Exhibit 10(a)
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of the 16 day of
August, 1999 by and between MIDAMERICA BANCORP, INC., a Kentucky
corporation and BANK OF LOUISVILLE, a Kentucky Combined Bank and
Trust Company, (individually a "Company"; together with their
successors and assigns permitted under this Agreement, the
"Companies"), and XXXX X. XXXXX (the "Executive").
W I T N E S S E T H:
WHEREAS, the Companies desire to continue the employment of
the Executive and to enter into an agreement embodying the terms of
such employment (this "Agreement"), and the Executive desires to
enter into this Agreement and accept such continued employment,
subject to the terms and provisions of this Agreement,
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable
consideration, the receipt of which is mutually acknowledged, the
Companies and the Executive (individually a "Party" and together
the "Parties") agree as follows:
1. Definitions.
(a) "Affiliate" of a person or other entity shall mean a
person or other entity that directly or indirectly
controls, is controlled by, or is under common control
with the person or other entity specified.
(b) Except as provided otherwise in Section 7 hereof, "Base
Salary" shall mean the salary provided for in Section 4
below or any increased salary granted to the Executive
pursuant to Section 4.
(c) "Board" shall mean the Boards of Directors of the
Companies.
(d) "Cause" shall mean:
(i) The Executive is convicted of a felony; or
(ii) The Executive is guilty of willful gross neglect or
willful gross misconduct in carrying out his duties
under this Agreement, resulting, in either case, in
material economic harm to a Company, unless the
Executive believed in good faith that such act or
nonact was in the best interests of such Company.
(e) A "Change of Control" shall mean the occurrence of any
one of the following events:
(i) Any "person," as such term is used in Sections
3(a)(9) and 13(d)of the Securities Exchange Act of
1933, after the date hereof becomes a "beneficial
owner," as such term is used in Rule 13d-3
promulgated under that Act, of 20% or more of the
Voting Stock of a Company;
(ii) The majority of either Board consists of individuals
other than Incumbent Directors, which term means
the members of the Board on the date of this
Agreement; provided that any person becoming a
director subsequent to such date whose election or
nomination for election was supported by two-thirds
of the directors who then comprised the Incumbent
Directors shall be considered to be an Incumbent
Director;
(iii) A Company adopts any plan of liquidation
providing for the distribution of all or
substantially all of its assets;
(iv) All or substantially all of the assets or business
of a Company is disposed of pursuant to a merger,
consolidation or other transaction (unless the
shareholders of such Company immediately prior to
such merger, consolidation or other transaction
beneficially own, directly or indirectly, in
substantially the same proportion as they owned the
Voting Stock of such Company, all of the Voting
Stock or other ownership interests of the entity
or entities, if any, that succeed to the business
of such Company); or
(v) A Company combines with another company and is the
surviving corporation but, immediately after the
combination, the shareholders of such Company
immediately prior to the combination hold, directly
or indirectly, 50% or less of the Voting Stock of
the combined company (there being excluded from the
number of shares held by such shareholders, but not
from the Voting Stock of the combined company, any
shares received by Affiliates of such other company
in exchange for stock of such other company).
(f) "Constructive Termination Without Cause" shall mean a
termination of the Executive's employment at his
initiative as provided in Section 7(d) below following
the occurrence, without the Executive's prior written
consent, of one or more of the following events (except
in consequence of a prior termination):
(i) A reduction in the Executive's then current Base
Salary or the termination or material reduction of
any employee benefit or perquisite enjoyed by him
(other than as part of an across-the-board
reduction applicable to all executive officers of
the Companies);
(ii) The failure to elect or reelect the Executive to any
of the positions described in Section 3 below or
removal of him from any such position;
(iii) A material diminution in the Executive's duties
or the assignment to the Executive of duties which
are materially inconsistent with his duties or
which materially impair the Executive's ability to
function as the Executive Vice President or any
other office to which he may be elected or
appointed:
(iv) The failure to continue the Executive's
participation in any incentive compensation plan
unless a plan providing a substantially similar
opportunity is substituted;
(v) The relocation of a Company's principal office, or
the Executive's own office location as assigned to
him by a Company, to a location outside of the
metropolitan area of Louisville, Kentucky; or
(vi) The failure of a Company to obtain the assumption in
writing of its obligation to perform this Agreement
by any successor to all or substantially all of the
assets of such Company within 45 days after a
merger, consolidation, sale or similar transaction.
(g) "Disability" shall mean the Executive's inability to
substantially perform his duties and responsibilities
under this Agreement for a period of 180 consecutive
days.
(h) "Term of Employment" shall mean the period specified in
Section 2 below.
(i) "Voting Stock" shall mean capital stock of any class or
classes having general voting power under ordinary
circumstances in the absence of contingencies, to elect
the directors of a corporation.
