EXHIBIT 10.16.
EMPLOYMENT AGREEMENT
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THIS AGREEMENT, dated as of the 15th day of February, 2000, by and
between F.N.B. Corporation, a Pennsylvania corporation (the "Company"),
and XXXXX X. XXXX (the "Executive").
W I T N E S S E T H:
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WHEREAS, the Company owns 100% of the outstanding stock of the Bank; and
WHEREAS, the Board of Directors of the Company, recognizing the experience
and knowledge of Executive in the banking industry, desires to retain the
valuable services and business counsel of Executive, it being in the best
interest of the Company to arrange terms of employment for Executive so as to
reasonably induce Executive to accept employment with the Company for the
term hereof; and
WHEREAS, Executive is willing to provide services to the Company, in
accordance with the terms and conditions hereinafter set forth;
NOW, THEREFORE, for and in consideration of the mutual premises and
covenants herein contained, the parties hereto agree as follows:
Section 1. Term of Employment.
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(a) The term of employment of the Executive under this Agreement shall
be, initially, the three year ten month period commencing on March 6, 2000 and
ending on December 31, 2003. Said term shall be subject to automatic extension
by operation of the provisions of Section 1(b) hereof to a date not later than
December 31, 2016 (beyond which the term of employment shall not be extended
pursuant to Section 1(b) hereof).
(b) At December 31, 2002, and December 31 of each succeeding calendar
year to and including December 31, 2013, the term of employment of the Executive
under this Agreement shall be automatically extended to December 31 of the third
calendar year thereafter unless either party, acting under this Section 1(b),
shall have elected to fix the expiration date of the Executive's term of
employment hereunder. Each of the parties shall have the right, exercisable by
written notice to the other, to terminate the automatic renewal and thereby fix
the expiration of the term of employment under this Section 1. Notice of
termination of automatic renewal having been given as aforesaid, the term of
employment of the Executive under this Section 1 shall continue until
December 31 of the third calendar year after the year in which such notice
is so given. Said term shall not continue after December 31, 2016 whether or
not such notice shall have been given in the year 2013 as aforesaid.
Section 2. Services to be Rendered.
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The Company hereby agrees to employ the Executive as Executive Vice
President - Chief Operating Officer, Florida Division, to serve at its
headquarters office located in the Naples, Florida area, subject to the terms,
conditions and provisions of this Agreement. The Executive hereby accepts
such employment and agrees to serve without additional compensation, if
elected, in any other senior executive position of the Company reasonably
requested of him and as an officer and/or director of any subsidiary of the
Company in accordance with Section 7 hereof. The Executive shall devote his
full-time best efforts to such employment and shall apply substantially that
degree of skill and diligence in rendering services to the Company and its
subsidiaries under this Agreement as would be applied by a person of ordinary
prudence and comparable experience under similar circumstances. In connection
therewith, the Executive shall report to and be subject to the direction of the
Chairman and CEO, President and COO and the Board of Directors. Notwithstanding
the foregoing, the Executive may devote a reasonable amount of his time to his
personal investments and business affairs (including service as a director of
unaffiliated companies) and to civic and charitable activities; provided,
however, the Executive shall not accept any position as a director of any
unaffiliated for-profit business organization without advance approval of the
Company's Board of Directors (which approval shall not be unreasonably
withheld).
Section 3. Compensation.
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In consideration for services rendered to the Company under this Agreement
(but excluding any directors' fees payable to the Executive), the Company shall
pay and provide to the Executive the following compensation and benefits.
(a) Salary. The Company shall pay the Executive a minimum base salary at
the rate of $250,000 per year during the term hereof, to be paid in accordance
with the Company's normal payroll practice, with such minimum base salary to be
adjusted from time to time to reflect (i) such merit increases as the Board of
Directors of the Company may determine are appropriate and (ii) annual cost of
living increases commensurate with those given other key executive officers of
F.N.B. Corporation. The stated minimum base salary, as the same may be
adjusted, shall be and remain in effect during the term of employment
established by Section 1(a) as the same may be extended pursuant to Section
1(b) hereof.
(b) Working Facilities. The Executive shall have such assistants,
perquisites, facilities and services as are suitable to his position and
appropriate for the performance of his duties, including a membership at the
Royal Poinciana Golf Club or any other comparably priced club (including dues,
assessments and initiation fees).
(c) Expenses. The Executive may incur reasonable expenses for promoting
the business of the Bank, including expenses for entertainment, travel, and
similar items. The Executive will be reimbursed for all such expenses upon
the Executive's periodic presentation of an itemized account of such
expenditures.
