EXECUTIVE COMPENSATION MODIFICATION AGREEMENT
EXECUTIVE
COMPENSATION MODIFICATION AGREEMENT
This
Executive Compensation Modification Agreement (the “Modification Agreement”) by
and between Crescent Financial Corporation, a North Carolina corporation
(including its direct and indirect subsidiaries, the “Employer”) and Xxxxxxx X.
Xxxxxxx, a resident of the State of North Carolina (the “Executive”) is entered
into on this 1st day of
January, 2009.
WITNESSETH
WHEREAS, the Executive is
employed as a “senior executive officer” of Employer as such term is defined in
section 111(b)(3) of the Emergency Economic Stabilization Act of 2008 (“EESA”);
and
WHEREAS, the Executive may be
eligible to receive from Employer, from time to time, cash and non-cash
consideration, bonuses and other compensation (“Compensation”) pursuant to an
employment agreement, salary continuation plan or agreement, incentive plan or
agreement, severance plan or agreement, change-in-control agreement, stock
option plan or grant agreement, restricted stock plan or grant agreement, equity
compensation plan or agreement, phantom stock plan or award, split dollar
agreement, supplemental retirement plan and/or any other agreement or plan,
whether or not written, provided by Employer and intended to compensate
Executive for services rendered as a senior executive officer of Employer (such
agreements, plans and arrangements referred to collectively herein as the
“Executive Compensation Agreements”); and
WHEREAS, the parties desire to
amend each of the Executive Compensation Agreements to insert a “savings clause”
with regard to the limitations on payments of certain benefits and to provide,
in certain instances, for the forfeiture or recovery of certain payments or
awards by the Employer while the Employer has outstanding certain equity or debt
securities (including warrants to purchase such securities) owned by the United
States Department of the Treasury pursuant to the EESA and acquired pursuant to
that certain Letter Agreement (including the Schedules thereto) and Securities
Purchase Agreement – Standard Terms (including the Annexes thereto) (together,
the “Purchase Agreement”), between the Employer and the United States Department
of the Treasury; and
WHEREAS, the execution of this
Modification Agreement to cause the Executive Compensation Agreements to be in
compliance with the provisions of EESA and to memorialize that Executive
acknowledges and agrees to the potential for a recovery by the Employer from the
Executive of certain cash and non-cash compensation pursuant to EESA is deemed
by the Executive to be in his best interest as well as the best interest of the
Employer and its shareholders; and
WHEREAS, the Executive desires
to enter into this Modification Agreement to permit the Employer to be eligible
for certain investments by the United States Department of the Treasury under
the TARP Capital Purchase Program.
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NOW, THEREFORE, in
consideration of the benefits Executive will receive as a result of Employer’s
participation in the Department of the Treasury’s TARP Capital Purchase Program
and other good and valuable consideration the adequacy and receipt of which is
hereby acknowledged, the parties hereto agree, effective as of the date first
above written, to amend the Executive Compensation Agreements as
follows:
A. Each
Executive Compensation Agreement, whether now existing or executed subsequent to
the date hereof, shall be amended by adding a new paragraph or section to read
in its entirety as follows:
Savings
Clause Pursuant to Emergency Economic Stabilization Act of 2008
(“EESA”)
Notwithstanding
any provision hereof to the contrary, and notwithstanding any prior or
prospective amendment hereto, the fulfillment of the financial obligations to
the Executive hereunder by the Employer shall be modified, amended and otherwise
curtailed and/or limited if any payments hereunder or pursuant hereto would be
contrary to the provisions of Section 111(b) of EESA as implemented by guidance
or regulation thereunder while the United States Department of the Treasury owns
any debt or equity securities of the Employer acquired pursuant to EESA or any
warrants to purchase equity securities of the Employer issued pursuant to the
provisions of EESA.
B. Executive
acknowledges and agrees, that should Executive be in receipt of any Compensation
from the Employer, that such Compensation shall be subject to recovery by the
Employer and shall be repaid or forfeited by the Executive to the Employer if
such compensation is proven to be, or have been, based on materially inaccurate
financial statements or on any other materially inaccurate performance criteria
in contravention of the provisions of EESA or any rules, regulations or guidance
promulgated thereunder.
C. Executive
acknowledges and agrees that by executing this Modification Agreement, Executive
waives all rights to the receipt of, and objection to, any recovery of any
Compensation to the extent necessary, during the period that the United States
Department of the Treasury owns any debt or equity securities of the Employer
acquired pursuant to the Purchase Agreement or any warrants issued in connection
therewith, in order for the Employer to comply with Section 111(b) of EESA as
implemented by rules, regulations, or guidance thereunder.
D. Except
as provided herein, all other terms of the Executive Compensation Agreements
shall remain in full force and effect.
E. This
Modification Agreement constitutes the valid, legal and binding obligation of
the Employer and the Executive enforceable against each of them in accordance
with its terms. This Modification Agreement shall inure to the
benefit of and be binding upon any corporate successor of the
Employer. This Modification Agreement shall be governed by and
construed in accordance with the laws of the State of North
Carolina.
[Signature
Page Follows]
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IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first above
written.
| EMPLOYER: | |||
| CRESCENT FINANCIAL CORPORATION | |||
|
|
By:
|
||
| Title: | |||
| EXECUTIVE | |||
| By: _______________________(SEAL) | |||
| Xxxxxxx X. Xxxxxxx | |||