2. Term of Employment.
The employment of the Executive will continue for thirty-six
months from the date hereof or until the earlier termination of his
employment in accordance with the terms of this Agreement.
Thereafter, if not terminated by written notice delivered by either
party to the other prior to expiration of the original or any
successive 36-month term, this Agreement's term shall be renewed
for successive thirty-six month periods. A termination of this
Agreement for any reason at the end of the original or renewal term
shall not constitute a termination of Executive's employment or
trigger required payments pursuant to Section 7 hereof, and
continued employment thereafter shall be "at will" and either party
may terminate the employment at any time thereafter, with or
without cause.
3. Position. Duties and Responsibilities.
(a) During the term of Employment, the Executive shall
continue to be employed as Executive Vice President and
General Counsel of the Companies with duties commensurate
with that position. The Executive, in carrying out his
duties under this Agreement, shall report to the Chief
Executive Officer.
(b) Anything herein to the contrary notwithstanding, nothing
shall preclude the Executive from (i) serving on the
boards of directors of a reasonable number of other
corporations (except Executive will not serve on the
board of any other financial institution) or the boards
of a reasonable number of trade associations and/or
charitable organizations, (ii) engaging in charitable
activities and community affairs, and (iii) managing his
personal investments and affairs, provided that such
activities do not materially interfere with the proper
performance of his duties and responsibilities as the
Companies' Executive Vice President or any other office
to which he may be elected or appointed.
4. Base Salary.
The Executive shall be paid an annualized Base Salary, payable
in accordance with the regular payroll practices of the Companies,
of $120,000. The Base Salary shall be reviewed no less frequently
than annually for increase at the sole discretion of the Board and
its Nominating and Executive Compensation Committee.
5. Employee Benefit Programs.
During the Term of Employment, the Executive shall be entitled
to participate in all employee incentive, pension and welfare
benefit plans and programs made available to the Companies' senior
level executives or to their employees generally, as such plans or
programs may be in effect from time to time, including without
limitation, annual stock option grant, ESOP, bonus, pension, profit
sharing, savings and other retirement plans or programs, medical,
dental, hospitalization, short-term and long-term disability and
life insurance plans, accidental death and dismemberment
protection, travel accident insurance, and any other pension or
retirement plans or programs and any other employee incentive
compensation plan, employee welfare benefit plans or programs that
may be sponsored by the Companies from time to time, including any
plans that supplement the above-listed types of plans or programs,
whether funded or unfunded.
6. Reimbursement of Business and Other Expenses.
The Executive is authorized to incur reasonable expenses in
carrying out his duties and responsibilities under this Agreement
and the Companies shall promptly reimburse him for all business
expenses incurred in connection with carrying out the business of
the Companies, subject to documentation in accordance with the
Companies' policy.
7. Termination of Employment.
(a) Termination for Cause. In the event the Companies
terminate the Executive's employment for Cause, he shall
be entitled to:
(i) The Base Salary through the date of the termination
of his employment for Cause;
(ii) Any pension benefit that may become due pursuant to
Section 5 above, determined as of the date of such
termination;
(iii) Other or additional benefits in accordance with
applicable plans or programs of the Companies to
the date of termination;
(iv) Any incentive awards earned (but not yet paid).
(b) Termination Without Cause. If the Executive's employment
is terminated by the Companies without Cause other than
due to Disability or death, or there is a Constructive
Termination without Cause, the Executive shall be
entitled to:
(i) The Base Salary through the date of termination of
the Executive's employment;
(ii) The Base Salary, at the annualized rate in effect on
the date of termination of the Executive's
employment, for thirty-six months following such
termination, paid in installments in accordance
with the regular pay practices of the Companies;
provided that at the Executive's option the
Companies shall pay him the present value of such
salary continuation payments in a lump sum (using
as the discount rate the Applicable Federal Rate
for short term Treasury obligations as published by
the Internal Revenue Service for the month in which
such termination occurs).
(iii) The balance of any incentive awards earned (but
not yet paid);
(iv) The right to exercise any stock option in full,
whether or not such right is exercisable pursuant
to the terms of the grant.
