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MAGNA GROUP, INC.
AGREEMENT
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This agreement ("Agreement") has been entered into this 20th day
of October, 1997, by and between Magna Group, Inc., a Delaware corporation
("Company"), and Xxxxxx X. Xxxxxx, an individual ("Executive").
RECITALS
The Board of Directors of the Company (the "Board"), has determined
that it is in the best interests of the Company and its stockholders to
reinforce and encourage the continued attention and dedication of the
Executive to the Company as a member of the Company's management (including,
if applicable, management of a wholly owned subsidiary) and to assure that
the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change in Control
(as defined below) of the Company. The Board desires to provide for the
continued employment of the Executive on the terms hereof, and the Executive
is willing to commit to continue to serve the Company. Additionally, the
Board believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a
pending or threatened Change in Control, to encourage the Executive's full
attention and dedication to the Company currently and in the event of any
threatened or pending Change in Control, and to provide the Executive with
compensation and benefits arrangements upon the breach of this Agreement by
the Employer or upon a termination of employment after a Change in Control
which ensure that the compensation and benefits expectations of the Executive
will be satisfied and which are competitive with those of other corporations.
Therefore, in order to accomplish these objectives, the Board has caused the
Company to enter into this Agreement.
IT IS AGREED AS FOLLOWS:
SECTION 1: DEFINITIONS AND CONSTRUCTION.
1.1 DEFINITIONS. For purposes of this Agreement, the
following words and phrases, whether or not capitalized, shall have the
meanings specified below, unless the context plainly requires a different
meaning.
1.1(a) "ANNUAL BASE SALARY" means the dollar amount
approved by the Company Director Compensation
Committee or the Company Chief Executive Officer.
1.1(b) "BOARD" means the Board of Directors of the
Company.
1.1(c) "CHANGE IN CONTROL" means a change in control
of the Company of a nature that would be
required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A
promulgated under the Exchange Act; provided
that, for purposes of this Agreement, a Change
in Control shall be deemed to have occurred if
(i) any Person (other than the Company) is or
becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act),
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directly or indirectly, of securities of the Company
which represent 20% or more of the combined voting
power of the Company's then outstanding
securities; (ii) during any period of two (2)
consecutive years, individuals who at the
beginning of such period constitute the Board
cease for any reason to constitute at least a
majority thereof, unless the election, or the
nomination for election, by the Company's
stockholders, of each new director is approved
by a vote of at least two-thirds (2/3) of the
directors then still in office who were
directors at the beginning of the period but
excluding any individual whose initial
assumption of office occurs as a result of
either an actual or threatened election contest
(as such term is used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange
Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a
person other than the Board; (iii) there is
consummated any consolidation or merger of the
Company in which the Company is not the
continuing or surviving corporation or pursuant
to which shares of the Company's Common Stock
is converted into cash, securities, or other
property, other than a merger of the Company in
which the holders of the Company's Common Stock
immediately prior to the merger have the same
proportionate ownership of common stock of the
surviving corporation immediately after the
merger; (iv) there is consummated any
consolidation or merger of the Company in which
the Company is the continuing or surviving
corporation in which the holders of the
Company's Common Stock immediately prior to the
merger do not own fifty percent (50%) or more
of the stock of the surviving corporation
immediately after the merger; (v) there is
consummated any sale, lease, exchange, or other
transfer (in one transaction or a series of
related transactions) of all, or substantially
all, of the assets of the Company, or (vi) the
stockholders of the Company approve any plan or
proposal for the liquidation or dissolution of
the Company.
1.1(d) "CHANGE IN CONTROL DATE" shall mean the date
of the Change in Control. If a Change in
Control occurs and if the Executive's
employment with the Company is terminated prior
to the date on which the Change in Control
occurs, and if it is reasonably demonstrated by
the Executive that such termination of
employment (i) was at the request of a third
party who has taken steps reasonably calculated
to effect a Change in Control or (ii) otherwise
arose in connection with or anticipation of a
Change in Control, then for all purposes of
this Agreement, the "Change in Control Date"
shall mean the date immediately prior to the
date of such termination of employment, and a
Change in Control shall be deemed to have
occurred on the Change in Control Date.
