AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.3
AMENDED
AND RESTATED EMPLOYMENT AGREEMENT
This
Amended And Restated Employment Agreement (the “Agreement”),
made and dated as of October 1, 2007, by and between Lincoln Bank, an Indiana
commercial bank (“Employer”), and Xxxxxxxx X. Xxxxxxxxx, a
resident of Monroe County, Indiana (“Employee”), but effective
as of January 11, 2006
This
Agreement amends and restates the prior Employment Agreement between Employer
and the Employee dated January 1, 2007 (the “Prior
Agreement”). It has been amended and restated for compliance
with the final regulations under Section 409A of the Internal Revenue Code
of
1986, as amended, effective as of January 11, 2006.
W
I T N E S S E T H
Whereas,
Employee is employed by Employer as the Senior Vice President, Credit
Administration, and has made valuable contributions to the profitability and
financial strength of Employer;
Whereas,
Employer and Employee entered into an Employment Agreement dated as of January
11, 2006, which Employer and Employee now desire to amend and restate in its
entirety as provided herein;
Whereas,
Employer desires to encourage Employee to continue to make valuable
contributions to Employer’s business operations and not to seek or accept
employment elsewhere;
Whereas,
Employee desires to be assured of a secure minimum compensation from Employer
for his services over a defined term;
Whereas,
Employer desires to assure the continued services of Employee on behalf of
Employer on an objective and impartial basis and without distraction or conflict
of interest in the event of an attempt by any person to obtain control of
Employer or Lincoln Bancorp (the “Holding Company”), the
Indiana corporation which owns all of the issued and outstanding capital stock
of Employer;
Whereas,
Employer recognizes that when faced with a proposal for a change of control
of
Employer or the Holding Company, Employee will have a significant role in
helping the Boards of Directors assess the options and advising the Boards
of
Directors on what is in the best interests of Employer, the Holding Company,
and
its shareholders, and it is necessary for Employee to be able to provide this
advice and counsel without being influenced by the uncertainties of his own
situation;
Whereas,
Employer desires to provide fair and reasonable benefits to Employee on the
terms and subject to the conditions set forth in this Agreement;
Whereas,
Employer desires reasonable protection of its confidential business and customer
information which it has developed over the years at substantial expense and
assurance that Employee will not compete with Employer for a reasonable period
of time after termination of his employment with Employer, except as otherwise
provided herein.
Now,
Therefore, in consideration of these premises, the mutual covenants and
undertakings herein contained and the continued employment of Employee by
Employer as its
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Senior
Vice President, Credit Administration, Employer and Employee, each intending
to
be legally bound, covenant and agree as follows:
1. Upon
the terms and subject to the conditions set forth in this Agreement, Employer
employs Employee as Employer’s Senior Vice President, Credit Administration, and
Employee accepts such employment.
2. Employee
agrees to serve as one of Employer’s Senior Vice Presidents and to perform such
duties in that office as may reasonably be assigned to him by Employer’s Board
of Directors; provided, however, that such duties shall be
performed in or from the offices of Employer currently located at 000 Xxxxxxxxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxx, and shall be of the same character as those
previously performed by Employee and generally associated with the office held
by Employee. Employee shall not be required to be absent from the location
of
the principal executive offices of Employer on travel status or otherwise more
than forty-five (45) days in any calendar year. Employer shall not, without
the
written consent of Employee, relocate or transfer Employee to a location more
than thirty (30) miles from Employer’s primary office. Employee shall render
services to Employer as Senior Vice President, Credit Administration in
substantially the same manner and to substantially the same extent as Employee
rendered his services to Employer before the date hereof. While employed by
Employer, Employee shall devote substantially all his business time and efforts
to Employer’s business during regular business hours and shall not engage in any
other related business.
3. The
term of this Agreement shall begin on January 11, 2006 (the “Effective
Date”) and shall end on January 1, 2009; provided,
however, that such term shall be extended automatically
for an
additional year on each anniversary of January 1, 2007, if Employer’s Board of
Directors determines by resolution with respect to each such annual extension
that the performance of Employee has met the Board’s requirements and standards
and that this Agreement should be extended for another year. Notwithstanding
the
foregoing, if either party hereto gives written notice to the other party not
to
so extend within ninety (90) days prior to such anniversary, or if Employer’s
Board of Directors does not adopt the resolution authorizing annual extension
of
the contract with respect to any annual period during the term of this
Agreement, no further automatic extension shall occur and the term of this
Agreement shall end one year subsequent to the anniversary as of which the
notice not to extend or failure to extend for an additional year occurs (such
term, including any extension thereof shall herein be referred to as the
“Term”). Notwithstanding the foregoing, the Term may end
earlier upon the occurrence of any event described in Section 7.