(v) Any pension benefit that may become due pursuant to
Section 5 above;
(vi) Continued accrual of credited service for the
purpose of the pension benefit provided under
Section 5 for thirty-six months, with such amount
payable on a non-tax-qualified basis;
(vii) Continued participation in all medical, dental,
hospitalization and life insurance coverage and in
other employee benefit plans or programs in which
he was participating on the date of the termination
of his employment until the earlier of:
(A) The end of the period during which he is
receiving salary continuation payments (or in
respect of which a lump-sum severance payment
is made);
(B) The date, or dates, he receives equivalent
coverage and benefits under the plans and
programs of a subsequent employer (such
coverages and benefits to be determined on a
coverage-by-coverage, or benefit-by-benefit,
basis);
provided that (x) if the Executive is precluded
from continuing his participation in any employee
benefit plan or program as provided in this clause
(vii) of this Section 7(b), he shall be provided
with the after-tax economic equivalent of the
benefit provided under the plan or program in which
he is unable to participate for the period
specified in this clause (vii) of this Section
7(b), (y) the economic equivalent of any benefit
foregone shall be deemed to be the lowest cost that
would be incurred by the Executive in obtaining
such benefit himself on an individual basis, and
(z) payment of such after-tax economic equivalent
shall be made quarterly in advance; and
(viii) Immediate vesting of the Companies'
contribution to his Employee Stock Ownership Plan
with any unvested amounts paid on a non-tax-
qualified basis
(ix) Other or additional benefits in accordance with
applicable plans and programs of the Companies to
the date of termination.
(c) Termination of Employment Following a Change in Control.
If following a Change in Control, the Executive's
employment is terminated without Cause other than due to
Disability or death or there is a Constructive
Termination Without Cause, the Executive shall be
entitled to the payments and benefits provided in Section
7(b), provided that the salary continuation payments
shall be paid in a lump sum without any discount. Also,
immediately following a Change in Control, all amounts,
entitlements or benefits in which he is not yet vested
shall become fully vested. In addition, if this Agreement
is in effect at the date of the Change in Control (even
if subsequently not renewed) and Executive continues in
the employ of the Companies for a period of two years
following the effective date of the Change of Control, he
may then voluntarily terminate his employment and in such
a case would receive a lump sum equal to three times Base
Salary. A voluntary termination under the previous
sentence of this Section 7(c) shall be effective upon 30
days prior notice to the Companies and shall not be
deemed a breach of this Agreement;
(d) Voluntary Termination. In the event of a termination of
employment by the Executive on his own initiative other
than a termination due to death or Disability or a
Constructive Termination without Cause, the Executive
shall have the same entitlements as provided in Section
7(a) for a Termination for Cause.
(e) Limitation Following a Change in Control. In the event
that the termination of the Executive's employment is for
one of the reasons set forth in Section 7(b) above
following a Change in Control, and the aggregate of all
payments or benefits made or provided to the Executive
under any Section above and under all other plans and
programs of the Companies (the "Aggregate Payment") is
determined to constitute a Parachute Payment, as such
term is defined in Section 280G(b)(2) of the Internal
Revenue Code of 1986, as amended, notwithstanding any
other provision of this Agreement to the contrary, the
aggregate amount of payments or benefits paid by the
Companies to the Executive pursuant to this Agreement,
the amount to be paid to the Executive and the time of
payment shall be adjusted pursuant to this Section 7(e)
so as to make such payments fully deductible by the
Companies. If the Parties are unable to agree upon an
Auditor to calculate such an adjustment, then the
Executive and Companies shall each select one accounting
firm and those two firms shall jointly select the
accounting firm to serve as the Auditor.
(f) Upon termination pursuant to Section 7(b), the Executive
will have the option of purchasing his Company car for
the value of such car on the books of the Company at the
time of termination, adjusted for value of the
Executive's cash contribution, if any, to the purchase of
the car.
(g) No Mitigation - No Offset. In the event of any
termination of employment under this Section 7, the
Executive shall be under no obligation to seek other
employment and there shall be no offset against amounts
due the Executive under this Agreement on account of any
remuneration attributable to any subsequent employment
that he may obtain except as specifically provided in
this Section 7.
(h) Nature of Payments. Any amounts due under this Section 7
are in the nature of severance payments considered to be
reasonable by the Companies and are not in the nature of
a penalty.
8. Indemnification.
(a) The Companies agree that if the Executive is made a
party, or is threatened to be made a party, to any
action, suit or proceeding, whether civil, criminal,
administrative or investigative (a "Proceeding"), by
reason of the fact that he is or was a director, officer
or employee of the Companies or is or was serving at the
request of the Companies as a director, officer, member,
employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether
or not the basis of such Proceeding is the Executive's
alleged action in an official capacity while serving as
a director, officer, member, employee or agent, the
Executive shall be indemnified and held harmless by the
Companies to the fullest extent permitted or authorized
by the Companies' certificates of incorporation or bylaws
or, if greater, by the laws of the State of Kentucky,
against all cost, expense, liability and loss (including,
without limitation, reasonable attorney's fees,
judgments, fines, ERISA fines, excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to
the Executive even if he has ceased to be a director,
member, employee or agent of the Companies or other
entity and shall inure to the benefit of the Executive's
heirs, executors and administrators. The Companies shall
advance to the Executive all reasonable costs and
expenses incurred by him in connection with a Proceeding
within 20 days after receipt by the Companies of a
written request for such advance. Such request shall
include an undertaking by the Executive to repay the
amount of such advance if it shall ultimately be
determined that he is not entitled to be indemnified
against such costs and expenses.
(b) Neither the failure of the Companies (including its board
of directors, independent legal counsel or stockholders)
to have made a determination prior to the commencement of
any proceeding concerning payment of amounts claimed by
the Executive under Section 8(a) that indemnification of
the Executive is proper because he has met the applicable
standard of conduct, nor a determination by the Companies
(including its board of directors, independent legal
counsel or stockholders) that the Executive has not met
such applicable standard of conduct, shall create a
presumption that the Executive has not met the applicable
standard of conduct.
(c) The Companies agree to continue and maintain a directors'
and officers' liability insurance policy covering the
Executive to the extent either Company provides such
coverage for its other executive officers.
9. Representation. The Companies represent and warrant that
they are fully authorized and empowered to enter into this
Agreement and that the performance of their obligations under this
Agreement will not violate any agreement between it and any other
person, form or organization.
10. Entire Agreement. This Agreement contains the entire
understanding and agreement between the Parties concerning the
subject matter hereof and supersedes all prior agreements,
understandings, discussions, negotiations and undertakings, whether
written or oral, between the Parties with respect thereto.
11. Amendment or Waiver. No provision in this Agreement may
be amended unless such amendment is agreed to in writing and signed
by the Executive and an authorized officer of the Companies. No
waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed
by such other Party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same or any prior or
subsequent time. Any waiver must be in writing and signed by the
Executive or an authorized officer of the Companies, as the case
may be.
12. Severability. In the event that any provision or portion
of this Agreement shall be determined to be invalid or
unenforceable for any reason, in whole or in part, the remaining
provisions of this Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted by
law.
13. Survivorship. The respective rights and obligations of
the Parties hereunder shall survive any termination of the
Executive's employment to the extent necessary to the intended
preservation of such rights and obligations.
14. Resolution of Disputes. Any disputes arising under or in
connection with this Agreement shall, at the election of the
Executive or the Companies, be resolved by binding arbitration, to
be held in Kentucky in accordance with the rules and procedures of
the American Arbitration Association. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. Costs of the arbitration or litigation,
including, without limitation, attorneys' fees of both Parties,
shall be borne by the Companies, provided that if the arbitrator(s)
determine that the claims or defenses of the Executive were without
any reasonable basis, each Party shall bear his or its own costs.
15. Notices. Any notice given to a party shall be in writing
and shall be deemed to have been given when delivered personally or
sent by certified or registered mail, postage prepaid, return
receipt requested, duly addressed to the Party concerned at the
address indicated below or to such changed address as such Party
may subsequently give such notice of:
If to the Companies: MID-AMERICA BANCORP, INC.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx
If to the Executive: XXXX X. XXXXX
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
IN WITNESS WHEREOF, the undersigned have executed this Agreement as
of the date first written above.
SIGNATURES ON FOLLOWING PAGE
MIDAMERICA BANCORP, INC.
By: /S/ X. X. Xxxxxxxxx
Title: Vice Chairman and CEO
BANK OF LOUISVILLE
By: /S/ X. X. Xxxxxxxxx
Title: Vice Chairman and CEO
/S/ Xxxx X. Xxxxx
XXXX X. XXXXX
Exhibit 10(b)
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of the 15th day of
August, 1999 by and between MID-AMERICA BANCORP, a Kentucky
corporation and BANK OF LOUISVILLE, a Kentucky Combined Bank and
Trust Company (together with their successors and assigns
permitted under this Agreement, the "Companies"), and XXXXXX X.
SMALL (the "Executive").
W I T N E S S E T H:
WHEREAS, the Companies and the Executive are parties to an
Agreement dated as of May 3, 1993, covering the employment
relationship of Executive with Companies, which agreement was
superceded by an agreement dated March 1, 1996; and
WHEREAS, a subsequent agreement was executed by the Parties
dated June 1, 1998; and
WHEREAS, the parties have discovered that they disagree
about the enforceability and construction of the agreement dated
June 1, 1998 in various circumstances;; and
WHEREAS, the parties desire to maintain the relationship of
the Companies with a valued long-term employee in the face of
conflicting claims about the June 1, 1998 agreement's
enforceability, and therefore agreed orally on August 15, 1999
and now wish to document that agreement, to cancel the June 1,
1998 agreement and replace it in its entirety with the agreement
dated March 1, 1996, with clarifying changes, all as set forth
in this Employment Agreement (the "Agreement").
