Exhibit 10.20
SEVERANCE PROTECTION AND NON-COMPETITION AGREEMENT
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THIS SEVERANCE PROTECTION AND NON-COMPETITION AGREEMENT (the "Agreement") made
as of November 1, 1998, by and between ABC BANCORP (the "Company"), a Georgia
corporation, and W. XXXXX XXXX, XX. (the "Executive"), an individual resident of
the State of Georgia.
WHEREAS, the Board of Directors of the Company (the "Board") has determined
that it is essential and in the best interest of the Company and its
shareholders to retain the services of the Executive in the event of a threat or
occurrence of a Change in Control (as hereinafter defined) and to ensure his
continued dedication and efforts in such event without undue concern for his
personal financial and employment security;
WHEREAS, in order to induce the Executive to remain in the employ of the
Company in the event of a threat or the occurrence of a Change in Control, the
Company desires to enter into this Agreement with the Executive to provide the
Executive with certain benefits in the event his employment is terminated as a
result of, or in connection with, a Change in Control and to provide the
Executive with certain other benefits whether or not the Executive's employment
is terminated; and
WHEREAS, in consideration for the benefits provided to the Executive hereunder
and as an inducement to the Company providing such benefits, the Executive
agrees that it is reasonable and fair to enter into certain restrictive
covenants as hereinafter set forth.
NOW, THEREFORE, in consideration of the respective agreements of the parties
contained herein, it is agreed as follows:
1. Term of Agreement. This Agreement shall commence as of November 1, 1998
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and shall continue in effect until November 1, 1999; provided, however, that
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commencing on November 1, 1999, and on each November 1 thereafter, the term of
this Agreement shall automatically be extended for one (1) year unless either
the Company or the Executive shall have given written notice to the other at
least ninety (90) days prior thereto that the term of this Agreement shall not
be so extended; and provided, further, however, that notwithstanding any such
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notice by the Company not to extend, the term of this Agreement shall not expire
prior to the expiration of twelve (12) months after the occurrence of a Change
in Control.
2. Definitions.
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2.1. Accrued Compensation. For purposes of this Agreement, "Accrued
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Compensation" shall mean an amount which shall include all amounts earned or
accrued through the "Termination Date" (as hereinafter defined) but not paid as
of the Termination Date, including, without limitation, (i) base salary, (ii)
reimbursement for reasonable and necessary expenses incurred by the Executive on
behalf of the Company during the period ending on the Termination
Date, (iii) vacation pay, and (iv) bonuses and incentive compensation (other
than the "Pro Rata Bonus" (as hereinafter defined)).
2.2. Base Amount. For purposes of this Agreement, "Base Amount" shall
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mean the greater of the Executive's annual base salary (a) at the rate in effect
on the Termination Date or (b) at the highest rate in effect at any time during
the ninety (90) day period prior to the Change in Control, and shall include all
amounts of his base salary that are deferred under the qualified and non-
qualified employee benefit plans of the Company or any other agreement or
arrangement.
2.3. Bonus Amount. For purposes of this Agreement, "Bonus Amount" shall
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mean the average of the annual bonuses paid or payable to the Executive during
the three (3) full fiscal years ended prior to the Termination Date or, if
greater, the three full fiscal years ended prior to the Change in Control (or,
in each case, such lesser period for which annual bonuses were paid or payable
to the Executive).
