality Agreement, executed on February
15, 2001, by Xxxx Xxxxxxx.
"Oklahoma Loan" shall mean the personal loan, #115999, from Gold
Bank-Oklahoma to Xxxx Xxxxxxx.
"Option Exercise Date" shall mean each date that Xxxx Xxxxxxx
delivers a notice to Gold Banc for the exercise of a Xxxxxxx Option as set forth
in Section 4 below.
"Option Shares" shall have the meaning set forth in Section 5 below.
"Person" shall mean any natural person, corporation, partnership,
trust, limited liability company, association, governmental authority or unit,
or any other entity, whether acting in an individual, fiduciary or other
capacity.
"REIT Interests" shall mean the $1,500.00 preferred member interest
in Gold RE Holdings-I, LLC, and the $500.00 preferred member interest in Gold RE
Holdings-III, LLC, both owned by Xxxx Xxxxxxx.
3
"Split Dollar Insurance Agreement" shall mean the Split Dollar
Insurance Agreement, dated August 13, 2001, between Gold Banc and Xxxx Xxxxxxx,
relating to the Split Dollar Life Insurance Policies.
"Split Dollar Life Insurance Policies" shall mean the two life
insurance policies, #151212794 and #15121682, issued by Equitable Life Assurance
Society of the United States on the life of Xxxx Xxxxxxx.
"Stock Option Plan" shall mean Gold Banc Corporation, Inc. 1996
Equity Compensation Plan, as amended.
"Value of an Exercised Option" shall mean (a) an amount equal to (i)
the Market Value of an Option Share, minus (ii) the Exercise Price of such
Option Share, multiplied by (b) the number of Option Shares to be acquired by
the exercise of the related Xxxxxxx Option.
"Xxxxxx/Xxxxxxxx Waiver" shall mean a written waiver of the right of
first refusal in favor of Xxxxx X. Xxxxxxxx ("Xxxxxxxx") and Xxxxxxx X. Xxxxxx
("Xxxxxx") created under a Proxy Agreement/Shareholder Agreement, dated
September 15, 1996, among Xxxx Xxxxxxx, Xxxxxxxx and Xxxxxx (the "Shareholder
Agreement").
2. Agreement to Sell GBK Shares. As soon as possible but not later than three
days before the Closing Date, Xxxx Xxxxxxx agrees to sell 82,727 shares of
common stock in Gold Banc currently represented by five (5) stock certificates
held by Gold Bank-Kansas for Xxxx Xxxxxxx (the "GBK Shares"). Within one
business day after the date hereof, Gold Bank-Kansas shall deliver to Baird the
stock certificates representing the GBK Shares.
3. Additional Restitution. Without admitting any wrongdoing or liability
-----------------------
on any specific claim, Xxxx Xxxxxxx hereby agrees to pay to Gold Bank-Kansas
on the Closing Date the sum of $1,200,000 (the "Additional Restitution") in
the manner specified in Section 15 below.
4. Agreement to Exercise Options.
-----------------------------
(a) Xxxx Xxxxxxx agrees to exercise his non-qualified stock options (the
"Xxxxxxx Options") as follows:
(1) On or before December 31, 2003, Xxxx Xxxxxxx shall exercise the options
granted to him on April 1, 1997 to purchase 70,000 shares of common stock
of Gold Banc, at $5.25 per share.
(2) On or before December 31, 2003, Xxxx Xxxxxxx shall exercise the options
granted to him on March 8, 2000 to purchase 21,000 shares of common stock
of Gold Banc, at $7.25 per share.
(3) On or before March 16, 2004, Xxxx Xxxxxxx shall exercise the options
granted to Xxxx Xxxxxxx on February 11, 1998 to purchase 70,000 shares of
common stock of Gold Banc, at $12.125 per share.
4
The Xxxxxxx Options may be exercised in whole or in part in one or more
transactions. Xxxx Xxxxxxx shall deliver to Gold Banc a notice of exercise of
stock options substantially in the form attached hereto as Exhibit C (the
"Exercise Notice") upon each exercise of the Xxxxxxx Options.
(b) The Value of each Exercised Option will be reported by Gold Banc as W-2
supplemental compensation paid to Xxxx Xxxxxxx in the year in which such Xxxxxxx
Option is exercised and will be subject to withholding taxes at the rate of
1.45% for Medicare, 25% for federal income taxes, 5% for Kansas income taxes,
and, for options exercised in 2004, social security taxes of 6.20% up to the
social security wage base (collectively, for each exercise of a Xxxxxxx Option,
the "Total Withholding Taxes").
(c) On the first business day following each Option Exercise Date, Xxxx Xxxxxxx
will pay to Gold Banc via wire transfer the Exercise Price and the Total
Withholding Taxes due with respect to such exercised Xxxxxxx Option.
