EMPLOYMENT AGREEMENT
AGREEMENT by and between SunTrust Banks, Inc., a Georgia corporation
(the "Company"), and Xxxxxxx X. Xxxxxxxx (the "Executive"), dated as of July 20,
1998, but effective as of the Effective Date (as hereinafter defined).
The Company has determined that it is in the best interests of the
Company and its stockholders to assure that it will have the benefit of the
valuable services and continued dedication of the Executive following
consummation of the merger (the "Merger") of Crestar Financial Corporation
("Crestar") with the Company or a subsidary of the Company pursuant to the
Agreement and Plan of Merger dated as of July 20, 1998, and the Executive has
agreed to serve the Company on the terms and conditions hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, the Company and the Executive hereby agree as
follows:
1. Effective Date. The "Effective Date" shall mean the date of
consummation of the Merger. In the event the Merger is not consummated, this
Agreement shall be null and void and of no force and effect.
2. Employment Period. The Company on its behalf and on behalf of
Crestar Bank ("C Bank ") hereby agrees to employ the Executive, and the
Executive hereby agrees to be employed by Company and C Bank, subject to the
terms and conditions of this Agreement, for the period commencing on the
Effective Date and ending on December 31, 2000 (the "Employment Period").
3. Terms of Employment.
(a) Position; Duties; Place of Employment.
(i) During the Employment Period, (A) the Executive shall serve
as Vice Chairman and Executive Vice President of the Company and as Chief
Executive Officer of C Bank, (B) the Executive's services under this Agreement
shall be performed principally in the same location or locations as the
Executive's services were performed for Crestar immediately prior to the
Effective Date, (C) Executive shall operate as a "State Head" of the Company
with the same authority normally associated with such status from time to time
to run the operations of the Company in the States of Virginia and Maryland and
in the District of Columbia, and (D) the Executive shall report directly to the
Chief Executive Officer of the Company and shall perform such additional duties
not inconsistent with the Executive's position as a senior executive of the
Company as may reasonably be requested by such Chief Executive Officer.
(ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive agrees
to devote substantially all of his attention and time during normal business
hours to the business and affairs of the Company and to use the Executive's
reasonable best efforts to perform faithfully and efficiently the
responsibilities assigned to him under this Agreement. During the Employment
Period, it shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B) deliver
lectures, fulfill speaking engagements or teach at educational institutions and
(C) manage personal investments, so long as such activities do not unreasonably
interfere with the performance of the Executive's responsibilities as a senior
executive of the Company in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities have been
conducted regularly by the Executive prior to the Effective Date, the continued
conduct of such activities (or the conduct of activities similar in nature and
scope thereto) subsequent to the Effective Date shall not thereafter be deemed
to unreasonably interfere with the performance of the Executive's
responsibilities to the Company.
(b) Board Membership. As of the Effective Date, the Board of
Directors of the Company (the "Board") shall nominate the Executive (and the
Board shall elect the Executive) as a director of the Company and the Company
shall cause the Board of Directors of C Bank (the "C Bank Board") to appoint the
Executive as Chairman of the C Bank Board. So long as the Executive serves as an
employee of the Company during the Employment Period, the Company shall cause
the Executive to be included in the slate of nominees recommended by the Board
to the Company's stockholders for election as directors at each annual meeting
of the stockholders of the Company at which his class of directors is standing
for election, and the Company shall use its best efforts to cause the election
of the Executive, including soliciting proxies in favor of the election of the
Executive, and the Company shall cause the C Bank Board to maintain the
Executive in the position of Chairman of the C Bank Board. Executive shall
resign from the Company's Board of Directors and from the C Bank Board effective
as of the last day of his Employment Period, and his resignation shall be
accepted.
(c) Compensation.
(i) Base Salary. With respect to each full calendar year during
the Employment Period, the Executive shall be entitled to receive base salary
("Annual Base Salary") equal to $900,000. Such Annual Base Salary shall be paid
in accordance with the Company's payroll policies and practices for executive
employees.
(ii) Annual Bonus. With respect to each full calendar year
during the Employment Period, the Executive shall receive an annual cash bonus
("Annual Bonus") in an amount equal to $600,000 for calendar year 1999 and
$700,000 for calendar year 2000. Such Annual Bonus shall be paid in accordance
with the Company's payroll policies and practices for executive employees.
