Exhibit 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
this 15th day of July, 2000, by and among Xxxxxxx X. Xxxxx, an individual (the
"Executive"); Carolina First Bank, a South Carolina corporation headquartered in
Greenville, South Carolina ("Company"); and The South Financial Group, Inc.,
(f/k/a Carolina First Corporation), a South Carolina corporation headquartered
in Greenville, South Carolina (?Corporation?). As used herein, the term
?Company? shall include the Company and any and all of its affiliates where the
context applies.
W I T N E S S E T H
WHEREAS the Company is engaged in the business of banking primarily in
the State of South Carolina (the "Business");
WHEREAS the Company desires to employ and retain the services of, the
Executive as an employee of the Company and as Executive Vice President of the
Corporation and the Executive desires to provide his services in these
capacities to the Company;
WHEREAS the Executive is willing to accept the employment contemplated
herein under the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
1. Employment. Subject to the terms and conditions hereof, the
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Company hereby employs the Executive, and Executive hereby accepts such
employment by the Company having such duties and responsibilities as are set
forth in Section 3 below.
2. Definitions. For purposes of this Agreement, the following
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terms shall have the meanings specified below.
"Board of Directors" shall mean the board of directors of the
Corporation.
"Change in Control" shall mean
(i) the acquisition, directly or indirectly, by any Person
within any twelve month period of securities of the Corporation
representing an aggregate of 20% or more of the combined voting power
of the Corporation's then outstanding securities; or
(ii) during any period of two consecutive years, individuals who
at the beginning of such period constitute the Board of Directors,
cease for any reason to constitute at least a majority thereof, unless
the election of each new director was approved in advance by a vote of
at least a majority of the directors then still in office who were
directors at the beginning of the period; or
(iii) consummation of (A) a merger, consolidation or other
business combination of the Corporation with any other Person or
affiliate thereof, other than a merger, consolidation or business
combination which would result in the outstanding common stock of the
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Corporation immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into common stock of the
surviving entity or a parent or affiliate thereof) at least 51% of the
outstanding common stock (on a fully diluted basis) of the Corporation
or such surviving entity or parent or affiliate thereof outstanding
immediately after such merger, consolidation or business combination,
or (B) a plan of complete liquidation of the Corporation or an
agreement for the sale or disposition by the Corporation of all or
substantially all of the Corporation's assets; or
(iv) the occurrence of any other event or circumstance which is
not covered by (i), (ii) or (iii) above which the Board of Directors
determines affects control of the Corporation and, in order to
implement the purposes of this Agreement as set forth above, adopts a
resolution that such event or circumstance constitutes a Change in
Control for the purposes of this Agreement.
"Cause" shall mean (i) fraud; or (ii) embezzlement; or (iii) conviction
of the Executive of any felony; or (iv) dereliction of duties, or (v) a material
breach of, or the wilful failure or refusal by the Executive to perform and
discharge the Executive's duties, responsibilities and obligations under this
Agreement; or (vi) any act of moral turpitude or wilful misconduct by the
Executive intended to result in personal enrichment of the Executive at the
expense of the Company or any of its affiliates, or which has a material adverse
impact on the business or reputation of the Company or any of its affiliates
(such determination to be made by the Board of Directors in its reasonable
judgment); or (vii) intentional material damage to the property or business of
the Company; or (viii) gross negligence; or (ix) the ineligibility of the
Executive to perform his duties because of a ruling, directive or other action
by any agency of the United States or any state of the United States having
regulatory authority over the Company. In addition, Company may terminate
Executive for cause due to failure to achieve the expectations and goals set for
Executive by the Company?s Chief Executive Officer or Board of Directors;
provided, however, any such for Cause termination shall be subject to a
requirement of written notice of the failure from the Chief Executive Officer,
and Executive shall have a 90-day right to cure the failure.
