EMPLOYMENT AGREEMENT
Exhibit 10.1
THIS EMPLOYMENT AGREEMENT (the “Agreement”), entered into and effective as of the 1st day of
December, 2010 (the “Effective Date”), by and between First Financial Bank, N.A. (the “Bank”), a
national banking association organized under the laws of the United States of America, First
Financial Corporation (the “Corporation”), a corporation formed under the laws of the State of
Indiana and a financial holding company (jointly referred to herein as the “Company”) and Xxxxxx X.
Xxxxxx (the “Employee”), a resident of the State of Indiana.
WHEREAS, the Employee has heretofore been employed by the Bank as its President and Chief
Executive Officer and by the Corporation as its Chief Executive Officer and has performed valuable
services for both the Bank and the Corporation; and
WHEREAS, the Company desires to enter into this Agreement with the Employee in order to assure
continuity of management and to reinforce and encourage the continued attention and dedication of
the Employee to his assigned duties; and
WHEREAS, the parties desire, by this writing, to set forth the continuing employment
relationship between the Company and the Employee.
NOW, THEREFORE, in consideration of the premises contained herein and for other good and
valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Employee and
the Company agree as follows:
1. Employment. The Employee is employed as the President and Chief Executive Officer of the Bank and as
the Chief Executive Officer of the Corporation. The Employee shall render such administrative and
management services for the Company as are currently rendered and as are currently performed by
persons situated in a similar executive capacity. The Employee shall also promote, by
entertainment or otherwise, as and to the extent permitted by law, the business of the Company.
The Employee’s other duties shall be such as the boards of directors of the Bank or the Corporation
may, from time to time, reasonably direct, including normal duties as an officer of the Bank and
the Corporation. During the term of this Agreement, the Employee shall be nominated and elected to
serve as a director of the Bank or of any successor to the Bank and shall be nominated to serve as
a director of the Corporation.
2. Base Compensation. The Company agrees to pay the Employee during the term of this Agreement a base salary at
the rate of $500,074.10 per annum, payable in cash not less frequently than monthly. Such base
salary shall be effective and calculated commencing as of the Effective Date. The Company may
consider and declare from time to time increases in the base salary it pays the Employee. Prior to
a Change in Control (as hereinafter defined), the Company may also declare decreases in the base
salary it pays the Employee if the operating results of the Company are significantly less
favorable than those for the fiscal year ending December 31, 2009, and the Company makes similar
decreases in the base salary it pays to other
executive officers of the Company. After a Change in Control, the Company shall consider and
declare salary increases in base salary based upon the following standards:
(a) Inflation;
(b) Adjustments to the base salaries of other senior management personnel;
(c) Past performance of the Employee; and
(d) The contribution which the Employee makes to the business and profits of the
Company during the term of this Agreement.
3. Bonuses. The Employee shall participate in any year-end bonus granted to other employees. The
Employee shall further participate in an equitable manner with all other senior management
employees of the Company in any discretionary bonuses that the Company may award from time to time
to senior management employees. No other compensation provided for in this Agreement shall be
deemed a substitute for the Employee’s right to participate in such discretionary bonuses.
4. Benefits.
(a) Participation in Retirement, Medical and Other Benefit Plans. During the
term of this Agreement, the Employee shall be eligible to participate in the following
benefit plans; group hospitalization, disability, health, dental, sick leave, retirement,
supplemental retirement, pension, 401(k), employee stock ownership plan, and all other
present or future qualified and/or nonqualified plans provided by the Company generally, or
to executive officers of the Bank or the Corporation, which benefits, taken as a whole, must
be at least as favorable as those in effect on the Effective Date, unless the continued
operation of such plans or changes in the accounting, legal or tax treatment of such plans
would adversely affect the Company’s operating results or financial condition in a material
way, and the Company concludes that modifications to such plans are necessary to avoid such
adverse effects and such modifications apply consistently to all employees participating in
the affected plans. In addition, the Employee shall be eligible to participate in any
fringe benefits which are or may become available to the Company’s senior management
employees, including, for example, any stock option or incentive compensation (including,
but not limited to the First Financial Corporation 2011 Omnibus Equity Incentive Plan (“2011
Omnibus Plan”)) or performance-based plans, any insurance programs (including, but not
limited to, any group and executive life insurance programs), and any other benefits which
are commensurate with the responsibilities and functions to be performed by the Employee
under this Agreement. All the employee benefits referenced in this subsection 4(a) are
collectively referred to hereinafter as “Employee Benefits.”
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(b) Benefits After Retirement. Upon retirement of the Employee at or after
attaining age 65 (“Retirement Age”), during the term of this Agreement, the Company agrees
to continue, at no greater cost to Employee than is generally allocated to all employees,
full coverage for the Employee, his spouse and his children living in his household under
the health, life and disability plans as adopted by the Company which
shall be no less favorable than those in effect on the Effective Date of this
Agreement. The Company agrees to continue such health coverage until both the Employee and
his spouse are eligible for coverage by Medicare. When both the Employee and his spouse
become eligible for Medicare coverage, the Company agrees to pay for supplemental coverage,
at the best level available, for both the Employee and his spouse until the death of the
Employee and his spouse. The Employee shall be entitled to a life insurance policy on his
life, provided at the Company’s cost, in the maximum amount established by the Company’s
group life insurance plan from time to time which amount shall be no less than the limit on
the Effective Date of three times his annual salary (subject to a $350,000 maximum). The
Employee shall also be entitled to an additional life insurance policy on his life in the
amount established by the Company’s insurance program for executive officers from time to
time. The Company shall continue to pay to the Employee the annual premiums, which are
required to keep the life insurance policy in force, on behalf of the Employee pursuant to
the Company’s insurance program for executive officers.
(c) Expenses and Membership. The Employee shall be reimbursed for all
reasonable out-of-pocket business expenses which he shall incur in connection with his
services under this Agreement, upon substantiation of such expenses in accordance with the
policies of the Company. In addition, the Employee shall be reimbursed for all reasonable
out-of-pocket expenses incurred by him to satisfy his continuing legal education
requirements for his license to practice law in the State of Indiana. So long as the
Employee is employed by the Company pursuant to this Agreement, the Employee shall be
entitled to continue his memberships in the American, Indiana and Terre Haute Bar
Associations, the American Association for Justice, the Indiana Trial Lawyers Association
and the Country Club of Terre Haute, and the Company shall continue to pay or reimburse the
Employee for the dues and assessments for such memberships.
(d) Automobile. So long as the Employee is employed by the Company pursuant to
this Agreement, the Employee shall be entitled to continue to use a Company-owned automobile
of commensurate quality and value as that used by him on the same terms and conditions in
effect with respect to such use on the Effective Date of this Agreement. The Company shall
provide and pay the premiums for full insurance coverage on the automobile. Such insurance
coverage shall be no less than the coverage provided on the Effective Date of this
Agreement. The Company shall also pay for the cost of operation, maintenance and repair of
the automobile. All benefits referenced in this subsection 4(d) are collectively referred
to hereinafter as “Automobile Benefits.”
