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EXHIBIT 10.3
FIRST PALM BEACH BANCORP, INC.
EMPLOYMENT AGREEMENT
This AGREEMENT is made effective as of May 20, 1997 by and between
First Palm Beach Bancorp, Inc. (the "Holding Company"), a Delaware corporation,
with its principal administrative office at 000 Xxxxx Xxxxxxxxxx Xxxxxx, Xxxx
Xxxx Xxxxx, Xxxxxxx, and R. Xxxxx Xxxxxxx (the "Executive"), residing at 0000
Xxxxxxxx Xxxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000. Any reference to "Association"
herein shall mean the Holding Company's wholly-owned subsidiary, First Bank of
Florida, or any successor thereto.
WHEREAS, Executive currently serves the Holding Company in the capacity
of Executive Vice President and Chief Operating Officer; and
WHEREAS, the Holding Company wishes to assure itself of the continued
availability of the services of Executive for the period provided in this
Agreement; and
WHEREAS, the Executive is willing to serve in the employ of the Holding
Company on a full-time basis for said period on the terms and conditions
hereinafter set forth..
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and upon the other terms and conditions hereinafter
provided; the parties hereby agree as follows:
1. POSITION AND RESPONSIBILITIES
(a) During the period and upon the terms and conditions set forth
herein, Executive agrees to serve as Executive Vice President and Chief
Operating Officer of the Holding Company and the Association. The Executive
shall have such power, authority and responsibility and shall perform such
duties as are prescribed by or under the By-Laws of the Holding Company and as
are customarily performed by persons situated in a similar executive capacity.
Failure to reelect Executive as [President and Chief Executive Officer] without
the consent of the Executive shall constitute a breach of this Agreement.
(b) Executive's principal place of employment shall be at the Holding
Company's executive offices at the address first above written, or at such other
location within a 25-mile radius thereof at which the Holding Company shall
maintain its principal executive offices, or at such other location as the
Holding Company and Executive may mutually agree upon. The Holding Company shall
provide Executive at his principal place of employment with a private office,
secretarial services and other support services and facilities suitable to his
position with the Holding Company and necessary or appropriate in connection
with the per formance of his assigned duties under this Agreement. The Holding
Company shall reimburse Executive for his ordinary and necessary business
expenses, including, without limitation, fees for memberships in such clubs and
organizations as Executive and the Holding Company shall mutually agree are
necessary and appropriate for business purposes, and his travel and
entertainment expenses incurred in connection with the performance of his duties
under this Agreement, in each case upon presentation to the Holding Company of
an itemized account of such expenses in such form as the Holding Company may
reasonably require.
2. TERM
(a) The period of Executive's employment under this Agreement shall be
for an initial term of three (3) years beginning on the date of this Agreement
and ending on the third anniversary date of this Agreement (each an "Anniversary
Date"), plus such extensions, if any, as are provided by the Board of Directors
of the Holding Company ("Board") pursuant to section 2(b).
(b) Except as provided in section 2(c), beginning on the date of this
Agreement, the term of this Agreement shall automatically be extended for one
(1) additional day each day, unless either the Holding Company or Executive
elects not to extend the Agreement further by giving written notice to the other
party, in which case the term of this Agreement shall end on the third (3rd)
anniversary of the date on which such written notice is given. For all purposes
of this Agreement, the term "Remaining Unexpired Employment Period" as of any
date shall mean the period beginning on such date and ending on: (i) if a notice
of non-extension has been given in accordance with this section 2(b), the third
(3rd) anniversary of the date on which such notice is given; and (ii) in all
other cases, the third (3rd) anniversary of the date as of which the Remaining
Unexpired Employment Period is being determined.
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Upon termination of Executive's employment with the Holding Company for any
reason whatsoever, any daily extensions provided pursuant to this section 2(b),
if not therefore discontinued, shall automatically cease.
(c) Nothing in this Agreement shall be deemed to prohibit the Holding
Company at any time from terminating Executive's employment during the term of
this Agreement with or without notice for any reason; provided, however, that
the relative rights and obligations of the Holding Company and the Executive in
the event of any such termination shall be determined under this Agreement.