(iii) Initial Equity-Based Awards. As of the Effective Date,
the Company shall grant to the Executive an aggregate of 60,000 shares of
restricted Company common stock (the "Restricted Stock") and a ten-year
nonqualified option (the "Option") to acquire an aggregate of 180,000 shares of
the Company's common stock (the "Company Stock"). The Option shall have an
exercise price per share equal to the closing price per share of the Company
Stock on the New York Stock Exchange on the Effective Date and shall be subject
to anti-dilution adjustments set forth in the Company's 1995 stock option plan
under which the Option is granted . Except as otherwise provided herein, the
Option and the Restricted Stock shall vest in accordance with the vesting
schedule applicable to similarly situated executives of the Company, but the
Option and the Restricted Stock shall fully vest in no event later than the
earlier of (1) the end of the Employment Period or (2) the occurrence of an
event which fully vests all options granted under the Company's 1995 stock
option plan. The Option and the Restricted Stock shall also become fully vested
upon Executive's death, Disability, termination of Executive's employment by the
Company without Cause and termination of Executive's employment by the Executive
for Good Reason. The Option shall have a ten (10) year term and shall remain
exercisable until the expiration of such term unless the Executive's employment
is terminated by the Company for Cause or by the Executive without Good Reason;
provided, however, that in the event of a merger transaction involving the
Company, the foregoing shall not be construed as precluding the Option from
being treated in such transaction in the same manner as other outstanding
options held by Company employees. As promptly as practicable, and in any event
within six (6) months after the Effective Date, the Company shall, at its
expense, cause all shares of Restricted Stock and all shares of Company Stock
subject to the Option (and the options referred to in paragraph (iv) below) to
be registered under the Securities Act of 1933, as amended (the "Securities
Act"), and registered or qualified under applicable state laws, to be freely
resold. The Company shall maintain the effectiveness of such registration and
qualification for so long as the Executive or any member of the Executive's
immediate family owns the shares of Restricted Stock or holds any option
described in this Agreement or owns the underlying shares of Company Stock or
until such earlier date as all such shares, without such registration or
qualification, may be freely sold without any restrictions under the Securities
Act.
(iv) Future Stock Options. At the time the Company makes its
option grant to other senior executives, the Executive shall be granted an
option to purchase 25,000 shares of Company Stock in 1999 and in 2000. Each such
option shall be granted subject to the terms of the Company's stock option plan
for a ten (10) year term and shall be subject to the anti-dilution adjustments
set forth in such plan, provided, however, that (A) each such option shall fully
vest no later than the earlier of (1) the end of the Employment Period or (2)
the occurrence of an event which fully vests all options granted under the
Company's 1995 stock option plan, (B) each such option shall fully vest upon
Executive's death, Disability, termination of employment by the Company without
Cause and termination of Executive's employment by the Executive for Good
Reason, and (C) each such option shall remain exercisable until the expiration
of such term unless Executive's employment is terminated by the Company for
Cause or by the Executive without Good Reason; provided, however, that in the
event of a merger transaction involving the Company, the foregoing shall not be
construed as precluding the option from being treated in such transaction in the
same manner as other outstanding options held by Company employees. However, no
options shall be granted to the Executive under this clause (iv) if his
employment by the Company terminates before the date the option is granted;
provided, however, that any such options not theretofore granted shall be deemed
to have been granted immediately prior to the date as of which the Executive's
employment is terminated by the Company without Cause or by the Executive for
Good Reason.
(v) Supplemental Retirement Benefit. The Company agrees that,
upon the Executive's ceasing to be employed by the Company for any reason on or
before the end of the Employment Period, the Executive shall have the right to
receive, at his election (or, in the event of his death, at the election of his
surviving spouse) either (A) the benefit payable to or in respect of Executive
under the terms of the supplemental retirement plan of Crestar as in effect on
July 20, 1998 treating all service and compensation (salary and bonus) earned by
the Executive with the Company on and after the Effective Date as service and
compensation with Crestar or (B) the benefit payable to or in respect of the
Executive under the terms of the Company's supplemental retirement plan as in
effect on July 20, 1998, treating all service with and compensation from Crestar
prior to the Effective Date as service with, and compensation from, the Company
to the extent such service and compensation would have been taken into account
under such plan if such service had been performed for the Company and such
compensation had been paid by the Company. No compensation under Crestar's value
share program shall be taken into account under this Section 3(c)(v).