2.4. Cause. For purposes of this Agreement, a termination of employment
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is for "Cause" if the Executive has been convicted of a felony or a felony
prosecution has been brought against the Executive or if the termination is
evidenced by a resolution adopted in good faith by two-thirds of the Board that
the Executive (a) intentionally and continually failed substantially to perform
his reasonably assigned duties with the Company (other than a failure resulting
from the Executive's incapacity due to physical or mental illness or from the
Executive's assignment of duties that would constitute "Good Reason" as
hereinafter defined) which failure continued for a period of at least thirty
(30) days after a written notice of demand for substantial performance has been
delivered to the Executive specifying the manner in which the Executive has
failed substantially to perform, or (b) intentionally engaged in conduct which
is demonstrably and materially injurious to the Company; provided, however, that
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(i) where the Executive has been terminated for Cause because a felony
prosecution has been brought against him and no conviction or plea of guilty or
plea of nolo contendere or its equivalent results therefrom, then said
termination shall no longer be deemed to have been for Cause and the Executive
shall be entitled to all the benefits provided by Section 3.1(b) hereof from and
after the date on which the prosecution of the Executive has been dismissed or a
judgement of acquittal has been entered, whichever shall first occur; and (ii)
no termination of the Executive's employment shall be for Cause as set forth in
clause (b) above until (x) there shall have been delivered to the Executive a
copy of a written notice setting forth that the Executive was guilty of the
conduct set forth in clause (b) and specifying the particulars thereof in
detail, and (y) the Executive shall have been provided an opportunity to be
heard in person by the Board (with the assistance of the Executive's counsel if
the Executive so desires). No act, nor failure to act, on the Executive's part,
shall be considered "intentional" unless the Executive has acted or failed to
act, with a lack of good faith and with a lack of reasonable belief that the
Executive's action or failure to act was in the best interest of the Company.
2.5. Change in Control. For purposes of this Agreement, a "Change in
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Control" shall have occurred if:
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(a) a majority of the directors of the Company shall be persons
other than persons: (A) for whose election proxies shall have been
solicited by the Board, or (B) who are then serving as directors appointed
by the Board to fill vacancies on the Board caused by death or resignation
(but not by removal) or to fill newly-created directorships;
(b) a majority of the outstanding voting power of the Company shall
have been acquired or beneficially owned (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934, as amended, or any successor rule
thereto) by any person (other than the Company, a subsidiary of the
Company or the Executive) or Group (as defined below), which Group does
not include the Executive; or
(c) there shall have occurred:
(A) a merger or consolidation of the Company with or into
another corporation (other than (1) a merger or consolidation with a
subsidiary of the Company or (2) a merger or consolidation in which
(aa) the holders of voting stock of the Company immediately prior to
the merger as a class continue to hold immediately after the merger
at least a majority of all outstanding voting power of the surviving
or resulting corporation or its parent and (bb) all holders of each
outstanding class or series of voting stock of the Company
immediately prior to the merger or consolidation have the right to
receive substantially the same cash, securities or other property in
exchange for their voting stock of the Company as all other holders
of such class or series);
(B) a statutory exchange of shares of one or more classes or
series of outstanding voting stock of the Company for cash,
securities or other property;
(C) the sale or other disposition of all or substantially all of
the assets of the Company (in one transaction or a series of
transactions); or
(D) the liquidation or dissolution of the Company;
unless more than twenty-five percent (25%) of the voting stock (or
the voting equity interest) of the surviving corporation or the
corporation or other entity acquiring all or substantially all of
the assets of the Company (in the case of a merger, consolidation or
disposition of assets) or of the Company or its resulting parent
corporation (in the case of a statutory share exchange) is
beneficially owned by the Executive or a Group that includes the
Executive.
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2.6. Group. For purposes of this Agreement, "Group" shall mean any two or
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more persons acting as a partnership, limited partnership, syndicate, or other
group acting in concert for the purpose of acquiring, holding or disposing of
voting stock of the Company.
2.7. Company. For purposes of this Agreement, "Company" shall mean ABC
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Bancorp and shall include each of its subsidiaries and its "Successors and
Assigns" (as hereinafter defined).
2.8. Disability. For purposes of this Agreement, "Disability" shall mean a
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physical or mental infirmity which impairs the Executive's ability to
substantially perform his duties with the Company for a period of one hundred
eighty (180) consecutive days and the Executive has not returned to his full
time employment prior to the Termination Date as stated in the "Notice of
Termination" (as hereinafter defined).