(d) Vacations. The Executive shall be entitled each year to a vacation
in accordance with the personnel policy established by the Company's
Compensation Committee, during which time Executive's compensation shall be
paid in full.
(e) Executive Incentive Compensation Plan. Each year in which the
Company meets or exceeds its performance plan, Executive shall be entitled to
receive a cash bonus of approximately 45% of Executive's current minimum annual
base salary. The precise amount of such bonus shall be determined by the
Compensation Committee of the Board of Directors of the Company.
(f) Additional Benefits. As additional consideration paid to Executive,
the Executive shall be provided with health, dental, long term disability,
hospitalization, life insurance and 401(k) F.N.B. Salary Savings Plan. In
addition, the Executive shall be provided with a monthly automobile allowance
of $1,000.00, which allowance shall be adjusted based on the annual Consumer
Price Index on January 1, 2000 and on each third anniversary thereafter.
(g) Additional Compensation. The Executive and the Company acknowledge
that this agreement is being entered into as an inducement for Executive to
leave his current employer; the Company hereby grants Executive a one time cash
signing bonus of $50,000 payable on March 6, 2000. In addition, Executive will
receive an option to purchase 25,000 shares of stock priced on date of hire.
Section 4. Confidentiality.
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For purposes of this Agreement, "proprietary information" shall mean any
information relating to the business of the Company or its subsidiaries that
has not previously been publicly released and shall include (but shall not be
limited to) Company information encompassed in all marketing and business
plans, financial information, costs, pricing information, and all methods,
concepts, or ideas related to the business of the Company or its subsidiaries
and not in the public domain.
The Executive agrees to regard and preserve as confidential all
proprietary information that has been or may be developed or obtained by the
Executive in the course of his employment with the Company and its subsidiaries,
whether he has such information in his memory or in writing or other physical
form. The Executive shall not, without written authorization from the Company
to do so, use for his benefit or purposes, nor disclose to others, either
during the term of his employment hereunder or thereafter, except as required
by the conditions of his employment hereunder, any proprietary information
connected with the business or development of the Company or its subsidiaries.
This prohibition shall not apply after the proprietary information has been
disclosed to the public.
Section 5. Removal of Documents or Objects.
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The Executive agrees not to remove from the premises of the Company, except
as an employee of the Company in pursuit of the business of the Company or any
of its subsidiaries or affiliates, or except as specifically permitted in
writing by the Company, any document or object containing or reflecting any
proprietary information. The Executive recognizes that all such documents and
objects, whether developed by him or by someone else, are the exclusive
property of the Company.
Section 6. Injunctive Relief.
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It is understood and agreed by and among the parties hereto that the
services to be rendered by the Executive hereunder are of a special, unique,
extraordinary and intellectual character, which gives them a peculiar value,
the loss of which may not be reasonably or adequately compensated in damages,
and additionally that a breach by the Executive of the covenants set out in
Sections 4, 5 and 11 of this Agreement will cause the Company great and
irreparable injury and damage. The Executive hereby expressly agrees that
the Company shall be entitled to the remedies of injunction, specific
performance and other equitable relief to prevent a breach of Sections 4, 5
and 11 of this Agreement by the Executive. This provision shall not, however,
be construed as a waiver of any of the remedies which the Company may have
for damages or otherwise.
Section 7. Subsidiaries.
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It is understood and agreed by the parties hereto that, at the election
and direction of the Company's Board of Directors and without modification of
the terms and provisions hereof, the Executive shall also serve as an executive
officer of any one or more subsidiaries of the Company and, when and as so
determined by the Board and any such subsidiary, the rights, duties and
obligations of the Company expressed and implied in this Agreement shall
inure to the benefit of and bind any subsidiary with the same force and effect
as would obtain if the subsidiary were a party hereto jointly and severally
with the Company.
Section 8. Death or Disability.
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In the event of Executive's death, the Company and/or the Bank shall pay
to Executive's designated beneficiary, or, if Executive has failed to designate
a beneficiary, to his estate, an amount equal to the Executive's minimum annual
base salary pursuant to Section 3 hereof. Payment shall be made in twelve equal
installments. Such compensation shall be in lieu of any other benefits
provided hereunder, except that (i) in the event of a change in control of the
Company as defined herein, Executive's designated beneficiary or his estate, as
the case may be, shall be entitled to the benefits of Section 10(b) hereof,
and (ii) any benefit payable pursuant to Section 3 shall be prorated and made
available to Executive in respect of any period prior to his death. The
Company may maintain insurance on its behalf to satisfy in whole or in part
the obligations of the Section 8.