(e) Vacation, Sick Leave and Disability. The Employee shall be entitled to 30
days vacation annually and shall be entitled to the same sick leave and disability leave as
other executive employees. The Employee shall not receive any additional compensation on
account of his failure to take a vacation or sick leave, and the Employee shall not
accumulate unused vacation or sick leave from one fiscal year to the next, except in either
case to the extent authorized by the Company or permitted for other executive employees.
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In addition to the aforesaid paid vacations, the Employee shall be entitled, without
loss of pay, to absent himself voluntarily from the performance of his employment with
the Company for such additional periods of time and for such valid and legitimate
reasons as the Company may determine and to attend the continuing legal education seminars
contemplated by subsection 4(c) hereof. Further, the Company may grant to the Employee a
leave or leaves of absence, with or without pay, at such time or times and upon such terms
and conditions as the board of directors of the Bank or the Company in its discretion may
determine.
(f) Other Policies. All other matters relating to the employment of the
Employee not specifically addressed in this Agreement shall be subject to the general
policies regarding executive employees of the Company as in effect from time to time.
5. Term of Employment. The Company hereby employs the Employee, and the Employee hereby accepts such employment
under the terms of this Agreement, for the period commencing on the Effective Date and ending 36
months thereafter (or such earlier date as is determined in accordance with Section 8).
Additionally, on each annual anniversary of the Effective Date, the Employee’s term of employment
shall be extended for an additional one-year period beyond the then effective expiration date,
unless the boards of directors of the Bank and the Corporation determine in a duly adopted
resolution that this Agreement shall not be extended. Only those disinterested members of the
boards of directors of the Bank and the Corporation shall discuss and vote on any proposed
resolution not to extend this Agreement. The initial term of this Agreement and all extensions
thereof are hereinafter referred to individually and collectively as the “Term.”
6. Covenants.
(a) Loyalty.
(i) During the period of his employment hereunder and except for illnesses,
reasonable vacation periods, and reasonable leaves of absence, the Employee shall
devote all of his full business time, attention, skill and efforts to the faithful
performance of his duties hereunder; provided, however, from time to time, the
Employee may serve on the boards of directors of, and hold any other offices or
positions in, companies or organizations, and may perform legal services either
directly or as a result of an of counsel or analogous position with a law firm for
clients which will not present any conflict of interest with the Bank or the
Corporation or any of their subsidiaries or affiliates, or unfavorably affect the
performance of Employee’s duties pursuant to this Agreement, or will not violate any
applicable statute or regulation. “Full business time” is hereby defined as that
amount of time usually devoted to like companies by similarly situated executive
officers. During the term of his employment under this Agreement, the Employee
shall not engage in any business or activity contrary to the business affairs or
interests of the Company, or be gainfully employed in any other position or job
other than as provided above.
(ii) Nothing contained in this Section shall be deemed to prevent or limit the
Employee’s right to invest in the capital stock or other securities of any
business dissimilar from that of the Company, or, solely as a passive or
minority investor, in any business.
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(b) Nonsolicitation. The Employee hereby understands and acknowledges that, by
virtue of his position with the Company, he will have advantageous familiarity and personal
contacts with the Company’s customers, wherever located, and the business, operations and
affairs of the Company. Accordingly, while the Employee is employed by the Company and for
a period of one year after the Employee’s Separation from Service (as defined in Section
8(h)(ii) of this Agreement) for any reason (whether with or without cause or whether by the
Company or the Employee) or the expiration of the Term, the Employee shall not, directly or
indirectly, or individually or jointly, (i) solicit any non-legal business of any party
which is a customer of the Company at the time of such Separation from Service or any party
which was a customer of the Company during the one year period immediately preceding such
Separation from Service, (ii) request or advise any customers or suppliers of the Company to
terminate, reduce, limit or change their business or relationship with the Company, or (iii)
induce, request or attempt to influence any employee of the Company to terminate his
employment with the Company, unless such actions are taken in connection with Employee
engaging in the practice of law.
For purposes of this Agreement, the term “solicit” means any direct or indirect
communication of any kind whatsoever, regardless of by whom initiated, which encourages or
requests any person or entity, in any manner, to cease doing business with the Company.
(c) Noncompetition. During the period of his employment hereunder, and for a
period of one year following the termination hereof, the Employee shall not, directly or
indirectly:
(i) As owner, officer, director, stockholder, investor, proprietor, organizer
or otherwise, engage in the same trade or business as the Company, as conducted on
the date hereof, which would conflict with the interests of the Company or in a
trade or business competitive with that of the Company, which would conflict with
the interests of the Company, as conducted on the date hereof; or
(ii) Offer or provide employment (whether such employment is with the Employee
or any other business or enterprise), either on a full-time or part-time or
consulting basis, to any person who then currently is, or who within one (1) year
prior to such offer or provision of employment has been, a management-level employee
of the Bank or Corporation. This subsection 6(c)(ii) shall only apply in the event
the Employee has a voluntary Separation from Service.
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The restrictions contained in this paragraph upon the activities of the Employee
following Separation from Service shall be limited to the following geographic areas
(hereinafter referred to as “Restricted Geographical Area”):
(1) Terre Haute, Indiana; and
(2) The 00-xxxx xxxxxx xx Xxxxx Xxxxx, Xxxxxxx.
Nothing contained in this Section 6 shall prevent or restrict the Employee from
engaging in the practice of law, including within the Restricted Geographical Area. In
addition, nothing contained in this subsection shall prevent or limit the Employee’s right
to invest in the capital stock or other securities of any business dissimilar from that of
the Bank or the Corporation, or, solely as a passive or minority investor, in any business.
If the Employee does not comply with the provisions of this Section, the one-year
period of non-competition provided herein shall be tolled and deemed not to run during any
period(s) of noncompliance, the intention of the parties being to provide one full year of
non-competition by the Employee after the termination or expiration of this Agreement.
(d) Nondisclosure. The term “Confidential Information” as used herein shall
mean any and all customer lists, computer hardware, software and related material, trade
secrets (as defined in I.C. 24-2-3-2), know-how, skills, knowledge, ideas, knowledge of
customer’s commercial requirements, pricing methods, sales and marketing techniques, dealer
relationships and agreements, financial information, intellectual property, codes, research,
development, research and development programs, processes, documentation, or devices used in
or pertaining to the Company’s business (i) which relate in any way to the Company’s
business, products or processes; or (ii) which are discovered, conceived, developed or
reduced to practice by the Employee, either alone or with others either during the Term, at
the Company’s expense, or on the Company’s premises.