NOW, THEREFORE, in consideration of the promises and mutual
covenants contained herein and for other good and valuable
consideration, the receipt of which is mutually acknowledged,
the Companies and the Executive (individually a "Party" and
together the "Parties") agree as follows:
1. Definitions.
(a) "Affiliate" of a person or other entity shall mean a
person or other entity that directly or indirectly
controls, is controlled by, or is under common control
with the person or other entity specified.
(b) Except as provided otherwise in Section 8 hereof,
"Base Salary" shall mean the salary provided for in
Section 5 below or any increased salary granted to the
Executive pursuant to Section 5.
(c) "Board" shall mean the Boards of Directors of the
Companies.
(d) "Cause" shall mean:
(i) The Executive is convicted of a felony; or
(ii) The Executive is guilty of willful gross neglect
or willful gross misconduct in carrying out his
duties under this Agreement, resulting, in either
case, in material economic harm to the Companies,
unless the Executive believed in good faith that
such act or nonact was in the best interests of
such Company
(e) A "Change of Control" shall mean the occurrence of any
one of the following events:
(i) Any "person," as such term is used in Sections
3(a)(9) and 13(d)of the Securities Exchange Act
of 1923, becomes a "beneficial owner," as such
term is used in Rule 13d-3 promulgated under that
Act, of 20% or more of the Voting Stock of the
Companies;
(ii) The majority of either Board consists of
individuals other than Incumbent Directors, which
term means the members of the Board on the date
of this Agreement; provided that any person
becoming a director subsequent to such date whose
election or nomination for election was supported
by two-thirds of the directors who then comprised
the Incumbent Directors shall be considered to be
an Incumbent Director,
(iii) The Companies adopt any plan of liquidation
providing for the distribution of all or
substantially all of its assets;
(iv) All or substantially all of the assets or
business of the Companies is disposed of pursuant
to a merger, consolidation or other transaction
(unless the shareholders of such Company
immediately prior to such merger, consolidation
or other transaction beneficially own, directly
or indirectly, in substantially the same
proportion as they owned the Voting Stock of such
Company, all of the Voting Stock or other
ownership interests of the entity or entities, if
any, that succeed to the business of such
Company); or
(v) The Companies combine with another company and is
the surviving corporation but, immediately after
the combination, the shareholders of such Company
immediately prior to the combination hold,
directly or indirectly, 50% or less of the Voting
Stock of the combined company (there being
excluded from the number. of shares held by such
shareholders, but not from the Voting Stock of
the combined company, any shares received by
Affiliates of such other company in exchange for
stock of such other company).
(f) "Constructive Termination Without Cause" shall mean a
termination of the Executive's employment at his
initiative other than pursuant to death or Disability
(whether such termination is covered by Section 8(b)
or 8(c) below), following the occurrence, without the
Executive's prior written consent, of one or more of
the following events (except in consequence of a prior
termination):
(i) A reduction in the Executive's then current Base
Salary or the termination or material reduction
of any employee benefit or perquisite enjoyed by
him;
(ii) The failure to elect or reelect the Executive to
any of the positions described in Section 4 below
or removal of him from any such position;
(iii) A material diminution in the Executive's
duties or the assignment to the Executive of
duties which are materially inconsistent with his
duties or which materially impair the Executive's
ability to function as the Executive Vice
President and Chief Financial Officer or any
other office to which he may be elected or
appointed:
(iv) The failure to continue the Executive's
participation in any incentive compensation plan
unless a plan providing a substantially similar
opportunity is substituted;
(v) The relocation of a Companies' principal office,
or the Executive's own office location as
assigned to him by the Companies, to a location
outside of the metropolitan area of Louisville,
Kentucky; or
(vi) The failure of the Companies to obtain the
assumption in writing of its obligation to
perform this Agreement by any successor to all or
substantially all of the assets of such Company
within 45 days after a merger, consolidation,
sale or similar transaction.
(g) "Disability" shall mean the Executive's inability to
substantially perform his duties and responsibilities
under this Agreement for a period of 180 consecutive
days.
(h) "Term of Employment" shall mean the period specified
in Section 3 below.
(i) "Voting Stock" shall mean capital stock of any class
or classes having general voting power under ordinary
circumstances in the absence of contingencies, to
elect the directors of a corporation.
2. Cancellation of Old Agreement.
The Agreement between the Parties entered into as of June
1, 1998, is hereby revoked and canceled in its entirety.
3. Term of Employment.
The employment of the Executive will continue to the last
day of the month in which the Executive turns 55 years of age or
until the earlier termination of his employment in accordance
with the terms of this Agreement.