(vi) Other Employee Benefit Plans; Perquisites. During the
Employment Period, the Executive shall be provided with employee benefits
(including, but not limited to, medical benefits and life insurance, but
excluding benefits which are like the benefits described in Section 3(c)(i)
through section 3(c)(iv) of this Agreement) and fringe benefits and other
perquisites, at a level not less favorable than that provided to the Executive
by Crestar immediately prior to the Effective Date.
(vii) Expenses. During the Employment Period, the Executive
shall be entitled to receive prompt reimbursement for all reasonable expenses
incurred by the Executive in accordance with the Company's policies.
(viii) Office and Support Staff. During the Employment Period,
the Executive shall be entitled to an office or offices of a size and with
furnishings and to administrative and other support services as are provided
generally to other senior executives of the Company.
(ix) Vacation. During the Employment Period, the Executive
shall be entitled to paid vacation in accordance with the plans, policies,
programs and practices of the Company with respect to other senior executives of
the Company.
4. Termination of Employment.
(a) Death or Disability. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period. If the
Company determines in good faith that the Disability of the Executive has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), it may give to the Executive written notice in accordance with
Section 12(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the "Disability Effective Date"), provided that, within the 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 the absence of the Executive from the Executive's duties
with the Company on a full-time basis for 180 consecutive business days as a
result of incapacity due to mental or physical illness which is determined to be
total and permanent by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive's legal representative.
(b) Cause. The Company may terminate the Executive's employment
during the Employment Period for Cause. For purposes of this Agreement, "Cause"
shall mean:
(i) the continued failure of the Executive to perform
substantially the Executive's duties with the Company and its affiliates (other
than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to the
Executive by the Board which specifically identifies the manner in which the
Board believes that the Executive has not substantially performed the
Executive's duties, or
(ii) the willful engaging by the Executive in illegal conduct
or gross misconduct, which is materially and demonstrably injurious to the
Company, or
(iii) conviction of a felony or guilty or nolo contendere plea
by the Executive with respect thereto, which is materially and demonstrably
injurious to the Company.
For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the Chief Executive Officer of
the Company or based upon the advice of counsel for the Company shall be
conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of the Company. The cessation of employment
of the Executive shall not be deemed to be for Cause unless and until there
shall have been delivered to the Executive a copy of a resolution duly adopted
by the affirmative vote of not less than two-thirds of the entire membership of
the Board at a meeting of the Board called and held for such purpose (after
reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the Board), finding that,
in the good faith opinion of the Board, the Executive is guilty of the conduct
described in subparagraph (i), (ii) or (iii) above and specifying the
particulars thereof in detail.
(c) Good Reason. The Executive's employment may be terminated by the
Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall
occur upon a good faith determination by the Executive that the Company has
materially breached any of its obligations under this Agreement, which breach is
not cured within 20 days of the receipt of written notice of such breach by the
Company from the Executive.
(d) Notice of Termination. Any termination by the Company for Cause,
or by the Executive for Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 12(b) of
this Agreement. For purposes of this Agreement, a "Notice of Termination" shall
mean 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 thirty days after the giving of such notice).
(e) Date of Termination. "Date of Termination" shall mean (i) if the
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein in accordance with this Agreement, (ii) if the
Executive's employment is terminated by the Company other than for Cause or
Disability, the Date of Termination shall be the date on which the Company
notifies the Executive of such termination and (iii) 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.