1.1(e) "CODE" shall mean the Internal Revenue Code of
1986, as amended.
1.1(f) "COMPANY" means Magna Group, Inc., a Delaware
corporation.
1.1(g) "EFFECTIVE DATE" shall mean October 20, 1997.
1.1(h) "EXCHANGE ACT" means the Securities Exchange
Act of 1934, as amended.
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1.1(i) "INCENTIVE BONUS" shall mean the incentive
bonus provided through any incentive
compensation plan, which is generally available
to other peer executives of the Company,
awarded to the Executive for the year preceding
termination. To the extent such incentive
bonus is paid in shares of restricted stock,
Incentive Bonus shall include the value of such
shares on their award date without any
discount; provided, however, such restricted
shares shall include only those awarded in lieu
of compensation payable as determined by the
Compensation Committee of the Board.
1.1(j) "PERSON" means any "person" within the meaning
of Sections 13(d) and 14(d) of the Exchange Act.
1.1(k) "TERM" means the period that begins on the
Effective Date and ends on the earlier of: (i)
the Date of Termination as defined in Section
3.7, or (ii) the close of business on December
31 of any calendar year during which notice is
given, by December 1 of such year, by either
party (as provided in Section 7) of such
party's intent not to renew this Agreement.
1.2 GENDER AND NUMBER. When appropriate, pronouns in
this Agreement used in the masculine gender include the feminine gender,
words in the singular include the plural, and words in the plural include the
singular.
1.3 HEADINGS. All headings in this Agreement are included
solely for ease of reference and do not bear on the interpretation of the
text. Accordingly, as used in this Agreement, the terms "Article" and
"Section" mean the text that accompanies the specified Article or Section of
the Agreement.
1.4 APPLICABLE LAW. This Agreement shall be governed by
and construed in accordance with the laws of the state of Missouri, without
reference to its conflict of law principles.
SECTION 2: TERMS AND CONDITIONS OF EMPLOYMENT.
2.1 EMPLOYMENT. If the Executive is in the employ of the
Company (or in the employ of a wholly owned subsidiary) on a Change in
Control Date, then the Executive shall thereafter remain in the employ of the
Company (or in the employ of a wholly owned subsidiary) in accordance with
the terms and provisions of this Agreement.
2.2 POSITIONS AND DUTIES.
2.2(a) Following a Change in Control Date, the Executive
shall continue to serve in the Executive's then
current capacity, subject to the reasonable
directions of the Board. The Executive shall
thereafter devote the Executive's full working time
and attention to such business and affairs of the
Company and/or any subsidiary of the Company as
directed by the Board, as may be compatible with the
Executive's titles and positions. In addition, the
Executive's position (including status, offices,
titles and reporting requirements), authority,
duties and responsibilities shall be at least
commensurate in all material respects with those
assigned to, or held and exercised by, the Executive
immediately preceding a Change in Control Date.
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2.2(b) Following a Change in Control Date and thereafter
throughout the Term of this Agreement (but excluding
any periods of vacation and sick leave to which the
Executive is entitled), the Executive shall devote
reasonable attention and time during normal business
hours to the business and affairs of the Company and
shall use the Executive's reasonable best efforts to
perform faithfully and efficiently such
responsibilities as are assigned to the Executive
under or in accordance with this Agreement;
provided that, it shall not be a violation of this
paragraph for the Executive to (i) serve on
corporate, civic or charitable boards or committees,
(ii) deliver lectures or fulfill speaking
engagements, or (iii) manage personal investments,
so long as such activities do not significantly
interfere with the performance of the Executive's
responsibilities as an employee of the Company in
accordance with this Agreement or violate the
Company's conflict of interest policy as in effect
immediately prior to the Effective Date.
2.3 SITUS OF EMPLOYMENT. Following a Change in Control
Date and thereafter throughout the Term of this Agreement, the Executive's
services shall be performed at the location where the Executive was employed
immediately preceding the Change in Control Date.