In the event of Executive's disability, as hereinafter defined, the
Company shall pay to Executive an amount equal to the difference, if any,
between Executive's minimum annual base salary pursuant to Section 3 hereof and
any payments which Executive is entitled to receive under the long-term
disability insurance policy which the Company presently maintains for the
benefit of Executive. Payments by the Company hereunder, if any, shall be
made in equal installments as provided in Section 3 throughout what would
otherwise be the remaining term of employment hereunder.
Executive shall be entitled to the disability benefits provided by this
Section if, by reason of physical or mental impairment, he is incapable of
performing his duties hereunder. Any dispute regarding the existence, the
extent or the continuance of Executive's disability shall be resolved by the
determination of a duly licensed and practicing physician selected by and
mutually agreeable to both the Board of Directors of the Bank and Executive;
provided, however, if Executive officially establishes his eligibility to
receive Social Security Disability benefits or is deemed disabled under the
terms and conditions of the disability insurance policy carried on the
Executive by the Company or the Bank, he shall be deemed to be disabled as
provided herein without further proof. Executive shall make himself available
for and submit to such examinations by said physician as may be directed from
time to time by the physician. Failure to submit to any such examination shall
constitute a material breach of this Agreement.
Section 9. Termination.
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(a) Proper Cause.The occurrence of any of the following events or
circumstances shall constitute "proper cause" for termination, at the
election of the Board of Directors of the Company, of the term of employment
of the Executive under this Agreement, to wit:
(i) the Executive shall voluntarily resign as a director, officer
or employee of the Company or any significant subsidiary without approval of
the Board of Directors of the Company for reasons other than a breach of this
Agreement in any material respect by the Company which has not been cured
within 30 calendar days after the Company's receipt of written notice of such
breach from the Executive;
(ii) the perpetration of defalcations by the Executive involving
the Company or any of its affiliates, as established by certified public
accountants employed by the Company, or willful, reckless or grossly
negligent conduct of the Executive entailing a substantial violation of any
material provision of the laws, rules, regulations or orders of any governmental
agency applicable to the Company or its subsidiaries;
(iii) the repeated and deliberate failure by the Executive, after
advance written notice to him, to comply with reasonable policies or directives
of the Board of Directors;
(iv) the Executive shall breach this Agreement in any other material
respect and fails to cure such breach within 30 calendar days after the
Executive receives written notice of such breach from the Company; or
(v) receipt by the Company of written notice from the Federal
Reserve Bank that it has criticized Executive's performance and has either
(a) rated the Bank a "4" or a "5" under the Uniform Financial Institution
Rating System or (b) has determined that the Bank is in a "troubled condition"
as defined under Section 914 of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989; provided, however the inability of the Executive
to achieve favorable results of operations for reasons essentially unrelated
to the events or circumstances described in xxxxxxxxx (x)x, (x)xx, (x)xxx,
(x)xx and (a)v hereof shall not be deemed to constitute proper cause for
termination hereunder.
In the event that the Company discharges Executive alleging "cause"
under this Section 9(a) and it is subsequently determined judicially that
the termination was "without cause," then such discharge shall be deemed a
discharge without cause subject to the provisions of Section 9(b) hereof.
In the event that the Company discharges Executive alleging "cause" under this
Section 9(a), such notice of discharge shall be accompanied by a written
and specific description of the circumstances alleging such "cause." The
termination of Executive for "cause" shall not entitle the Company to
enforcement of the non-competition and non-solicitation covenants contained
in Section 11 hereof.
(b) Without Cause. The Company may, upon sixty (60) days' written
notice to Executive, terminate this Agreement without cause at any time during
the term of this Agreement upon the condition that Executive shall be entitled,
as liquidated damages in lieu of all other claims, to the same severance
payments as provided in Section 10 hereof; provided that for purposes of
Section 10(b), the fair market value of Common Stock shall be determined as
of the date of notice of termination of this Agreement given by the Company
to Executive. The severance payments provided for in this Section 9(b) shall
commence not later than thirty (30) days after the actual date of termination
of employment of Executive.
Section 10. Change in Control of the Company.