2.9. Good Reason.
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2.9.1. For purposes of this Agreement, "Good Reason" shall mean a good
faith determination by the Executive, in the Executive's sole and absolute
judgment, that any one or more of the following events has occurred,
without the Executive's express written consent, after a Change in Control:
(a) a change in the Executive's reporting responsibilities, titles
or offices as in effect immediately prior to the Change of Control, or
any removal of the Executive from, or any failure to re-elect the
Executive to, any of such positions which has the effect of diminishing
the Executive's responsibility or authority;
(b) a reduction by the Company in the Executive's base salary as in
effect immediately prior to the Change of Control or as the same may be
increased from time to time or a change in the eligibility requirements
or performance criteria under any bonus, incentive or compensation
plan, program or arrangement under which the Executive is covered
immediately prior to the Change of Control which adversely affects the
Executive;
(c) the Company requires the Executive to be based anywhere other
than within fifty (50) miles of the Executive's job location at the
time of the Change of Control, provided that if the Executive's job
location at such time is not within fifty (50) miles of the Company's
principal executive offices, then the Company may thereafter require
the Executive to be based within such fifty (50) mile radius without
such event constituting Good Reason hereunder;
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(d) without replacement by a plan providing benefits to the
Executive equal to or greater than those discontinued, the failure by
the Company to continue in effect, within its maximum stated term, any
pension, bonus, incentive, stock ownership, purchase, option, life
insurance, health, accident disability, or any other employee benefit
plan, program or arrangement, in which the Executive is participating
at the time of the Change of Control, or the taking of any action by
the Company that would adversely affect the Executive's participation
or materially reduce the Executive's benefits under any of such plans;
(e) the taking of any action by the Company that would materially
adversely affect the physical conditions existing at the time of the
Change of Control in or under which the Executive performs his
employment duties, provided that the Company may take action with
respect to such conditions after a Change in Control so long as such
conditions are at least commensurate with the conditions in or under
which an officer of the Executive's status would customarily perform
his employment duties; or
(f) a material change in the fundamental business philosophy,
direction, and precepts of the Company and its subsidiaries, considered
as a whole, as the same existed prior to the Change of Control.
2.9.2 Any event described in subsection 2.9.1 (a) through (f) which
occurs prior to a Change in Control but which the Executive reasonably
demonstrates (A) was at the request of a third party who has indicated an
intention, or taken steps reasonably calculated, to effect a Change in
Control or (B) otherwise arose in connection with, or in anticipation of, a
Change in Control which actually occurs, shall constitute Good Reason for
purposes hereof, notwithstanding that it occurred prior to a Change in
Control.
2.9.3 The Executive's right to terminate his employment pursuant to
this Section 2.9 shall not be affected by his incapacity due to physical or
mental illness.
2.10. Notice of Termination. For purposes of this Agreement, "Notice of
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Termination" shall mean a written notice of termination from the Company,
following a Change in Control, of the Executive's employment which indicates the
specific termination provision in this Agreement relied upon and which sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the provision so
indicated.
2.11. Pro Rata Bonus. For purposes of this Agreement, "Pro Rata Bonus" shall
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mean an amount equal to the Bonus Amount multiplied by a fraction the numerator
of which is the number of days in the fiscal year through the Termination Date
and the denominator of which is 365.
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2.12. Successors and Assigns. For purposes of this Agreement, "Successors
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and Assigns" shall mean a corporation or other entity acquiring all of
substantially all the assets and business of the Company (including this
Agreement) whether by operation of law or otherwise.
2.13. Termination Date. For purposes of this Agreement, "Termination Date"
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shall mean in the case of the Executive's death, his date of death, in the case
of Good Reason, the last day of employment, and in all other cases, the date
specified in the Notice of Termination; provided, however, that if the
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Executive's employment is terminated by the Company for Cause or due to
Disability, the date specified in the Notice of Termination shall be at least
thirty (30) days from the date the Notice of Termination is given to the
Executive, provided that in the case of Disability the Executive shall not have
returned to the full-time performance of his duties during such period of at
least thirty (30) days.