2.4 COMPENSATION. For any calendar year including and
following a Change in Control Date, the Executive shall receive an Annual
Base Salary equal to the Annual Base Salary being received immediately prior
to a Change in Control Date, which shall be paid in equal or substantially
equal monthly installments. The Annual Base Salary payable to the Executive
shall be reviewed thereafter at least annually but need not be adjusted
upward as a result of such review and shall not be reduced after any increase
thereof.
SECTION 3: TERMINATION OF AGREEMENT.
3.1 DEATH. This Agreement shall terminate automatically
upon the Executive's death during the Term of this Agreement.
3.2 DISABILITY. If, following a Change in Control Date,
the Company determines in good faith that the Disability of the Executive has
occurred during the Term of this Agreement (pursuant to the definition of
Disability set forth below), it may give to the Executive written notice in
accordance with Section 8.1 of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the thirtieth (30th) day after receipt of such notice
by the Executive (the "Disability Effective Date"), provided that, within the
thirty (30) days after such receipt, the Executive shall not have returned to
full-time performance of the Executive's duties. For purposes of this
Agreement, "Disability" shall mean that the Executive has been unable to
perform the services required of the Executive hereunder on a full-time basis
for a period of one hundred eighty (180) consecutive business days by reason
of a physical and/or mental condition. "Disability" shall be deemed to exist
when certified by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive's legal representative (such
agreement as to acceptability not to be withheld unreasonably). The
Executive will submit to such medical or psychiatric examinations and tests
as such physician deems necessary to make any such Disability determination.
3.3 PRIOR TO CHANGE IN CONTROL. Executive is employed
at will. Any notice of termination by Executive or Company shall be given in
accordance with Section 3.6 of the Agreement.
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3.4 FOLLOWING A CHANGE IN CONTROL - TERMINATION BY
COMPANY FOR CAUSE. Following a Change in Control Date, the Company may
terminate the Executive's employment during the Term of this Agreement for
"Cause," which shall mean termination based upon: (i) the Executive's willful
and continued failure to substantially perform the Executive's duties with
the Company (other than as a result of incapacity due to physical or mental
condition), after a demand for substantial performance is delivered to the
Executive by the Chief Executive Officer of the Company or the Chairman of
the Compensation Committee of the Board, which specifically identifies the
manner in which the Executive has not substantially performed the Executive's
duties, (ii) the Executive's willful commission of misconduct which is
materially injurious to the Company, monetarily or otherwise, or (iii) the
Executive's material breach of any provision of this Agreement. For purposes
of this paragraph, no act, or failure to act on the Executive's part shall be
considered "willful" unless done, or omitted to be done, without good faith
and without reasonable belief that the act or omission was in the best
interest of the Company. Notwithstanding the foregoing, the Executive shall
not be deemed to have been terminated for Cause unless and until (i) the
Executive receives a Notice of Termination (as defined in Section 3.6) from
the Chief Executive Officer of the Company or the Chairman of the
Compensation Committee of the Board, (ii) the Executive is given the
opportunity, with counsel to be heard before the Board, and (iii) the Board
finds, in its good faith opinion, the Executive was guilty of the conduct set
forth in the Notice of Termination.
3.5 FOLLOWING A CHANGE IN CONTROL - TERMINATION BY
EXECUTIVE FOR GOOD REASON. Following a Change in Control Date, the
Executive may terminate the Executive's employment with the Company for "Good
Reason," which shall mean termination based upon:
(i) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting
requirements), authority, duties or responsibilities as
contemplated by Section 2.2(a) or any other action by the
Company which results in a material diminution in such
position, authority, duties or responsibilities, excluding
for this purpose any action not taken in bad faith and which
is remedied by the Company promptly after receipt of notice
thereof given by the Executive;
(ii) the failure by the Company to continue in effect
any benefit or compensation plan, stock ownership plan, life
insurance plan, health and accident plan or disability plan
to which the Executive is entitled, the taking of any action
by the Company which would adversely affect the Executive's
participation in, or materially reduce the Executive's
benefits such plans, or deprive the Executive of any
material fringe benefit enjoyed by the Executive or the
failure by the Company to provide the Executive with the
number of paid vacation days to which the Executive is
entitled.