(d) During the period of his employment hereunder, except for periods
of absence occasioned by illness, holidays, reasonable vacation periods, and
reasonable leaves of absence, Executive shall devote substantially all his
business time, attention, skill, and efforts to the faithful performance of his
duties hereunder including activities and services related to the organization,
operation and management of the Holding Company and participation in community
and civic organizations; provided, however, that, with the approval of the
Board, as evidenced by a resolution of such Board, from time-to-time, Executive
may serve, or continue to serve, on the Boards of Directors of, and hold any
other offices or positions in, companies or organizations, which, in such
Board's judgment, will not present any conflict of interest with the Holding
Company, or materially affect the performance of Executive's duties pursuant to
this Agreement. Executive may also engage in personal business and investment
activities which do not materially interfere with the performance of his duties
hereunder; provided, however, that such activities are not prohibited under any
code of conduct or investment or securities trading policy established by the
Holding Company and generally applicable to all similarly situated executives.
Executive may also serve as an officer or director of the Association on such
terms and conditions as the Association and the Holding Company may mutually
agree upon, and such service shall not be deemed to materially interfere with
Executive's performance of his duties hereunder or otherwise to result in a
material breach of this Agreement. If Executive is discharged or suspended, or
is subject to any regulatory restriction or prohibition with respect to
participation in the affairs of the Association, he shall continue to provide
services for the Holding Company in accordance with this Agreement but shall not
directly or indirectly provide services to or participate in the affairs of the
Association in a manner inconsistent with the terms of such discharge or
suspension or any applicable regulatory order.
3. COMPENSATION AND REIMBURSEMENT
(a) In consideration for the services to be rendered by Executive
hereunder, the Association shall pay Executive a salary at an initial annual
rate of $160,000 per year ("Base Salary"), payable in approximately equal
installments in accordance with the Holding Company's customary payroll
practices for senior officers. The Board, or a Committee designated thereby,
shall review Executive's Base Salary at such times as it deems appropriate, but
not less frequently then once every twelve months, and the Board may, in its
discretion, approve an increase in Executive's Base Salary. Any such increase
shall become the "Base Salary" for purposes of this Agreement. In addition to
Base Salary, Executive may receive other cash compensation from the Holding
Company for services hereunder at such times, in such amounts and on such terms
and conditions as the Board may determine from time to time. Base Salary shall
include any amounts of compensation deferred by Executive under a qualified plan
maintained by the Holding Company.
(b) During the term of this Agreement, Executive shall be treated as an
employee of the Holding Company and shall be eligible to participate in and
receive benefits under any and all qualified or non-qualified retirement,
pension, savings, profit-sharing or stock bonus plans, any and all group life,
health (including hospitalization, medical and major medical), dental, accident
and long-term disability insurance plans, professional financial planning
services and tax preparation programs and any other employee benefit and
compensation plans (including, but not limited to, any incentive compensation
plans or programs, ESOP, stock option and appreciation rights plans and
restricted stock plans) as may from time to time be maintained by, or cover
employees of, the Holding Company, in accordance with the terms and conditions
of such employee benefit plans and programs and compensation plans and programs
and consistent with the Holding Company's customary practices.
(c) In addition to the Base Salary provided for by paragraph (a) of
this section 3, the Holding Company shall provide Executive with the perquisites
customarily provided to senior officers and may provide such additional
compensation in such form and such amounts as the Board may from time-to-time
determine.
4. TERMINATION OF EMPLOYMENT WITH SEVERANCE BENEFITS
(a) Executive shall be entitled to the severance benefits described
herein in the event that his employment with the Holding Company terminates
during the term of this Agreement under any of the following circumstances:
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(i) Executive's voluntary resignation from employment with the
Holding Company within ninety (90) days following:
(A) the failure of the Board to appoint or re-appoint or
elect or re-elect Executive to the office described in section 1
of this Agreement (or a more senior office of the Holding
Company);
(B) if Executive is a member of the Board as of the date
of this Agreement, the failure of the stockholders of the Holding
Company to elect or re-elect Executive or the failure of the
Board (or the nominating committee thereof) to nominate Executive
for such election or re-election;
(C) the expiration of a thirty (30) day period following
the date on which Executive gives written notice to the Holding
Company of its material failure, whether by amendment of the
Holding Company's Organization Certificate or By-laws, action of
the Board or the Holding Company's stockholders or otherwise, to
vest in Executive the functions, duties, or responsibilities
prescribed in section 1 of this Agreement, unless, during such
thirty (30) day period, the Holding Company fully cures such
failure; or
(D) the expiration of a thirty (30) day period following
the date on which Executive gives written notice to the Holding
Company of its material breach of any term, condition or covenant
contained in this Agreement (including, without limitation any
reduction of Executive's rate of Base Salary in effect from time
to time and any change in the terms and conditions of any
compensation or benefit program in which Executive participates
which, alone or together with other changes, has a material
adverse effect on the aggregate value of his total compensation
package), unless, during such thirty (30) day period, the Holding
Company fully cures such failure; or
(ii) the termination of Executive's employment with the Holding
Company for any other reason not described in section 7;
then, subject to sections 14 and 15, the Holding Company shall provide the
benefits and pay to Executive the amounts described in section 4(b).