3. Termination of Employment.
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3.1. Severance Benefits. If, during the term of this Agreement, the
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Executive's employment with the Company shall be terminated within twelve (12)
months following a Change in Control, the Executive shall be entitled to the
following compensation and benefits:
(a) If the Executive's employment with the Company shall be
terminated (i) by the Company for Cause or Disability, (ii) by reason
of the Executive's death, or (iii) by the Executive other than for Good
Reason, the Company shall pay to the Executive the Accrued Compensation
and, if such termination is by the Company other than for Cause, a Pro
Rata Bonus.
(b) If the Executive's employment with the Company shall be
terminated for any reason other than as specified in Section 3.1(a),
the Executive shall be entitled to the following:
(i) the Company shall pay the Executive all Accrued
Compensation and a Pro-Rata Bonus;
(ii) the Company shall pay the Executive as severance pay and
in lieu of any further compensation for periods subsequent to the
Termination Date an amount in cash equal to one times the sum of
(A) the Base Amount and (B) the Bonus Amount;
(iii) for a number of months equal to twelve (12) (the
"Continuation Period"), the Company shall at its expense continue
on behalf of the Executive and his dependents and beneficiaries
the life insurance, disability, medical, dental and
hospitalization benefits generally provided to the Company's non-
executive salaried employees at any time during the 90-day period
prior to the Change in Control or at any time thereafter. The
Company's obligation hereunder with respect to the foregoing
benefits shall be limited to the extent that the Executive
obtains any such benefits pursuant
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to a subsequent employer's benefit plans, in which case the
Company may reduce the coverage of any benefits it is required to
provide the Executive hereunder as long as the aggregate
coverages and benefits of the combined benefit plans is no less
favorable to the Executive than the coverages and benefits
required to be provided hereunder. This subsection (iii) shall
not be interpreted so as to limit any benefits to which the
Executive or his dependents or beneficiaries may be entitled
under any of the Company's employee benefit plans, programs or
practices following the Executive's termination of employment,
including, without limitation, retiree medical and life insurance
benefits;
(iv) the Company shall pay an amount in cash equal to the
excess, if any, of (A) the Supplemental Retirement Benefit (as
defined below) had (w) the Executive remained employed by the
Company for an additional one (1) complete year of credited
service, (x) his annual compensation during such period been
equal to his Base Salary and the Bonus Amount, (y) the Company
made employer contributions to each defined contribution plan, if
any, in which the Executive was a participant at the Termination
Date (in an amount equal to the amount of such contribution for
the plan year immediately preceding the Termination Date) and (z)
he been fully (100%) vested in his benefit under each retirement
plan, if any, in which the Executive was a participant, over (B)
the lump sum actuarial equivalent of the aggregate retirement
benefit, if any, the Executive is actually entitled to receive
under such retirement plans. For purposes of this subsection
(iv), the "Supplemental Retirement Benefit" shall mean the lump
sum actuarial equivalent of the aggregate retirement benefit the
Executive would have been entitled to receive under the Company's
supplemental and other retirement plans, if any; and
(v) the restrictions on any outstanding incentive awards
(including restricted stock and granted performance shares or
units) under any incentive plan or arrangement shall lapse and
such incentive award shall become 100% vested, all stock options
and stock appreciation rights granted to the Executive shall
become immediately exercisable and shall become 100% vested, and
all performance units granted to the Executive shall become 100%
vested, provided that to the extent that all or any part of any
such incentive award or stock option or stock appreciation right
or performance unit is not exercisable or does not vest within
four (4) years from the Termination Date, then to that extent
(but only to that extent) there shall be no acceleration of
vesting or lapse of restrictions under this Section 3.1(b)(v).
(c) The amounts provided for in Sections 3.1(a) and 3.1(b)(i),
(ii) and (iv) shall be paid in twelve (12) equal monthly payments
(without interest) on the first day of each month commencing on the
first day of the month immediately following Executive's Termination
Date.