"Protected Information" shall mean trade secrets, confidential or
proprietary information and all other knowledge, know-how, information,
documents or materials, owned, developed, or possessed by the Company or any of
its subsidiaries or affiliates, whether tangible or intangible form, pertaining
to the Business of the Company or the Business of any of its subsidiaries or
affiliates, including without limitation, research and development operations,
systems, data bases, computer programs, computer software, designs, models,
operating procedures, knowledge of the organization, products (including prices,
costs, sales or content), processes, technical or non-technical data, programs,
methods, techniques, processes, office machinery, contracts, financial data,
financial plans, financial information or measures, business methods, future
business plans, details of consultant contracts, new personnel acquisition
plans, business acquisition plans, customers (including identities of customers
and prospective customers, identities of individual contacts at business
entities which are customers or prospective customers, preferences, businesses
or habits), business relationships and other information owned, developed or
possessed by the Company or its subsidiaries or affiliates, which (i) derives
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by, other persons, and (ii) is the
subject of efforts that are reasonable under the circumstances to maintain its
secrecy or confidentiality; provided, however, that protected information shall
not include information that is generally known to the public or the trade. Such
information and compilations of information shall be contractually subject to
protection under this Agreement whether or not such information constitutes a
trade secret and is separately protectable at law or in equity as a trade
secret. Protected information does not include protected business information
which does not constitute a trade secret under applicable law two years after
expiration or termination of this Agreement.
"Disability" or "Disabled" shall mean the Executive's inability as a
result of any physical or mental incapacity to substantially perform his
essential duties for the Company on a full-time basis for a period of six (6)
months with or without reasonable accommodation.
"Good Reason" shall mean the termination by Executive of Executive?s
employment due to the assignment to the Executive of any duties inconsistent in
any material respect with the Executive's position (including status, offices,
titles and reporting requirements), authority, duties, or responsibilities as
contemplated by Section 3 of this Agreement, including any duties inconsistent
in any material respect with the Executive's position, authority, duties or
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responsibilities with the Company or Corporation or any action by the Company
which results in a material diminishment in such position, authority, duties or
responsibilities as in effect immediately before the Change in Control. The
Executive shall have the right to terminate his employment under this Agreement
for Good Reason upon prior written notice to the Company, in which case this
Agreement shall terminate on the date specified in such notice; provided the
date of termination specified in the notice shall be at least thirty (30) days
after the delivery of the notice.
"Person" shall mean any individual, corporation, bank, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or other entity.
"Voluntary Termination" shall mean the termination by Executive of
Executive's employment other than for Good Reason.
3. Duties.
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3.1 During the Term hereof, the Executive shall be responsible
for consumer lending for the Company and its affiliates, Blue Ridge
Finance Company, Inc. and Resource Processing Group, Inc., and will
assist in developing consumer lending, technical support systems, and
corporate acquisition opportunities. In addition, the Executive shall
have such more specific responsibilities or duties as may be determined
and assigned to the Executive from time-to-time by or upon the
authority of the Board of Directors, or the Chief Executive Officer of
the Company. The Executive shall serve the Company faithfully and to
the best of his ability, devoting substantially all of his business
time, attention, knowledge, energy and skills to the diligent
performance of his duties, except for that time and attention that,
consistent with the practices of other senior executive officers
similarly situated, the Executive may devote to civic or community
affairs, other business matters that do not interfere in any material
respect with the performance by the Executive of services required to
be performed by him hereunder, or time devoted to serving as a director
of other companies. If elected, the Executive also shall serve during
any part of the Term hereof as any other officer or a director of the
Company or any subsidiary corporation or parent corporation of the
Company without any compensation therefor.
3.2 Executive shall not, without the prior written consent of
the Company, at any time during the Term hereof (i) accept employment
with, or render services of a business, professional or commercial
nature to, any Person other than the Company, (ii) engage in any
venture or activity which the Company may in good faith consider to be
competitive with or adverse to the business of the Company or of any
affiliate of the Company, whether alone, as a partner, or as an
officer, director, employee or shareholder or otherwise, except that
the ownership of not more than 5% of the stock or other equity interest
of any publicly traded corporation or other entity shall not be deemed
a violation of this Section, or (iii) engage in any venture or activity
which the Board of Directors may in good faith consider to interfere
with Executive's performance of his duties hereunder.
4. Term. The Executive's employment hereunder shall be for a term
of two years (the "Term") commencing on July 1, 2000 and ending on June 30,
2002, unless terminated earlier as provided herein.
5. Termination. This Agreement may be terminated as follows:
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5.1 The Company. The Company shall have the right to terminate
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Executive's employment hereunder at any time during the Term hereof (i)
for Cause, (ii) if the Executive becomes Disabled and unable to perform
the essential duties of his position with or without reasonable
accommodation, or (iii) upon the Executive's death.