(iii) the Company's requiring the Executive to be based
at any office or location other than that described in
Section 2.3;
(iv) a material breach by the Company of any provision
of this Agreement;
(v) any failure by the Company to renew this Agreement
so that the Term ends prior to the second anniversary of the
Change in Control Date or any purported termination by the
Company of the Executive's employment otherwise than as
expressly permitted by this Agreement;
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(vi) within a period ending at the close of business on
the date two (2) years after the Change in Control Date, any
failure by the Company to comply with and satisfy
Section 6.2 on or after the Change in Control Date; or
(vii) within a period ending at the close of business
on the date one (1) year after the Change in Control Date,
the Executive, in the Executive's sole and absolute
discretion, determines and notifies the Company in writing,
that the Executive does not wish to continue employment with
the Company.
For purposes of this Section any good faith determination of "Good Reason"
made by the Executive shall be conclusive.
3.6 NOTICE OF TERMINATION. Any termination by the
Company, or by the Executive, shall be communicated by Notice of Termination
to the other party, given in accordance with Section 8.1. For purposes of
this Agreement, a "Notice of Termination" means a written notice which
(i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated, and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of
such notice, specifies the termination date (which date shall be not more
than fifteen (15) days after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of Termination any fact
or circumstance which contributes to a showing of Good Reason or Cause shall
not waive any right of the Executive or the Company hereunder or preclude the
Executive or the Company from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder.
3.7 DATE OF TERMINATION. "Date of Termination" means
(i) if the Executive's employment is terminated by the Company with or
without Cause, or by the Executive for Good Reason or otherwise, the Date of
Termination shall be the date of receipt of the Notice of Termination or any
later date specified therein, as the case may be, or (ii) if the Executive's
employment is terminated by reason of death or Disability, the Date of
Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.
SECTION 4: CERTAIN BENEFITS UPON TERMINATION OF EMPLOYMENT.
4.1 TERMINATION WITHOUT CAUSE PRIOR TO A CHANGE IN
CONTROL. If, prior to a Change in Control, during the Term of this
Agreement the Company shall terminate the Executive's employment without
Cause, then on the tenth (10th) business day following the Date of
Termination, the Company shall pay to the Executive the sum of (1) the
Executive's Annual Base Salary prorated through the Date of Termination to
the extent not previously paid, and (2) any accrued vacation pay to the
extent not previously paid.
4.2 TERMINATION AFTER A CHANGE IN CONTROL. If a Change
in Control occurs during the Term of this Agreement and within two (2) years
after such Change in Control: (i) the Company shall terminate the Executive's
employment without Cause, or (ii) the Executive shall terminate employment
with the Company for Good Reason, then the Executive shall be entitled to the
benefits provided below:
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4.2(a) "Accrued Obligations": On the tenth (10th)
business day following the Date of Termination, the Company
shall pay to the Executive the sum of (1) the Executive's
Annual Base Salary prorated through the Date of Termination
to the extent not previously paid, and (2) any accrued
vacation pay to the extent not previously paid.
4.2(b) "Severance Amount": On the tenth (10th) business
day following the Date of Termination, the Company shall pay
to the Executive as severance pay a lump sum cash payment in
an amount equal to 2 (two) times the sum of the Executive's
Annual Base Salary in effect on the Date of Termination and
the Executive's Incentive Bonus.
4.2(c) "Stock Options": To the extent not otherwise
provided for under the terms of any of the Company's stock
option agreements, all such stock options shall become fully
exercisable as of the Date of Termination and, except for
"incentive stock options" within the meaning of Code Section
422 granted prior to the date hereof, shall remain fully
exercisable in accordance with their terms.