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(d) The Executive 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 Executive in any
subsequent employment except as provided in Section 3.1(b)(iii).
3.2 Payments in Lieu of Other Severance Benefits. The severance pay
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and benefits provided for in this Section 3 shall be in lieu of any other
severance or termination pay to which the Executive may be entitled under any
Company severance or termination plan, program, practice or arrangement.
3.3 Other Compensation and Benefits. The Executive's entitlement to
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any other compensation or benefits shall be determined in accordance with the
Company's employee benefit plans and other applicable programs, policies and
practices then in effect.
4. Notice of Termination. Following a Change in Control, any purported
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termination of the Executive's employment by the Company shall be communicated
by Notice of Termination to the Executive. For purposes of this Agreement, no
such purported termination shall be effective without such Notice of
Termination.
5. Excess Parachute Payments.
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5.1 Excise Tax. Notwithstanding anything contained herein to the
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contrary, if any portion of the payments and benefits provided hereunder and
benefits provided to, or for the benefit of, the Executive under any other plan
or agreement of the Company (such payments or benefits are collectively referred
to as the "Payments") would be subject to the excise tax (the "Excise Tax")
imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") or would be nondeductible by the Company pursuant to Section 280G of the
Code, the Payments shall be reduced (but not below zero) if and to the extent
necessary so that no portion of any Payment to be made or benefit to be provided
to the Executive shall be subject to the Excise Tax or shall be nondeductible by
the Company pursuant to Section 280G of the Code (such reduced amount is
hereinafter referred to as the "Limited Payment Amount"). Unless the Executive
shall have given prior written notice specifying a different order to the
Company to effectuate the Limited Payment Amount, the Company shall reduce or
eliminate the Payments, by first reducing or eliminating those payments or
benefits which are not payable in cash and then by reducing or eliminating cash
payments, in each case in reverse order beginning with payments or benefits
which are to be paid the farthest in time from the Determination (as hereinafter
defined). Any notice given by the Executive pursuant to the preceding sentence
shall take precedence over the provisions of any other plan, arrangement or
agreement governing the Executive's rights and entitlements to any benefits or
compensation.
5.2 Excise Tax Determination. An initial determination as to whether the
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Payments shall be reduced to the Limited Payment Amount pursuant to the Plan and
the amount of such Limited Payment Amount shall be made by an accounting firm at
the Company's expense
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selected by the Company which is designated as one of the six largest accounting
firms in the United States (the "Accounting Firm"). The Accounting Firm shall
provide its determination (the "Determination"), together with detailed
supporting calculations and documentation to the Company and the Executive
within thirty (30) days of the Termination Date, if applicable, and if the
Accounting Firm determines that no Excise Tax is payable by the Executive with
respect to a Payment or Payments, it shall furnish the Executive with an opinion
reasonably acceptable to the Executive that no Excise Tax will be imposed with
respect to any such Payment or Payments. Within ten (10) days of the delivery of
the Determination to the Executive, the Executive shall have the right to
dispute the Determination (the "Dispute"). If there is no Dispute, the
Determination shall be binding, final and conclusive upon the Company and the
Executive subject to the application of Section 5.3 below.