5.1.1 If the Company terminates Executive's employment
under this Agreement pursuant to clause (i) of Section 5.1, the
Company's obligations hereunder shall cease as of the date of
termination, except that Executive shall be paid immediately in
a lump sum a pro-rata portion of the compensation amounts under
Section 6 which have not been previously paid based upon the
actual length of Executive?s employment with Company, plus any
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amounts deferred under Section 6.2. For example, if Executive?s
employment is terminated under this Section 5.1.1 on January 1,
2001, Executive will be paid $250,000 and any unpaid amounts
previously deferred under Section 6.2.
5.1.2 If the Company terminates Executive during the Term
hereof pursuant to clauses (ii) or (iii) of Section 5.1 and
there has been a Change in Control, Executive shall be entitled
to receive immediately in a lump sum as severance upon such
termination, the compensation and benefits provided in Section 6
hereof that would otherwise be payable for the remaining Term of
this Agreement and any deferred compensation under Section 6.2
hereof.
5.1.3 If the Company terminates Executive during the Term
hereof pursuant to clauses (ii) or (iii) of Section 5.1 and
there has been no Change in Control, Executive shall be entitled
to receive immediately in a lump sum as severance upon such
termination, a pro-rata portion of the compensation amounts
under Section 6 which have not been previously paid based upon
the actual length of Executive?s employment with Company, plus
any amounts deferred under Section 6.2. For example, if
Executive?s employment is terminated under this Section 5.1.3 on
January 1, 2001, Executive will be paid $250,000 and any unpaid
amounts previously deferred under Section 6.2.
5.1.4 If the Company terminates Executive during the Term
hereof other than pursuant to clauses (i), (ii) or (iii) of
Section 5.1, Executive shall be entitled to receive immediately
in a lump sum as severance upon termination, the compensation
and benefits provided in Section 6 hereof that would otherwise
be payable for the remaining Term of this Agreement and any
deferred compensation under Section 6.2 hereof.
5.2 By Executive. Executive shall have the right to terminate
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his employment hereunder (i) by Voluntary Termination; (ii) if the
Company materially breaches this Agreement and such breach is not cured
within 30 days after written notice of such breach is given by
Executive to the Company; or (iii) if there is a termination for Good
Reason. If the Executive elects to terminate his employment pursuant to
this Section, Executive must do so within twelve (12) months of a
Change in Control.
5.2.1 If Executive terminates his employment pursuant to
clause (i) of Section 5.2, the Company's obligations under this
Agreement shall cease as of the date of such termination and
Executive shall be subject to the noncompetition provisions set
forth in Section 9 hereof; provided, however, Executive shall be
entitled to receive immediately in a lump sum as severance upon
such termination, a pro-rata portion of the compensation amounts
under Section 6 which have not been previously paid based upon
the actual length of Executive?s employment with Company, plus
any amounts deferred under Section 6.2. For example, if
Executive?s employment is terminated under this Section 5.2.1 on
January 1, 2001, Executive will be paid $250,000 and any unpaid
amounts previously deferred under Section 6.2.
5.2.2 If, within twelve (12) months following a Change in
Control, Executive terminates his employment hereunder pursuant
to clauses (ii) or (iii) of Section 5.2. Executive shall be
entitled to receive immediately in a lump sum as severance upon
termination, the compensation and benefits provided in Section 6
hereof for the remaining Term of this Agreement and any deferred
compensation under Section 6.2 hereof.
5.2.3 If, Executive terminates his employment pursuant to
clause (ii) of Section 5.2 and there has been no Change in
Control, Executive shall be entitled to receive immediately in a
lump sum as severance upon termination, the compensation and
benefits provided in Section 6 hereof for the remaining Term of
this Agreement and any deferred compensation under Section 6.2
hereof.
6. Compensation. In consideration of Executive's services and covenants
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hereunder, Company shall pay to Executive the compensation and benefits
described below (which compensation shall be subject to such deductions and
withholdings as are required by law or policies of the Company in effect from
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time to time, provided that his salary pursuant to Section 6.1 shall be payable
not less frequently than monthly):
6.1 Annual Salary. During the Term hereof and subject to Section
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6.2, the Company shall pay Executive a salary at the rate of $500,000
per annum. The first $500,000 salary payment shall be paid to Executive
in a lump sum on January 3, 2002. The second $500,000 salary payment
shall be paid to Executive in a lump sum on January 2, 2003.