(d) Xxxx Xxxxxxx hereby waives all his claims, interests or rights in the
following options (i) the options granted to him on February 11, 1999 to
purchase 35,000 shares of common stock in Gold Banc at $13.25 per share, of
which 28,000 are vested as of the date of this Agreement and (ii) any other
stock options that Xxxx Xxxxxxx may have, or have had, an interest, either
directly or indirectly, vested or unvested.
(e) Xxxx Xxxxxxx hereby waives all his claims, interests or rights in any of the
Xxxxxxx Options which he has not exercised by the dates set forth in Section
4(a) above.
5. Agreement to Sell Option Shares
-------------------------------
(a) Xxxx Xxxxxxx agrees to sell the 161,000 shares of common stock of Gold Banc
to be acquired by him through the exercise of his stock options as set forth in
Section 4 above (the "Option Shares") not later than March 31, 2004. Xxxx
Xxxxxxx covenants and agrees to sell Option Shares at any time the market price
for such shares is at or above $12.64 per share.
(b) In the event any Option Shares are owned by Xxxx Xxxxxxx on March 31, 2004,
he shall instruct Baird to immediately sell such shares, irrespective of the
market price.
(c) If the average sale price per share, net of sales commissions, of the Option
Shares is above $13.25 per share, then Xxxx Xxxxxxx agrees to pay Gold Banc an
amount (the "Supplemental Restitution") equal to 30% of (i) the proceeds, net of
brokerage commissions, from the sale of the Option Shares, minus (ii) an amount
equal to (A) $13.25 multiplied by (B) the number of Options Shares sold after
the Closing Date.
6. Security Interest
------------------
(a) Contemporaneous with the execution of this Agreement, Gold Banc, Gold
Bank-Kansas and Xxxx Xxxxxxx hereby agree to enter into a Pledge and Security
Agreement (the "Security Agreement") substantially in the form attached hereto
as Exhibit A to provide a security interest to Gold Banc and Gold Bank-Kansas in
the GBK Shares, the Option Shares, the Xxxxxxx Account and the Baird Account,
and proceeds thereof.
5
(b) Contemporaneous with the execution of this Agreement, Gold Banc, Gold
Bank-Kansas, Xxxx Xxxxxxx and Baird hereby agree to enter into a Control
Agreement (the "Control Agreement") substantially in the form attached hereto as
Exhibit B to provide for the perfection of the security interest of Gold Banc
and Gold Bank-Kansas in the GBK Shares, the Option Shares and the Baird Account,
and proceeds thereof.
7. Agreement to Sell REIT Interests. Xxxx Xxxxxxx hereby agrees to sell, and
--------------------------------
Gold Banc hereby agrees to cause Gold Bank-Kansas and Gold Bank, a Florida bank
(Gold Bank-Florida), to purchase, on the Closing Date, the REIT Interests for an
aggregate purchase price of $2,000.00 in the manner specified in Section 15
below. On the Closing Date Xxxx Xxxxxxx shall execute and deliver to Gold Banc a
Preferred Member Interest Power, substantially in the form attached hereto as
Exhibits E-1 and E-2, covering each REIT Interest.
8. Payment of Loans
----------------
(a) Gold Banc and Xxxx Xxxxxxx hereby acknowledge and agree that the Kansas Loan
and Oklahoma Loan have been paid as previously agreed by the parties.
(b) Gold Banc, on behalf of itself and its subsidiaries, hereby represent,
warrant, covenant and agree that they have not made and, after the date hereof
they will not make, any negative credit reports with respect to the Kansas Loan
or the Oklahoma Loan to any outside credit reporting agencies including, but not
limited to, TransUnion, Experian and Equifax, and agree that the Kansas Loan and
the Oklahoma Loan were paid as agreed.
9. Continuing Contracts. Notwithstanding Sections 12, 13 and 14 below:
--------------------
(a) Gold Bank-Kansas and Xxxx Xxxxxxx agrees to remain bound by the terms and
conditions of the Xxxxxxx Mortgage. This Agreement does not change, amend,
release or otherwise alter the terms and obligations of the Xxxxxxx Mortgage.
(b) The parties hereto remain bound by the terms of the 401(k) Plan and the ESOP
Plan. This Agreement does not change, amend, release or otherwise alter the
terms, obligations, rights or duties of any party under the 401(k) Plan or the
ESOP Plan.
(c) Gold Banc and Xxxx Xxxxxxx are parties to the Xxxx Xxxxxxx Confidentiality
Agreements. Xxxx Xxxxxxx acknowledges and agrees that he has continuing
obligations under the Xxxx Xxxxxxx Confidentiality Agreements regarding Gold
Banc and its subsidiaries and their customers, and that he will continue to
fulfill such obligations in accordance with such agreements. This Agreement does
not change, amend, release or otherwise alter the terms and obligations of the
Xxxx Xxxxxxx Confidentiality Agreements.
