Retirement Agreement
Exhibit 10.1
Xx. Xxxxxx X. Xxxxxxx, Xx.
000 Xxxxxxx Xxxxxx XX
Xxxxx Xxxxxx, Xxxxxxxx 00000
000 Xxxxxxx Xxxxxx XX
Xxxxx Xxxxxx, Xxxxxxxx 00000
Dear Xxxxx,
This Retirement Agreement (this “Agreement”) is among you, Mercantile Bank Corporation
(“MBC”), and Mercantile Bank of Michigan (“MBM”), and sets forth the agreement among us relating to
your retirement from MBC, MBM, and their respective subsidiaries and affiliated companies
(collectively the “Mercantile Entities”).
1. Retirement. Your retirement as an officer and employee of all Mercantile Entities will be
effective as of the end of the day on June 30, 2007 (the “Retirement Time”), and your resignation
from all of your positions as an officer or employee of all Mercantile Entities shall be
automatically effective as of the Retirement Time.
2. Resignation as a director. This Agreement constitutes your resignation from the Boards of
Directors of MBC, MBM and any other Mercantile Entities for whom you serve as a director, effective
as of the Retirement Time.
3. Resignation as a trustee. Unless accomplished prior to the Retirement Time, you will resign as
trustee of MBM’s 401(k) plan, and as an administrative trustee of Mercantile Bank Capital Trust I,
effective as of the Retirement Time, and your rights and duties as trustee will be transferred to
one or more successor trustees, or as otherwise requested by MBM or MBC.
4. Payments and benefits. You, MBC and MBM have previously entered into an Employment Agreement
dated as of October 18, 2001, by and among you, MBC and MBM, as amended by agreements dated October
17, 2002 and November 17, 2005 (your “Employment Agreement”). In connection with your retirement,
and as consideration for your agreements, releases and waivers set forth in this Agreement, and as
payment in full of all amounts payable to you by MBC, MBM or any of the other Mercantile Entities,
you will have all of the rights to payments and benefits that would have been provided to you under
your Employment Agreement if you had terminated your employment for “Good Reason” under Section 8.3
of your Employment Agreement effective at the Retirement Time. These payments and benefits are set
forth in Sections 8.5 (Obligations of Employers upon Termination without Cause or Employee’s
Termination with Good Reason) and 9A (Delay in Severance Payments) of your Employment Agreement,
and are subject to the other provisions of the Employment Agreement, including Section 13
(Deductions of Taxes and Adjustments re IRC Section
280G) and the last sentence of Section 19 (Entire Agreement and Regulatory Compliance) of your
Employment Agreement. Notwithstanding the provisions of this Section above, you agree with respect
to the payments and benefits provided for in Sections 8.5(c) and (d) of your Employment Agreement
as follows:
(a) All life insurance under the MBM’s split dollar life insurance or “BOLI” life insurance
programs is excluded from Sections 8.5(c) and (d) of your Employment Agreement, and you will
receive no coverage, payments or insurance relating to those programs.
(b) The insurance provided under the following policies, for which you have been paying the
premiums, are excluded from Section 8.5(c) of your Employment Agreement; however, to the extent
that it is practical for you to acquire or keep the policies, by conversion or otherwise, at your
expense, and without adversely affecting MBM or MBC, you may do so: (i) Mutual of Omaha $50,000
term life insurance policy insuring your life, (ii) MetLife individual long term care policy for
you, and (iii) Colonial Life cancer insurance policy for you.
5. Your obligations under your Employment Agreement. This Agreement does not eliminate or reduce
any of your duties or obligations under your Employment Agreement, or any of our rights under your
Employment Agreement. Your duties and obligations under your Employment Agreement will continue to
apply, including on and after the Retirement Time, to the same extent as if you had terminated your
employment for “Good Reason” under Section 8.3 of your Employment Agreement effective at the
Retirement Time, except that the provisions of Section 11 (Noncompetition Covenant) of your
Employment Agreement are amended to read in full as follows, which expands the duration and
geographic scope of your noncompete covenant:
“ 11. Noncompetition Covenant. From the time that the Employee’s employment
with the Employers terminates through December 31, 2009, the Employee will not be
employed by (including as an employee, independent contractor, consultant or
otherwise) or act as a director or officer of any business involving or engaged in
the business of banking within a 50-mile radius of any of the Cities of Xxx Arbor,
Grand Rapids, Holland, or Lansing, Michigan, where such business engages in
soliciting, directly or indirectly, customers of the Bank.”