6.2 Salary Deferrals. Prior to the time of a salary payment
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under Section 6.1, Executive may elect to defer all or part of such
salary payment into a ?rabbi trust.? Any salary deferral amounts under
this Section 6.2 shall be held in the rabbi trust by the Company and
shall be subject to the claims of creditors of the Company. Such trust
shall be an irrevocable trust to fund the obligations hereunder and (i)
shall have as trustee a person or entity acceptable to Executive, and
(ii) shall contain such other terms and conditions as are reasonably
necessary in Executive?s determination to ensure the Company?s
compliance with its obligations hereunder.
6.3 Expenses. Any reasonable and necessary business expenses
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incurred by Executive on behalf of the Company shall be reimbursed by
the Company upon receipt of adequate written evidence of the business
expense in the standard form required by Company.
6.4 Beneficiary. In the event Executive dies following the end
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of the Term of this Agreement but before the payment of amounts under
Section 6.1 such remaining amounts shall be paid to Executive?s wife,
Xxxxxx X. Xxxxx, as otherwise scheduled to be paid under Section 6.1.
In the event Xxxxxx X. Xxxxx should die prior to receipt of all amounts
otherwise payable under this Section 6.4 (or if Xxxxxx X. Xxxxx should
predecease Executive), then the remaining balance shall be divided into
as many equal shares as there are children of Executive then living and
deceased children of Executive with descendants then living. Company
shall pay one such equal share to each child of Executive then living
and one such equal share to the descendants then living of each
deceased child of Executive, per stirpes. In the event there are no
children or descendants of Executive then living, Company shall pay the
remaining amount to Executive?s estate.
6.5 Other Benefits. Executive hereby waives his right to
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participate in any employee benefit plan (as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended), any
fringe benefit plan or program, and any bonus or other compensation
plan that is sponsored by the Company. Company shall not provide a
Company car to Executive.
7. Excess Parachute Payments. It is the intention of the parties hereto
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that the severance payments and other compensation provided for herein are
reasonable compensation for Executive's services to the Company and shall not
constitute "excess parachute payments" within the meaning of Section 28OG of the
Internal Revenue Code of 1986, as amended, and any regulations thereunder. In
the event that the Company's independent accountants acting as auditors for the
Company on the date of a Change of Control determine that the payments provided
for herein constitute "excess parachute payments," then the compensation payable
hereunder shall be reduced to the point that such compensation shall not qualify
as "excess parachute payments."
8. Confidentiality. Executive acknowledges that, prior to and during
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the term of this Agreement, the Company has furnished and will furnish to
Executive Protected Information which could be used by Executive on behalf of a
competitor of the Company to the Company's substantial detriment. In view of the
foregoing, Executive acknowledges and agrees that the restrictive covenants
contained in this Section are reasonably necessary to protect the Company's
legitimate business interests and goodwill. Executive agrees that he shall
protect the Company's Protected Information and shall not disclose to any
Person, or otherwise use, except in connection with his duties performed in
accordance with this Agreement, any Protected Information; provided, however,
that Executive may make disclosures required by a valid order or subpoena issued
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by a court or administrative agency of competent jurisdiction, in which event
Executive will promptly notify the Company of such order or subpoena to provide
the Company an opportunity to protect its interests. Upon the termination or
expiration of his employment hereunder, the Executive agrees to deliver promptly
to the Company all Company files, customer lists, management reports, memoranda,
research, Company forms, financial data and reports and other documents supplied
to or created by him in connection with his employment hereunder (including all
copies of the foregoing) in his possession or control and all of the Company's
equipment and other materials in his possession or control.