4. Employee
shall receive an annual salary of $132,313 (“Base
Compensation”) payable at regular intervals in accordance with
Employer’s normal payroll practices now or hereafter in effect. Employer may
consider and declare from time to time increases in the salary it pays Employee
and thereby increases in his Base Compensation. Prior to a Change in Control,
Employer may also declare decreases in the salary it pays Employee if the
operating results of Employer are significantly less favorable than those for
the fiscal year ending December 31, 2005, and Employer makes similar decreases
in the salary it pays to other executive officers of Employer. After a Change
in
Control, Employer shall consider and declare salary increases based upon the
following standards:
(a) Inflation;
(b) Adjustments
to the salaries of other senior management personnel; and
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(c) Past
performance of Employee and the contribution which Employee makes to the
business and profits of Employer during the Term.
Any
and
all increases or decreases in Employee’s salary pursuant to this section shall
cause the level of Base Compensation to be increased or decreased by the amount
of each such increase or decrease for purposes of this Agreement. The increased
or decreased level of Base Compensation as provided in this section shall become
the level of Base Compensation for the remainder of the Term of this Agreement
until there is a further increase or decrease in Base Compensation as provided
herein.
5. So
long as Employee is employed by Employer pursuant to this Agreement, he shall
be
included as a participant in all present and future employee benefit,
retirement, and compensation plans generally available to employees of Employer,
consistent with his Base Compensation and his position as Senior Vice President,
Credit Administration, of Employer, including, without limitation, Employer’s or
the Holding Company’s 401(k) plan, Stock Option Plan, Recognition and
Retention Plan and Trust, Employee Stock Ownership Plan, and hospitalization,
disability and group life insurance plans, each of which Employer agrees to
continue in effect on terms no less favorable than those currently in effect
as
of the date hereof (as permitted by law) during the Term of this Agreement
unless prior to a Change in Control the operating results of Employer are
significantly less favorable than those for the fiscal year ending December
31,
2005, and unless (either before or after a Change in Control) changes in the
accounting, legal, or tax treatment of such plans would adversely affect
Employer’s operating results or financial condition in a material way, and the
Board of Directors of Employer or the Holding Company concludes that
modifications to such plans need to be made to avoid such adverse
effects.
6. So
long as Employee is employed by Employer pursuant to this Agreement, Employee
shall receive reimbursement from Employer for all reasonable business expenses
incurred in the course of his employment by Employer, upon submission to
Employer of written vouchers and statements for reimbursement. So long as
Employee is employed by Employer pursuant to the terms of this Agreement,
Employer shall continue in effect vacation policies applicable to Employee
no
less favorable from his point of view than those written vacation policies
in
effect on the date hereof. So long as Employee is employed by Employer pursuant
to this Agreement, Employee shall be entitled to office space and working
conditions no less favorable than were in effect for him on the date
hereof.
7. Subject
to the respective continuing obligations of the parties, including but not
limited to those set forth in Section 9(a), Section 9(b), Section 9(c) and
Section 9(d) hereof, Employee’s employment by Employer may be terminated prior
to the expiration of the Term of this Agreement as follows:
(a) Employer,
by action of its Board of Directors and upon written notice to Employee, may
terminate Employee’s employment with Employer immediately for cause. For
purposes of this Section 7(a), “cause” shall be defined as (i)
personal dishonesty, (ii) incompetence, (iii) willful misconduct, (iv) breach
of
fiduciary duty involving personal profit, (v) intentional failure to perform
stated duties, (vi) willful violation of any law, rule, or regulation (other
than traffic violations or similar offenses) or final cease-and-desist order,
or
(vii) any material breach of any provision of this Agreement.
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(b) Employer,
by action of its Board of Directors may terminate Employee’s employment with
Employer without cause at any time; provided, however, that
the “date of termination” for purposes of determining benefits
payable to Employee under Section 8(b) hereof shall be the date which is sixty
(60) days after Employee receives written notice of such
termination.
