EMPLOYMENT SEPARATION AGREEMENT AND RELEASE
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THIS AGREEMENT AND RELEASE, is effective as of the 2nd day of March, 1999
by and between XXXX XXXXXX ("Executive") and POCAHONTAS FEDERAL SAVINGS AND LOAN
ASSOCIATION ( the "Bank") and POCAHONTAS BANCORP, INC. ("Bancorp" and
collectively with the Bank, "Pocahontas").
WHEREAS, Executive has served in the position of President and Chief
Executive Officer of the Bank since 1990 and of the Bancorp since its
organization in 1998; and
WHEREAS, Executive has elected to retire early and to discontinue
Executive's employment with the Bank and Bancorp, and the Bank and Bancorp have
consented to Executive's early retirement, on the following terms and
conditions, which contain the entire agreement of the parties relating to the
termination of Executive's employment, and any prior agreements, including the
Employment Agreement entered into by and between Executive and the Bank as of
October 1, 1996, ("Employment Agreement"), shall be superceded by this Agreement
and Release as of April 30, 1999, unless otherwise provided herein, and that
certain Employment Separation Agreement and Release dated March 2, 1999 (the
"March 2, 1999 Release").
NOW, THEREFORE, in consideration of the promises and payments stated and
other good and valuable consideration, the receipt and adequacy of which is
acknowledged by each of the parties, all of whom intend to be legally bound by
this Agreement and Release, the parties state and agree as follows:
1. Executive shall resign from employment with Pocahontas effective April
30, 1999 and shall have no further obligation to perform services as an employee
of Pocahontas following said date. Executive shall continue as a director of
each of the Bank and Bancorp for the remainder of his term, and such additional
terms to which Executive may be elected.
2. (a) Executive shall be entitled to receive bi-weekly salary payments
from Pocahontas, at the rate of salary payment in effect as of the date of this
Agreement and Release, through April 30, 1999, paid in accordance with
Pocahontas's regular payroll practices, including tax withholdings. All current
benefits shall continue until April 30, 1999.
(b) As of the date of this Agreement and Release, Executive is a
participant in the Pocahontas Bancorp, Inc. Stock Option Plan, approved by
shareholders of Bancorp on October 23, 1998. Executive has received an award of
80,000 options under said plan, which award shall vest, pursuant to its terms,
in five equal installments commencing on October 23, 1999. The parties hereby
agree that the stock options awarded to Executive under said plan shall continue
to vest in Executive so long as Executive maintains Continuous Service (as
defined in said plan) as a Director of the Bank or Bancorp.
(c) As of the date of this Agreement and Release Executive is a participant
in the Pocahontas Bancorp, Inc. Recognition and Retention Plan, approved by
shareholders of Bancorp on October 23, 1998. Executive has received an award of
35,707 shares of restricted stock under said plan, which award shall vest,
pursuant to its terms, in five equal installments commencing on January 3, 2000.
Executive and Bancorp hereby agree that Executive shall forfeit all shares of
restricted stock awarded under said plan, effective as of April 30, 1999.
(d) Bancorp agrees that as of April 30, 1999, it will allocate on its books
and records $2.75 million dollars for the benefit of Executive. The amount so
allocated shall earn interest at the Federal Funds rate, as determined each
month at the close of business on the first business day of the month,
compounded monthly, until distributed. Each year following Executive's
termination of employment, Bancorp shall pay Executive no less than One Hundred
Fifty Thousand Dollars ($150,000), until the $2.75 million, plus earnings
thereon, shall be fully distributed. Such amount shall be paid in monthly
installments commencing in May, 1999, no later than the fifth day of each month
following Executive's termination of employment. Executive may request that
Bancorp pay him an additional amount in any year, and such additional amount, or
portion thereof, may be paid to Executive in the sole discretion of the Board of
Directors. Payments to Executive shall be subject to applicable federal and
state tax withholding. In the event of Executive's death prior to the
distribution in full of amounts owed to Executive, the balance remaining at his
death shall be distributed to the beneficiary designated by Executive, in
writing, in the manner designated by the Executive.
(e) In the event of a Change in Control (as defined in the Pocahontas
Bancorp, Inc. Stock Option Plan) of the Bank or Bancorp, on or before April 30,
2003, Executive shall be entitled to receive an additional payment from Bancorp
equal to Five Hundred Fifty Thousand Dollars ($550,000). Such Change in Control
Payment shall be in addition to any payments to which Executive is entitled
under sub-paragraph 2(d) above and shall be made on or before the effective time
of the Change in Control.
(f) At the time of this Agreement and Release, Executive is a party to a
Restated Supplemental Executive Retirement Agreement between Pocahontas and
Executive dated January 1, 1998 ("SERP"). Following Executive's termination of
employment, Executive shall be entitled to no further benefits accruals or
contributions under said SERP, provided, however, that any contributions
previously made to said SERP and transferred to the Executive's grantor trust
shall be the sole property of Executive.