(b) Upon the termination of Executive's employment with the Holding
Company under circumstances described in section 4(a) of this Agreement, the
Holding Company shall pay and provide to Executive (or, in the event of his
death, to his estate):
(i) his earned but unpaid compensation (including, without
limitation, all items which constitute wages under applicable law and
the payment of which is not otherwise provided for under this Section
4(b)) as of the date of the termination of his employment with the
Holding Company, such payment to be made at the time and in the manner
prescribed by law applicable to the payment of wages but in no event
later than thirty (30) days after termination of employment;
(ii) the benefits, if any, to which he is entitled as a former
employee under the employee benefit plans and programs and
compensation plans and programs maintained for the benefit of the
Holding Company's officers and employees;
(iii) continued group life, health (including hospitalization,
medical and major medical), dental, accident and long-term disability
insurance benefits, in addition to that provided pursuant to section
4(b)(ii), and after taking into account the coverage provided by any
subsequent employer, if and to the extent necessary to provide for
Executive, for the Remaining Unexpired Employment Period, coverage
equivalent to the coverage to which he would have been entitled under
such plans (as in effect on the date of his termination of employment,
or, if his termination of employment occurs after a Change of Control,
on the date of such Change of Control, whichever benefits are greater)
if he had continued work ing for the Holding Company during the
Remaining Unexpired Employment Period at the highest annual rate of
compensation achieved during that portion of the term of this
Agreement which is prior to Executive's termination of employment with
the Holding Company, it being understood that Executive's "qualifying
event" for purposes of continuation coverage under the Consolidated
Budget Reconciliation Act ("COBRA") shall occur at the expiration of
this period;
(iv) within five (5) days following his termination of employment
with the Holding Company, a lump sum payment, in an amount equal to
the salary that Executive would have earned if he had continued
working for the Holding
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Company during the Remaining Unexpired Employment Period at the highest
annual rate of salary achieved during that portion of the term of this
Agreement which is prior to Executive's termination of employment with
the Holding Company. Such lump sum is to be paid in lieu of all other
payments of salary provided for under this Agreement in respect of the
period following any such termination;
(v) within thirty (30) days following his termination of
employment with the Holding Company, a lump sum payment in an amount
equal to the excess, if any, of:
(A) the present value of the aggregate benefits to
which he would be entitled under any and all qualified and
non-qualified defined benefit pension plans maintained by, or
covering employees of, the Holding Company, if he were 100%
vested thereunder and had continued working for the Holding
Company during the Remaining Unexpired Employment Period, such
benefits to be determined as of the date of termination of
employment by adding to the service actually recognized under
such plans an additional period equal to the Remaining
Unexpired Employment Period and by adding to the compensation
recognized under such plans for the year in which termination
of employment occurs all amounts payable under sections
4(b)(i), (iv) and (vi); over
(B) the present value of the benefits to which he is
actually entitled under such defined benefit pension plans as
of the date of his termination;
where such present values are to be determined using the mortality
tables prescribed under section 415(b)(2)(E)(v) of the Code (as
hereinafter defined) and a discount rate, compounded monthly equal to
the annualized rate of interest prescribed by the Pension Benefit
Guaranty Corporation for the valuation of immediate annuities payable
under terminating single- employer defined benefit plans for the month
in which the Executive's termination of employment occurs ("Applicable
PBGC Rate"); and
(vi) within five (5) days following his termination of employment
with the Holding Company, the payments that would have been made to
Executive under any cash bonus or long-term or short-term cash
incentive compensation plan maintained by, or covering employees of,
the Holding Company if he had continued working for the Holding
Company during the Remaining Unexpired Employment Period and had
earned in each calendar year that ends during the Remaining Unexpired
Employment Period a bonus in an amount equal to the highest annual
bonus or incentive award actually paid to him in any calendar year
ending during the three-year period ending on the date of termination
of employment.
