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EXHIBIT 10.14
UNITED BANK AND TRUST COMPANY
SALARY CONTINUATION AGREEMENT
THIS AGREEMENT is made this ______ day of ____________, 1997, by and
between UNITED BANK AND TRUST COMPANY, a state commercial bank located in St.
Petersburg, Florida (the "Company") and XXXXXXX X. XXXXXX (THE "EXECUTIVE").
INTRODUCTION
To encourage the Executive to remain an employee of the Company, the
Company is willing to provide salary continuation benefits to the Executive.
The Company will pay the benefits from its general assets.
AGREEMENT
The Executive and the Company agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:
1.1.1 "Benefit Percentage" means 40 percent.
1.1.2 "Change of Control" means: (i) a tender offer made and
consummated for the ownership of 25% or more of the outstanding voting
securities of the Company; (ii) a merger or consolidation of the Company with
another bank or corporation and as a result of such merger or consolidation
less than 75% of the outstanding voting securities of the surviving or
resulting bank or shareholders of the Company, other than affiliates (within
the meaning of the Securities Exchange Act of 1934) of any party to such merger
or consolidation, as the same shall have existed immediately prior to such
merger or consolidation, (iii) a sale of substantially all of the Company's
assets to another bank or corporation which is not a wholly owned subsidiary;
or (iv) an acquisition of the Company by a person, within the meaning of
Section 3(a)(9) or Section 13 (d)(3) (as in effect on the date hereof) of the
Securities Exchange Act of 1934, of 25% or more of the outstanding voting
securities of the Company (whether directly, indirectly, beneficially or of
record). For purposes hereof, ownership of voting securities shall take into
account and shall include ownership as determined by applying the provisions of
Rule 13d-3(d)(1)(I) (as in effect on the date hereof) pursuant to the
Securities and Exchange Act of 1934.
1.1.3 "Code" means the Internal Revenue Code of 1986, as
amended.
1.1.4 "Disability" means, if the Executive is covered by a
Company sponsored disability policy, total disability as defined in such policy
without regard to any waiting period. If the Executive is not covered by such a
policy, Disability means the Executive suffering a
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sickness, accident, or injury which, in the judgment of a physician
satisfactory to the Company, prevents the Executive from performing
substantially all of the Executive's normal duties for the Company. As a
condition to any benefits, the Company may require the Executive to submit to
such physical or mental evaluations and tests as the Company's Board of
Directors deems appropriate.
1.1.5 "Early Termination" means the Termination of Employment
before Normal Retirement Age for reasons other than Death, Disability,
Termination for Cause or following a Change of Control.
1.1.6 "Early Termination Date" means the month, day and year
in which Early Termination occurs.
1.1.7 "Final Pay" means the total annual base salary payable
to the Executive at the rate in effect on the date specified. Final Pay shall
not be reduced for any salary reduction contributions: (i) to cash or deferred
arrangements under Section 401(k) of the Code; (ii) to a cafeteria plan under
Section 125 of the Code; (iii) to a deferred compensation plan that is not
qualified under Section 401(a) of the Code.
1.1.8 "Normal Retirement Age" means the Executive's 65th
birthday.
1.1.9 "Normal Retirement Date" means the later of the Normal
Retirement Age or Termination of Employment.
1.1.10 "Plan Year" means a twelve-month period commencing on
____________ and ending on ___________ of each year. The initial Plan Year
shall commence on the effective date of this Agreement, which shall be January
1, 1997.
1.1.11 "Termination for Cause" See Section 4.1.
1.1.12 "Termination of Employment" means that the Executive
ceases to be employed by the Company for any reason whatsoever other than by
reason of a leave of absence which is approved by the Company. For purposes of
this Agreement, if there is a dispute over the employment status of the
Executive or the date of the Executive's Termination of Employment, the Company
shall have the sole and absolute right to decide the dispute.
ARTICLE 2
LIFETIME BENEFITS
2.1 Normal Retirement Benefit. Upon Termination of Employment
on or after the Normal Retirement Age for reasons other than death, the Company
shall pay to the Executive the benefit described in this Section 2.1 in lieu of
any other benefit under this Agreement.
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2.1.1 Amount of Benefit. The annual benefit under
this Section 2.1 is the Executive's Final Pay multiplied by the Benefit
Percentage.
2.1.2 Payment of Benefit. The Company shall pay the
annual benefit to the Executive in 12 equal monthly installments payable on the
first day of each month commencing with the month following the Executive's
Normal Retirement Date and continuing for 239 additional months.
2.1.3 Benefit Increases. Commencing on the first
anniversary of the first benefit payment, and continuing on each subsequent
anniversary, the Company's Board of Directors, in its sole discretion, may
increase the benefit.
2.2 Early Termination Benefit. Upon Early Termination, the Company
shall pay to the Executive the benefit described in this Section 2.2 in lieu of
any other benefit under this Agreement.