3. (a) The provisions of this Agreement and Release shall satisfy all
obligations of Pocahontas to Executive that now exist or hereinbefore existed
relating to the employment of Executive by Pocahontas and the termination of the
employment of Executive, including without limitation, any rights under
Executive's Employment Agreement and the March 2, 1999 Release, provided,
however, that Executive's rights to contributions made to Executive's SERP and
his right under any tax-qualified plans maintained by Pocahontas shall not be
affected hereby.
(b) In consideration of the provisions of this Agreement and Release,
Executive hereby irrevocably and unconditionally, waives and releases
Pocahontas, its affiliates and subsidiaries, officers, directors, and
executives, from any and all causes of action, debts and claims, known or
unknown, which Executive may now have or may have in the future, concerning
Executive's employment under the Employment Agreement, or separation from
service thereunder, including but not limited to any claims for alleged breach
of contract, wrongful discharge, or any rights or claims arising out of title
VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in
Employment Act ("ADEA"), the Americans with Disabilities Act ("ADA"), or any
other federal, state or municipal statute or ordinance relating to
discrimination in employment. However, Executive may pursue claims or institute
legal action to enforce the provisions of this Agreement and Release. Nothing
herein contained shall be construed to require Executive's release of any rights
granted to him as a former employee, officer or director of Pocahontas under its
Charter and Bylaws or under federal or Delaware law. Executive shall continue to
be indemnified by Pocahontas for any actions taken as an employee, officer or
director to the fullest extent provided by Pocahontas's Charter and Bylaws and
federal or Delaware law.
4. Executive further covenants that Executive will neither file nor cause
nor permit to be filed on Executive's behalf and, as the case may be, waives
Executive's right to recover in his own right upon filing, any lawsuits, claims,
grievances, complaints, or charges with any Court, State, federal or local
agency, concerning or relating to any dispute arising out of the employment
relationship, alleged breaches of employment, covenants or contracts, abusive or
wrongful and constructive discharge, unlawful employment discrimination, or
otherwise relating to Executive's employment or resignation from that employment
with Pocahontas.
5. (a) Executive further states that Executive has carefully read the
foregoing, has had sufficient opportunity to review and deliberate the terms of
this Agreement and Release with or without counsel of Executive's own choosing,
knows and understands its contents, and signs the same as Executive's free and
independent act. No inducements, representations, or agreements have been made
or relied upon to make this Agreement and Release except as stated in this
Agreement and Release.
(b) Executive has twenty-one (21) days from March 1, 1999 (the date of the
initial receipt of these terms) within which to consider accepting and being
bound by the terms of this Agreement and Release. Executive understands and
acknowledges that this release and waiver of claims is exchanged for the
payments described in Paragraph 2. Executive also understands that he may revoke
this waiver and release of claims under the ADEA for a period of seven (7) days
following the date the Executive signs this Agreement and Release and that the
Executive's waiver of the ADEA claims will not become effective until the
revocation period has expired. Such date that is seven (7) days after Executive
signs this Agreement and Release is referred to as the "Waiting Period
Expiration Date."
6. Section 9 of the Employment Agreement shall remain in effect as to
Executive for the one year period from April 30, 1999.
7. Executive shall continue to preserve the confidences and proprietary
information of Pocahontas and its subsidiaries, parent corporations and
affiliates, including information that has been disclosed to Executive relating
to Pocahontas's business activities, as set forth in Section 10 of the
Employment Agreement which Section is incorporated herein by reference.
8. This Agreement and Release may not be amended or modified except in a
writing signed by the party to be charged. This Agreement and Release
constitutes the entire understanding of the parties, and all prior discussions
and agreements between the parties are merged herein.
9. Any term or provision of this Agreement and Release which is held to be
invalid or unenforceable shall be ineffective to the extent of such invalidity
or unenforceability without rendering invalid or unenforceable the remaining
terms and provisions of this Agreement and Release.
10. The terms and provisions of, and the obligations under, the Employment
Agreement shall be superceded by this Agreement and Release, and shall be of no
further force or effect, unless otherwise expressly stated herein.
[Remainder of Page Intentionally Blank]
IN WITNESS WHEREOF, the parties hereto have signed their Agreement and
Release.
XXXX XXXXXX DATE:
\s\ Xxxx Xxxxxx March 25, 1999
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POCAHONTAS FEDERAL SAVINGS DATE:
AND LOAN ASSOCIATION
By:
/s/Xxxxx X. Xxxxx March 25, 1999
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Xxxxx X. Xxxxx
POCAHONTAS BANCORP, INC. DATE:
By:
/s/Xxxxx X. Xxxxx March 25, 1999
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Xxxxx X. Xxxxx