9. Noncompetition. In the event that Executive's employment with the
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Company is terminated before a Change in Control voluntarily by the Executive or
by the Board of Directors pursuant to clause (i) of Section 5.1, then Executive
shall not, for a period of one year following such termination of employment (i)
become employed by any insured depository institution which conducts business
activities in the State of South Carolina or the counties in the States of
Florida and North Carolina in which the Company and its affiliates conduct
business operations; (ii) attempt to interfere with any business relationship of
the Company or its affiliates, including without limitation, employee and
customer relationships; or (iii) otherwise compete against the Company or its
affiliates, directly or indirectly, either as principal, agent, employee, or
owner (if the percentage of ownership exceeds 10% of the entity). In the event
that Executive's employment is terminated for any reason following a Change in
Control (whether by the Company or Executive), it is expressly acknowledged that
there shall be no limitation on any activity of Executive, including direct
competition with the Company, its affiliates, or their successors, and Company
shall not be entitled to injunctive relief with respect to any such activities
of Executive.
10. Assignment. The parties acknowledge that this Agreement has been
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entered into due to, among other things, the special skills of Executive, and
agree that this Agreement may not be assigned or transferred by Executive, in
whole or in part, without the prior written consent of Company. The Executive
acknowledges that the services to be rendered by the Executive are special,
unique and of extraordinary character and, in connection with such services, the
Executive will have access to Protected Information vital to the Company's
Business and the business of its subsidiaries and affiliates. By reason of this,
the Executive consents and agrees that if the Executive violates any provisions
of Section 9, hereof, the Company could sustain irreparable injury that money
damages will not provide adequate remedy to the Company and that the Company
shall be entitled to have Section 9 specifically enforced by any court having
equity jurisdiction. Nothing contained herein shall be construed as prohibiting
the Company and any of its subsidiaries or affiliates from pursuing any other
remedies available to it for such breach or threatened breach, including the
recovery of damages from the Executive.
11. Notices. All notices, requests, demands, and other communications
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required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered or seven days after mailing if mailed, first class,
certified mail postage prepaid:
To the Company: Carolina First Corporation
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Chairman of the Board
To Executive: Xxxxxxx X. Xxxxx
000 Xxxxxx Xxx
Xxxxx, Xxxxx Xxxxxxxx 00000
Any party may change the address to which notices, requests, demands, and other
communications shall be delivered or mailed by giving notice thereof to the
other party in the same manner provided herein.
12. Provisions Severable. If any provision or covenant, or any part
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thereof, of this Agreement should be held by any court to be invalid, illegal or
unenforceable, either in whole or in part, such invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
the remaining provisions or covenants, or any part thereof, of this Agreement,
all of which shall remain in full force and effect.
13. Remedies. All claims, disputes and other matters in question
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between the Executive and the Company arising out of or related to the
interpretation of this Agreement or the breach of this Agreement, except as
specifically governed by the foregoing provisions where there may be irreparable
harm and damage to the Company which could not be compensated in damages, shall
be decided by arbitration in accordance with the rules of the American
Arbitration Association. This agreement to arbitrate shall be specifically
enforceable under applicable law in any court having jurisdiction. The award
rendered by the arbitrator shall be final and judgment may be entered upon it in
accordance with the applicable law of any court having jurisdiction thereof.
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In the event that Executive is reasonably required to engage
legal counsel to enforce his rights hereunder against the Company, Executive
shall be entitled to receive from the Company his reasonable attorneys' fees and
costs; provided that Executive shall not be entitled to receive those fees and
costs related to matters, if any, which were the subject of litigation and with
respect to which a judgment is rendered against Executive.
15. Waiver. Failure of either party to insist, in one or more
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instances, on performance by the other in strict accordance with the terms and
conditions of this Agreement shall not be deemed a waiver or relinquishment of
any right granted in this Agreement or of the future performance of any such
term or condition or of any other term or condition of this Agreement, unless
such waiver is contained in a writing signed by the party making the waiver.
16. Binding Agreement. This Agreement shall be binding upon the
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Corporation and Company and their respective successors and assigns and upon
Executive and his executors, personal representatives, successors and assigns.
17. Entire Agreement. This Agreement represents the entire
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understanding of the parties hereto and shall supercede all prior agreements and
understandings between Executive and Corporation.
18. Amendments and Modifications. This Agreement may be amended or
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modified only by a writing signed by other parties hereto.
19. Governing Law. The validity and effect of this agreement shall
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be governed by and construed and enforced in accordance with the laws of the
State of South Carolina.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
EXECUTIVE:
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
CAROLINA FIRST BANK
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
Chief Executive Officer
THE SOUTH FINANCIAL GROUP, INC.
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
Chief Executive Officer
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