(d) Gold Banc, Gold Bank-Kansas and Xxxx Xxxxxxx are parties to the Security
Agreement. The Agreement does not change, amend, release or otherwise alter the
terms, obligations, rights or duties of the Security Agreement.
(e) Gold Banc, Gold Bank-Kansas Xxxx Xxxxxxx and Xxxxx are parties to the
Control Agreement. The Agreement does not change, amend, release or otherwise
alter the terms, obligations, rights or duties of the Control Agreement.
6
10. Cancellation of Split Dollar Life Insurance Policies.
----------------------------------------------------
(a) Gold Banc and Xxxx Xxxxxxx hereby acknowledge and agree that the Split
Dollar Insurance Agreement terminated in accordance with its terms on March 17,
2003, the date on which Xxxx Xxxxxxx'x employment with Gold Banc terminated.
(b) Gold Banc and Xxxx Xxxxxxx hereby acknowledge and agree that Xxxx Xxxxxxx is
indebted to Gold Banc pursuant to the Split Dollar Insurance Agreement in the
principal amount of $102,839.98, which amount is equal to the premium payments
made by Gold Banc under the Split Dollar Life Insurance Policies on behalf of
Xxxx Xxxxxxx. Gold Banc and Xxxx Xxxxxxx hereby further acknowledge and agree
that the interest owed by Xxxx Xxxxxxx to Gold Banc on the loans under the Split
Dollar Insurance Agreement is an amount equal to $10,836.61 as of October 31,
2003, with interest continuing to accrue on such amount at the rate of $11.61
per day.
(c) Pursuant to the terms of the Split Dollar Insurance Agreement, Xxxx Xxxxxxx
hereby irrevocably elects:
(1) not to repay the loans associated with the Split Dollar Insurance
Agreement;
(2) not to repay the accrued interest on such loans,
(3) to convey the Split Dollar Life Insurance Policies to Gold Banc; and
(4) to recognize as additional compensation an amount (the "Split Dollar
Balance") equal to the difference between (i) the aggregate amount of such
loans, plus interest thereon and (ii) the aggregate cash surrender value
of the Split Dollar Life Insurance Policies.
(d) On or before the Closing Date, Xxxx Xxxxxxx shall surrender and deliver the
Split Dollar Life Insurance Policies to Gold Banc, along with an executed
"Request for Change of Beneficiary and/or Owner," substantially in the form
attached hereto as Exhibit F. Xxxx Xxxxxxx further agrees to execute and deliver
such other documents or instruments, if any, as are necessary or desirable to
vest ownership of the Split Dollar Life Insurance Policies in Gold Banc and to
change the beneficiary of the Split Dollar Life Insurance Policies to Gold Banc.
(e) Promptly following the Closing Date, Gold Banc will surrender the policies
in exchange for the cash surrender value thereof. Gold Banc shall apply the cash
surrender value of the policies against the principal and interest owed by Xxxx
Xxxxxxx to Gold Banc under the Split Dollar Insurance Agreement.
(f) Gold Banc and Xxxx Xxxxxxx acknowledge and agree that:
(1) Gold Banc will issue to Xxxx Xxxxxxx a 2003 Form W-2 for the Split
Dollar Balance;
7
(2) pursuant to the Split Dollar Insurance Agreement and applicable
tax laws, the Split Dollar Balance is supplemental income that is subject
to withholding taxes at the rate of 1.45% for Medicare, 25% for federal
income taxes and 5% for Kansas income taxes; and
(3) on the Closing Date, Xxxx Xxxxxxx will pay to Gold Banc the amount of such
withholding taxes due on the Split Dollar Balance in the manner specified
in Section 15 below.
11. Termination of Other Banking Relationships.
------------------------------------------
(a) On the Closing Date, Gold Banc and all its subsidiaries shall close and
terminate all of the following deposit accounts, loan accounts, credit card
accounts and other account relationships with Xxxx Xxxxxxx:
--------------------------------------------------------------------
ACCOUNT HOLDER ACCOUNT NUMBER TYPE OF ACCOUNT GOLD BANC ENTITY
--------------------------------------------------------------------
--------------------------------------------------------------------
Xxxx Xxxxxxx 1000002238 Certificate of Gold Bank -
Deposit Kansas
--------------------------------------------------------------------
--------------------------------------------------------------------
Xxxx Xxxxxxx 1003800008 Savings Gold Bank -
Kansas
--------------------------------------------------------------------
--------------------------------------------------------------------
Xxxx Xxxxxxx 4104 2500 1007 Credit Card Gold Bank -
6188 Kansas
--------------------------------------------------------------------
(b) On the Closing Date, Gold Bank-Kansas shall permit withdrawal of the
Certificate of Deposit of Xxxx Xxxxxxx without penalty and shall pay interest on
such Certificate of Deposit through the Closing Date.
(c) On the Closing Date, Gold Bank-Kansas shall deliver to Xxxx Xxxxxxx a
cashier's check for the balance of the funds remaining in the Savings Account.
(d) Xxxx Xxxxxxx may pay the outstanding balance on his credit card on any day
between the date of this Agreement and the Closing Date. If such balance is not
paid off by the Closing Date, Xxxx Xxxxxxx hereby authorizes Gold Bank-Kansas to
withhold funds from the Certificate of Deposit on the Closing Date to pay off
the balance of such credit card account.
(e) Gold Bank-Kansas shall hold the funds in the Xxxxxxx Account until the
Closing Date. Xxxx Xxxxxxx hereby authorizes Gold Bank-Kansas to withdraw funds
from the Xxxxxxx Account to make the payments contemplated by this Agreement. On
the Closing Date, Gold Bank-Kansas shall deliver to Xxxx Xxxxxxx a cashier's
check for the balance of the funds from the Xxxxxxx Account.
(f) Xxxx Xxxxxxx covenants and agrees not to open any new accounts (deposit or
credit) with Gold Banc or any of its subsidiaries.
12. Release of All Claims by Gold Banc Entities. In consideration of the mutual
-------------------------------------------
releases in this Agreement and other consideration provided for herein, Gold
Banc, on behalf of itself and all of its subsidiaries, hereby release, effective
as of the Closing Date, and forever discharge Xxxx Xxxxxxx of and from any and
all claims, contracts, promises, liens, losses,
8
controversies, agreements, trespasses, debts, fees, rights, demands, costs
(including attorneys' fees), expenses, compensation of any nature whatsoever,
damages, lawsuits, injuries, liabilities, actions and causes of action of every
kind and nature in equity or law, including, but not limited to, any actions
arising under any federal, state or local statutes, laws, ordinances,
regulations or orders, whether foreseen or unforeseen, contingent or actual,
liquidated or unliquidated, known or unknown, that Gold Banc or its subsidiaries
have or at any time prior hereto may have had, whether known to them or not,
arising in whole or in part at any time before the Closing Date, including,
without limitation, the events and claims at issue in the Demand Letter;
provided, however, this release does not release or discharge Xxxx Xxxxxxx from
his obligations arising under the Continuing Contracts, or any claim or
liability arising under or pursuant to the Continuing Contracts; provided
further, that if any of the representations and warranties made by Xxxx Xxxxxxx
in Section 18(a) of this Agreement are materially inaccurate or false, then the
releases provided to Xxxx Xxxxxxx in this Section 12 shall be void and
unenforceable; provided further, that if Xxxx Xxxxxxx does not sell all of the
Option Shares by the date set forth in this Agreement, then the releases
provided to Xxxx Xxxxxxx in this Section 12 shall be void and unenforceable;
provided, further, that if Xxxx Xxxxxxx does not pay the Additional Restitution
Amount and any Supplemental Restitution due under Section 5(c) above by the
dates set forth in this Agreement, then the releases provided to Xxxx Xxxxxxx in
this Section 12 shall be void and unenforceable.
13. Release of All Claims by Xxxx Xxxxxxx. In consideration of the mutual
-------------------------------------
releases exchanged in this Agreement and other consideration provided for
herein, Xxxx Xxxxxxx hereby releases, effective as of the Closing Date, and
forever discharges the Gold Banc Entities, and each of them, of and from any and
all claims, contracts, promises, liens, losses, controversies, agreements,
trespasses, debts, fees, rights, demands, costs (including attorneys' fees),
expenses, compensation of any nature whatsoever, damages, lawsuits, injuries,
liabilities, actions and causes of action of every kind and nature in equity or
law, including, but not limited to, any actions arising under any federal, state
or local statutes, laws, ordinances, regulations or orders, whether foreseen or
unforeseen, contingent or actual, liquidated or unliquidated, known or unknown,
that Xxxx Xxxxxxx has or at any time prior hereto may have had, whether known to
them or not, arising in whole or in part at any time before the Closing Date,
including, without limitation, the events and any counterclaims to the claims at
issue in the Demand Letter; provided, however, this release does not release or
discharge the Gold Banc Entities from their obligations arising under the
Continuing Contracts, or any claim or liability arising under or pursuant to the
Continuing Contracts, and provided, further, that nothing in this release shall
impair, impede or preclude Xxxx Xxxxxxx'x ongoing and complete cooperation with
law enforcement and regulatory agencies; provided, further, that if any of the
representations and warranties made by Gold Banc in Section 18(b) of this
Agreement are materially inaccurate or false, then the releases provided to the
Gold Banc Entities in this Section 13 shall be void and unenforceable.