4.2(d) "Other Benefits": To the extent not previously
paid or provided, the Company shall timely pay or provide to
the Executive and/or the Executive's family any other
amounts or benefits required to be paid or provided for
which the Executive and/or the Executive's family is
eligible to receive pursuant to this Agreement and under any
plan, program, policy or practice or contract or agreement
of the Company as those provided generally to other peer
executives and their families during the ninety (90) day
period immediately preceding the Effective Date or, if more
favorable to the Executive, as those provided generally
after the Effective Date to other peer executives of the
Company and their families.
4.2(e) "Excess Parachute Payment": Anything in this
Agreement to the contrary notwithstanding, in the event that
an independent accountant shall determine that any payment
or distribution by the Company to or for the benefit of
Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or
otherwise) (a "Payment") would be nondeductible by the
Company for Federal income tax purposes because of Code
Section 280G or would constitute an "excess parachute
payment" (as defined in Code Section 280G), then the
aggregate present value of amounts payable or distributable
to or for the benefit of Executive pursuant to this
Agreement (such payments or distributions pursuant to this
Agreement are hereinafter referred to as "Agreement
Payments") shall be reduced (but not below zero) to the
Reduced Amount. For purposes of this paragraph, the
"Reduced Amount" shall be an amount expressed in present
value which maximizes the aggregate present value of
Agreement Payments without causing any Payment to be
nondeductible by the Company because of Code Section 280G or
without causing any portion of the Payment to be subject to
the excise tax imposed by Code Section 4999.
If the independent accountant determines that any Payment would
be nondeductible by the Company because of Code Section 280G
or that any portion of the Payment will be subject to the
excise tax imposed by Code Section 4999, the Company shall
promptly give Executive notice to that effect and a copy of
the detailed calculation thereof and of the Reduced Amount.
The Executive may then elect, in the Executive's sole
discretion, which and how much of the Agreement Payments
shall be eliminated or reduced (as long as after
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such election the aggregate present value of the Agreement
Payments equals the Reduced Amount), and shall advise the
Company in writing of the Executive's election within ten
(10) days of the Executive's receipt of such notice. If no
such election is made by Executive within such ten-day
period, the Company may elect which and how much of the
Agreement Payments shall be eliminated or reduced (as long
as after such election the aggregate present value of the
Agreement Payments equals the Reduced Amount) and shall
notify the Executive promptly of such election. For
purposes of this paragraph, present value shall be
determined in accordance with Code Section 280G(d)(4). All
determinations made by the independent accountant under this
paragraph shall be binding upon the Company and the
Executive and shall be made within sixty (60) days of a
termination of employment of the Executive. As promptly as
practicable following such determination and the elections
hereunder, the Company shall pay to or distribute to or for
the benefit of the Executive such amounts as are then due to
the Executive under this Agreement and shall promptly pay to
or distribute for the benefit of the Executive in the future
such amounts as become due to the Executive under this
Agreement.
As a result of the uncertainty in the application of Code
Sections 280G and 4999 at the time of the initial
determination by the independent accountant hereunder, it is
possible that Agreements Payments will be made by the
Company which should not have been made ("Overpayment") or
that additional Agreement Payments which have not been made
by the Company should have been made ("Underpayment"), in
each case, consistent with the calculation of the Reduced
Amount hereunder. In the event that the independent
accountant, based upon the assertion of a deficiency by the
Internal Revenue Service against the Company or the
Executive which the independent accountant believes has a
high probability of success, determines that an Overpayment
has been made, any such Overpayment shall be treated for all
purposes as a loan to the Executive which the Executive
shall repay to the Company together with interest at the
applicable Federal rate provided for in Code
Section 7872(f)(2); provided, however, that no amount shall
be payable by the Executive to the Company if and to the
extent such payment would not reduce the amount which is
subject to taxation under Code Section 4999 or if the period
of limitations for assessment of tax under Code Section 4999
against the Executive shall have expired. If the Executive
is required to repay an amount under this Section, the
Executive shall repay such amount over a period of time not
to exceed one (1) year for each twenty-five thousand dollars
($25,000) which the Executive must repay to the Company. In
the event that the independent accountant, based upon
controlling precedent, determines that an Underpayment has
occurred, any such Underpayment shall be promptly paid by
the Company to or for the benefit of the Executive together
with interest at the applicable Federal rate provided for in
Code Section 7872(f)(2)(A).