4. Position, Duties and Responsibilities.
(a) During the term of Employment, the Executive shall
continue to be employed as Executive Vice President
and Chief Financial Officer of the Companies with
duties commensurate with that position, including
S.E.C. reporting, internal financial reporting,
financial reporting to the Board of Directors,
interest rate risk management, deposit pricing, loan
review, internal audit, investment management,
budgeting and forecasting, and various operations
functions. The Executive, in carrying out his duties
under this Agreement, shall report to the Chairman of
the Board,
(b) Anything herein to the contrary notwithstanding,
nothing shall preclude the Executive from (i) serving
on the boards of directors of a reasonable number of
other corporations (except Executive will not serve on
the board of any other financial institution) or the
boards of a reasonable number of trade associations
and/or charitable organizations, (ii) engaging in
charitable activities and community affairs, and (iii)
managing his personal investments and affairs,
provided that such activities do not materially
interfere with the proper performance of his duties
and responsibilities as the Companies' Executive Vice
President and Chief Financial Officer or any other
office to which he may be elected or appointed.
5. Signing Bonus; Base Salary.
(a) The Executive shall be paid a non-contingent bonus of
$600,000, payable $300,000 upon execution of this
Agreement, and the remainder by October 10, 1999
(regardless whether Executive remains employed at that
date), each installment to be paid less any taxes or
other withholdings required by law, in consideration
of his agreement to cancel his prior employment
agreement, and agreement to forego other employment
opportunities in favor of continued service for the
Companies.
(b) In addition, the Executive shall be paid an annualized
base salary, payable in accordance with the regular
payroll practices of the Companies, of $200,000 ("Base
Salary"). The Base Salary shall be reviewed no less
frequently than annually for increase at the sole
discretion of the Board and its Nominating and
Executive Compensation Committee.
6. Employee Benefit Programs.
During the Term of Employment, the Executive shall be
entitled to participate in all employee incentive, pension and
welfare benefit plans and programs made available to the
Companies' senior level executives or to its employees
generally, as such plans or programs may be in effect from time
to time, including without limitation, annual stock option
grant, ESOP, bonus, pension, profit sharing, savings and other
retirement plans or programs, medical, dental, hospitalization,
short-term and long-term disability and life insurance plans,
accidental death and dismemberment protection, travel accident
insurance, and any other pension or retirement plans or programs
and any other employee incentive compensation plan, employee
welfare benefit plans or programs that may be sponsored by the
Companies from time to time, including any plans that supplement
the above-listed types of plans or programs, whether funded or
unfunded.
7. Reimbursement of Business and Other Expenses.
The Executive is authorized to incur reasonable expenses in
carrying out his duties and responsibilities under this
agreement and the Companies shall promptly reimburse him for all
business expenses incurred in connection with carrying out the
business of the Companies, subject to documentation in
accordance with the Companies' policy.
8. Termination of Employment.
(a) Termination for Cause. In the event the Companies
terminate the Executive's employment for Cause, he
shall be entitled to:
(i) The Base Salary through the date of the
termination of his employment for Cause;
(ii) Any incentive awards earned (but not yet paid);
(iii) Any pension benefit that may become due
pursuant to Section 6 above, determined as of the
date of such termination;
(iv) Other or additional benefits in accordance with
applicable plans or programs of the Companies to
the date of termination.
(b) Termination Without Cause. If the Executive's
employment is terminated without Cause other than due
to Disability or death, or there is a Constructive
Termination without Cause, the Executive shall be
entitled to:
(i) The Base Salary through the date of termination
of the Executive's employment;
(ii) The Base Salary, at the annualized rate in effect
on the date of termination of the Executive's
employment for the unexpired term of this
Employment Agreement following such termination,
paid in installments in accordance with the
regular pay practices of the Companies; provided
that, at the Executive's option, the Companies
shall pay him the present value of such salary
continuation payments in a lump sum (using as the
discount rate the Applicable Federal Rate for
short term Treasury obligations as published by
the Internal Revenue Service for the month in
which such termination occurs). For purposes of
this subsection (ii) "Base Salary" shall include
an annual bonus calculated by taking the highest
Management Incentive Compensation Plan bonus of
the three years preceding the year of
termination;
(iii) The balance of any incentive awards earned
(but not yet paid);
(iv) The right to exercise any stock option in full,
whether or not such right is exercisable pursuant
to the terms of the grant.