6. Cooperation and Transition. You agree (a) to cooperate fully in effecting a smooth transfer of
your responsibilities relating to the Mercantile Entities, including your positions as trustee of
MBM’s 401(k) plan and as an administrative trustee of Mercantile Bank Capital Trust I, (b) to
return to the Mercantile Entities all documents, materials, records, or other things belonging to
any of the Mercantile Entities or containing proprietary information of any of the Mercantile
Entities, (c) to surrender to the Mercantile Entities all of their property, and (d) to reconcile
all of your expense accounts. You agree that from the date of this Agreement through the
Retirement Time,
2
you will (a) diligently take all actions reasonably requested by MBC or MBM to assist in the
effective transition of customers, prospective customers, and other business contacts of the
Mercantile Entities with whom you have a relationship, to other officers and employees of MBC or
MBM, and (b) devote substantially all of your business days to the business of MBC and MBM.
7. Comprehensive Unconditional Release. You hereby release and forever discharge MBC, MBM, each of
the other Mercantile Entities, and their respective successors, assigns, affiliates, shareholders,
directors, officers, trustees, administrators, employees, agents, subcontractors, consultants,
representatives, and heirs (hereinafter collectively referred to as the “Released Persons”) from
any and all claims, demands, actions, causes of action, lawsuits, liabilities, interest, attorney’s
fees, damages, losses, expenses or costs of any and every nature whatsoever, expressly or impliedly
that you may have had or do have as of the date of execution of this Agreement, including any
claims that are known or unknown that may have been asserted by you or on your behalf against any
of the Mercantile Entities or any of the other Released Persons, or involving any other matter
relating to your employment or prospective employment, or position as an officer, director or
trustee. This includes, but is not limited to, releasing any and all claims that you may have
under the Michigan Xxxxxxx-Xxxxxx Civil Rights Act, Title VII of the Civil Rights Act of 1964, as
amended, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the
Americans with Disabilities Act, and the Michigan Persons With Disabilities Civil Rights Act, and
all other relevant state and Federal statutes. You agree that you will not seek, apply for, or
accept employment with any of the Mercantile Entities without the written approval of an executive
officer of MBC. This Section shall not be deemed to waive or release (a) any of your rights to
payments or benefits provided for in this Agreement, including Section 4 of this Agreement, (b) any
rights you may have to the return of the principal or interest on any deposits that you may have
with MBM, in accordance with the terms of the deposit, (c) any rights you may have to
indemnification or reimbursement or any limitation of liability applicable to you under the
Articles of Incorporation or Bylaws of any of the Mercantile Entities and any rights you may have
under any directors and officers liability insurance policy purchased by any of the Mercantile
Entities, or (d) any persons, other than Mercantile Entities or their directors, officers,
trustees, employees or counsel, from any claims, demands, actions, causes of action, lawsuits,
liabilities, interest, attorney’s fees, damages, losses, expenses or costs, that are totally
unrelated to any of the Mercantile Entities, or their business, or your service or the termination
of your service as a director, officer, trustee or employee of any of the Mercantile Entities.
You agree, promptly upon request by MBC or MBM, to execute an additional release of claims
satisfactory to MBC and MBM after the Retirement Time, in order to continue to receive payments
under this Agreement. The additional release shall cover substantially the matters referred to in
this Section above through the Retirement Time.
3
8. Full Review and Knowing and Voluntary Agreement. You acknowledge and agree that:
(a) You have been given the opportunity to fully review this Agreement, have thoroughly
reviewed it, fully understand its terms and knowingly and voluntarily agree to all of its
provisions including, but not limited to, the release set forth above.
(b) You are receiving additional consideration for signing this Agreement, that you are not
otherwise entitled to, including the payments and benefits provided for in Section 4 of this
Agreement.
(c) You have been provided up to twenty-one (21) days to consider whether to sign this
Agreement and that such period is a reasonable time for your consideration of this Agreement.