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(a) In the event of a "change in control" of the Company, as defined
herein, Executive shall be entitled, for a period of thirty (30) days from
the date of closing of the transaction effecting such change in control and at
his election, to give written notice to the Company of termination of this
Agreement and to receive a cash payment equal to two hundred ninety nine
percent (299%) times the compensation, including bonus, received by the
Executive in the one-year period immediately preceding the change in control.
The severance payments provided for in this Section 10(a) shall be paid in
three installments as follows: an amount equal to one-third (1/3) of the
Initial Present Value shall be paid on the effective date of the termination of
his employment hereunder; an additional amount equal to one-third of the
Initial Present Value shall be paid on the last day of the sixth month
following such effective date; and a final amount equal to one-third of the
Initial Present Value shall be paid on the last day of the twelfth month
following such effective date.
(b) The payments provided for by Section 10(a) shall be payable to the
Executive only to the extent that such payments are deductible by the Bank and
are not rendered non-deductible by Section 280G of the Internal Revenue Code of
1986, as amended.
(c) For purposes of this Section 10, "change in control" of the Company
shall mean:
(i) any transaction, whether by merger, consolidation, asset sale,
tender offer, reverse stock split or otherwise, which results in the acquisition
or beneficial ownership (as such term is defined under rules and regulations
promulgated under the Securities Exchange Act of 1934, as amended) by any person
or entity or any group of persons or entities acting in concert, of 50% or
more of the outstanding shares of Common Stock of the Company;
(ii) the sale of all or substantially all of the assets of the
Company; or
(iii) the liquidation of the Company.
(d) Section 10 will become non-enforceable and will terminate on
December 31, 2013.
Section 11. Non-Competition and Non-Solicitation.
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(a) Executive acknowledges that he has performed services or will perform
services hereunder which directly affect the Company's business. Accordingly,
the parties deem it necessary to enter into the protective agreement set forth
below, the terms and condition of which have been negotiated by and between the
parties hereto.
(b) In the event of termination of employment under this Agreement by
action of Executive prior to the expiration of the term of this Agreement,
Executive agrees with the Company that through the actual date of termination
of the Agreement, and for a period of two (2) years after such termination date:
(i) Executive shall not, without the prior written consent of the
Company in any county in which the Company or any of its subsidiaries operates,
serve as an employee of any bank, bank holding company or other financial
institution; and
(ii) Executive shall not employ or attempt to employ or assist in
employing any present employee of the Company or any of its subsidiaries
(whether or not such employment is full time or is pursuant to a written
contract), for the purpose of having such employee perform services for any
bank or other business or organization in competition with the business of the
Company and any of its subsidiaries as such exists on the termination date of
Executive's employment hereunder.
(c) The covenants of Executive set forth in this Section 11 are separate
and independent covenants for which valuable consideration has been paid, the
receipt, adequacy and sufficiency of which are acknowledged by Executive, and
have also been made by Executive to induce the Company to enter into this
Agreement. Each of the aforesaid covenants may be availed of or relied upon
by the Company in any court of competent jurisdiction, and shall form the basis
of injunctive relief and damages including expenses of litigation (including but
not limited to reasonable attorney's fees) suffered by the Company arising
out of any breach of the aforesaid covenants by Executive. The covenants of
Executive set forth in this Section 11 are cumulative to each other and to all
other covenants of Executive in favor of the Company contained in this agreement
and shall survive the termination of this Agreement for the purposes intended.
Should any covenant, term or condition contained in this Section 11 become or
be declared invalid or unenforceable by a court of competent jurisdiction, then
the parties may request that such court judicially modify such unenforceable
provision consistent with the intent of this Section 11 so that it shall be
enforceable as modified, and in any event the invalidity of any provision of
this Section 11 shall not affect the validity of any other provision in this
Section 11 or elsewhere in this Agreement.
Section 12. Waiver of Breach.
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The waiver by the Company or the Bank of a breach of any provision of
this Agreement by the Executive shall not operate or be construed as a waiver
of any subsequent breach by the Executive. No waiver shall be valid unless
in writing and signed by an authorized officer of the Company and the Bank.
Section 13. Governmental Regulation.
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In the event that any payment, coverage or benefit provided under this
Agreement would, in the opinion of counsel for the Company, not be deemed to be
deductible in whole or in part in the calculation of the Federal income tax of
the Company, or any other person making such payment or providing such coverage
or benefit, by reason of Section 280G of the Code, the aggregate payments,
coverages or benefits provided hereunder shall be reduced to the "safe harbour"
level under Section 280G so that no portion of such amount which is paid to the
Executive is not deductible by reason of Section 280G of the Code.