14. Release of Employment Related Claims by Xxxx Xxxxxxx.
----------------------------------------------------
(a) Gold Banc and Xxxx Xxxxxxx acknowledge and agree that Xxxx Xxxxxxx either
was terminated or has resigned as a director, officer and employee of all of the
Gold Banc Entities.
9
(b) Xxxx Xxxxxxx understands and agrees that he is releasing the Gold
Banc Entities from any and all claims, damages, lawsuits, injuries, liabilities
and causes of action that he may have under any express or implied contract, or
any city ordinance or state, federal or common law meant to protect workers in
their employment relationships including, without limitation, claims under Title
VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in
Employment Act, the Older Workers Benefit Protection Act, the Kansas Acts
Against Discrimination, the Kansas Age Discrimination in Employment Act, the
Americans with Disabilities Act, the Equal Pay Act, 42 U.S.C. xx.xx. 1981, 1983
and 1985, 18 U.S.C. ss. 1514A, the Family and Medical Leave Act, the Employee
Retirement Income Security Act, the Consolidated Omnibus Budget Reconciliation
Act of 1985, the Fair Labor Standards Act, the Kansas Service Letter statute,
the Labor Management Relations Act, Workers' Compensation laws, and under which
he may have rights and claims, whether known to him or not, arising, directly or
indirectly out of his employment by the Gold Banc Entities, and/or the
termination of his employment with the Gold Banc Entities. Xxxx Xxxxxxx further
agrees to execute and deliver on the Closing Date the ADEA Release.
(c) Xxxx Xxxxxxx acknowledges and agrees that he is no longer employed by, and
is not a director or officer of, any of the Gold Banc Entities, that he waives
any right to reemployment with the Gold Banc Entities, and that he will never
apply for employment with any of the Gold Banc Entities. Xxxx Xxxxxxx further
understands and agrees that the Gold Banc Entities may reject any application
for employment that he may make and he waives any claims he might otherwise have
as a result of such rejection.
(d) Xxxx Xxxxxxx acknowledge and agrees that he has not elected to continue any
COBRA insurance coverage.
15. Actions to Be Taken by the Parties:
----------------------------------
(a) On the date hereof:
(1) Gold Banc, Gold Bank-Kansas and Xxxx Xxxxxxx shall execute and deliver the
Security Agreement.
(2) Gold Banc, Gold Bank-Kansas, Xxxx Xxxxxxx and Xxxxx shall execute and
deliver the Control Agreement and Xxxx Xxxxxxx shall cause Baird to
execute and deliver such agreement.
(3) Gold Bank-Kansas shall electronically file a UCC Form 3 with the Kansas
Secretary of State's office releasing its security interest in Xxxx
Xxxxxxx'x membership interest in I-435/Xxxx, L.L.C. and shall promptly
thereafter provide written evidence of such filing to Xxxx Xxxxxxx.
(4) Xxxx Xxxxxxx will execute and deliver to Gold Banc the ADEA Release.
(5) Xxxx Xxxxxxx will deliver to Gold Banc a signed copy of the
Xxxxxx/Xxxxxxxx Waiver.
10
(6) Gold Bank-Kansas will send to Baird via Federal Express the
certificates representing the GBK Shares.
(7) Xxxx Xxxxxxx shall instruct Baird to sell all of the GBK Shares at least
three days prior to the Closing Date.
(b) On the Closing Date, the Parties agree to do the following:
(1) Gold Banc shall instruct Baird to transmit $1,200,000.00 to Gold
Bank-Kansas as payment of the Additional Restitution pursuant to Section 3
hereof.
(2) Xxxx Xxxxxxx shall deliver to Gold Banc the Split Dollar Life Insurance
Policies along with executed Requests for Change of Beneficiary and/or
Owner.
(3) Gold Banc shall cause Baird to transmit to Gold Banc the total withholding
taxes due with respect to cause Split Dollar Balance pursuant to Section
10(f) hereof.
(4) Xxxx Xxxxxxx will deliver to Gold Banc the Preferred Member Interest
Powers covering each REIT Interest.
(5) Gold Banc will cause to be transferred $2,000.00 to the Xxxxxxx Account
representing the proceeds of the purchase of the REIT Interests.
(6) Gold Bank-Kansas will (i) deliver the funds remaining in the Xxxxxxx
Account to Xxxx Xxxxxxx by cashier's check and (ii) close the Xxxxxxx
Account.