2.2.1 Amount of Benefit. The annual benefit under
this Section 2.2 is the Executive's Final Pay multiplied by the Benefit
Percentage times the vesting schedule as shown in Schedule A.
2.2.2 Payment of Benefit. The Company shall pay the
annual benefit to the Executive in 12 equal monthly installments payable on the
first day of each month commencing with the month following the later of the
Executive's termination or attainment of age fifty-nine (59) and continuing for
239 additional months.
2.2.3 Benefit Increases. Benefit payments may be
increased as provided in Section 2.1.3.
2.3 Disability Benefit. If the Executive terminates
employment due to Disability prior to Normal Retirement Age, the Company shall
pay to the Executive the benefit described in this Section 2.3 in lieu of any
other benefit under this Agreement.
2.3.1 Amount of Benefit. The annual benefit under
this Section 2.3 is the Executive's Final Pay multiplied by the Benefit
Percentage.
2.3.2 Payment of Benefit. The Company shall pay the
annual benefit amount to the Executive in 12 equal monthly installments payable
on the first day of each month commencing with the month following the
Termination of Employment and continuing for 239 additional months.
2.3.3 Benefit Increases. Benefit payments may be
increased as provided in Section 2.1.3.
2.4 Change of Control Benefit. Upon a Change of Control, the
Company shall pay to the Executive the benefit described in this Section 2.4 in
lieu of any other benefit under this Agreement.
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2.4.1 Amount of Benefit. The annual benefit under
this Section 2.4 is the Executive's Final Pay multiplied by the Benefit
Percentage at the time of the Executive's Termination of Employment.
2.4.2 Payment of Benefit. The Company shall pay the
annual benefit amount to the Executive in 12 equal monthly installments payable
on the first day of each month commencing with the month following the later of
age fifty-nine (59) or Termination of Employment and continuing for 239
additional months.
2.4.3 Benefit Increases. Benefit payments may be
increased as provided in Section 2.1.3.
ARTICLE 3
DEATH BENEFITS
3.1 Death. Upon the death of the Executive, this Agreement
shall immediately terminate. Upon the termination of this Agreement, all
benefit payments shall cease and the Company shall not be obligated to pay any
more benefits. This includes, but is not limited to, the situations where the
death of the Executive occurs after benefit payments have commenced and the
death of the Executive has occurred after Termination of Employment but before
benefit payments have commenced.
ARTICLE 4
GENERAL LIMITATIONS
Notwithstanding any provision of this Agreement to the contrary, the Company
shall not pay any benefit under this Agreement:
4.1 Termination for Cause. If the Company terminates the
Executive's employment for "cause", which shall be restricted to the following:
4.1.1 Gross negligence or gross neglect of duties
which continue to occur after thirty (30) days from the date Executive has
received written notice from Company:
4.1.2 Commission of a felony or of a gross
misdemeanor involving moral turpitude; or
4.1.3 Fraud, disloyalty, dishonesty or willful
violation of any law or significant Company policy committed in connection with
the Executive's employment and resulting in an adverse effect on the Company.
4.2 Competition After Termination of Employment. No benefits
shall be payable if the Executive, without the prior written consent of the
Company, engages in, becomes interested in, directly or indirectly, as a sole
proprietor, as a partner in partnership, or as a
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substantial shareholder in a corporation, or becomes associated with, in the
capacity of employee, director, officer, principal, agent, trustee or in any
other capacity whatsoever, any enterprise conducted in the trading area (a 50
mile radius) of the business of the Company, which enterprise is, or may deemed
to be, competitive with any business carried on by the Company as of the date
of termination of the Executive's employment or his retirement. This section
shall not apply following a Change of Control.
4.3 Suicide or Misstatement. No benefits shall be payable if
the Executive commits suicide within two years after the date of this
Agreement, or if the Executive has made any material misstatement of fact on
any application for life insurance purchased by the Company.
ARTICLE 5
CLAIMS AND REVIEW PROCEDURES
5.1 Claims Procedure. The Company shall notify any person or
entity that makes a claim against the Agreement (the "Claimant") in writing,
within ninety (90) days of Claimant's written application for benefits, of his
or her eligibility or noneligibility for benefits under the Agreement. If the
Company determines that the Claimant is not eligible for benefits or full
benefits, the notice shall set forth (1) the specific reasons for such denial,
(2) a specific reference to the provisions of the Agreement on which the denial
is based, (3) a description of any additional information or material necessary
for the Claimant to perfect his or her claim, and a description of why it is
needed, and (4) an explanation of the Agreement's claims review procedure and
other appropriate information as to the steps to be taken if the Claimant
wishes to have the claim reviewed. If the Company determines that there are
special circumstances requiring additional time to make a decision, the Company
shall notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an
additional ninety-day period.