5.3 Excess Payment. As a result of the uncertainty in the application of
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Sections 4999 and 280G of the Code, it is possible that the Payments to be made
to, or provided for the benefit of, the Executive either have been made or will
not be made by the Company which, in either case, will be inconsistent with the
limitations provided in Section 5.1 (hereinafter referred to as an "Excess
Payment" or "Underpayment", respectively). If it is established pursuant to a
final determination of a court or an Internal Revenue Service (the "IRS")
proceeding which has been finally and conclusively resolved, that an Excess
Payment has been made, such Excess Payment shall be deemed for all purposes to
be a loan to the Executive made on the date the Executive received the Excess
Payment and the Executive shall repay the Excess Payment to the Company on
demand (but not less than ten (10) days after written notice is received by the
Executive), together with interest on the Excess Payment at the "Applicable
Federal Rate" (as defined in Section 1274(d) of the Code) from the date of the
Executive's receipt of such Excess Payment until the date of such repayment. In
the event that it is determined by (i) the Accounting Firm, the Company (which
shall include the position taken by the Company, or together with its
consolidated group, on its federal income tax return) or the IRS, (ii) pursuant
to a determination by a court, or (iii) upon the resolution to the Executive's
satisfaction of the Dispute, that an Underpayment has occurred, the Company
shall pay an amount equal to the Underpayment to the Executive within ten (10)
days of such determination or resolution, together with interest on such amount
at the Applicable Federal Rate from the date such amount would have been paid to
the Executive until the date of payment.
6. One Million Dollar Deduction Limit.
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6.1 Section 162(m). Notwithstanding anything contained herein to the
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contrary, if any portion of the Payments would be nondeductible by the Company
pursuant to Section 162(m) of the Code, the Payments to be made to the Executive
in any taxable year of the Company shall be reduced (but not below zero) if and
to the extent necessary so that no portion of any Payment to be made or benefit
to be provided to the Executive in such taxable year of the Company shall be
nondeductible by the Company pursuant to Section 162(m) of the Code. The amount
by which any Payment is reduced pursuant to the immediately preceding sentence,
together with interest thereon at the Applicable Federal Rate, shall be paid by
the Company to the Executive on or before the fifth business day of the
immediately succeeding taxable year of the Company, subject to the application
of the limitations of the immediately preceding sentence and Section 5 hereof.
Unless
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the Executive shall have given prior written notice specifying a different order
to the Company to effectuate this Section 6, the Company shall reduce or
eliminate the Payments in any one taxable year of the Company by first reducing
or eliminating those payments or benefits which are not payable in cash and then
by reducing or eliminating cash payments, in each case in reverse order
beginning with payments or benefits which are to be paid the farthest in time
from the Section 162(m) Determination (as hereinafter defined). Any notice given
by the Executive pursuant to the preceding sentence shall take precedence over
the provisions of any other plan, arrangement or agreement governing the
Executive's rights and entitlements to any benefits or compensation.
6.2 Section 162(m) Determination. The determination as to whether the
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Payments shall be reduced pursuant to Section 6.1 hereof and the amount of the
Payments to be made in each taxable year after the application of Sections 6.1
hereof shall be made by the Accounting Firm at the Company's expense. The
Accounting Firm shall provide its determination (the "Section 162(m)
Determination"), together with detailed supporting calculations and
documentation to the Company and the Executive within thirty (30) days of the
Termination Date. The Section 162(m) Determination shall be binding, final and
conclusive upon the Company and the Executive.
7. Restrictive Covenants.
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7.1 Additional Consideration. The Executive acknowledges that (i) the
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Company separately bargained and paid additional consideration for the
restrictive covenants herein; and (ii) the Company has provided certain benefits
to the Executive hereunder in reliance on such covenants in view of the unique
and essential nature of the services the Executive performs or will perform on
behalf of the Company and the irreparable injury that would befall the Company
should the Executive breach such covenants.
7.2 Uniqueness of Services. The Executive further acknowledges that his
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services are of a special, unique and extraordinary character and that his
position with the Company places or will place him in a position of confidence
and trust with employees of the Company and with the Company's other
constituencies and allows him or will allow him access to Confidential
Information (as hereinafter defined).
7.3 Reasonableness of Restrictions. The Executive further acknowledges
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that the type and periods of restrictions imposed by the covenants in this
Section 7 are fair and reasonable and that such restrictions will not prevent
the Executive from earning a livelihood.
7.4 Business of Company. The Executive further acknowledges that (a) the
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Company, together with its subsidiaries, is engaged in the commercial banking
business; (b) the Company conducts its business activity in and throughout the
Area (as hereinafter defined); and (c) Competing Businesses (as hereinafter
defined) are engaged in businesses like and similar to the business of the
Company.