(d) MBC and MBM have advised you to consult with an attorney regarding this Agreement, and
that you either consulted with an attorney regarding this Agreement or have intentionally chosen
not to exercise your right to consult with an attorney regarding this Agreement.
(e) If this Agreement is executed prior to the expiration of the twenty-one (21) day period
that you were given to consider this Agreement, such execution was knowing and voluntary, your
preference to do so, and without coercion from MBC, MBM or any other person.
9. Seven Day Revocation Period. You have the right to revoke this Agreement for a period of seven
(7) days following the date of your signing this Agreement. You may revoke this Agreement by
providing written notice of your revocation of this Agreement to the President, the Secretary or
the Human Resource Director of MBM before expiration of the revocation period. This Agreement is
not effective or enforceable until the seven day revocation period has expired.
10. Applicable Law and Severability. This Agreement shall be governed by the laws of the State of
Michigan. If, for any reason, any provision of this Agreement is unenforceable, the remainder of
this Agreement shall nonetheless remain binding and in effect.
4
11. Entire Agreement. This Agreement and your Employment Agreement constitute the entire agreement
among you, MBC and MBM regarding the subject matter of this Agreement, and no amendment, deletion,
addition, modification, or waiver of any provision of this Agreement shall be binding or
enforceable unless in writing and signed by you, and on behalf of MBC and MBM by an authorized
officer. This Agreement, together with your Employment Agreement, supersede all prior agreements
and arrangements among you, MBC and MBM, or among you and any other Mercantile Entities, regarding
the subject matter of this Agreement. No promises or representations have been made or relied upon
apart from those expressly stated in this Agreement.
12. Arbitration. Except as provided in Section 12 of your Employment Agreement, any dispute
arising out of this Agreement or your Employment Agreement, or any claimed breach, shall be
exclusively resolved by binding arbitration in Grand Rapids, Michigan, and in accordance with the
rules of the American Arbitration Association. Upon request of any party, the dispute, controversy
or alleged breach shall be submitted to binding arbitration employing the following procedure. MBC
or MBM, and the Employee, shall each select one person not related or affiliated to the selecting
party to serve as an arbitrator, and the selection shall be made within thirty (30) days after the
written request for arbitration. The two arbitrators selected shall choose a third independent
arbitrator. The three selected arbitrators shall notify the parties of the date, time and place of
the arbitration hearing. A decision shall be rendered within thirty (30) days after the
arbitration hearing. The cost of the arbitrators and the arbitrators’ fees shall be shared equally
by (a) MBC and MBM, or either of them, paying half, and (b) you paying the other half; provided,
however, that the arbitrators in their sole discretion may allocate costs and fees solely to one of
the parties to the arbitration if the arbitrators believed that the cause for the dispute,
controversy or alleged breach was without merit or was caused solely by the unreasonable acts or
omissions of the non-prevailing party or parties, as determined by the decision of the arbitrators.
Each party shall be responsible for attorneys and experts engaged by the party on its or his
behalf. A decision of two of the three arbitrators shall be determinative. Any decision rendered
by arbitration shall be final, conclusive and binding and any party may obtain a judgment on the
arbitration decision by submitting the arbitration decision to a circuit court in the State of
Michigan.
13. Headings. The Paragraph headings in this Agreement are for reference purposes only and shall
not be deemed to be part of this Agreement or to affect the meaning or interpretation of this
Agreement.
5
Please read carefully. This Agreement includes a release of all known and unknown claims.
Please confirm your agreement to the above by signing and returning to MBC or MBM a copy of
this Agreement, in which case this will become a legally binding agreement among MBC, MBM and you,
subject only to your right to revoke this Agreement as provided for in Section 9 of this Agreement.
| MERCANTILE BANK CORPORATION | ||||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||||
| Xxxxxxx X. Xxxxx | ||||||
| President and Chief Operating Officer | ||||||
| Dated: May 24, 0000 | ||||||
| XXXXXXXXXX XXXX XX XXXXXXXX | ||||||
| By: | /s/ Xxxxxxx X. Xxxxx | |||||
| Xxxxxxx X. Xxxxx President and Chief Executive Officer |
||||||
| Dated: May 24, 2007 | ||||||
I Agree to the above.
/s/ Xxxxxx X. Xxxxxxx, Xx.
|
Dated: May 24, 2007
6