(i) During the course of his services hereunder the Employee may become
knowledgeable about, or become in possession of, Confidential Information. If such
Confidential Information were to be divulged or become known to any competitor of
the Company or to any other person outside the employ of the Company, or if the
Employee were to consent to be employed by any competitor of the Company or to
engage in competition with the Company, the Company would be irreparably harmed. In
addition, the Employee has or may develop relationships with the Company’s customers
which could be used to solicit the business of such customers away from the Company.
The Company and the Employee have entered into this Agreement to guard against such
potential harm.
(ii) The Employee shall not, directly or indirectly, use any Confidential
Information for any purpose other than the benefit of the Company or communicate,
deliver, exhibit or provide any Confidential Information to any person, firm,
partnership, corporation, organization or entity, except as required in the normal
course of the Employee’s service as a consultant or as an employee of the Company.
The covenant contained in this subsection shall be binding upon the Employee during
the Term and following the termination hereof until either (i) such Confidential
Information becomes obsolete; or (ii) such Confidential
Information becomes generally known in the Company’s trade or industry by means
other than a breach of this covenant.
(iii) The Employee agrees that all Confidential Information and all records,
documents and materials relating to such Confidential Information, shall be and
remain the sole and exclusive property of the Company.
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(e) Remedies. The Employee agrees that the Company will suffer irreparable
damage and injury and will not have an adequate remedy at law in the event of any breach by
the Employee of any provision of this Section. Accordingly, in the event the Company seeks,
under law or in equity, a temporary restraining order, permanent injunction or a decree of
specific performance of the provisions of this Section, no bond or other security shall be
required. The Company shall be entitled to recover from the Employee, reasonable attorneys’
fees and expenses incurred in any action wherein the Company successfully enforces any of
the provisions of this Section against the breach or threatened breach of those provisions
by the Employee. The remedies described in this Section are not exclusive and are in
addition to all other remedies the Company may have at law, in equity, or otherwise.
(i) The Employee and the Company acknowledge and agree that in the event of the
Employee’s Separation from Service for any reason whatsoever, the Employee can
obtain other engagements or employment of a kind and nature similar to that
contemplated herein outside the Restricted Geographical Area and that the issuance
of an injunction to enforce the provisions of this Section will not prevent him from
earning a livelihood.
(ii) The covenants on the part of the Employee contained in this Section are
essential terms and conditions to the Company entering into this Agreement, and
shall be construed as independent of any other provision in this Agreement.
(f) Surrender of Records. Upon the Employee’s Separation from Service for any
reason, the Employee shall immediately surrender to the Company any and all computer
hardware, software and related materials, records, notes, documents, forms, manuals,
photographs, instructions, lists, drawings, blueprints, programs, diagrams or other written
or printed material (including any and all copies made at any time whatsoever) in his
possession or control which pertain to the business of the Company including any
Confidential Information in the Employee’s personal notes, address books, calendars,
rolodexes, personal data assistants, etc.
7. Standards. The Employee shall perform his duties under this Agreement in accordance with such
reasonable standards as the Board may establish from time to time. The Company will provide the
Employee with the working facilities and staff commensurate with his position or positions and
necessary or advisable for him to perform his duties.
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8. Separation from Service and Termination Pay. Subject to Section 10 hereof, the Employee may experience a Separation from Service under
the following circumstances:
(a) Death. The Employee shall experience a Separation from Service upon his
death during the Term of this Agreement, in which event the Employee’s estate or designated
beneficiaries shall be entitled to receive the base salary, bonuses, vested rights, and
Employee Benefits due the Employee through the last day of the calendar month in which his
death occurred. Any benefits payable under insurance, health, retirement, bonus, incentive,
performance or other plans as a result of the Employee’s participation in such plans through
such date shall be paid when and as due under those plans. If the Employee’s death occurs
on or after Retirement Age, during the term of this Agreement, the Employee’s spouse and
child living in his household at the time of his death shall be entitled to receive the
health and disability benefits provided for under subsection 4(b) until the death of his
spouse.
(b) Disability.
(i) The Company may terminate the Employee’s employment, resulting in a
Separation from Service, as a result of the Employee’s Disability, in a manner
consistent with the Company’s and the Employee’s rights and obligations under the
Americans with Disabilities Act or other applicable state and federal laws
concerning disability. For the purpose of this Agreement, “Disability” means the
Employee is:
(1) 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 12 months, or
(2) 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 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Employer.
(ii) During any period that the Employee shall receive disability benefits and
to the extent that the Employee shall be physically and mentally able to do so, he
shall furnish such information, assistance and documents so as to assist in the
continued ongoing business of the Company.
(iii) In the event of the Employee’s Separation from Service due to Disability,
the Employee shall be entitled to receive the base salary, bonuses, vested rights,
and Employee Benefits due the Employee through his date of termination. Any
benefits payable under insurance, health, retirement, bonus, incentive, performance
or other plans as a result of the Employee’s participation in the plans through the
date of termination shall be paid when and as due under those plans. If the
Employee’s Separation from Service due to Disability occurs on or after Retirement
Age, during the term of this Agreement, the Employee
shall be entitled to the retirement benefits provided for under subsection 4(b)
as described in that subsection.
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(c) Just Cause. The Company may, by written notice to the Employee,
immediately terminate his employment at any time, resulting in a Separation from Service,
for Just Cause. The Employee shall have no right to receive any base salary, bonuses or
other Employee Benefits, except as provided by law, whatsoever, for any period after his
Separation from Service for Just Cause. However, the vested rights of the Employee as of
his Separation from Service shall not be affected. Any benefits payable under insurance,
health, retirement, bonus, incentive, performance or other plans as a result of the
Employee’s participation in such plans through such date of Separation of Service shall be
paid when and as due under those plans. Separation from Service for “Just Cause” shall mean
termination because of:
(i) An intentional act of fraud, embezzlement, theft, or personal dishonesty;
willful misconduct, or breach of fiduciary duty involving personal profit by the
Employee in the course of his employment or director service. No act or failure to
act shall be deemed to have been intentional or willful if it was due primarily to
an error in judgment or negligence. An act or failure to act shall be considered
intentional or willful if it is not in good faith and if it is without a reasonable
belief that the action or failure to act is in the best interest of the Company;
(ii) Intentional wrongful damage by the Employee to the business or property of
the Company, causing material harm to the Company;
(iii) Breach by the Employee of any confidentiality or non-disclosure agreement
in effect from time to time with the Company;
(iv) Gross negligence or insubordination by the Employee in the performance of
his duties; or
(v) Removal or permanent prohibition of the Employee from participating in the
conduct of Bank’s affairs by an order issued under Section 8(e)(iv) or 8(g)(i) of
the Federal Deposit Insurance Act, 12 USC 1818(e)(4) and (g)(1).