7.5 Covenants. Having acknowledged the foregoing, the Executive covenants
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and agrees with the Company that he will not, directly or indirectly:
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(a) while he is in the Company's employ and through the period ending
one (1) year after the termination of his employment for any reason
whatsoever (whether voluntarily or involuntarily), disclose or use or
otherwise exploit for his own benefit, or the benefit of any other person,
except as may be necessary in the performance of his duties hereunder, any
Confidential Information disclosed to the Executive or of which the
Executive became aware by reason of his employment with or ownership in
the Company;
(b) while he is in the Company's employ and through the period ending
one (1) year after the termination of his employment for Cause or
Disability, solicit or divert or appropriate to any Competing Business,
directly or indirectly, on his own behalf or in the service of or on
behalf of any Competing Business, or attempt to solicit or divert or
appropriate to any such Competing Business, within the Area, any person or
entity who or which was a customer of the Company at any time during the
last twelve (12) months of the Executive's employment hereunder and with
whom the Executive had contact during the term of his employment;
(c) while he is in the Company's employ and through the period ending
one (1) year after the termination of his employment for Cause or
Disability, employ or attempt to employ or assist anyone else in employing
in any Competing Business in the Area any officer, managerial or executive
employee of the Company (whether or not such employment is full time or is
pursuant to a written contract with the Company); and
(d) while he is in the Company's employ and through the period ending
one (1) year after the termination of his employment for Cause or
Disability, engage in or render any services to, or be employed by, any
Competing Business in the Area in the capacity of officer, managerial or
executive employee, director, consultant or shareholder (other than as the
owner of less than one (1%) percent of the shares of a publicly-owned
corporation whose shares are traded on a national securities exchange or
in the over-the-counter market); provided, however, that this subsection
(iv) shall not prohibit or otherwise restrict the Executive from accepting
employment with a bank holding company that has a banking subsidiary
within the Area so long as the principal offices of such holding company
are outside the Area and the Executive's place of employment is also
outside the Area.
7.6 Return of Documents. The Executive agrees that upon the termination
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of his employment for any reason whatsoever (whether voluntarily or
involuntarily) he will not take with him or retain without written
authorization, and he will promptly deliver to the Company, originals and all
copies of all papers, files or other documents containing any Confidential
Information and all other property belonging to the Company and in his
possession or under his control.
7.7 Area. For purposes of this Section 7, the term (a) "Area" means a
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fifty (50) mile radius of the Company's main office or the main office of any of
its subsidiaries; (b) "Competing Business" means the commercial banking
business; and (c) "Confidential Information" means any and all data and
information relating to the business of the Company (whether or not constituting
a trade secret) that is, has been or will be disclosed to the Executive or
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of which the Executive became or becomes aware as a consequence of or through
his relationship with the Company and that has value to the Company and is not
generally known by its competitors; provided, however, that no information will
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be deemed confidential unless it has been reduced to writing and marked clearly
and conspicuously as confidential information, or it is otherwise treated by the
Company as confidential. Confidential Information shall not include any data or
information that has been voluntarily disclosed to the public by the Company
(except where such public disclosure has been made without authorization by the
Company), or that has been independently developed and disclosed by others, or
that otherwise enters the public domain through lawful means. Confidential
Information includes, but is not limited to, information relating to the
Company's financial affairs, processes, services, customers, employees or
employees' compensation, accounting or marketing.
7.8 Injunctive Relief. The Executive acknowledges that irreparable loss
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and injury would result to the Company upon the breach of any of the covenants
contained in this Section 7 and that damages arising out of such breach would be
difficult to ascertain. The Executive hereby agrees that, in addition to all
other remedies provided at law or at equity, the Company may petition and obtain
from a court of law or equity both temporary and permanent injunctive relief to
prevent a breach by the Executive of any covenant contained in this Section 7.