(7) Gold Bank-Kansas will (i) withhold from Xxxx Xxxxxxx'x Certificate of
Deposit such amounts as are necessary to pay off the outstanding balance
of Xxxx Xxxxxxx'x Gold Bank-Kansas credit card and (ii) deliver the
balance on the Certificate of Deposit, including any accrued interest
thereon, to Xxxx Xxxxxxx in the form of a cashier's check.
(8) Gold Bank-Kansas will deliver the funds in Xxxx Xxxxxxx'x Savings Account,
including any accrued interest thereon, to Xxxx Xxxxxxx in the form of
cashier's check.
(9) Xxxx Xxxxxxx, Gold Banc and Gold Bank-Kansas will terminate the Security
Agreement.
(10) Xxxx Xxxxxxx, Gold Banc, Gold Bank-Kansas and Baird will terminate the
Control Agreement.
(11) The parties hereto will take all other acts and actions as set forth
herein that are to be taken on or before the Closing Date.
(c) After the Closing Date:
11
(1) Xxxx Xxxxxxx shall execute and deliver to Gold Banc an Exercise Notice for
each exercise of the Xxxxxxx Options.
(2) On the first business day following each Option Exercise Date, Xxxx
Xxxxxxx shall cause Baird to wire transfer to Gold Banc the Exercise Price
and the Total Withholding Taxes due with respect to such exercised Xxxxxxx
Options.
(3) Within one (1) business day after receipt of the wire transfer for an
exercised Xxxxxxx Option, Gold Banc shall deliver to the Transfer Agent an
instruction letter directing the agent to issue the applicable amount of
Option Shares and electronically deliver them to the Xxxxx Account via the
DWAC system.
(4) Xxxx Xxxxxxx shall instruct Xxxxx to sell the Option Shares in accordance
with the terms of this Agreement.
(d) After the Closing Date and before January 31, 2004, Gold Banc will issue to
Xxxx Xxxxxxx W-2s covering his 2003 salary and bonuses, the supplemental income
from the exercise of his stock options in 2003 and the supplemental income from
the termination of the Split Dollar Insurance Agreement.
(e) After the Closing Date and before January 31, 2005, Gold Banc will issue to
Xxxx Xxxxxxx W-2s covering any supplemental income from the exercise of his
stock options in 2004.
(f) If all of the Option Shares are not sold by Xxxx Xxxxxxx by March 30, 2004,
then on March 31, 2004 Xxxx Xxxxxxx will instruct Xxxxx to immediately sell any
such remaining shares.
(g) Upon the sale of the all of the Option Shares, Xxxx Xxxxxxx will instruct
Xxxxx to deliver to Gold Banc an account statement that sets forth the dates,
sale price and amounts of each sale of Option Shares. If any Supplemental
Restitution is due to Gold Banc as set forth in Section 5(c) above, Xxxx Xxxxxxx
will cause Xxxxx to transfer the Secondary Restitution Amount to Gold Banc
within five business days after the sale of the last Option Share.
16. Indemnification.
---------------
(a) Gold Banc, on behalf of itself and all of its subsidiaries, shall indemnify
and hold harmless Xxxx Xxxxxxx from any and all expenses incurred, including but
not limited to attorneys' fees and expenses, as the result of the assertion
after the Closing Date of any claims, actions, causes of action, rights,
grievances, demands, costs, expenses, compensation, liabilities or obligations
which Gold Banc and each of its subsidiaries have released and discharged in
this Agreement.
(b) Xxxx Xxxxxxx shall indemnify and hold harmless the Gold Banc Entities from
any and all expenses incurred, including but not limited to attorneys' fees and
expenses, as the result of the assertion after the Closing Date of any claims,
actions, causes of action, rights,
12
grievances, demands, costs, expenses, compensation, liabilities or obligations
which Xxxx Xxxxxxx has released and discharged in this Agreement.
17. Non-Admissibility. This Agreement is the product of informed negotiations
-----------------
and involves compromises of the parties' previously stated legal positions. The
parties to this Agreement agree that this Agreement and the negotiations
surrounding this Agreement shall not be admissible in any suit, action or other
proceeding brought by any party to this Agreement against any party to this
Agreement (or its affiliates, subsidiaries, parent companies, successors,
predecessors, assigns, partners, officers, directors, agents, employees,
representatives, shareholders or attorneys), except as shall be necessary to
enforce the terms of this Agreement; and provided further that nothing in this
release will impair, impede or preclude Xxxx Xxxxxxx'x ongoing and complete
cooperation with law enforcement and regulatory agencies.
18. Representations and Warranties.
------------------------------
(a) Xxxx Xxxxxxx represents and warrants to the Gold Banc Entities the
following:
(1) I have the power and authority to enter into this Agreement and all other
agreements, documents and instruments to be executed and delivered by me
hereunder, to perform my obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby.