Notwithstanding the foregoing, in the event of Separation from Service for Just Cause
there shall be delivered to the Employee a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the disinterested directors of the Bank and
the Corporation at meetings of the boards called and held for that purpose (after reasonable
notice to the Employee and an opportunity for the Employee, together with the Employee’s
counsel, to be heard before the boards), such meetings and the opportunity to be heard to be
held prior to, or as soon as reasonably practicable following, termination, but in no event
later than 60 days following such termination, finding that in the good faith opinion of the
boards the Employee was guilty of conduct constituting Just Cause and specifying the
particulars thereof in detail. If, following such
meetings, the Employee is reinstated, he shall be entitled to receive the base salary,
bonuses, all Employee Benefits, and all other fringe benefits provided for under this
Agreement for the period following Separation from Service and continuing through
reinstatement as though he was never terminated.
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(d) Without Just Cause. The Company may, by written notice to the Employee,
immediately terminate his employment at any time, resulting in a Separation from Service,
for a reason other than Just Cause, in which event the Employee shall be entitled to receive
the following compensation and benefits (unless such Separation from Service occurs within
the time period set forth in subsection 10(a) hereof, in which event the benefits and
compensation provided for in Section 10 shall apply):
(i) The base salary provided pursuant to Section 2 hereof, as in effect on the
date of Separation from Service, through the Expiration Date of this Agreement as
determined pursuant to Section 5 hereof (including any renewal or extension of this
Agreement) (the “Expiration Date”);
(ii) An amount equal to the bonuses received by or payable to the Employee in
the calendar year prior to the calendar year of the Employee’s Separation from
Service, for each year remaining through the Expiration Date; and
(iii) Cash reimbursement to the Employee in an amount equal to the cost to the
Employee (demonstrated by submission to the Company of invoices, bills, or other
proof of payment by the Employee) of (A) all health insurance premiums for the
Employee, his spouse and child living in the Employee’s household and the best level
Medicare supplement insurance available, and life insurance (all as described in
subsection 4(b)); (B) all other Employee Benefits (all as defined in subsection 4(a)
excluding benefits under the 2011 Omnibus Plan which will be made in accordance with
the terms and conditions of that Plan); and (C) professional and club dues, the cost
of Employee’s continuing legal education requirements (as described in subsection
4(c)), all Automobile Benefits (as defined in subsection 4(d)) and all other
benefits which the Employee would otherwise have been eligible to participate in or
receive, through the Expiration Date, based upon the benefit levels substantially
equal to those provided for the Employee at the date of the Employee’s Separation
from Service. The Employee shall also be entitled to receive an amount necessary to
provide any cash payments received under this subsection 8(d)(iii) net of all income
and payroll taxes that would not have been payable by the Employee had he continued
participation in the benefit plan or program instead of receiving cash
reimbursement.
Notwithstanding the foregoing, but only to the extent required under federal banking
law, the amount payable under subsection 8(d) shall be reduced to the extent that on the
date of the Employee’s Separation from Service, the present value of the benefits payable
under subsection 8(d) exceeds any limitation on severance benefits that is imposed by the
Office of the Comptroller of the Currency (the “OCC”) on such benefits.
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All amounts payable to the Employee under subsections 8(d)(i) and 8(d)(ii) shall be
paid in one lump sum within ten days of such Separation from Service. All amounts payable
to the Employee under subsection 8(d)(iii) shall be paid on the first day of each month
following the Employee’s Separation from Service, in an amount equal to the total
reimbursable amount (demonstrated by invoices, bills or other proof of payment submitted by
the Employee). Such amounts must be submitted for reimbursement no later than the earlier
of: (i) six months after the date such amounts are paid by the Employee; or (ii) March 15th
of the year following the year in which the Employee paid the amount.
(e) Voluntary for Good Reason. The Employee may voluntarily Separate from
Service under this Agreement at any time for Good Reason. In the event that the Employee
has a Separation from Service for Good Reason, the Employee will first deliver to the
Company a written notice which will (A) indicate the specific provisions of this Agreement
relied upon for such Separation from Service, (B) set forth in reasonable detail the facts
and circumstances claimed to provide a basis for such Separation from Service, and (C)
describe the steps, actions, events or other items that must be taken, completed or followed
by the Company to correct or cure the basis for such Separation from Service. The Company
will then have 30 days following the effective date of such notice to fully correct and cure
the basis for the Separation from Service. If the Company does not fully correct and cure
the basis for the Employee’s Separation from Service within such 30-day period, then the
Employee will have the right to Separate from Service with the Company for Good Reason
immediately upon delivering to the Company a written Notice of Termination and without any
further cure period. Notwithstanding the foregoing, the Company will be entitled to so
correct and cure only a maximum of two times during any calendar year. The Employee shall
thereupon be entitled to receive the same amount payable under subsections 8(d)(i) and (ii)
hereof, within 30 days following his date of Separation from Service and under subsection
8(d)(iii) as provided in subsection 8(d).
For purposes of this Agreement, “Good Reason” means the occurrence of any of the
following events, which has not been consented to in advance by the Employee in writing
(unless such voluntary Separation from Service occurs within the time period set forth in
subsection 10(b) hereof, in which event the benefits and compensation provided for in
Section 10 shall apply):
(i) The requirement that the Employee perform his executive functions more than
30 miles from his Terre Haute, Indiana office;
(ii) A reduction of ten percent or more in the Employee’s base salary, unless
part of an institution-wide reduction and similar to the reduction in the base
salary of all other executive officers of the Company;
(iii) The removal of the Employee from participation in any incentive
compensation or performance-based compensation plans or bonus plans unless the
Company terminates participation in the plan or plans with respect to all other
executive officers of the Company;
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(iv) A material failure by the Company to continue to provide the Employee with
the base salary, bonuses or benefits provided for under subsections 4(a), (c), (d)
and (e) of this Agreement, as the same may be increased from time to time, or with
benefits substantially similar to those provided to him under those Sections or
under any benefit plan or program in which the Employee now or hereafter becomes
eligible to participate, or the taking of any action by the Company which would
directly or indirectly reduce in a material manner any such benefits or deprive the
Employee to a material degree of any such benefit enjoyed by him, unless part of an
institution-wide reduction and applied similarly to all other executive officers of
the Company:
(v) The assignment to the Employee of duties and responsibilities materially
different from those normally associated with his position as referenced in Section
1;
(vi) A failure to elect or re-elect the Employee to the Bank’s board of
directors or a failure on the part of the Corporation to honor its obligation to
nominate Employee to the Corporation’s board of directors;
(vii) A material diminution or reduction in the Employee’s responsibilities or
authority (including reporting responsibilities) in connection with his employment
with the Company; or
(viii) A material reduction in the secretarial or administrative support of the
Employee.
Notwithstanding the foregoing, but only to the extent required under federal banking law, the
amount payable under this subsection shall be reduced to the extent that on the date of the
Employee’s Separation from Service, the present value of the benefits payable under subsections
8(d)(i), (ii) and (iii) exceed any limitation on severance benefits that is imposed by the OCC on
such benefits.
