AGREEMENT FOR SEVERANCE PAYMENTS IN THE EVENT OF TERMINATION OF EMPLOYMENT UNDER CERTAIN CIRCUMSTANCES
EXHIBIT
10.3
CHANGE IN CONTROL AGREEMENT OF XXXXXXXX X. XXXXXXXX
AGREEMENT FOR
SEVERANCE PAYMENTS
IN THE EVENT OF
TERMINATION OF EMPLOYMENT
UNDER CERTAIN CIRCUMSTANCES
THIS AGREEMENT, by and between First
Commonwealth Financial Corporation, a bank holding company organized and
existing under the laws of the Commonwealth of Pennsylvania and with its
principal place of business in Indiana, Pennsylvania (the "Employer")
and Xxxxxxxx X. Xxxxxxxx (the "Executive") made this 3rd day of May , 2002;
WITNESSETH
WHEREAS, the Executive is presently
employed by the Employer as Senior Vice President/Human Resources;
WHEREAS, the Employer wishes to
induce the Senior Vice President/Human Resources to continue in employment and,
accordingly, to provide certain employment security to said Executive in the
event of a "change in control" (as hereinafter defined);
WHEREAS, the Employer believes that
it is in the best interest of its shareholders for the Executive to continue in
his position on an objective and impartial basis and without distraction or
conflict of interest as a result of a possible, or actual "change in
control" (as hereinafter defined); and
WHEREAS, in consideration, inter alia, of this Agreement the
Executive is willing to continue as Senior Vice President/Human Resources of
the Employer;
NOW THEREFORE, IN CONSIDERATION OF
THE EXECUTIVE CONTINUING AS THE SENIOR VICE PRESIDENT/HUMAN RESOURCES OF THE
EMPLOYER, AND OF THE MUTUAL PREMISES HEREIN CONTAINED, THE EXECUTIVE AND THE
EMPLOYER, INTENDING TO BE LEGALLY BOUND, HEREBY AGREE AS FOLLOWS, TO WIT:
ARTICLE I
DEFINITIONS
1. A
"Change in Control" for the purpose of this Agreement, shall be
deemed to have occurred if, at any time, any person or group of persons acting
in concert (within the meaning of Section 13(d) of the Securities Exchange Act
of 1934, as amended, and the regulations of the Securities and Exchange
Commission promulgated thereunder) shall acquire legal or beneficial ownership
interest, or voting rights, in twenty-five percent (25%) or more of the common
voting stock of First Commonwealth Financial Corporation.
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2. A "Triggering Event" for the purpose of this Agreement shall be deemed to have occurred if, on or after the occurrence of a Change in Control, any of the following shall occur, viz:
(a) Within one (1) year from the date on which the Change In Control occurred, the Employer shall terminate the employment of the Executive, other than in the case of a Termination For Cause, as herein defined;
(b) Within one (1) year from the date on which the Change In Control occurred, the Employer shall reduce the Executive's title, responsibilities, power or authority in comparison with his title, responsibilities, power or authority at the time of the Change In Control;
(c) Within one (1) year from the date on which the Change In Control occurred, the Employer shall assign the Executive duties which are inconsistent with the duties assigned to the Executive on the date on which the Change In Control occurred and which duties the Employer persists in assigning to the Executive despite the prior written objection of the Executive;
(d) Within one (1) year from the date in which the Change In Control occurred, the Employer shall reduce the Executive's base compensation, his group health, life, disability or other insurance programs (including any such benefits provided to the Executive's family), his pension, retirement or profit-sharing benefits or any benefits provided by the Employer's Employee Stock Ownership Plan, or any substitute therefor, or shall exclude him from any plan, program or arrangement in which other comparable officers of the Employer are included.