(c) Employee,
by written notice to Employer, may terminate his employment with Employer
immediately for cause. For purposes of this Section 7(c),
“cause” shall be defined as (i) any action by Employer’s Board
of Directors to remove Employee as Senior Vice President, Credit Administration,
of Employer, except for promotions, if any, and except where Employer’s Board of
Directors properly acts to remove Employee from such office for “cause” as
defined in Section 7(a) hereof, (ii) any action by Employer’s Board of Directors
to materially limit, increase, or modify Employee’s duties and/or authority as
Senior Vice President, Credit Administration, except for changes commensurate
with promotions, if any, of Employer, (iii) any failure of Employer to obtain
the assumption of the obligation to perform this Agreement by any successor
or
the reaffirmation of such obligation by Employer, as contemplated in Section
20
hereof; or (iv) any material breach by Employer of a term, condition or covenant
of this Agreement.
(d) Employee,
upon sixty (60) days’ written notice to Employer, may terminate his employment
with Employer without cause.
(e) Employee’s
employment with Employer shall terminate in the event of Employee’s death or
disability. For purposes hereof, “disability” shall be defined
as Employee’s inability by reason of illness or other physical or mental
incapacity to perform the duties required by his employment for any consecutive
one hundred eighty (180) day period, provided that notice of any termination
by
Employer because of Employee’s “disability” shall have been given to Employee
prior to the full resumption by him of the performance of such
duties.
8. In
the event of termination of Employee’s employment with Employer pursuant to
Section 7 hereof, compensation shall continue to be paid by Employer to Employee
as follows:
(a) In
the event of termination pursuant to Section 7(a) or Section 7(d), compensation
provided for herein (including Base Compensation) shall continue to be paid,
and
Employee shall continue to participate in the employee benefit, retirement,
and
compensation plans and other perquisites as provided in Section 5 and Section
6
hereof, through the date of termination specified in the notice of termination.
Any benefits payable under insurance, health, retirement and bonus plans as
a
result of Employee’s participation in such plans through such date shall be paid
when due under those plans. The date of termination specified in any notice
of
termination pursuant to Section 7(a) shall be no later than the last business
day of the month in which such notice is provided to Employee.
(b) In
the event of termination pursuant to Section 7(b) or Section 7(c), compensation
provided for herein (including Base Compensation) shall continue to be paid,
and
Employee shall continue to participate in the employee benefit, retirement,
and
compensation plans and other perquisites as provided in Section 5 and Section
6
hereof, through the date of termination specified in the notice of termination.
Any benefits
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payable
under insurance, health, retirement and bonus plans as a result of Employee’s
participation in such plans through such date shall be paid when due under
those
plans. In addition, Employee shall be entitled to continue to receive from
Employer his Base Compensation at the rates in effect at the time of termination
for the remaining Term of the Agreement, if the termination does not follow
a
Change in Control. In addition, during such periods, Employer will maintain
in
full force and effect for the continued benefit of Employee each employee
welfare benefit plan and each employee pension benefit plan (as such terms
are
defined in the Employee Retirement Income Security Act of 1974, as amended)
in
which Employee was entitled to participate immediately prior to the date of
his
termination, unless an essentially equivalent and no less favorable benefit
is
provided by a subsequent employer of Employee. If the terms of any employee
welfare benefit plan or employee pension benefit plan of Employer do not permit
continued participation by Employee, Employer will arrange to provide to
Employee a benefit substantially similar to, and no less favorable than, the
benefit he was entitled to receive under such plan at the end of the period
of
coverage. If the termination pursuant to Section 7(b) or Section 7(c)
occurs within 12 months following a Change in Control, Employee shall be
entitled to a lump sum payment paid by the Employer within 30 days following
his
termination of employment equal to three times his Base Compensation at the
rate
in effect at the time of his termination of employment. In addition, Employee
shall be entitled to the continued payment to Employee through the date of
termination of this Agreement of all compensation and benefits provided for
in
Sections 5 and 6.
(c) In
the event of termination pursuant to Section 7(e), compensation provided for
herein (including Base Compensation) shall continue to be paid, and Employee
shall continue to participate in the employee benefit, retirement, and
compensation plans and other perquisites as provided in Section 5 and Section
6
hereof, (i) in the event of Employee’s death, through the date of death, or (ii)
in the event of Employee’s disability, through the date of proper notice of
disability as required by Section 7(e). Any benefits payable under insurance,
health, retirement and bonus plans as a result of Employer’s participation in
such plans through such date shall be paid when due under those
plans.