8. Successors; Assignability.
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8.1 Binding Agreement. This Agreement shall be binding upon and shall
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inure to the benefit of the Company, its Successors and Assigns, and the Company
shall require any Successors and Assigns to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession or assignment had
taken place. This Agreement shall inure to the benefit of and be enforceable by
the Executive's legal personal representative.
8.2 No Assignment. Neither this Agreement nor any right or interest
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hereunder shall be assignable or transferable by the Executive, his
beneficiaries or legal representatives, except by will or by the laws of descent
and distribution.
9. Fees and Expenses. The Company shall pay all legal fees and related
-----------------
expenses (including the costs of experts, evidence and counsel) incurred by the
Executive as they become due as a result of (a) the Executive's termination of
employment (including all such fees and expenses, if any, incurred in contesting
or disputing any such termination of employment), (b) the Executive seeking to
obtain or enforce any right or benefit provided by this Agreement (including,
without limitation, any such fees and expenses incurred in connection with the
Dispute) or by any other plan or arrangement maintained by the Company under
which the Executive is or may be entitled to receive benefits, and (c) the
Executive's hearing before the Board as contemplated in Section 2.4 of this
Agreement; provided, however, that the circumstances set forth in clauses (a)
-------- -------
and (b) of this Section 9 (other than as a result of the Executive's termination
of employment under circumstances described in Section 2.9.2) occurred on or
after a Change in Control.
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10. Notice. For the purposes of this Agreement, notices and all other
------
communications provided for in the Agreement (including the Notice of
Termination) shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other, provided that all notices to the Company shall be directed to the
attention of the Board with a copy to the Secretary of the Company. All notices
and communications shall be deemed to have been received on the date of delivery
thereof or on the third business day after the mailing thereof, except that
notice of change of address shall be effective only upon receipt.
11. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
-------------------------
limit the Executive's continuing or future participation in any benefit, bonus,
incentive or other plan or program provided by the Company (except for any
severance or termination policies, plans, programs or practices) and for which
the Executive may qualify, nor shall anything herein limit or reduce such rights
as the executive may have under any other agreements with the Company (except
for any severance or termination agreement). Amounts which are vested benefits
or which the Executive is otherwise entitled to receive under any plan or
program of the Company shall be payable in accordance with such plan or program,
except as explicitly modified by this Agreement.
12. Settlement of Claims. The Company's obligation to make the payments
--------------------
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company may have against the Executive or others.
13. Miscellaneous. No provision of this Agreement may be modified, waived or
-------------
discharged unless such waiver, modification or discharge is agreed to in writing
and signed by the Executive and the Company. 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 similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreement or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by either party which are not expressly set forth in this
Agreement.
14. Governing Law. This Agreement shall be governed by and construed and
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enforced in accordance with the laws of the State of Georgia without giving
effect to the conflict of laws principles thereof.
15. 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 provisions hereof.
16. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto
with respect to the subject matter hereof.
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17. Construction. Whenever the context requires, words used in the singular
------------
shall be construed to mean or include the plural and vice versa, and pronouns of
any gender shall be deemed to include and designate the masculine, feminine or
neuter gender. The Section headings contained in this Agreement are for
reference purposes only and will not affect in any way the meaning or
interpretation of this Agreement.
[SIGNATURES NEXT PAGE]
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and
delivered by its duly authorized officers and has caused its proper corporate
seal to be affixed hereto, and the Executive has executed, sealed and delivered
this Agreement, all as of the day and year first above written.
ABC BANCORP
[CORPORATE SEAL]
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------
ATTEST: Name: Xxxxxxx X. Xxxxxxxxx
Title: President & Chief Executive Officer
/s/ Xxxx X. Xxxx
-------------------------
Secretary
Xxxx Xxxx, Vice President
/s/ W. Xxxxx Xxxx, Xx. (SEAL)
--------------------------------
W. XXXXX XXXX, XX.
Executive Vice President &
Chief Financial Officer
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