5. Obligations of the Company upon Termination.
(a) Good Reason; Other Than for Cause or Disability. If, during the
Employment Period, the Company shall terminate the Executive's employment other
than for Cause or Disability or the Executive shall terminate employment for
Good Reason:
(i) the Company shall pay to the Executive, in addition to any
earned but unpaid portion of the Executive's Annual Base Salary and Annual Bonus
through the Date of Termination (the "Accrued Obligations"), a lump sum cash
payment, within 10 days after the Date of Termination, in an amount equal to the
Annual Base Salary and Annual Bonus which would have been paid to the Executive
for the remainder of the Employment Period absent such termination;
(ii) for the remainder of the Employment Period, the Company
shall continue to provide to the Executive (and, to the extent applicable, his
spouse) medical and dental benefits (collectively "Medical Benefits") and other
welfare benefits, fringe benefits and perquisites on the same basis as such
benefits and perquisites were provided to the Executive immediately prior to the
Date of Termination;
(iii) the Option and the Restricted Stock awards, as well as
the options referred to in Section 3(c)(iv) hereof, shall vest immediately;
(iv) the Company shall pay to the Executive a lump sum cash
payment, within 30 days after the Date of Termination, in an amount equal to the
amount the Company would have contributed on the Executive's behalf to any
qualified or supplemental defined contribution plan for the period from the Date
of Termination through and including the end of the Employment Period, had the
Executive's employment not terminated hereunder;
(v) to the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company and its affiliated companies through the Date of Termination, including
retiree medical and dental benefits and executive life insurance benefits in
accordance with Crestar's current practice with respect to its "grandfathered"
executives (such other amounts and benefits shall be hereinafter referred to as
the "Other Benefits"); and
(vi) the Company shall pay to Executive (and, after his death,
his surviving spouse) the supplemental retirement benefit hereunder.
(b) Death. If the Executive's employment is terminated by reason of
the Executive's death during the Employment Period, this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this Agreement, other than the payment of Accrued Obligations, the timely
payment or provision of Other Benefits to or in respect of the Executive and the
payment to the Executive's surviving spouse of the supplemental retirement
benefits hereunder. In addition, the Option and the Restricted Stock, as well as
the options referred to in Section 3(c)(iv) hereof, shall vest immediately.
Accrued Obligations shall be paid to the Executive's estate or beneficiary, as
applicable, in a lump sum in cash within 30 days of the Date of Termination.
(c) Disability. If the Executive's employment is terminated by
reason of the Executive's Disability during the Employment Period, this
Agreement shall terminate without further obligations to the Executive, other
than for payment of Accrued Obligations, the timely payment or provision of
Other Benefits and the payment of the supplemental retirement benefit hereunder.
In addition, the Option and the Restricted Stock, as well as the options
referred to in Section 3 (c)(iv), shall vest immediately. Accrued Obligations
shall be paid to the Executive in a lump sum in cash within 30 days of the Date
of Termination.
(d) Cause; other than for Good Reason. If the Executive's employment
shall be terminated for Cause or the Executive terminates his employment without
Good Reason during the Employment Period, this Agreement shall terminate without
further obligations to the Executive other than the obligation to pay or provide
to the Executive the Accrued Obligations and Other Benefits, in each case to the
extent theretofore unpaid or not provided, and the payment of the supplemental
retirement benefit hereunder.
(e) Effect. Any termination of the Executive's employment shall have
no effect on the continuing operation of this Section 5.
6. Non-exclusivity of Rights. Except as specifically provided,
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 or any of its affiliated companies and for which the Executive may
qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise
affect such rights as the Executive may have under any contract or agreement
with the Company or any of its affiliated companies. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan,
policy, practice or program of or any contract or agreement with the Company or
any of its affiliated companies 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.
7. No Mitigation, etc. 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 to pay or promptly reimburse the Executive for all reasonable
costs and expenses (including all reasonable legal fees and expenses) which the
Executive may reasonably incur in connection with any dispute hereunder
(regardless of the outcome thereof) relating to the validity or enforceability
of, or liability under, any provision of this Agreement (including as a result
of any claim 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 Section 7872(f)(2)(A) of the Internal
Revenue Code of 1986, as amended (the "Code"); provided, however, that the
foregoing obligation shall not apply with respect to any claim by the Executive
which is determined not to have been brought in good faith.
8. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding, in
the event it shall be determined that any payment, distribution or other benefit
provided by the Company or Crestar or any of their affiliates to or for the
benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
8) (a "Payment") would be subject to the excise tax imposed by Section 4999 of
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes, employment taxes and Excise Tax
imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
(b) Subject to the provisions of Section 8(c), all determinations
required to be made under this Section 8, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by KPMG Peat
Marwick LLP or such other certified public accounting firm reasonably acceptable
to the Company as may be designated by the Executive (the "Accounting Firm"),
which shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days of the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. All fees and expenses of the Accounting Firm shall be borne solely by
the Company. Any Gross-Up Payment, as determined pursuant to this Section 8,
shall be paid by the Company to the Executive within five days of the later of
(i) the due date for the payment of any Excise Tax, and (ii) the receipt of the
Accounting Firm's determination. Any determination by the Accounting Firm shall
be binding upon the Company and the Executive. As a result of the uncertainty in
the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up
Payments which will not have been made by the Company should have been made
("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies pursuant to
Section 8(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.