5.2 Review Procedure. If the Claimant is determined by the
Company not to be eligible for benefits, or if the Claimant believes that he or
she is entitled to greater or different benefits, the Claimant shall have the
opportunity to have such claim reviewed by the Company by filing a petition for
review with the Company within sixty (60) days after receipt of the notice
issued by the Company. Said petition shall state the specific reasons which the
Claimant believes entitle him or her to benefits or to greater or different
benefits. Within sixty (60) days after receipt by the Company of the petition,
the Company shall afford the Claimant (and counsel, if any) an opportunity to
present his or her position to the Company orally or in writing, and the
Claimant (or counsel) shall have the right to review pertinent documents. The
Company shall notify the Claimant of its decision in writing within the
sixty-day period, stating specifically the basis of its decision, written in a
manner calculated to be understood by the Claimant and the specific provisions
of the Agreement on which the decision is based. If, because of the need for a
hearing, the sixty-day period is not sufficient, the decision may be deferred
for up to another sixty-day period at the election of the Company, but notice
of this deferral shall be given to the Claimant.
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ARTICLE 6
AMENDMENTS AND TERMINATION
This Agreement may be amended or terminated only by a written agreement signed
by the Company and the Executive.
ARTICLE 7
MISCELLANEOUS
7.1 Binding Effect. This Agreement shall bind the Executive
and the Company, and their beneficiaries, survivors, executors, successors,
administrators and transferees.
7.2 No Guarantee of Employment. This Agreement is not an
employment policy or contract. It does not give the Executive the right to
remain an employee of the Company, nor does it interfere with the Company's
right to discharge the Executive. It also does not require the Executive to
remain an employee nor interfere with the Executive's right to terminate
employment at any time.
7.3 Non-Transferability. Benefits under this Agreement cannot
be sold, transferred, assigned, pledged, attached or encumbered in any manner.
7.4 Reorganization. The Company shall not merge or
consolidate into or with another company, or reorganize, or sell substantially
all of its assets to another company, firm, or person unless such succeeding or
continuing company, firm, or person agrees to assume and discharge the
obligations of the Company under this Agreement. Upon the occurrence of such
event, the term "Company" as used in this Agreement shall be deemed to refer to
the successor or survivor company.
7.5 Tax Withholding. The Company shall withhold any taxes
that are required to be withheld from the benefits provided under this
Agreement.
7.6 Applicable Law. The Agreement and all rights hereunder
shall be governed by the laws of the State of Florida, except to the extent
preempted by the laws of the United States of America.
7.7 Unfunded Arrangement. The Executive and beneficiary are
general unsecured creditors of the Company for the payment of benefits under
this Agreement. The benefits represent the mere promise by the Company to pay
such benefits. The rights to benefits are not subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors. Any insurance on the Executive's life
is a general asset of the Company to which the Executive and beneficiary have
no preferred or secured claim.
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7.8 Recovery of Estate Taxes. If the Executive's gross estate
for federal estate tax purposes includes any amount determined by reference to
and on account of this Agreement, and if the beneficiary is other than the
Executive's estate, then the Executive's estate shall be entitled to recover
from the beneficiary receiving such benefit under the terms of the Agreement,
an amount by which the total estate tax due by the Executive's estate, exceeds
the total estate tax which would have been payable if the value of such benefit
had not been included in the Executive's gross estate. If there is more than
one person receiving such benefit, the right of recovery shall be against each
such person. In the event the beneficiary has a liability hereunder, the
beneficiary may petition the Company for a lump sum payment in an amount not to
exceed the beneficiary's liability hereunder.
7.9 Entire Agreement. This Agreement constitutes the entire
agreement between the Company and the Executive as to the subject matter
hereof. No rights are granted to the Executive by virtue of this Agreement
other than those specifically set forth herein.
7.10 Administration. The Company shall have powers which are
necessary to administer this Agreement, including but not limited to:
7.10.1 Interpreting the provisions of this
Agreement;
7.10.2 Establishing and revising the method of
accounting for the Agreement;
7.10.3 Maintaining a record of benefit payments; and
7.10.4 Establishing rules and prescribing any forms
necessary or desirable to administer the Agreement.
7.11 Designated Fiduciary. For purposes of the Employee
Retirement Income Security Act of 1974, if applicable, the Company shall be the
named fiduciary and plan administrator under the Agreement. The named fiduciary
may delegate to others certain aspects of the management and operation
responsibilities of the plan including the employment of advisors and the
delegation of ministerial duties to qualified individuals.
IN WITNESS WHEREOF, the Executive and a duly authorized
Company officer have signed this Agreement.
EXECUTIVE: COMPANY:
UNITED BANK AND TRUST COMPANY
______________________________ By:____________________________________
Xxxxxxx X. Xxxxxx
Title:__________________________
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GUARANTY: Any obligations of the Company under this Agreement are guaranteed by
United Financial Holdings, Inc.
By:___________________________________
Title:________________________________
SCHEDULE A
VESTING SCHEDULE
Years Completed * Vesting Percentage
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1 30%
2 40%
3 50%
4 60%
5 70%
6 80%
7 90%
8 100%
* Years of service following the date of execution of this Agreement.