(f) Voluntary Separation from Service Prior to Retirement Age. Subject to
subsection 4(b) and Section 10, the Employee may voluntarily Separate from Service with the
Company during the term of this Agreement prior to attaining Retirement Age, upon at least
90 days’ prior written notice to the Company, in which case, effective as of the Separation
from Service, the Employee shall receive only his base salary, bonuses, vested rights and
benefits up to the date of his Separation from Service, such benefits to be paid when and as
due under those plans (unless such Separation from Service occurs pursuant to subsection
10(b) hereof, in which event the benefits, bonuses and base salary provided for in
subsection 10(a) shall apply).
(g) Termination or Suspension Under Federal Law.
(i) If the Employee is removed and/or permanently prohibited from participating
in the conduct of the Company’s affairs by an order issued under Sections 8(e)(iv)
or 8(g)(i) of the Federal Deposit Insurance Act (“FDIA”) (12 U.S.C. 1818(e)(4) and
(g)(1)), all obligations of the Company under this
Agreement shall terminate, as of the effective date of the order, but vested
rights of the Employee shall not be affected.
12
(ii) If the Bank is in default (as defined in Section 3(x)(1) of the FDIA), all
obligations under this Agreement shall terminate as of the date of default; but the
vested rights of the Employee shall not be affected.
(iii) All obligations under this Agreement shall terminate, except to the
extent it is determined that the continuation of this Agreement is necessary for the
continued operation of the Bank; (A) by the OCC or its designee, at the time that
the Federal Deposit Insurance Corporation (“FDIC”) enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) of FDIA; or (B) by the OCC, or its designee, at the time that the OCC
or its designee approves a supervisory merger to resolve problems related to
operation of the Bank or when the Bank is determined by the OCC to be in an unsafe
or unsound condition. Such action shall not affect any vested rights of the
Employee.
(iv) If a notice served under Section 8(e)(3) or (g)(1) of the FDIA suspends
and/or temporarily prohibits the Employee from participating in the conduct of the
Bank’s affairs, the Bank’s obligations under this Agreement shall be suspended as of
the date of such service, unless stayed by appropriate proceedings. However, the
vested rights of the Employee as of the date of suspension will not be affected. If
the charges in the notice are dismissed, the Bank may in its discretion (A) pay the
Employee all or part of the compensation withheld while its contract obligations
were suspended, and (B) reinstate (in whole or in part) any of its obligations which
were suspended.
(h) Separation from Service. If the Employee qualifies as a Key Employee (as
defined in subsection 8(h)(i)) at the time of his Separation from Service (as defined in
subsection 8(h)(ii)), the Company may not make a payment pursuant to subsections 8(d)
(disregarding subsection 8(d)(iii)(A)), 8(e) or Section 10 (disregarding subsection
10(a)(1)(ii)(C)) earlier than six months following the date of the Employee’s Separation
from Service (or, if earlier, the date of the Employee’s death) to the extent such a payment
would constitute deferred compensation that is not exempt from the requirements of Code
Section 409A or Treasury Regulations 1.409A-1 et. seq. Payments to which the Key Employee
would otherwise be entitled during the first six months following the date of his Separation
from Service will be accumulated and paid to the Employee on the first day of the seventh
month following the Employee’s Separation from Service.
(i) Key Employee means an employee who is:
(1) An officer of the Bank or Corporation having annual compensation
greater than $160,000;
(2) A five percent owner of the Corporation; or
13
(3) A one percent owner of the Corporation having an annual
compensation from the employer of more than $150,000.
The $160,000 amount in subsection 8(h)(i)(1) will be adjusted at the same
time and in the same manner as under Code Section 415(d), except that the
base period shall be the calendar quarter beginning July 1, 2001, and any
increase under this sentence which is not a multiple of $5,000 shall be
rounded to the next lower multiple of $5,000.
(ii) Separation from Service means the date on which the Employee dies, retires
or otherwise experiences a “Termination of Employment” with the Company (as defined
below). Provided, however, a Separation from Service does not occur if the Employee
is on military leave, sick leave or other bona fide leave of absence if the period
of such leave does not exceed six months, or if longer, so long as the Employee
retains a right to reemployment with the Company under an applicable statute or by
contract. For purposes of this subsection 8(h)(ii), a leave of absence constitutes
a bona fide leave of absence only if there is a reasonable expectation that the
Employee will return to perform services for the Bank or Corporation. If the period
of leave exceeds six months and the Employee does not retain the right to
reemployment under an applicable statute or by contract, the employment relationship
is deemed to terminate on the first date immediately following such six-month
period. Notwithstanding the foregoing, where a leave of absence is due to any
medically determinable physical or mental impairment that can be expected to result
in death or can be expected to last for a continuous period of not less than six
months, where such impairment causes the Employee to be unable to perform the duties
of his position of employment or any substantially similar position of employment, a
29-month period of absence may be substituted for such six-month period. The
Employee shall incur a “Termination of Employment” for purposes of this subsection
8(h)(ii) when a termination of employment has occurred under Treasury Regulation
1.409A-1(h)(1)(ii).
9. No Mitigation. The Employee shall not be required to mitigate the amount of any payment provided for in
this Agreement by seeking other employment or otherwise and no such payment shall be offset or
reduced by the amount of any compensation or benefits provided to the Employee in any subsequent
employment.
10. Change in Control.
(a) Change in Control; Involuntary Separation from Service.
(1) Notwithstanding any provision herein to the contrary, if the Employee’s
employment under this Agreement is terminated by the Company, resulting in a
Separation from Service, without the Employee’s prior written consent and for a
reason other than Just Cause, in connection with or within 12 months after a Change
in Control, as defined in subsection 10(a)(3), the Employee shall be paid (subject
to subsection 10(a)(2)) the greater of:
(i) The total amount payable under subsection 8(d); or
14
(ii) The product of 2.99 times the sum of: (A) his base salary in
effect as of the date of the Change in Control; (B) an amount equal to the
bonuses received by or payable to the Employee in the calendar year prior to
the year in which the Change in Control occurs; and (C) cash reimbursement
to the Employee in an amount equal to the cost to the Employee (demonstrated
by submission to the Company of invoices, bills or other proof of payment by
the Employee) of obtaining all Employee Benefits (all as defined in
subsection 4(a) excluding benefits under the 2011 Omnibus Plan which will be
paid in accordance with the terms and conditions of that plan), health
insurance premiums for the Employee, his spouse and child living in the
Employee’s household, best level Medicare supplement insurance available,
life insurance (all as described in subsection 4(b)), professional and club
dues, the cost of Employee’s continuing legal education requirements (all as
described in subsection 4(c)), all Automobile Benefits (as defined in
subsection 4(d)) and all other benefits which the Employee would otherwise
have been eligible to participate in or receive, through the Expiration
Date, based upon the benefit levels substantially equal to those that the
Company provided for the Employee at the date of the Employee’s Separation
from Service. The Employee shall also be entitled to receive an amount
necessary to provide any cash payments received under this subsection
10(a)(1)(ii) net of all income and payroll taxes that would not have been
payable by the Employee had he continued participation in the benefit plan
or program instead of receiving cash reimbursement.