(c) The Executive shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:
(i) give the Company any information reasonably requested by
the Company relating to such claim,
(ii) take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any proceedings
relating to such claim;
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions of
this Section 8(c), the Company shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and xxx for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest to
a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts as the Company shall determine;
provided, however, that if the Company directs the Executive to pay such claim
and xxx for a refund, the Company shall advance the amount of such payment to
the Executive, on an interest-free loan basis and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Executive shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.
(d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to section 8(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 8(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced as an interest free loan by the Company pursuant to
Section 8(c), a determination is made that the Executive shall not be entitled
to any refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to the
expiration of 30 days after such determination, then such loan shall be forgiven
and shall not be required to be repaid and the amount of such loan shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.
9. Confidential Information.
(a) 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 or any of its affiliated companies 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 9 constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement.
(b) In the event of a breach or threatened breach of this Section 9,
the Executive agrees that the Company shall (in addition to any other remedy
available to the Company) be entitled to injunctive relief in a court of
appropriate jurisdiction to remedy any such breach or threatened breach, the
Executive hereby acknowledging that damages would be inadequate and
insufficient.
(c) Any termination of the Executive's employment or of this
Agreement shall have no effect on the continuing operation of this Section 9.
10. Anti-Pirating.
(a) The Executive shall not, during the one year period following
his termination of employment for any reason under this Agreement, seek to
employ on his own behalf or on behalf of any other person, firm, or corporation
which engages, directly or indirectly, in the same business as the Company or
Crestar, any person who was employed as an employee by the Company or Crestar in
an executive, managerial or supervisory capacity at any time during the
Executive's employment by the Company or Crestar and who has not thereafter
ceased to be employed in such capacity by the Company or Crestar for a period of
at least one (1) year.
(b) In the event of a breach or threatened breach of this Section
10, the Executive agrees that the Company shall (in addition to any other remedy
available to the Company) be entitled to injunctive relief in a court of
appropriate jurisdiction to remedy any such breach or threatened breach, the
Executive hereby acknowledging that damages would be inadequate and
insufficient.
11. Successors.
(a) This Agreement is personal to the Executive and without the
prior written consent of the Company 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.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
(c) 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. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.
12. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Virginia, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive:
Xxxxxxx X. Xxxxxxxx
Crestar Financial Corporation
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
If to the Company:
SunTrust Banks, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: General Counsel
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) The Executive's or the Company's failure to insist upon strict
compliance with any 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 4(c) of this Agreement, shall not be deemed to be a waiver
of such provision or right or any other provision or right of this Agreement.
(f) From and after the Effective Date, this Agreement shall
supersede any other employment, severance or change in control agreement between
the parties hereto or between the Executive and Crestar, including Crestar's
Executive Severance Plan as in effect for Executive immediately prior to the
Effective Date (the "Severance Agreement") and no such employment, severance or
change in control agreement, including the Severance Agreement, shall have any
further force or effect whatsoever.
13. Dispute Resolution. In the event of any dispute or controversy
arising under or in connection with this Agreement, the parties shall settle
such dispute or controversy exclusively by arbitration in Richmond, Virginia, in
accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any court having
jurisdiction.
14. Indemnification. To the fullest extent permitted by law, the
Company shall indemnify the Executive (including the advancement of expenses)
for any judgments, fines, amounts paid in settlement and reasonable expenses,
including attorneys' fees, incurred by the Executive in connection with the
defense of any lawsuit or other claim to which he is made a party by reason of
being an officer, director or employee of the Company or any of its affiliates
during the Employment period and for at least three (3) years thereafter, the
Company shall make every reasonable effort to maintain customary director and
officer liability insurance covering the Executive for acts and omissions during
the Employment Period. Any termination of the Executive's employment or of this
Agreement shall have no effect on the continuing operation of this Section 14.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the date and year first above written.
SunTrust Banks, Inc.
By: /s/ L. Xxxxxxx Xxxxxx
----------------------------------
Name: L. Xxxxxxx Xxxxxx
Title: Chairman of the Board and
Chief Executive Officer
/s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxxxx
