Contract
Exhibit 99.2
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AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April
28, 2009 (the “Effective Date”), is by and among White River Capital, Inc., an
Indiana corporation (“WRC”), and Xxxxxx X. Xxxxxxx, an individual residing in
California (“Executive”).
WHEREAS,
Executive has served as the Assistant Chief Financial Officer and subsequently
as the Chief Financial Officer of WRC pursuant to a letter agreement dated April
8, 2005 (the “2005 Agreement”); and
WHEREAS,
Castle Creek Capital, L.L.C. (“Castle Creek”), First Chicago Bancorp (“FCB”),
WRC, and Executive entered into an Employment Agreement dated as of June 27,
2008 (the “2008 Agreement”), which WRC and Executive now desire to modify in
certain respects and also to confirm and restate the terms of Executive’s
employment, which modifications have also been acknowledged by Castle Creek and
FCB; and
WHEREAS,
by entering into this Agreement, Executive and WRC hereby amend and restate the
2008 Agreement in its entirety as set forth below.
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein and for
other good and valuable consideration, the parties hereby agree as
follows:
1. Effectiveness. This
Agreement shall be effective as of the Effective Date. This Agreement
shall supersede the 2005 Agreement, 2008 Agreement, or any other agreement or
understanding Executive has with respect to his employment with WRC, and the
terms and conditions of Executive’s employment with WRC shall be governed only
by this Agreement. The parties hereto represent, acknowledge and
agree that the payments to be provided to Executive from and after the Effective
Date under the terms and conditions of this Agreement represent reasonable
compensation to Executive in exchange for the personal services to be rendered
by Executive for periods from and after the Effective Date.
2. Definitions. The
terms defined in this Section 2 shall have the respective meanings indicated
below for all purposes of this Agreement.
(a) Affiliate. “Affiliate”
of a Person means a Person that directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with, the
first Person. “Control” means the possession, directly or indirectly,
of the power to direct or cause the direction of the management policies of a
Person, whether through the ownership of voting securities, by contract, as
trustee or executor, or otherwise.
(b) Cause. “Cause”
shall mean any one or more of the following:
i. engaging in a
material dishonest act, including without limitation any material
misrepresentation or intentional omission to state a
material
fact to WRC or the WRC Board, willful breach of fiduciary duty, misappropriation
or fraud against WRC or any of its Affiliates (the “Group”);
ii. any
indictment or similar charge against Executive by a governmental authority
alleging the commission of a felony, or a guilty plea or no-contest plea by
Executive to a felony;
iii. material
failure by Executive to follow WRC’s general policies, reasonable directives or
orders applicable to officers of WRC after failing to cure prior similar
failures within thirty (30) days of receiving written notice thereof from the
WRC Board;
iv. intentional
destruction or theft of any member of the Group’s property or falsification of
documents of any member of the Group;
v. a breach by
Executive of the provisions of Section 14; or
vi. a material
breach by Executive of any other provision of this Agreement and the failure by
Executive to cure such breach within thirty (30) days of the date on which WRC
gives Executive notice thereof.
(c) Change
of Control. “Change of Control” shall
mean:
i. the
consummation of a plan of dissolution or liquidation of WRC;
ii. the
individuals who, as of the Effective Date hereof, are members of the WRC Board
(“Incumbent Board”), cease for any reason to constitute at least a majority of
the members of the WRC Board; provided, however, that if the election, or
nomination for election by WRC’s shareholders, of any new director was approved
by a vote of at least two-thirds of the Incumbent Board, such new director
shall, for purposes of this Agreement, be considered as a member of the
Incumbent Board; provided, further, however, that no individual shall be
considered a member of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened “election contest” or other
actual or threatened solicitation of proxies or consents by or on behalf of an
individual, entity or group (within the meaning of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other than the
WRC Board (a “Proxy Contest”) including by reason of any agreement intended to
avoid or settle any election contest or Proxy Contest;
iii. the
consummation of a plan of reorganization, merger or consolidation involving WRC,
except for a reorganization, merger or consolidation where (A) WRC is the
surviving entity resulting from such
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reorganization,
merger or consolidation (the “Surviving Company”), and (B) the individuals who
were members of the Incumbent Board immediately prior to the execution of the
agreement providing for such reorganization, merger or consolidation constitute
at least a majority of the members of the board of directors of the Surviving
Company, or of a company beneficially owning, directly or indirectly, a majority
of the voting securities of the Surviving Company;
iv. the sale of
all or substantially all the assets of WRC to another Person outside the
ordinary course of business; or
v. the
acquisition by another Person of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of stock representing more than
fifty (50%) of the voting power of WRC then outstanding, other than as a result
of an original issuance of equity interests approved by the Incumbent
Board.
(d) Date
of Termination. “Date of Termination” shall mean in the case
of Executive’s death, the date of death, in the case of Disability, thirty (30)
days after Notice of Termination is given (provided Executive shall not have
returned to the full-time performance of his duties during such thirty (30) day
period), and in all other cases, the date specified in the Notice of
Termination, which shall be at least thirty (30) days after the date of the
Notice of Termination, unless the termination is by WRC for Cause or by
Executive for Good Reason.
(e) Disability. “Disability”
shall mean Executive is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months.
(f) Good
Reason. “Good Reason” shall mean any one or more of the
following bases for termination of Executive’s employment by Executive during
the Term:
i. the removal
of Executive as Chief Financial Officer and Senior Vice President of WRC without
Cause;
ii. the
assignment to Executive of any duties inconsistent in any material respect with
Executive’s position, authority, duties or responsibilities as contemplated by
Section 6(a) of this Agreement, excluding for this purpose an isolated,
insubstantial or inadvertent action not taken in bad faith and which is remedied
by WRC promptly after receipt of notice thereof given by Executive;
iii. a material
change of more than 50 miles in the geographical location at which Executive
must perform his duties;
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iv. the
occurrence of a Change of Control within the preceding 12 months;
v. any action by
WRC to materially reduce Executive’s base compensation below the amount
established in Section 7; or
vi. any failure
by WRC that would constitute a material breach of this Agreement if WRC has
failed to cure such breach within thirty (30) days of the date on which
Executive gives written notice thereof to the WRC Board.
(g) Notice
of Termination. Any termination of Executive’s employment by
either WRC or Executive or both, as the case may be, except for a termination
based on Executive’s death, shall be communicated by a written Notice of
Termination.
(h) WRC
Board. “WRC Board” shall mean the Board of Directors of WRC or
a duly authorized committee of such Board.
(i) Person. “Person”
shall mean any natural person, corporation, partnership, association, limited
liability company, trust, governmental authority, or other
entity.
3. Employment. WRC
hereby employs Executive and Executive hereby accepts employment with WRC for
the Term set forth in Section 4 below, in the position and with the duties and
responsibilities set forth in Sections 5 and 6 below, and upon the other terms
and conditions hereinafter stated.
4. Term. Executive’s
employment as the Chief Financial Officer and Senior Vice President of WRC under
this Agreement shall be for the period commencing on the Effective Date and
terminating one year after the Effective Date, or upon Executive’s earlier
death, termination by reason of Disability or termination by mutual agreement or
by either party pursuant to Section 11 (the “Initial Term”). The
Initial Term shall be automatically extended for successive one-year periods
(each a “Renewal Term,” with the Initial Term and any Renewal Terms collectively
referred to herein as the “Term”), unless at least ninety (90) days prior to the
end of the Initial Term or any Renewal Term, either party, by a written notice
delivered to the other party, elects not to have the Term automatically
extended.
5. Position. Subject
to Section 6(a) below, Executive shall initially serve as the Chief Financial
Officer and Senior Vice President of WRC.
6. Duties and
Responsibilities.
(a) WRC hereby
engages Executive as a full-time executive employee and Executive accepts such
employment, on the terms and subject to the conditions set forth in this
Agreement. During the Term, Executive shall devote all of his
business time and best efforts to, and shall perform faithfully, loyally and
efficiently, his duties as an executive of WRC and shall exercise such powers
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and
fulfill such responsibilities as may be duly assigned to or vested in him by the
WRC Board or the Chief Executive Officer of WRC, consistent with the
responsibilities of an executive officer of WRC. Initially, Executive
shall serve as the Chief Financial Officer and Senior Vice President of WRC, but
Executive’s title and offices may be changed in the reasonable discretion of the
WRC Board.
(b) During the
Term, Executive will not engage in other employment or consulting work or any
trade or business for his own account or on behalf of any other
Person. Notwithstanding the foregoing, Executive may (i) serve on
such corporate, civic, industry or charitable boards or committees as are
approved by the WRC Board, and (ii) manage his own and his family’s personal
investments, provided that the activities permitted by clauses (i) and (ii)
above shall not, individually or in the aggregate, interfere in any material
respect with the performance of Executive’s responsibilities
hereunder.
7.
Salary/Bonus.
(a) For all
services rendered by Executive under this Agreement, WRC shall pay to Executive
an aggregate annual base salary at the rate of $156,000 (“Base Salary”), payable
in equal installments, in accordance with WRC’s regular payroll
procedures. During the Term, Executive’s Base Salary shall be
reviewed at least once every 12 months by WRC and may be changed by WRC in its
sole discretion as of each anniversary of the Effective Date pursuant to such
review; provided that, Executive’s Base Salary shall not be reduced below
$156,000 per annum during the Term.
(b) For each
calendar year during the Term, the Executive shall be eligible to receive from
WRC an annual performance bonus to be determined by the Chief Executive Officer
of WRC, subject to approval by the Compensation and Governance Committee of the
WRC Board and by the WRC Board itself, but in no event greater than 50% of
Executive’s Base Salary in effect as of the end of such year (or, if Executive’s
employment is terminated prior to such date, his Base Salary in effect as of the
termination date). The bonus described in this paragraph shall be
paid within two and one-half months following the end of the applicable calendar
year for which it is paid, in accordance with WRC’s regular payroll
procedures.
(c) WRC is a
party to an Agreement and Plan of Merger with FCB dated June 27, 2008, providing
for the merger of WRC and FCB (the “Merger”). WRC is currently
engaged in discussions with FCB regarding possible alternative terms of the
Merger transaction. In this regard, Executive hereby agrees that he
shall not be paid any amounts, nor shall Executive be provided with any benefits
or other compensation of any kind (including any acceleration of compensation or
benefits) pursuant to the 2005 Agreement or 2008 Agreement in connection with,
or from and after, the Merger (including in connection with any subsequent
termination of employment that occurs from and after the Merger) other than as
set forth in this Agreement.
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8. Employee
Benefits. During the Term, WRC shall provide or cause to be
provided to Executive and to Executive’s dependents, at WRC’s expense,
substantially similar disability, medical and dental benefits provided to other
similarly situated executives of WRC. During any waiting period for
insurance eligibility, any COBRA costs incurred by or with respect to Executive
and Executive’s dependents will be paid by WRC.
9. Vacation. Executive
shall be entitled to four (4) weeks vacation for each year during the
Term. In the event that the full vacation is not taken by Executive
each year during the Term, no vacation time shall accrue for use in future
periods, except as approved by the WRC Board.
10. Business
Expenses. Executive will be reimbursed for all reasonable,
ordinary and necessary business expenses incurred by Executive in connection
with Executive’s employment (to be supported by receipts and other documentation
as required by the Internal Revenue Code of 1986, as amended (the “Code”)), and
in conformance with WRC’s normal procedures). Except as otherwise
expressly provided herein, to the extent any expense reimbursement under this
Section 10 is determined to be subject to Section 409A of the Code (“Section
409A”), the amount of any such expenses eligible for reimbursement in one
calendar year shall not affect the expenses eligible for reimbursement in any
other taxable year, in no event shall any expenses be reimbursed after the last
day of the calendar year following the calendar year in which Executive incurred
such expenses, and in no event shall any right to reimbursement be subject to
liquidation or exchange for another benefit.
11. Termination. Subject
to the terms and conditions of this Agreement, either WRC or Executive may
terminate the employment of Executive at any time prior to or upon the
expiration of the Term, with or without Cause or Good Reason.
12. Payments During Disability
and Upon Termination. Executive or his estate shall be
entitled to the following payments during a period of Disability, upon
Executive’s death, or upon termination of Executive’s employment by Executive or
WRC, as the case may be.
(a) During any
period that Executive fails to perform his full-time duties with WRC as a result
of incapacity due to physical or mental illness, until such time as Executive
returns to the full-time performance of his duties or the Date of Termination if
Executive’s employment is terminated for Disability, Executive shall continue to
receive his Base Salary at the rate in effect at the commencement of any such
period minus any disability benefits received by him under any insurance or
disability plan of WRC. If terminated for Disability or in the event
of his death, Executive or his estate, as the case may be, shall additionally be
entitled to receive the severance compensation provided for in subsection
12(c)(i) (reduced by any disability benefits received by him under any insurance
or disability plan of WRC), and subsection 12(c)(ii).
(b) If (1)
Executive’s employment is terminated by Executive without Good Reason, or (2)
Executive’s employment is terminated by WRC for Cause, then WRC shall pay
Executive his full Base Salary through the Date of Termination at the rate in
effect at the time Notice of Termination is given, plus
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all
other amounts or benefits to which Executive is entitled through such date under
any plan, arrangement or practice in effect at the time of such termination,
minus any amounts owed by Executive to WRC. Notwithstanding the
preceding sentence, Executive shall not be entitled to receive any bonus
applicable to the period in which termination occurs, and WRC shall have no
further obligations to Executive under this Agreement (other than under COBRA
and for vested and accrued benefits and accrued and unpaid
vacation).
(c) If (1)
Executive’s employment is terminated by WRC other than for Cause, (2)
Executive’s employment is terminated by Executive for Good Reason, or (3) the
Executive’s employment terminates at the expiration of the Term, then Executive
shall be entitled to the following:
i. Within 30
days of the Date of Termination, WRC shall pay to Executive a lump sum payment
in cash equal to: (A) any unpaid Base Salary through the Date of Termination,
plus (B) one year’s Base Salary at the rate in effect at the Date of
Termination, plus (C) an amount equal to 50% of the Base Salary paid to
Executive for the 12 months immediately prior to the Date of Termination;
and
ii. Executive
shall be entitled to any other compensation and benefits granted under this
Agreement (other than Base Salary, which is addressed in Section 12(c)(i)(A) and
(B) above, and the payment set forth in Section 12(c)(i)(C) above), for and
through the end of the then-remaining Term, which, for purposes of clarity,
shall include the annual performance bonus described in Section 7(b) above to
which Executive is entitled, if any, as of the Date of
Termination. Such benefits shall be determined in accordance with
WRC’s employee benefit plans and other applicable programs, policies and
practices then in effect as though Executive was still then in the employ of
WRC. The provisions of this Agreement, and any payment provided for
hereunder, shall not reduce any amounts otherwise payable, or in any way
diminish Executive’s existing rights, or rights which accrue solely as a result
of the passage of time under any benefit plan, employment agreement or other
contract, plan or arrangement.
13. Confidentiality. Except
as provided in the next two sentences, Executive covenants and agrees that all
information, knowledge or data of or pertaining to the Group, or pertaining to
any other Person with which they or any of them may do business during the Term
and which is not generally known in the relevant trade or industry (and whether
relating to methods, merchandising, processes, techniques, discoveries, pricing,
sales practices, marketing or any other proprietary matters) (the “Company
Information”) shall be kept secret and confidential at all times during and
after the termination or expiration of this Agreement and shall not be used or
divulged by him outside the scope of his employment as contemplated by this
Agreement, except as WRC may otherwise expressly authorize. In the
event that Executive is requested in a judicial, administrative or governmental
proceeding to disclose any of the Company Information, Executive will promptly
so notify WRC so that WRC may seek a
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protective
order at WRC’s expense or other appropriate remedy and/or waive compliance with
this Agreement. If such protective order or other remedy is not
obtained or WRC waives compliance with this Agreement and disclosure of any of
the Company Information is required, Executive may furnish the material so
required to be furnished, but Executive will furnish only that portion of the
Company Information which is legally required and will exercise his best efforts
to ensure that confidential treatment will be accorded the Company Information
furnished.
14. No-Hire. Executive
agrees and acknowledges that the services of Executive pursuant to this
Agreement are unique and extraordinary, and that the Group will be dependent
upon Executive for the development and growth of their business and related
functions. Executive agrees, during the Term and for a period of two
years after the Date of Termination or expiration of the Term, not to conduct or
participate (directly or indirectly, including through one or more Affiliates)
in hiring, attempting to hire or assisting any other Person in hiring or
attempting to hire, or inducing to leave the employ of any member of the Group,
any employee or officer of any member of the Group, or any person who was an
employee or officer of any member of the Group within the six-month period prior
to the Date of Termination. This Section 14 shall not apply to
Executive with respect to Xxxx Xxx. Executive agrees that if
Executive acts in violation of this Section, the number of days Executive is in
such violation will be added to any periods of limitation on Executive’s
activities specified herein.
15. Section
409A. If and to the extent that any payment or benefit is
determined by WRC to constitute “non-qualified deferred compensation” subject to
Section 409A and is payable hereunder to Executive by reason of his termination
of employment, then (a) such payment or benefit shall be made or provided to
Executive only upon a “separation from service” as defined for purposes of
Section 409A under applicable regulations and (b) if Executive is a “specified
employee” (within the meaning of Section 409A and as determined by WRC), such
payment or benefit shall not be made or provided before the date that is six
months after the date of Executive’s separation from service. Any
amount not paid in respect of the six month period specified in the preceding
sentence will be paid to Executive in a lump sum with the first payment made
after the end of such six month period (or if no other payment is then due, then
promptly after the expiration of such six month period.)
16. Monies Owed to
WRC. Upon the termination of Executive’s employment with WRC,
Executive hereby authorizes WRC to deduct from Executive’s final wages or other
monies due to Executive (other than amounts that would constitute “deferred
compensation” pursuant to Section 409A) all debts or financial obligations owed
to WRC by Executive.
17. Remedies. Executive
understands and agrees that the Group will be irreparably damaged in the event
that Section 14 of this Agreement is violated. Executive agrees that
WRC shall be entitled (in addition to any other remedy to which it may be
entitled, at law or in equity) to an injunction to redress breaches of such
Section of this Agreement and to specifically enforce the terms and provisions
thereof.
18. Successors and
Assigns. This Agreement is a personal contract, and the rights
and interests of Executive hereunder and under the awards and plans referred to
herein may not be sold, transferred, assigned, pledged, encumbered, or
hypothecated by him, except as
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may be
expressly permitted by the provisions of such awards or plans and that payments
due Executive hereunder shall be payable to his heirs or fiduciaries upon his
death. Except as may be expressly provided otherwise herein, this
Agreement shall be binding upon WRC and inure to the benefit of WRC and its
Affiliates, and its successors and assigns, including (but not limited to) any
corporation or other entity which may acquire all or substantially all of WRC’s
assets or business or into or with which WRC or an Affiliate may be consolidated
or merged.
19. Jurisdiction and Governing
Law. Any controversy or claim arising out of or relating to
this Agreement, or any breach thereof shall be governed by and construed in
accordance with the laws of California, without giving effect to principles of
conflicts of laws thereof.
20. Entire
Agreement. This Agreement contains all the understandings
between the parties hereto pertaining to the matters referred to herein, and
supersedes all undertakings and agreements, whether oral or in writing,
previously entered into by them with respect thereto. Effective as of
the Effective Date, this Agreement supersedes and restates the 2005 Agreement
and 2008 Agreement in their entireties. No representations or
warranties of any kind or nature relating to any member of the Group or their
respective businesses, assets, liabilities, operations, future plans or
prospects have been made by or on behalf of the Group to Executive, nor have any
representations or warranties of any kind or nature been made by Executive to
the Group.
21. Amendment or Modification,
Waiver. No provision of this Agreement may be amended or
waived unless such amendment or waiver is agreed to in writing, signed by
Executive and by a duly authorized officer of each of the parties to this
Agreement. No waiver by any party hereto of any breach by another party hereto
of any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same time, any prior time or any subsequent time.
22. Notices. Any
notice to be given hereunder shall be in writing and delivered personally or by
overnight courier or sent by registered or certified mail, postage prepaid,
return receipt requested, addressed to each of the parties to this
Agreement:
To:
Xxxxxx X.
Xxxxxxx
At the
address as shown of the records of WRC
With a
copy to:
Xxxx, Forward, Xxxxxxxx & Scripps
LLP
000 X. Xxxxxxxx, Xxxxx
0000
Xxx Xxxxx, XX 00000
Attention: Xxxxx X.
Xxxxxx
Facsimile: (000)
000-0000
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To:
Chief Executive Officer
White
River Capital, Inc.
0000 Xxxxxxxxxx Xxx, Xxxxx
X
Xxxxxxxxxxxx, XX 00000
With a
copy to:
Xxxxxx
& Xxxxxxxxx LLP
00 X.
Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx,
XX 00000
Attention:
Xxxx X. Xxx
Facsimile:
(000) 000-0000
Any
notice delivered personally shall be deemed given on the date delivered, any
notice transmitted by fax machine shall be deemed delivered upon receipt of
confirmation of fax transmission, any notice delivered by overnight courier
shall be deemed given the day after deposit with a courier, and any notice sent
by registered or certified mail, postage prepaid, return receipt requested,
shall be deemed given three days after mailing.
23. Severability. If
any provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid and
unenforceable, shall not be affected thereby, and each provision hereof shall be
validated and shall be enforced to the fullest extent permitted by
law.
24. Survivorship. The
respective rights and obligations of the parties hereunder shall survive any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.
25. Headings. All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed by
reference to the heading of any section or paragraph.
26. Withholding
Taxes. All payments to Executive under this Agreement shall be
reduced by any applicable federal, state or city withholding taxes.
27. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which shall be one and the same agreement.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
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White
River Capital, Inc.:
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/s/
Xxxx X. Xxxxxxxxx, III
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By:
Xxxx X. Xxxxxxxxx, III
Title:
Chief Executive Officer
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/s/
Xxxxxx X. Xxxxxxx
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Xxxxxx
X. Xxxxxxx
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