(2) To the extent payments that would be received based on the Employee’s
Separation from Service in connection with a Change in Control, or within 12 months
after a Change in Control would be considered “excess parachute payments” pursuant
to the Code Section 280G, the benefit payment to the Employee under this Agreement,
when combined with all other parachute payments to the Employee, shall be the
greater of:
(i) the Employee’s benefit under the Agreement reduced to the maximum
amount payable to the Employee such that when it is aggregated with payments
and benefits under all other plans and arrangements it will not result in an
“excess parachute payment;” or
(ii) the Employee’s benefit under the Agreement after taking into
account the amount of the excise tax imposed on the Employee under Code
Section 280G due to the benefit payment.
The determination of whether any reduction in the rights or payments under this Plan
is to apply will be made by the Company in good faith after consultation with the
Employee, and such determination will be conclusive and binding on the Employee.
The Employee will cooperate in good faith with the Company in
making such determination and providing the necessary information for this purpose.
15
(3) “Change in Control” shall be deemed to have occurred if one of the
following events takes place:
(i) Change in Ownership. A change in the ownership of the Bank
or the Corporation occurs on the date that any person, or group of persons,
as defined below, acquires ownership of stock of the Bank or the Corporation
that, together with stock held by the person or group, constitutes more than
50 percent of the total fair market value or total voting power of the stock
of the Bank or the Corporation. However, if any person or group is
considered to own more than 50 percent of the total fair market value or
total voting power of the stock, the acquisition of additional stock by the
same person or group is not considered to cause a change in the ownership of
the Bank or the Corporation (or to cause a change in the effective control
of the Bank or the Corporation as defined in subsection 10(a)(3)(ii)). An
increase in the percentage of stock owned by any person or group, as a
result of a transaction in which the Bank or the Corporation acquires its
stock in exchange for property will be treated as an acquisition of stock
for purposes of this subsection. This subsection only applies when there is
a transfer of stock of the Bank or the Corporation (or issuance of stock of
a corporation) and stock in the Bank or the Corporation remains outstanding
after the transaction.
For purposes of subsections 10(a)(3)(i) and (ii), persons will not be
considered to be acting as a group solely because they purchase or own stock
of the Bank or the Corporation at the same time, or as a result of the same
public offering. However, 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 Bank or the Corporation. If a person, including an
entity, owns stock in both corporations that enter into a merger,
consolidation, purchase or acquisition of stock or similar transaction, such
shareholder is considered to be acting as a group with other shareholders
only with respect to the ownership in that corporation before the
transaction giving rise to the change and not with respect to the ownership
interest in the other corporation.
(ii) Change in the Effective Control. A change in the
effective control of the Bank or the Corporation will occur when: (i) any
person or group (as defined in subsection 10(a)(3)(i)) acquires, or has
acquired during the 12-month period ending on the date of the most recent
acquisition by such person(s), ownership of stock of the Bank or the
Corporation possessing 30 percent or more of the total voting power; or (ii)
a majority of members of the board of the Bank or the Corporation is
replaced during any 12-month period by directors whose appointment or
election is not endorsed by a majority of the members of the Bank’s or
Corporation’s board prior to the date of the appointment or election.
However, if any person or group is considered to effectively control the
Bank or Corporation, the acquisition of additional control of the Bank or
Corporation by the same person(s) is not considered to cause a change in the
effective control.
16
(iii) Change in the Ownership of a Substantial Portion of the
Bank’s or Corporation’s Assets. A change in the ownership of a
substantial portion of the Bank’s or Corporation’s assets occurs on the date
that any person or group acquires, or has acquired during the 12-month
period ending on the date of the most recent acquisition by such person(s),
assets from the Bank or Corporation that have a total gross fair market
value equal to or more than 40 percent of the total gross fair market value
of all of the assets of the Bank or Corporation immediately prior to such
acquisition(s). Gross fair market value means the value of the assets of
the Bank or Corporation, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets.
However, there is no Change in Control under this subsection when there is a
transfer to an entity that is controlled by the shareholders of the Bank or
Corporation immediately after the transfer. A transfer of assets by the
Bank or Corporation is not treated as a change in the ownership of such
assets if the assets are transferred to: (i) a shareholder of the Bank or
Corporation (immediately before the asset transfer) in exchange for or with
respect to its stock; (ii) an entity, 50 percent or more of the total value
or voting power of which is owned, directly or indirectly, by the Bank or
Corporation; (iii) a person, or group of persons, that owns, directly or
indirectly, 50 percent or more of the total value or voting power of all the
outstanding stock of the Bank or Corporation or (iv) 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 (iii). For purposes of this
subsection, except as otherwise provided, a person’s status is determined
immediately after the transfer of the assets. For example, a transfer to a
company in which the Bank or Corporation has no ownership interest before
the transaction, but which is a majority-owned subsidiary of the Bank or
Corporation after the transaction, is not treated as a change in the
ownership of the assets of the transferor Bank or Corporation.
For purposes of this subsection 10(a)(3)(iii), persons will not be
considered to be acting as a group solely because they purchase assets of
the Bank or Corporation at the same time. However, 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 assets, or
similar business transaction with the Bank or Corporation. If a person,
including an entity shareholder, owns stock in both corporations that enter
into a merger, consolidation, purchase or acquisition of assets, or similar
transaction, such shareholder is considered to be acting as a group with
other shareholders in a corporation only to the extent of the ownership in
that corporation before the transaction giving rise to the change and not
with respect to the ownership interest in the other corporation.
17
Notwithstanding the foregoing, the acquisition of Bank or Corporation stock by any
retirement plan sponsored by the Bank or an affiliate of the Bank will not constitute a
Change in Control. Additionally, notwithstanding the foregoing, but only to the extent
required under federal banking law, the amount payable under subsection 10(a) shall be
reduced to the extent that on the date of the Employee’s Separation from Service, the amount
payable under subsection 10(a) exceeds any limitation on severance benefits that is imposed
by the OCC.
(b) Change in Control; Voluntary for Good Reason. Notwithstanding any other
provision of this Agreement to the contrary, the Employee may Separate from Service under
this Agreement for Good Reason within 12 months following a Change in Control of the Bank or
Corporation, as defined in subsection 10(a)(3). In the event that the Employee has a
Separation from Service for Good Reason within 12 months following a Change in Control of
the Bank or Corporation, the Employee will first deliver to the Company a written notice
which will (A) indicate the specific provisions of this Agreement relied upon for such
Separation from Service, (B) set forth in reasonable detail the facts and circumstances
claimed to provide a basis for such Separation from Service, and (C) describe the steps,
actions, events or other items that must be taken, completed or followed by the Company to
correct or cure the basis for such Separation from Service. The Company will then have 30
days following the effective date of such notice to fully correct and cure the basis for the
Separation from Service. If the Company does not fully correct and cure the basis for the
Employee’s Separation from Service within such 30-day period, then the Employee will have
the right to Separate from Service with the Company for Good Reason immediately upon
delivering to the Company a written Notice of Termination and without any further cure
period. Notwithstanding the foregoing, the Company will be entitled to so correct and cure
only a maximum of two times during any calendar year.