3. A
"Termination For Cause" for the purpose of this Agreement shall be
deemed to have occurred if:
(a) The Executive shall have committed a felony under the laws of the United States of America, or of any state or territory thereof, and shall have been convicted of the same, or shall have pled guilty or nolo contendere with respect to said charge, and the commission of said felony resulted in, or was intended to result in, a loss (monetary or otherwise) to the Employer or its clients, customers, directors, officers or employees, or
(b) The Executive shall have deliberately and intentionally failed and refused to perform his duties to the Employer (other than during such time as the Executive shall be incapacitated due to accident or illness or during his regularly scheduled vacation periods) for a period of thirty (30) consecutive days following the receipt by him of a notice from the Employer sent by certified mail, return receipt requested, setting forth in detail the facts upon which the Employer
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relies in concluding that the Executive has deliberately and intentionally refused to perform his duties and indicating with specificity the duties that the Employer demands that the Executive perform forthwith.
ARTICLE II
SEVERANCE PAYMENT
Upon the occurrence of a Triggering Event, the Employer shall pay to the Executive a severance benefit which shall be in addition to any other compensation or remuneration to which the Executive is, or shall become, entitled to receive from the Employer. Each severance payment shall be paid by the Employer to the Executive on the first day of each calendar month commencing on the first day of the month next following the month in which the Triggering Event occurred, and be payable to the Executive or his beneficiary (as hereinafter provided) for eleven (11) consecutive months thereafter, so that a total of twelve (12) consecutive monthly payments shall be made. The amount of each such payment shall be equal to one-twelfth (1/12) of the Executive's annual base salary on the date of the Change In Control. In addition thereto, the Employer shall, at its expense, provide the Executive, and his family, with life, health, disability and accidental death and dismemberment insurance in an amount not less than that provided on the date on which the Change In Control occurred, for the period during which the monthly payments provided above are to be made.
ARTICLE III
LIMITATION ON PAYMENT OF BENEFITS
Notwithstanding anything to the contrary herein contained, in no event shall any amount of severance payments be paid to the extent that such amount constitutes "excess parachute payments" to a "disqualified individual," as such terms defined by Section 280G of the Internal Revenue Code of 1986, as amended (26 USC 280G) and the regulations of the Secretary of the Treasury or his delegate issued pursuant thereto.
ARTICLE IV
PAYMENTS ON DEATH
If the Executive shall die after the occurrence of a Triggering Event, but prior to the payment of all of the monthly severance payments required by Article II hereof, then all remaining severance payments shall be paid to the beneficiary herein provided at the same time, and in the same amount, as would have been payable to the Executive (in accordance with Article II hereof) had he survived. For this purpose, the Executive's beneficiary shall mean the person or persons designated by the Executive in a notice to the Employer,
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provided, however than any such designation shall be revocable during the lifetime of the Executive, and in the event that the Executive shall have given more than one such notice during his lifetime, the beneficiary designated in the last such notice shall govern. If the Executive shall not have given such a notice prior to his death, the beneficiary shall be deemed to be the same person that the Executive designated with respect to his group life insurance program maintained by the Employer.
ARTICLE V
COMPETITIVE EMPLOYMENT
If during the period that the Executive is
receiving severance payments as herein provided, he shall become an officer,
director, employee or consultant to a bank or bank holding company which
provides (or whose subsidiaries or affiliates provide) trust, loan or retail
banking facilities in the same county as such facilities are provided by any
subsidiary or affiliate of the Employer, and which is in direct competition
with the Employer, then the Employer may elect to notify the Executive by
certified mail, return receipt requested, that it considers the employment of
the Executive as competitive employment in accordance with this Article of this
Agreement.
The Executive may, within thirty (30)
days of receipt of such notice from the Employer, terminate such competitive
employment and certify the same to the Employer by certified mail, return
receipt requested. However, if he shall
fail to so terminate his employment and certify the same to the Employer within
thirty (30) days of receipt of the notice as herein provided, no subsequent
severance payments shall be due or payable following such thirtieth day,
notwithstanding any other provision of this Agreement. However, this provision
shall in no event affect Executive's entitlement to receive all severance
payments due prior to the thirtieth day after receipt by the Executive of such
notice, nor shall it in any way require Executive not to engage in such
competitive employment.