(d) Employer
will permit Employee or his personal representative(s) or heirs, during a period
of three months following Employee’s termination of employment by Employer for
the reasons set forth in Section 7(b) or Section 7(c), if such termination
follows a Change in Control, to require Employer, upon written request, to
purchase all outstanding stock options previously granted to Employee under
any
Holding Company stock option plan then in effect whether or not such options
are
then exercisable at a cash purchase price equal to the amount by which the
aggregate “fair market value” of the shares subject to such options exceeds the
aggregate option price for such shares. For purposes of this Agreement, the
term
“fair market value” shall mean the higher of (1) the average of
the highest asked prices for Holding Company shares on the NASDAQ Global Market
or other NASDAQ tier or market if the shares are traded on such tier or market
for the thirty (30) business days preceding such termination, or (2) the average
per share price actually paid for the most highly priced one percent (1%) of
the
Holding Company shares acquired in connection with the Change in Control of
the
Holding Company by any person or group acquiring such control.
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(e) For
purposes of this Agreement, a “Change in Control” shall mean any of the
following:
(i)
a
change in the ownership of the Employer or the Holding Company, which shall
occur on the date that any one person, or more than one person acting as a
group, acquires ownership of stock of the Employer or the Holding Company that,
together with stock held by such person or group, constitutes more than fifty
percent (50%) of the total fair market value or total voting power of the stock
of the Employer or the Holding Company. Such acquisition may occur as
a result of a merger of the Holding Company or the Employer into another entity
which pays consideration for the shares of capital stock of the merging Holding
Company or Employer or as a result of a merger of another entity into the
Holding Company or the Employer if the entity’s shareholders as a group acquire
or receive over 50% of the total fair market value or total voting power of
the
stock of the entity resulting from the merger. However, if any one
person, or more than one person acting as a group, is considered to own more
than fifty percent (50%) of the total fair market value or total voting power
of
the stock of the Employer or the Holding Company, the acquisition of additional
stock by the same person or persons is not considered to cause a change in
the
ownership of the Employer or the Holding Company (or to cause a change in the
effective control of the Employer or the Holding Company (within the meaning
of
subsection (ii)). An increase in the percentage of stock owned by any
one person, or persons acting as a group, as a result of a transaction in which
the Employer or the Holding Company acquires its stock in exchange for property
will be treated as an acquisition of stock for purposes of this
subsection. This subsection applies only when there is a transfer of
stock of the Employer or the Holding Company (or issuance of stock of the
Employer or the Holding Company) and stock in the Employer or the Holding
Company remains outstanding after the transaction.
(ii)
a
change in the effective control of the Employer or the Holding Company, which
shall occur only on the date new directors are added to the Holding Company’s
board of directors as a result of a merger transaction involving the Holding
Company or the Employer, respectively, and as a result of such replacement
the
Holding Company’s directors or the Employer’s directors, respectively, before
the merger constitute 50% or less of the total directors of the Holding Company
or the Employer immediately following the merger; provided, however, that this
provision shall not apply if another corporation is a majority shareholder
of
the Holding Company. If any one person, or more than one person
acting as a group, is considered to effectively control the Employer or the
Holding Company, the acquisition of additional control of the Employer or the
Holding Company by the same person or persons is not considered to cause a
change in the effective control of the Employer or the Holding Company (or
to
cause a change in the ownership of the Employer or the Holding Company within
the meaning of subsection (i) of this section).
(iii)
a
change in the ownership of a substantial portion of the Employer’s assets, which
shall occur on the date that any one person, or more than one person acting
as a
group, acquires (or has acquired during the 12 month period ending
on
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the
date
of the most recent acquisition by such person or persons) assets from the
Employer that have a total gross fair market value equal to or more than forty
percent (40%) of the total gross fair market value of all of the assets of
the
Employer immediately before such acquisition or acquisitions. For
this purpose, gross fair market value means the value of the assets of the
Employer, or the value of the assets being disposed of, determined without
regard to any liabilities associated with such assets. No change in
control occurs under this subsection (iii) when there is a transfer to an entity
that is controlled by the shareholders of the Employer immediately after the
transfer. A transfer of assets by the Employer is not treated as a
change in the ownership of such assets if the assets are transferred to
–
1) a
shareholder of the Employer (immediately before the asset transfer) in exchange
for or with respect to its stock;
2) an
entity, 50 percent or more of the total value or voting power of which is owned,
directly or indirectly, by the Employer.
3) a
person, or more than one person acting as a group, that owns, directly or
indirectly, 50 percent or more of the total value or voting power of all the
outstanding stock of the Employer; or
4) an
entity, at least 50 percent of the total value or voting power of which is
owned, directly or indirectly, by a person described in paragraph
(iii).
For
purposes of this subsection (iii) and except as otherwise provided in paragraph
1) above, a person’s status is determined immediately after the transfer of the
assets.
(iv)
For
purposes of this
section, persons will not be considered to be acting as a group solely because
they purchase or own stock of the same corporation at the same time, or as
a
result of the same public offering. Persons will be considered to be
acting as a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction
with the Employer or the Holding Company.
(f) To
the extent the Employee is a “specified employee” (as defined below), payments
due to the Employee under this Section 8 shall begin no sooner than six
months after the Employee’s separation from service; provided, however, that any
payments not made during the six month period described in this
Section 8(f) shall be made in a single lump sum as soon as administratively
practicable after the expiration of such six month period; provided, further,
that the six month delay required under this Section 8(f) shall not apply
to the portion of any payment resulting from the Employee’s “involuntary
separation from service” (as defined in Treasury Reg. Section 1.409A-1(n)
and including a “separation from service for good reason,” as defined in
Treasury Reg. Section 1.409A-1(n)(2)) that (i) is payable no later than the
last day of the second year following the year in which the separation from
service occurs, and (ii) does not exceed two times the lesser of (1) the
Employee’s annualized compensation for the year prior to
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the
year
in which the separation from service occurs, or (2) the dollar limit described
in Section 401(a)(17) of the Code.
To
the
extent any life, health, disability or other welfare benefit coverage provided
to the Employee under this Section 8 would be taxable to the Employee, the
taxable amount of such coverage shall not exceed the applicable dollar amount
under Section 402(g)(1)(B) of the Code determined as of the year in which
the Employee’s separation from service occurs. The intent of the
foregoing sentence is to permit the Holding Company and the Employer to treat
the provision of such benefits as a limited payment under Treasury Reg.
Section 1.409A-1(a)(9)(v)(D) so as to avoid application of the six month
delay rule for specified employees. For purposes of this
Section 8, any reference to severance of employment or termination of
employment shall mean a “separation from service” as defined in Treasury Reg.
Section 1.409A-1(h).
For
purposes of this Agreement, the term “specified employee” shall have the meaning
set forth in Treasury Reg. Section 1.409A-1(i) and shall include, without
limitation, (1) an officer of the Employer or the Holding Company having annual
compensation greater than $130,000 (as adjusted for inflation under the Code),
(2) a five percent owner of the Employer or the Holding Company, or (3) a one
percent owner of the Employer or the Holding Company having annual compensation
of more than $150,000. The determination of whether the Employee is a
“specified employee” shall be made by the Employer in good faith applying the
applicable Treasury regulations.
9. In
order to induce Employer to enter into this Agreement, Employee hereby agrees
as
follows:
(a) While
Employee is employed by Employer and for a period of three (3) years after
termination of such employment, Employee shall not divulge or furnish any trade
secrets (as defined in Ind. Code § 24-2-3-2) of Employer or any
confidential information acquired by him while employed by Employer concerning
the policies, plans, procedures or customers of Employer to any person, firm
or
corporation, other than Employer or upon its written request, or use any such
trade secret or confidential information directly or indirectly for Employee’s
own benefit or for the benefit of any person, firm or corporation other than
Employer, since such trade secrets and confidential information are confidential
and shall at all times remain the property of Employer.
(b) For
a period of two (2) years after termination of Employee’s employment by Employer
for reasons other than those set forth in Section 7(b) or Section 7(c) of this
Agreement, Employee shall not directly or indirectly provide banking or
bank-related services to or solicit the banking or bank-related business of
any
customer of Employer at the time of such provision of services or solicitation
which Employee served either alone or with others while employed by Employer
in
any city, town, borough, township, village or other place in which Employee
performed services for Employer while employed by it, or assist any actual
or
potential competitor of Employer to provide banking or bank-related services
to
or solicit any such customer’s banking or bank-related business in any such
place.
(c) While
Employee is employed by Employer and for a period of one (1) year after
termination of Employee’s employment by Employer for reasons other than
those
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set
forth
in Section 7(b) or Section 7(c) of this Agreement, Employee shall not, directly
or indirectly, as principal, agent, or trustee, or through the agency of any
corporation, partnership, trade association, agent or agency, engage in any
banking or bank-related business which competes with the business of Employer
as
conducted during Employee’s employment by Employer within a radius of
twenty-five (25) miles of Employer’s main office or within a twenty-five (25)
mile radius of Employer’s Greenwood office.
(d) If
Employee’s employment by Employer is terminated hereunder for any reason,
Employee will turn over immediately thereafter to Employer all business
correspondence, letters, papers, reports, customers’ lists, financial
statements, credit reports or other confidential information or documents of
Employer or its affiliates in the possession or control of Employee, all of
which writings are and will continue to be the sole and exclusive property
of
Employer or its affiliates.
If
Employee’s employment by Employer is terminated during the Term of this
Agreement for reasons set forth in Section 7(b) or Section 7(c) of this
Agreement, Employee shall have no obligations to Employer with respect to the
noncompetition provisions under this Section 9.
10. Any
termination of Employee’s employment with Employer as contemplated by Section 7
hereof, except in the circumstances of Employee’s death, shall be communicated
by written “Notice of Termination” by the terminating party to the other party
hereto. Any “Notice of Termination” pursuant to Section 7(a), Section 7(c) or
Section 7(e) shall indicate the specific provisions of this Agreement relied
upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for such termination.
11. If
Employee is suspended and/or temporarily prohibited from participating in the
conduct of Employer’s affairs by a notice served under Section 8(e)(3) or (g)(1)
of the Federal Deposit Insurance Act (12 U.S.C. § 1818(e)(3) or (g)(1)),
Employer’s obligations under this Agreement shall be suspended as of the date of
service, unless stayed by appropriate proceedings. If the charges in the notice
are dismissed, Employer shall (i) pay Employee all or part of the compensation
withheld while its obligations under this Agreement were suspended and (ii)
reinstate (in whole or in part) any of its obligations which were
suspended.
12. If
Employee is removed and/or permanently prohibited from participating in the
conduct of Employer’s affairs by an order issued under Section 8(e)(4) or (g)(1)
of the Federal Deposit Insurance Act (12 U.S.C. § 1818(e)(4) or (g)(1)),
all obligations of Employer under this Agreement shall terminate as of the
effective date of the order, but vested rights of the parties to the Agreement
shall not be affected.
13. If
Employer is in default (as defined in Section 3(x)(1) of the Federal Deposit
Insurance Act), all obligations under this Agreement shall terminate as of
the
date of default, but this provision shall not affect any vested rights of
Employer or Employee.
14. All
obligations under this Agreement shall be terminated except to the extent
determined that the continuation of the Agreement is necessary for the continued
operation of Employer: (i) by the Director of the Indiana Department of
Financial Institutions or his or her designee (the “Director”),
at the time the Federal Deposit Insurance Corporation enters into an agreement
to provide assistance to or on behalf of Employer under the authority contained
in Section 13(c) of the Federal Deposit Insurance Act; or (ii) by the Director
at the time the Director approves a supervisory merger to resolve problems
related to operation of Employer or
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when
Employer is determined by the Director to be in an unsafe and unsound condition.
Any rights of the parties that have already vested, however, shall not be
affected by such action.
15. Anything
in this Agreement to the contrary notwithstanding, in the event that Employer’s
independent public accountants determine that any payment by Employer to or
for
the benefit of Employee, whether paid or payable pursuant to the terms of this
Agreement, would be non-deductible by Employer for federal income tax purposes
because of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”), then the amount payable to or for the benefit of
Employee pursuant to this Agreement shall be reduced (but not below zero) to
the
Reduced Amount. For purposes of this Section 15, the “Reduced
Amount” shall be the amount which maximizes the amount payable without
causing the payment to be non-deductible by Employer because of Section 280G
of
the Code. Any payments made to Employee pursuant to this Agreement or otherwise,
are subject to and conditional upon their compliance with 12 U.S.C. §1828(k) and
FDIC regulation 12 C.F.R. Part 359 (Golden Parachute and Indemnification
Payments) and any other regulations promulgated thereunder, to the extent
applicable to such parties.
16. If
a dispute arises regarding the termination of Employee pursuant to Section
7
hereof or as to the interpretation or enforcement of this Agreement and Employee
obtains a final judgment in his favor in a court of competent jurisdiction
or
his claim is settled by Employer prior to the rendering of a judgment by such
a
court, all reasonable legal fees and expenses incurred by Employee in contesting
or disputing any such termination or seeking to obtain or enforce any right
or
benefit provided for in this Agreement or otherwise pursuing his claim shall
be
paid by Employer, to the extent permitted by law.
17. Should
Employee die after termination of his employment with Employer while any amounts
are payable to him hereunder, this Agreement shall inure to the benefit of
and
be enforceable by Employee’s executors, administrators, heirs, distributees,
devisees and legatees and all amounts payable hereunder shall be paid in
accordance with the terms of this Agreement to Employee’s devisee, legatee or
other designee or, if there is no such designee, to his estate.
18. For
purposes of this Agreement, notices and all other communications provided for
herein shall be in writing and shall be deemed to have been given when delivered
or mailed by United States registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
|
If
to Employee:
|
Xxxxxxxx
X. Xxxxxxxxx
___________________
___________________
|
|
|
If
to Employer:
|
Lincoln
Bank
000
Xxxxxxxxxx Xxxxx
X.X.
Xxx 000
Xxxxxxxxxx,
Xxxxxxx 00000-0000
|
or
to
such address as either party hereto may have furnished to the other party in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
Page
10
19. The
validity, interpretation, and performance of this Agreement shall be governed
by
the laws of the State of Indiana, except as otherwise required by mandatory
operation of federal law.
20. Employer
shall require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business or
assets of Employer, by agreement in form and substance satisfactory to Employee
to expressly assume and agree to perform this Agreement in the same manner
and
same extent that Employer would be required to perform it if no such succession
had taken place. Failure of Employer to obtain such agreement prior to the
effectiveness of any such succession shall be a material intentional breach
of
this Agreement and shall entitle Employee to terminate his employment with
Employer pursuant to Section 7(c) hereof. As used in this Agreement,
“Employer” shall mean Employer as hereinbefore defined and any
successor to its business or assets as aforesaid.
21. No
provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing signed by Employee
and
Employer. No waiver by either party hereto at any time of any breach by the
other party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
dissimilar provisions or conditions at the same or any prior subsequent time.
No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not set forth expressly in this Agreement.
22. The
invalidity or unenforceability of any provisions of this Agreement shall not
affect the validity or enforceability of any other provisions of this Agreement
which shall remain in full force and effect.
23. This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original but all of which together shall constitute one and the same
agreement.
24. This
Agreement is personal in nature and neither party hereto shall, without consent
of the other, assign or transfer this Agreement or any rights or
obligations hereunder except as provided in Section 17 and Section 20 above.
Without limiting the foregoing, Employee’s right to receive compensation
hereunder shall not be assignable or transferable, whether by pledge, creation
of a security interest or otherwise, other than a transfer by his will or by
the
laws of descent or distribution as set forth in Section 17 hereof, and in the
event of any attempted assignment or transfer contrary to this paragraph,
Employer shall have no liability to pay any amounts so attempted to be assigned
or transferred.
[Remainder
of this page is intentionally left blank.]
Page
11
In
Witness Whereof, the parties have caused this Amended and Restated Employment
Agreement to be executed and delivered as of the day and year first above set
forth.
|
“Employer”
|
||
|
Lincoln
Bank
|
||
|
By:
|
/s/
Xxxxx X. Xxxxx
|
|
|
Xxxxx
X. Xxxxx, President
|
||
|
“Employee”
|
||
|
/s/
Xxxxxxxx X. Xxxxxxxxx
|
||
|
Xxxxxxxx
X. Xxxxxxxxx
|
||
The
undersigned, Lincoln Bancorp, sole shareholder of Employer, agrees that if
it
shall be determined for any reason that any obligations on the part of Employer
to continue to make any payments due under this Agreement to Employee is
unenforceable for any reason, Lincoln Bancorp, agrees to honor the terms of
this
Agreement and continue to make any such payments due hereunder to Employee
pursuant to the terms of this Agreement.
|
Lincoln
Bancorp
|
||
|
By:
|
/s/
Xxxxx X. Xxxxx
|
|
|
Xxxxx
X. Xxxxx, President
|
||
Page
12