(2) I have duly executed and delivered this Agreement and this Agreement is a
legal, valid and binding obligation, enforceable against me in accordance
with its terms. I will execute and deliver all other agreements,
documents, certificates and instruments contemplated by this Agreement at
or prior to the Closing, and such other agreements, certificates and
instruments will be legal, valid and binding obligations, enforceable
against me in accordance with their respective terms. I have the absolute
and unrestricted right and capacity to execute and deliver this Agreement
and all other agreements, certificates and instruments contemplated by
this Agreement and to perform my obligations under this Agreement and all
other agreements, certificates and instruments contemplated by this
Agreement.
(3) Neither the execution, delivery or performance of this Agreement and all
other agreements contemplated hereby, nor the consummation of the
transactions contemplated hereby or thereby, nor compliance with the
provisions hereof or thereof, by me will, with or without the passage of
time or the giving of notice, or both, (i) conflict with, constitute a
breach, violation or termination of any provision of, or constitute a
default under, any Contracts or Other Agreements to which I am a party or
by which I am bound or to which any of my properties or assets is subject,
or (ii) violate any law, statute, ordinance, regulation, judgment, writ,
injunction, rule, decree, order or any other restriction of any kind or
character applicable to me or any of my properties or assets.
(4) To my knowledge, there is no pending action, audit, hearing,
investigation, litigation, or suit (whether civil, criminal,
administrative, investigative or informal) commenced, brought, conducted
or heard by or before, or otherwise involving,
13
any Governmental Body that challenges, or that may have the effect of
preventing, delaying, making illegal, or otherwise interfering with, any
of the transactions contemplated by this Agreement.
(5) Except for the Xxxxxx/Xxxxxxxx Waiver, no notice, consent filing or
registration to, from or with any third party is necessary for me to
execute, deliver and perform this Agreement or any other agreement,
document or instrument contemplated hereby to be executed and delivered by
me.
(6) Prior to the date of this Agreement, I have obtained a written waiver of
the right of first refusal of Xxxxxxxx and Xxxxxx created under the
Shareholder Agreement.
(7) No representation or warranty or other provision contained herein, or in
any document, schedule or certificate delivered or to be delivered to Gold
Banc in connection with this Agreement or the transactions contemplated
hereby, or any written statement, certificate or other document furnished
to Gold Banc in connection with this Agreement or the transactions
contemplated hereby, contains or will contain any untrue statement of fact
or omits or will omit to state a fact necessary in order to make the
statements contained therein not misleading.
(8) My personal financial statement and tax returns delivered to Gold Banc are
accurate and complete in all material respects. All assets owned directly
or beneficially by me are reflected on the personal financial statement.
(9) Except for the sale of the Xxxxx Shares and the payment of $170,000 to
Xxxxxxxx and Xxxxxx, since the date of the personal financial statement
delivered to Gold Banc, there has not been any material change in my
assets or liabilities, and no event has occurred or circumstance exists
that may result in such a material change.
(10) Except for gifts to my children in amounts less than $35,000.00 per child,
within the twelve (12) months prior to the date of this Agreement, I have
not conveyed any assets, either individually or jointly, to any third
party for less than fair value.
(11) All right, title and interest in and to the Gold Shares and the Option
Shares are owned by me beneficially and of record free and clear of all
Liens.
(12) All right, title and interest in and to the Xxxxx Shares were owned by me
beneficially and of record free and clear of all Liens.
(13) I sold the Xxxxx Shares prior to the date of this Agreement and as of the
date of this Agreement at least $400,000 of the proceeds from such sale
are in the Xxxxx Account.
(14) Prior to the date of this Agreement, I have returned any and all property
(including, but not limited to, all keys, computers, automobiles, credit
cards, and
14
files and documents and all copies thereof) of the Gold Banc
Entities that was in my possession.
(b) The Gold Banc Entities represent and warrant to Xxxx Xxxxxxx the
following:
(1) Gold Banc previously delivered to Xxxx Xxxxxxx'x legal counsel a schedule
setting forth the unexercised stock options granted by Gold Banc to Xxxx
Xxxxxxx. This schedule is a true, correct and complete list of such stock
options as of the date of this Agreement.
(2) The information with respect to the Split Dollar Life Insurance Policies
set forth in Section 10 above is a true and accurate description of such
arrangements as of the date of this Agreement.
(3) The execution, delivery and performance of this Agreement by the
undersigned on behalf of Gold Banc and Gold Bank-Kansas will create legal,
valid and binding obligations of Gold Banc and Gold Bank-Kansas
enforceable in accordance with its terms.