ARTICLE VI
SETOFF
No amounts otherwise due or payable under this Agreement shall be subject to setoff or counterclaim by either party hereto.
ARTICLE VII
ATTORNEY'S FEES
All attorney's fees and related expenses
incurred by Executive in connection with or relating to the enforcement by him
of his rights under this Agreement shall be paid for by the Employer.
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ARTICLE VIII
SUCCESSORS AND PARTIES
IN INTEREST
This Agreement shall be binding upon and
shall inure to the benefit of the Employer and its successors and assigns,
including, without limitation, any corporation which acquires, directly or
indirectly, by purchase, merger, consolidation or otherwise, all or
substantially all of the business or assets of the Employer. Without limitation of the foregoing, the
Employer shall require any such successor, by agreement in form and substance
satisfactory to the Executive, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that it is required to be
performed by the Employer.
This Agreement shall be binding upon
and shall inure to the benefit of the Executive, his heirs at law and his
personal representatives.
ARTICLE IX
ATTACHMENT
Neither this Agreement nor any benefits payable hereunder shall be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge or to execution, attachment, levy or similar process at law, whether voluntary or involuntary.
ARTICLE X
EMPLOYMENT CONTRACT
This Agreement shall not in any way constitute an employment agreement between the Employer and the Executive and it shall not oblige the Executive to continue in the employ of Employer, nor shall it oblige the Employer to continue to employ the Executive, but it shall merely require the Employer to pay severance benefits to the Executive under certain circumstances, as aforesaid.
ARTICLE XI
RIGHTS UNDER OTHER PLANS
AND AGREEMENTS
The severance benefits herein provided
shall be in addition to, and is not intended to reduce, restrict or eliminate
any benefit to which the Executive may otherwise be entitled by virtue of his
termination of employment or otherwise.
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ARTICLE XII
NOTICES
All notices and other communications
required to be given hereunder shall be in writing and shall be deemed to have
been delivered or made when mailed, by certified mail, return receipt
requested, if to the Executive, to the last address which the Executive shall
provide to the Employer, in writing, for this purpose, but if the Executive has
not then provided such an address, then to the last address of the Executive
then on file with the Employer; and if to the Employer, then to the last
address which the Employer shall provide to the Executive, in writing, for this
purpose, but if the Employer has not then provided the Executive with such an
address, then to:
President and Chief Executive
Officer
First Commonwealth Financial Corporation
Old Courthouse Square
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
ARTICLE XIII
GOVERNING LAW AND
JURISDICTION
This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Pennsylvania, except for the laws governing conflict of laws. In the event that either party shall institute suit or other legal proceeding, whether in law or equity, the Courts of the Commonwealth of Pennsylvania shall have exclusive jurisdiction with respect thereto.
ARTICLE XIV
ENTIRE AGREEMENT
This Agreement constitutes the entire
understanding between the Employer and the Executive concerning the subject
matter hereof and supersedes all prior written or oral agreements or
understandings between the parties hereto.
No term or provision of this Agreement may be changed, waived, amended
or terminated except by a written instrument of equal formality to this
Agreement.
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IN WITNESS WHEREOF, and as conclusive
evidence of the adoption of this Agreement, the parties have hereunto set their
hands and seals as of the date and year first above written.
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(Corporate Seal) |
FIRST
COMMONWEALTH |
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Attest: |
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/S/XXXXX X. TOMB, JR. |
By: /S/XXXXXX X. O'DELL |
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Corporate Secretary |
Xxxxxx X. O'Dell |
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President and Chief |
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Executive Officer |
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/S/XXXXX X. XXXX |
/S/XXXXXXXX X. XXXXXXXX |
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Witness |
Xxxxxxxx X. Xxxxxxxx |
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