The Employee shall thereupon be entitled to receive the payment described in
subsections 10(a)(1), (2) and (3) of this Agreement, within 30 days. During such 30-day
period, the Bank shall not allow the Employee’s participation in any Employee Benefits to
lapse and shall continue to provide the Employee with the Automobile Benefits described in
subsection 4(d), reimbursement or payment of professional and club dues, and the cost of the
Employee’s continuing legal education requirements as described in subsection 4(c). In the
event subsection 8(h) applies at the time of the Employee’s termination, the six-month
suspension period shall not prevent the Employee from continuing to receive reimbursement of
health insurance premiums for himself, his spouse and child living in the Employee’s
household, Medicare supplement insurance and life insurance (all as described in subsection
4(b)) immediately following his
Separation from Service, without regard to the six-month suspension applicable to cash
payments and other benefit amounts.
18
For purposes of this subsection 10(b), “Good Reason” means, the occurrence of any of
the following events, which has not been consented to in advance by the Employee in writing:
(i) The requirement that the Employee perform his principal executive functions
more than 30 miles from his Terre Haute, Indiana office.
(ii) A reduction of ten percent or more in the Employee’s base salary as in
effect on the date of the Change in Control or as the same may be changed by mutual
agreement from time to time, unless part of an institution-wide reduction and
similar to the reduction in the base salary of all other executive officers of the
Company;
(iii) The removal of the Employee from participation in any incentive or
performance-based compensation plans or bonus plans unless the Company terminates
participation in the plan or plans with respect to all other executive officers of
the Company;
(iv) A material failure by the Company to continue to provide the Employee with
the base salary, bonuses or benefits provided for under subsections 4(a), (c), (d)
and (e) of this Agreement, as the same may be increased from time to time, or with
benefits substantially similar to those provided to him under those subsections or
under any benefit plan or program in which the Employee now or hereafter becomes
eligible to participate, or the taking of any action by the Company which would
directly or indirectly reduce in a material manner any such benefits or deprive the
Employee to a material degree of any such benefit enjoyed by him, unless part of an
institution-wide reduction and applied similarly to all other executive officers of
the Company;
(v) The assignment to the Employee of duties and responsibilities materially
different from those normally associated with his position as referenced in Section
1;
(vi) A failure to elect or re-elect the Employee to the Bank’s board of
directors or a failure on the part of the Corporation or its successor to honor any
obligation to nominate Employee to the board of directors of the Corporation or its
successor;
(vii) A material diminution or reduction in the Employee’s responsibilities or
authority (including reporting responsibilities) in connection with his employment
with the Company; or
(viii) A material reduction in the secretarial or administrative support of the
Employee.
19
Notwithstanding the foregoing, but only to the extent required under federal banking
law, the amount payable under subsection 10(b) shall be reduced to the extent that on the
date of the Employee’s Separation from Service, the amount payable under subsection 10(b)
exceeds any limitation on severance benefits that is imposed by the OCC.
(c) Compliance with 12 U.S.C. Section 1828(k). Any payments made to the
Employee pursuant to this Agreement, or otherwise, are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations promulgated thereunder.
(d) Trust.
(1) Within five business days before or after a Change in Control which was not
approved in advance by a resolution of a majority of the directors of the
Corporation, the Company shall (i) deposit, or cause to be deposited, in a grantor
trust (the “Trust”), designed to conform with Revenue Procedure 92-64 (or any
successor) and having a trustee independent of the Bank, an amount equal to the
amounts which would be payable in a lump sum under subsections 10(a)(1), (2) and (3)
hereof if those payment provisions become applicable, and (ii) provide the trustee
of the Trust with a written direction to hold said amount and any investment return
thereon in a segregated account for the benefit of the Employee, and to follow the
procedures set forth in the next paragraph as to the payment of such amounts from
the Trust.
(2) During the 12 consecutive month period following the date on which the
Company makes the deposit referred to in the preceding paragraph, the Employee may
provide the trustee of the Trust with a written notice requesting that the trustee
pay to the Employee, in a single sum, the amount designated in the notice as being
payable pursuant to subsections 10(a)(1), (2) and (3). Within three business days
after receiving said notice, the trustee of the Trust shall send a copy of the
notice to the Company via overnight and registered mail, return receipt requested.
On the tenth business day after mailing said notice to the Company, the trustee of
the Trust shall pay the Employee the amount designated therein in immediately
available funds, unless prior thereto the Company provides the trustee with a
written notice directing the trustee to withhold such payment. In the latter event,
the trustee shall submit the dispute, within ten days of receipt of the notice from
the Company, to non-appealable binding arbitration for a determination of the amount
payable to the Employee pursuant to subsections 10(a)(1), (2) and (3), and the party
responsible for the payment of the costs of such arbitration (which may include any
reasonable legal fees and expenses incurred by the Employee) shall be determined by
the arbitrator. The Company and the Employee shall choose the arbitrator to settle
the dispute, and such arbitrator shall be bound by the rules of the American
Arbitration Association in making his or her determination. If the Employee and the
Company cannot agree on an arbitrator, then the arbitrator shall be selected under
the rules of the American Arbitration Association. The Employee, the Company and
the trustee
shall be bound by the results of the arbitration and, within three days of the
determination by the arbitrator, the trustee shall pay from the Trust the amounts
required to be paid to the Employee and/or the Company, and in no event shall the
trustee be liable to either party for making the payments as determined by the
arbitrator.
20
(3) Upon the earlier of (i) any payment from the Trust to the Employee, or (ii)
the date twelve months after the date on which the Company makes the deposit
referred to in subsection 10(d)(1)(i), the trustee of the Trust shall pay to the
Company the entire balance remaining in the segregated account maintained for the
benefit of the Employee, if any. The Employee shall thereafter have no further
interest in the Trust pursuant to this Agreement. However, the termination of the
Trust shall not operate as a forfeiture or relinquishment of any of the Employee’s
rights under the terms of this Agreement. Furthermore, in the event of a dispute
under subsection 10(d)(2), the trustee of the Trust shall continue to hold, in
trust, the deposit referred to in subsection 10(d)(1)(i) until a final decision is
rendered by the arbitrator pursuant to subsection 10(d)(2).