(4) Prior to the date of this Agreement, the Gold Bank Entities have returned
any and all property of Xxxx Xxxxxxx that was in their possession
19. Gold Banc Cooperation. Gold Banc and its subsidiaries shall cooperate
---------------------
reasonably with Xxxx Xxxxxxx in ongoing processes with federal regulatory and
law enforcement agencies. Gold Bank-Kansas shall inform all regulatory and law
enforcement authorities in writing, with a copy to counsel for Xxxx Xxxxxxx,
that a full settlement of all claims and defenses between Xxxx Xxxxxxx and Gold
Banc and its subsidiaries has been reached, restitution to the satisfaction of
Gold Banc has been or will be made in the aggregate amount of at least
$3,452,931, and Xxxx Xxxxxxx has been cooperative throughout this process. Gold
Bank-Kansas shall also make available to Xxxx Xxxxxxx reasonable access to its
records for purposes of Xxxx Xxxxxxx'x ongoing process with federal regulatory
and law enforcement agencies.
20. No Tax Advice. Xxxx Xxxxxxx acknowledges and agrees that none of the Gold
-------------
Banc Entities, including their attorneys and accountants, have made any express
or implied representations to him or given advice to him with respect to the tax
implications of any provisions of this Agreement or any payment made to him
pursuant to this Agreement.
21. Integration. This Agreement and the Exhibits hereto constitute the entire
-----------
agreement between the Parties with respect to the subject matter hereof, and
supercedes all other prior negotiations, discussions, represent actions,
agreements, representations, or understandings both written and oral, among the
Parties with respect thereto. The Parties represent and warrant that no Party
has relied or is relying on any representations or promises made by any person
in connection with this Agreement in entering into this Agreement, other than
what has been set forth herein in writing, and that any prior representations or
promises are merged into this Agreement.
15
22. Successors and Assigns. This Agreement shall inure to the benefit of,
----------------------
and shall be binding upon, the Parties hereto and their respective heirs,
successors and assigns
23. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT SHALL BE GOVERNED
-----------------------------------------
BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF KANSAS, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. EACH OF THE PARTIES
HEREBY CONSENTS TO THE JURISDICTION OF THE DISTRICT COURT OF XXXXXXX COUNTY,
STATE OF KANSAS, AND IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS ARISING
OUT OF OR RELATING TO THIS AGREEMENT SHALL BE LITIGATED IN SUCH COURTS.
24. WAIVER OF JURY TRIAL. EACH OF PARTIES HEREBY IRREVOCABLY WAIVES ANY AND ALL
--------------------
RIGHT TO TRIAL BY JURY RELATING TO THE ENFORCEMENT OR INTERPRETATION OF THIS
AGREEMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.
25. Severability. Each provision of this Agreement is intended to be severable.
------------
Whenever possible, each provision of this Agreement will be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law
for any reason whatsoever, such provision will be ineffective only to the extent
of such prohibition or invalidity, and shall not affect the validity of the
remainder of such provision or the remaining provisions of this Agreement unless
the essential purposes of the Parties are thereby frustrated .
26. Headings. The headings used in this Agreement are for convenience of
--------
reference only and shall in no way define, limit or describe the scope or
intent of any provision of this Agreement.
27. Certification of Review. The Parties certify that they have read the terms
-----------------------
of this Agreement; that they have had the benefit of independent counsel; that
they understand the terms of this Agreement; that they are not relying on any
representation of any other party not contained herein or in the Continuing
Contracts; and that in the event of any dispute concerning this Agreement, the
Parties shall be considered joint authors and any ambiguities shall not be
construed for or against any Party to this Agreement on account of such
drafting.
28. Final Expression. This Agreement represents a final expression of the
----------------
understandings between the Parties with respect to the subject matter hereof and
this Agreement may not be contradicted by evidence of any prior oral agreement
or of a contemporaneous oral agreement or understanding between the Parties
hereto.
29. No Modifications. No change or modification of this Agreement shall be
----------------
valid unless it is contained in writing and signed by the Parties hereto.
30. No Amendments. No amendments to this Agreement shall be effective
-------------
unless such amendment is in writing and signed by all Parties hereto.
16
31. Attorneys' Fees. Each Party shall bear it own attorneys' fees and costs
---------------
arising from the actions of the Parties' own counsel in connection with the
Action, this Agreement, and the matters and documents referred to herein.
32. Multiple Counterparts. This Agreement may be executed in any number of
---------------------
counterparts, each of which shall be deemed to be an original and all of
which shall constitute but one and the same instrument.
17
IN WITNESS WHEREOF, the Parties hereto have caused this Restitution and
Settlement Agreement to be executed as of the date first written above.
/s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
GOLD BANC CORPORATION, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name:Xxxxxxx X. Xxxxx
Title: Chief Executive Officer
GOLD BANK
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Name:Xxxxxxx X. Xxxxx
Title: Chief Executive Officer
18