(v) Any pension benefit that may become due pursuant
to Section 6 above;
(vi) Continued accrual of credited service for the
purpose of the pension benefit provided under
Section 6 above until his attainment of age 55;
(vii) Continued participation in all medical,
dental, hospitalization and life insurance
coverage and in other employee benefit plans or
programs in which he was participating on the
date of the termination of his employment until
the earlier of:
(A) The end of the period during which he is
receiving salary continuation payments. (or
in respect of which a lump-sum severance
payment is made);
(B) The date, or dates, he receives equivalent
coverage and benefits under the plans and
programs of a subsequent employer (such
coverages and benefits to be determined on a
coverage-by-coverage, or benefit-by-benefit,
basis); provided that (x) if the Executive
is precluded from continuing his
participation in any employee benefit plan
or program as provided in this clause (vii)
of this Section 8(b), he shall be provided
with the after-tax economic equivalent of
the benefit provided under the plan or
program in which he is unable to participate
for the period specified in this clause
(vii) of this Section 8(b), (y) the economic
equivalent of any benefit foregone shall be
deemed to be the lowest cost that would be
incurred by the Executive in obtaining such
benefit himself on an individual basis, and
(z) payment of such after-tax economic
equivalent shall be made quarterly in
advance; and
(viii) Immediate vesting of the Companies'
contribution to his Employee Stock Option Plan
(ix) Other or additional benefits in accordance with
applicable plans and programs of the Companies to
the date of termination.
(c) Termination of Employment Following a Change in
Control. If following a Change in Control, the
Executive's employment is terminated without Cause or
there is a Constructive Termination Without Cause, the
Executive shall be entitled to the payments and
benefits provided in Section 8(b), provided that the
salary continuation payments shall be paid in a lump
sum without any discount. Also, immediately following
a Change in Control, all amounts, entitlements or
benefits in which he is not yet vested shall become
fully vested. In addition, if the Executive has
completed less than fifteen (15) years of service at
the time of such termination, the Executive will be
entitled to a supplemental pension benefit paid
directly by the Companies (and not as a part of the
Pension Plan of the Companies) equal to the benefit
otherwise payable under said Pension Plan based upon
the completion of fifteen (15) years of service, minus
any amounts payable pursuant to the said Pension Plan.
This supplemental pension benefit is an unfunded
liability of the Companies, the successors and
assigns, and not part of any established Plan of the
Companies. In addition, if Executive continues in the
employ of the Companies for a period of two years
following the effective date of the Change of Control,
he may then voluntarily terminate his employment and
in such a case would receive, in addition to the
benefits provided for elsewhere herein, a sum equal to
three times Base Salary. A voluntary termination under
this Section 8(c) shall be effective upon 30 days
prior notice to the Companies and shall not be deemed
a breach of this Agreement. For purposes of this
Section 8(c) "Base Salary" shall include an annual
bonus calculated by taking the highest Management
Incentive Compensation Plan bonus of the three years
preceding the year of termination;
(d) Voluntary Termination. In the event of a termination
of employment by the Executive on his own initiative
other than a termination due to death or Disability or
a Constructive Termination without Cause, the
Executive shall have the same entitlements as provided
in Section 8(a) for a Termination for Cause.
(e) Limitation Following a Change in Control. If the
Companies in good faith determine that amounts payable
or value of benefits provided under Section 8(c) (and
Section 8(b), to the extent incorporated in Section
8(c) by reference) of this Agreement are covered by
Section 280G of the Internal Revenue Code of 1986, as
amended (the "Code"), notwithstanding any other
provision of this Agreement to the contrary, the
aggregate amount of payments or benefits paid by the
Companies to the Executive pursuant to Section 8(c) of
this Agreement shall be adjusted to no less than $1.00
below the maximum amount that is deductible by the
Companies; provided, however that, in making this
determination, (i) the amounts payable pursuant to
Section 5 of this Agreement for calendar years prior
to the Change in Control shall be included in the
"base amount" calculated pursuant to Code Sections
280G(b)(3) and 280G(d)(2); and (ii) the amount payable
pursuant to Section 5(a) of this Agreement, as a non-
contingent payment, shall not be considered a
"parachute payment" as defined in Code Section
280G(b)(2)(A). If the Parties are unable to agree
upon an Auditor to calculate such an adjustment, then
the Executive and Companies shall each select one
accounting firm and those two firms shall jointly
select the accounting firm to serve as the Auditor.
The determination made under this paragraph shall be
final and binding on both Parties.
(f) Purchase of Car. Upon termination pursuant to
Section 8(b), (c) or (d), the Executive will have the
option of purchasing his Company car for the value of
such car on the books of the Company at the time of
termination, adjusted for value of the Executive's
cash contribution to the purchase of the car.
(g) No Mitigation - No Offset. In the event of any
termination of employment under this Section 8, the
Executive shall be under no obligation to seek other
employment and there shall be no offset against
amounts due the Executive under this Agreement on
account of any remuneration attributable to any
subsequent employment that he may obtain except as
specifically provided in this Section 8.