(e) In the event that any dispute arises between the Employee and the Company as to the
terms or interpretation of this Agreement or the obligations thereunder, including this
Section, whether instituted by formal legal proceedings or submitted to arbitration pursuant
to subsection 10(d)(2), including any action that the Employee takes to enforce the terms of
this Section or to defend against any action taken by the Company, the Employee shall be
reimbursed for all costs and expenses, including reasonable attorneys’ fees, arising from
such dispute, proceedings or actions, provided that the Employee shall obtain a final
judgment by a court of competent jurisdiction in favor of the Employee or, in the event of
arbitration pursuant to subsection 10(d)(2), a determination is made by the arbitrator that
the expenses should be paid by the Company. Such reimbursement shall be paid within ten
days of Employee’s furnishing to the Company written evidence, which may be in the form,
among other things, of a canceled check or receipt, of any costs or expenses incurred by the
Employee.
Should the Employee fail to obtain a final judgment in favor of the Employee and a
final judgment or arbitration decision is entered in favor of the Company and if decided by
arbitration, the arbitrator, pursuant to subsection 10(d)(2), determines the Employee to be
responsible for the Company’s expenses, then the Company shall be reimbursed for all costs
and expenses, including reasonable attorneys’ fees arising from such dispute, proceedings or
actions. Such reimbursement shall be paid within ten days of the Company furnishing to the
Employee written evidence, which may be in the form, among other things, of a canceled check
or receipt, of any costs or expenses incurred by the Company.
11. 2011 Omnibus Plan Awards. Any awards to the Employee under the 2011 Omnibus Plan that are outstanding at the time of
a Separation from Service will be governed by the terms of the 2011 Omnibus Plan.
21
12. Federal Income Tax Withholding. The Bank may withhold all federal and state income or other taxes from any benefit payable
under this Agreement as shall be required pursuant to any law or governmental regulation or ruling.
13. Successors and Assigns.
(a)
Company. This Agreement shall not be assignable by the Bank or Corporation, provided that this
Agreement shall inure to the benefit of and be binding upon any corporate or other successor of the
Bank or Corporation which shall acquire, directly or indirectly, by merger, consolidation, purchase
or otherwise, all or substantially all of the assets or stock of the Bank or Corporation.
(b)
Employee. Because the Company is contracting for the unique and personal skills of the Employee, the
Employee shall be precluded from assigning or delegating his rights or duties hereunder without
first obtaining the written consent of the Company; provided, however, that nothing in this
paragraph shall preclude (i) the Employee from designating a beneficiary to receive any benefit
payable hereunder upon his death, or (ii) the executors, administrators, or other legal
representatives of the Employee or his estate from assigning any rights hereunder to the person or
persons entitled thereunto.
(c)
Attachment. Except as required by law, no right to receive payments under this Agreement shall be subject
to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or
hypothecation or to exclusion, attachment, levy or similar process or assignment by operation of
law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and
of no effect.
14. Amendments. No amendments or additions to this Agreement shall be binding unless made in writing and
signed by the Bank, the Corporation and the Employee, except as herein otherwise specifically
provided.
15. Applicable Law. Except to the extent preempted by federal law, the laws of the State of Indiana, without
regard to that State’s choice of law principles, shall govern this Agreement in all respects,
whether as to its validity, construction, capacity, performance or otherwise.
16. Severability. The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of the other
provisions hereof. Should any particular covenant, provision or clause of this Agreement be held
unreasonable or unenforceable for any reason, including without limitation, the time period,
geographic area and/or scope of activity covered by such covenant, provision or clause, the Company
and Employee acknowledge and agree that such covenant, provision or clause shall be given effect
and enforced to whatever extent would be reasonable and enforceable under applicable law.
17. Entire Agreement. This Agreement: (a) supersedes all other understandings and agreements, oral or written,
between the parties with respect to the subject matter of this Agreement; and (b) constitutes the
sole agreement between the parties with respect to this subject matter; provided, however, that the
benefit plans and arrangements referred to in this Agreement
are not superseded or replaced unless this Agreement specifically so states and such benefit
plans and arrangements may be set forth in separate plan documents stating their terms.
22
18. Construction. The rule of construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement.
19. Headings. The headings in this Agreement have been inserted solely for ease of reference and shall
not be considered in the interpretation, construction or enforcement of this Agreement.
20. Notices. 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 (a) if hand delivered, upon delivery to
the party, or (b) if mailed, two days following deposit of the notice or communication with the
United States Postal Service by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Employee:
|
Xxxxxx X. Xxxxxx 00 Xxxxxxxxx Xxxxx Xxxxx, Xxxxxxx 00000 |
|
If to the Bank:
|
First Financial Bank, N.A. Attn: Chairman of the Board of Directors One First Financial Xxxxx X.X. Xxx 000 Xxxxx Xxxxx, Xxxxxxx 00000-0000 |
|
With a copy to (which will not
constitute notice):
|
Xxxxx XxXxxxx LLP Attn: Xxxxxx X. Xxxxx, Esq. Xxx Xxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxxxxxxx, Xxxxxxx 00000 |
|
If to First Financial Corporation:
|
First Financial Corporation Attn: Chairman of the Board of Directors One First Financial Xxxxx X.X. Xxx 000 Xxxxx Xxxxx, Xxxxxxx 00000-0000 |
|
With a copy to (which will not
constitute notice):
|
Xxxxx XxXxxxx LLP Attn: Xxxxxx X. Xxxxx, Esq. Xxx Xxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxxxxxxx, Xxxxxxx 00000 |
23
or to such other 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.
21. Waiver. The waiver by either party of a breach of any provision of this Agreement, or failure to
insist upon strict compliance with the terms of this Agreement, shall not be deemed a waiver of any
subsequent breach or relinquishment of any right or power under this Agreement.
22. Review and Consultation. Employee acknowledges and agrees he (a) has read this Agreement in its entirety prior to
executing it, (b) understands the provisions and effects of this Agreement and (c) has consulted
with such attorneys, accountants and financial or other advisors as he has deemed appropriate in
connection with the execution of this Agreement. Employee understands, acknowledges and agrees
that he has not received any advice, counsel or recommendation with respect to this Agreement from
Employer’s attorneys.
IN WITNESS WHEREOF, the parties have executed this Agreement on this 1st day of December,
2010.
| ATTEST | FIRST FINANCIAL BANK, N.A. | |||||||
| (s) Xxxxxxx X. Xxxxxx | (s) Xxxxxx XxXxxxxx | |||||||
Title:
|
Sr. Executive Assistant | Xxxxxx X. XxXxxxxx, Secretary/Treasurer | ||||||
| ATTEST | FIRST FINANCIAL CORPORATION | |||||||
| (s) Xxxxxx XxXxxxxx | (s) Xxxxxx X. Xxxxx | |||||||
Title:
|
Secretary | Xxxxxx X. Xxxxx, President | ||||||
| EMPLOYEE | ||||||||
| (s) Xxxxxx X. Xxxxxx
|
||||||||
24