Furthermore, the Company shall hold such portions not paid to the
Executive in escrow pending a final determination of whether such amounts would
be deductible if paid to the Executive and the Company shall use its best
efforts to seek a ruling from the Internal Revenue Service that any portion of
such payments, coverages or benefits not paid to the Executive pursuant to
this Section 13 would continue to be deductible if paid to the Executive and
the Company shall pay to the Executive any portion of such amounts for which
such a ruling is received. In the event the IRS will not rule on such matter,
the Company shall pay to the Executive such amounts maintained in escrow
pursuant to this Section 13 as shall be determined at some point in time by a
counsel, selected by the Company and the Executive, is likely to be deductible
if paid to the Executive or shall be forfeited by the Executive in the event of
a final determination by the IRS that such amounts are not deductible. For
purposes of this Section, the value of any non-cash benefit or coverage or any
deferred or contingent payment or benefit shall be determined by the
independent auditors of the Company in accordance with the principles of
Section 280G of the Code.
Section 14. Arbitration.
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Any dispute or controversy as to the validity, interpretation,
construction, application or enforcement of, or otherwise arising under or in
connection with this Agreement, shall be submitted at the request of either
party hereto for resolution and settlement through arbitration in Tampa,
Florida in accordance with the rules then prevailing of the American
Arbitration Association. Any award rendered therein shall be final and
binding on each of the parties hereto and their heirs, executors,
administrators, successors and assigns, and judgment may be entered thereon
in any court having jurisdiction., The foregoing provisions of this Section
14 shall not be deemed to limit the rights and remedies reserved to the
Company under and pursuant to Section 6 hereof.
Section 15. Notices.
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All notices and other communications which are required or may be given under
this Agreement shall be in writing and shall be deemed to have been given if
delivered personally or sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed as follows:
(a) To the Company: F.N.B. Corporation
0000 Xxxxxxxxx Xxxx Xxxxx
Xxx 000
Xxxxxx, XX 00000
(b) To the Executive: Xx. Xxxxx X. Xxxx
00000 Xxxxxxxxx Xxxxx
Xxxxxx Xxxxxxx, XX 00000
or to such other place as either party shall have specified by notice in
writing to the other. A copy of any notice or other communication given
under this Agreement shall also be sent to the Board of Directors of the
Company at the then principal Florida office of the Company.
Section 16. Successors, Assigns, Etc.
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This Agreement shall be binding upon, and shall inure to the benefit of,
the Executive and the Company and their respective permitted successors,
assigns, heirs, legal representatives and beneficiaries.
Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge or hypothecation or to execution,
attachment, levy, or similar process or assignment by operation of law, and
any attempt, voluntary or involuntary, to effect any such action shall be
null, void and of no effect; provided, however, that nothing in this Section
16 shall preclude the assumption of such rights by executors, administrators
or other legal representatives of the Executive or his estate and their
assigning any rights hereunder to the person or persons entitled thereto.
Nothing in this agreement shall preclude the Company from consolidating
or merging into or with, or transferring all or substantially all of its
assets to, another corporation which assumes this Agreement and all obligations
and undertakings of the Company hereunder. Upon such a consolidation, merger
or transfer of assets and assumption, the term "Company", as used herein,
shall mean such other corporation and this Agreement shall continue in full
force and effect.
Section 17. Governing Law.
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This Agreement shall be governed and construed in accordance with the laws
of the State of Florida.
Section 18. Divisibility.
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Should a court or arbitrator declare any provision hereof to be invalid,
such declaration shall not affect the validity of the Agreement as a whole or
any part thereof, other than the specific portion declared to be invalid.
Section 19. Headings.
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The headings to the Sections and paragraphs hereof are placed herein for
convenience of reference only and in case of any conflict the text of this
Agreement, rather than the headings, shall control.
Section 20. Entire Agreement; Amendment.
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This Agreement sets forth the entire understanding of the parties in
respect of the subject matter contained herein and supersedes all prior
agreements, arrangements and understandings relating to the subject matter
and may only be amended by a written agreement signed by both parties hereto
or their duly authorized representatives.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
Witness: Executive:
/s/Xxxxxxx X. Xxxxxxxx /s/Xxxxx X. Xxxx
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Attest: F.N.B. Corporation
/s/Xxxxx X. Xxxxx By: /s/Xxxx X. Xxxx
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Secretary Xxxx X. Xxxx
(SEAL) President and COO