(h) Nature of Payments. Any amounts due under this Section
8 are in the nature of severance payments considered
to be reasonable by the Companies and are not in the
nature of a penalty.
9. Indemnification.
(a) The Companies agree that if the Executive is made a
party, or is threatened to be made a party, to any
action, suit or proceeding, whether civil, criminal,
administrative or investigative (a "Proceeding"), by
reason of the fact that he is or was a director,
officer or employee of the Companies or is or was
serving at the request of the Companies as a director,
officer, member, employee or agent of another
corporation, partnership, joint venture, trust or
other enterprise, including service with respect to
employee benefit plans, whether or not the basis of
such Proceeding is the Executive's alleged action in
an official capacity while serving as a director,
officer, member, employee or agent, the Executive
shall be indemnified and held harmless by the
Companies to the fullest extent permitted or
authorized by the Companies' certificates of
incorporation or bylaws or, if greater, by the laws of
the State of Kentucky, against all cost, expense,
liability and loss (including, without limitation,
reasonable attorneys fees, judgments, fines, ERISA
fines, excise taxes or penalties and amounts paid or
to be paid in settlement) reasonably incurred or
suffered by the Executive in connection therewith, and
such indemnification shall continue as to the
Executive even if he has ceased to be a director,
member, employee or agent of the Companies or other
entity and shall inure to the benefit of the
Executive's heirs, executors and administrators. The
Companies shall advance to the Executive all
reasonable costs and expenses incurred by him in
connection with a Proceeding within 20 days after
receipt by the Companies of a written request for such
advance. Such request shall include an undertaking by
the Executive to repay the amount of such advance if
it shall ultimately be determined that he is not
entitled to be indemnified against such costs and
expenses.
(b) Neither the failure of the Companies (including its
board of directors, independent legal counsel or
stockholders) to have made a determination prior to
the commencement of any proceeding concerning payment
of amounts claimed by the Executive under Section
10(a) that indemnification of the Executive is proper
because he has met the applicable standard of conduct,
nor a determination by the Companies (including its
board of directors, independent legal counsel or
stockholders) that the Executive has not met such
applicable standard of conduct, shall create a
presumption that the Executive has not met the
applicable standard of conduct.
(c) The Companies agree to continue and maintain a
directors' and officers' liability insurance policy
covering the Executive to the extent either Company
provides such coverage for its other executive
officers.
10. Representation.
The Companies represent and warrant that they are fully
authorized and empowered to enter into this Agreement and that
the performance of their obligations under this Agreement will
not violate any agreement between it and any other person, form
or organization.
11. Entire Agreement.
This Agreement contains the entire understanding and
agreement between the Parties concerning the subject matter
hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or
oral, between the Parties with respect thereto.
12. Amendment or Waiver.
No provision in this Agreement may be amended unless such
amendment is agreed to in writing and signed by the Executive
and an authorized officer of the Companies. No waiver by either
Party of any breach by the other Party of any condition or
provision contained in this Agreement to be performed by such
other Party shall be deemed a waiver of a similar or dissimilar
condition or provision at the same or any prior or subsequent
time. Any waiver must be in writing and signed by the Executive
or an authorized officer of the Companies, as the case may be.
13. Severability.
In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for
any reason, in whole, or in part, the remaining provisions of
this Agreement shall be unaffected thereby and shall remain in
full force and effect to the fullest extent permitted by law.
14. Survivorship.
The respective rights and obligations of the Parties
hereunder shall survive any termination of the Executive's
employment to the extent necessary to the intended preservation
of such rights and obligations.
15. Resolution of Disputes.
Any disputes arising under or in connection with this
Agreement shall, at the election of the Executive or the
Companies, be resolved by binding arbitration, to be held in
Kentucky in accordance with the rules and procedures of the
American Arbitration Association. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. Costs of the arbitration or litigation,
including, without limitation, attorneys' fees of both Parties,
shall be borne by the Companies, provided that if the
arbitrator(s) determine that the claims or defenses of the
Executive were without any reasonable basis, each Party shall
bear his or its own costs.
16. Notices.
Any notice given to a party shall be in writing and shall
be deemed to have been given when delivered personally or sent
by certified or registered mail, postage prepaid, return receipt
requested, duly addressed to the Party concerned at the address
indicated below or to such changed address as such Party may
subsequently give such notice of
If to the Companies: MID-AMERICA BANCORP
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx
If to the Executive: XXXXXX X. SMALL
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first written above.
MID-AMERICA BANCORP
By: /s/ X.X. Xxxxxxxxx
Title: Chief Executive Officer
BANK OF LOUISVILLE
By: /s/ X.X. Xxxxxxxxx
Title: Chief Executive Officer
XXXXXX X. SMALL
/s/ Xxxxxx X. Small