4.3 DEATH. If the Executive's employment is terminated by
reason of the Executive's death during the Term of this Agreement (either
prior or subsequent to a Change in Control), this Agreement shall terminate
without further obligations to the Executive's legal representatives under
this Agreement, other than for payment of Accrued Obligations (as defined in
Section 4.1) (which shall be paid to the Executive's estate or beneficiary,
as applicable, in a lump sum in cash within ten (10) days of the Date of
Termination).
4.4 DISABILITY. If the Executive's employment is
terminated by reason of the Executive's Disability during the Term of this
Agreement (either prior or subsequent to a Change in Control), this
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Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations (as defined in Section 4.1) (which shall
be paid to the Executive in a lump sum in cash within ten (10) days of the Date
of Termination).
4.5 TERMINATION FOR CAUSE; EXECUTIVE'S TERMINATION
OTHER THAN FOR GOOD REASON AFTER A CHANGE IN CONTROL. If the
Executive's employment shall be terminated for Cause during the Term of this
Agreement (either prior to or subsequent to a Change in Control), this
Agreement shall terminate without further obligations to the Executive other
than the obligation to pay to the Executive Accrued Obligations (as defined
in Section 4.1). If the Executive terminates employment with the Company
during the Term of this Agreement, (other than for Good Reason after a Change
in Control) this Agreement shall terminate without further obligations to the
Executive, other than for Accrued Obligations (as defined in Section 4.1).
In such case, all Accrued Obligations shall be paid to the Executive in a
lump sum cash payment within thirty (30) days of the Date of Termination. If
the Executive's employment shall terminate for the reasons stated in this
Section, the provisions of Section 5 shall continue to apply.
4.6 NON-EXCLUSIVITY OF RIGHTS. Nothing in this
Agreement shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice provided by the
Company and for which the Executive may qualify, nor shall anything herein
limit or otherwise affect such rights as the Executive may have under any
contract or agreement with the Company. Amounts which are vested benefits of
which the Executive is otherwise entitled to receive under any plan, policy,
practice or program of, or any contract or agreement with, the Company at or
subsequent to the Date of Termination, shall be payable in accordance with
such plan, policy, practice or program or contract or agreement except as
explicitly modified by this Agreement.
4.7 FULL SETTLEMENT. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the Company may
have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and such amounts shall not be reduced whether or
not the Executive obtains other employment. The Company agrees, only on and
after a Change in Control Date to pay promptly as incurred, to the full
extent permitted by law, all legal fees and expenses which the Executive may
reasonable incur as a result of any contest (regardless of the outcome
thereof) by the Company, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Executive regarding the amount of any payment pursuant to this Agreement),
plus in each case interest on any delayed payment at the applicable Federal
rate provided for in Code Section 7872(f)(2)(A).
4.8 RESOLUTION OF DISPUTES. If there shall be any
dispute between the Company and the Executive (i) in the event of any
termination of the Executive's employment by the Company, whether such
termination was for Cause, or (ii) in the event of any termination of
employment by the Executive, whether Good Reason existed, then, unless and
until there is a final, nonappealable judgment by a court of competent
jurisdiction declaring that such termination was for Cause or that the
determination by the Executive of the existence of Good Reason was not made
in good faith, the Company shall, only on and after a Change in Control Date
pay all amounts, and provide all benefits, to the Executive and/or the
Executive's family or other beneficiaries, as the case may be, that the
Company would be required to pay or provide pursuant to Section 4.2 as though
such termination were by the Company without Cause or
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by the Executive with Good Reason; provided, however, that the Company shall not
be required to pay any disputed amounts pursuant to this paragraph except upon
receipt of an undertaking by or on behalf of the Executive to repay all such
amounts to which the Executive is ultimately adjudged by such court not to be
entitled.
SECTION 5: CONFIDENTIAL INFORMATION.
CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its
affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive's employment by the Company
and which shall not be or become public knowledge (other than by acts by the
Executive or representatives of the Executive in violation of this
Agreement). After termination of the Executive's employment with the
Company, the Executive shall not, without the prior written consent of the
Company, or as may otherwise be required by law or legal process, communicate
or divulge any such information, knowledge or data to anyone other than the
Company and those designated by it. In no event shall an asserted violation
of the provisions of this Section constitute a basis for deferring or
withholding any amounts otherwise payable to the Executive under this
Agreement.
SECTION 6: SUCCESSORS.
6.1 SUCCESSORS OF EXECUTIVE. This Agreement is personal
to the Executive and, without the prior written consent of the Company,
amounts receivable hereunder shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
6.2 SUCCESSORS OF COMPANY. The Company will require
any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of
the Company to assume expressly and agree to perform this Agreement in the
same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. Failure of the Company to
obtain such agreement upon the effectiveness of any such succession shall be
a breach of this Agreement and shall entitle the Executive to terminate the
Agreement at the Executive's option on or after the Change in Control Date
for Good Reason. As used in this Agreement, "Company" shall mean the Company
as hereinbefore defined and any successor to its business and/or assets which
assumes and agrees to perform this Agreement by operation of law, or
otherwise.
SECTION 7: TERMS OF AGREEMENT.
This Agreement will automatically renew for annual one-year
periods beginning on January 1 of each year and ending on the following December
31; provided that, the last annual period shall be the twelve (12) month period
beginning on January 1 and ending on the following December 31 during which
written notice is given by December 1, by either party, of such party's
intent not to renew this Agreement. If notice is given by either party after
December 1 of any year, but prior to January 1 of the next succeeding year,
then the last renewal period shall be the twelve (12) month period which
begins
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on the January 1 following the date notice is given and ending the
following December 31. Notwithstanding the foregoing, in the event a Change
in Control shall have occurred, this Agreement shall terminate two (2) years
after a Change in Control Date.
SECTION 8: MISCELLANEOUS.
8.1 NOTICE. For purposes of this Agreement, notices and all
other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered or mailed by certified
or registered mail, return receipt requested, postage prepaid, addressed to
the respective addresses as set forth below; provided that all notices to the
Company shall be directed to the attention of the Chairman of the Board of
the Company with a copy to the Secretary of the Company, or to such other
address as one party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only
upon receipt.
Notice to Executive:
-------------------
Xxxxxx X. Xxxxxx
0000 Xxxxxxxx Xxxxx
Xx. Xxxxx, XX 00000
Notice to Company:
-----------------
Magna Group, Inc.
0000 Xxxxx Xxxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
8.2 VALIDITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement.
8.3 WITHHOLDING. The Company may withhold from any
amounts payable under this Agreement such Federal, state or local taxes as
shall be required to be withheld pursuant to any applicable law or
regulation.
8.4 WAIVER. The Executive's or the Company's failure to
insist upon strict compliance with any provision hereof or any other
provision of this Agreement or the failure to assert any right the Executive
or the Company may have hereunder, including, without limitation, the right
of the Executive to terminate employment for Good Reason pursuant to Section
3.5 shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.
8.5 EFFECT ON OTHER EMPLOYMENT AGREEMENTS. The terms of
this Agreement shall supersede all other employment or other agreements with
respect to severance entered into by and between the Executive and the
Company, or the Executive and any other employer, and this Agreement shall
constitute the sole agreement pursuant to which the Company shall have an
obligation to the Executive upon the termination of the Executive's
relationship with the Company or any subsidiary.
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IN WITNESS WHEREOF, the Executive and the Company, pursuant to
the authorization from its Board, have caused this Agreement to be executed
in its name on its behalf, all as of the day and year first above written.
/s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Executive
MAGNA GROUP, INC.
By /s/ G. Xxxxxx Xxxxx
-----------------------------------------
Name: G. Xxxxxx Xxxxx
Title: Chairman of the Board, President and
Chief Executive Officer
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