The Holding Company and Executive hereby stipulate that the damages which may be
incurred by Executive following any such termination of employment are not
capable of accurate measurement as of the date first above written and that the
payments and benefits contemplated by this section 4(b) constitute reasonable
damages under the circumstances and shall be payable without any requirement of
proof of actual damage and without regard to Executive's efforts, if any, to
mitigate damages. The Holding Company and Executive further agree that the
Holding Company may condition the payments and benefits (if any) due under
sections 4(b)(iii), (iv), (v), and (vi) on the receipt of Executive's
resignation from any and all positions which he holds as an officer, director or
committee member with respect to the Association or Holding Company or any
subsidiary or affiliate of either of them.
5. TERMINATION UPON OR FOLLOWING A CHANGE OF CONTROL
(a) For the purposes of this Agreement, a "Change of Control" of the
Holding Company shall be (i) an event of a nature that results in a Change of
Control of the Association or the Holding Company within the meaning of the Home
Owners' Loan Act of 1933 and the Rules and Regulations promulgated by the Office
of Thrift Supervision (or its predecessor agency), as in effect on the date
hereof (provided that in applying the definition of a Change of Control as set
forth under the Rules and Regulations of the OTS, the Board of Directors shall
substitute its judgment for that of the OTS), or (ii) a Change of Control of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), without regard to whether or not such
regulation actually applies; provided that, without limitation, such a Change of
Control shall be deemed to have occurred if (A) any "person" (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act in effect on the date first
above written), other than the Holding Company or any person who on the date
hereof is a director or officer of the Holding Company, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Holding Company (not including any securities
acquired directly from the Holding Company or its affiliates other than in
connection with the acquisition by the Holding Company or its affiliates of a
business) representing 20% or more of the combined voting power in the election
of directors of the Holding Company's then
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outstanding securities, (B) during any period of not more than two consecutive
years, individuals who at the beginning of such period constitute the Board of
Directors of the Holding Company together with any new director (other than a
director whose initial assumption of office is in connection with any actual or
threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Holding Company)
whose appointment or election by the Board of Directors of the Holding Company
or nomination for election by the Holding Company's stockholders was approved or
recommended by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors on the date hereof or whose appointment,
election or nomination for election was previously so approved or recommended,
cease for any reason to constitute at least a majority thereof, (C) the
stockholders of the Holding Company approve a merger or consolidation of the
Holding Company or the Association with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of the
Holding Company outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or any parent thereof) at least
60% of the combined voting power in the election of directors of the securities
of the Holding Company or such surviving entity or any parent thereof
outstanding immediately after such merger or consolidation, or (ii) a merger or
consolidation effected to implement a recapitalization of the Holding Company
(or similar transaction) in which no "person" is or becomes the "beneficial
owner," directly or indirectly, of securities of the Holding Company (not
including in the securities "beneficially owned" by such "person" any securities
acquired directly from the Holding Company or its affiliates other than in
connection with the acquisition by the Holding Company or its affiliates of a
business) representing 20% or more of the combined voting power in the election
of directors of the Holding Company's then outstanding securities; or (D) the
stockholders of the Holding Company approve a plan of complete liquidation or
dissolution of the Holding Company or an agreement for the sale or disposition
by the Holding Company of all or substantially all of the Holding Company's
assets, other than a sale or disposition by the Holding Company of all or
substantially all of the Holding Company's assets to an entity which assumes the
obligations set forth in this Agreement, and at least 60% of the combined voting
power in the election of directors of the voting securities of which are owned
by stockholders of the Holding Company in substantially the same proportions as
their ownership of the Holding Company immediately prior to such sale.
A Change of Control of the Holding Company shall also include any event
described in this section 5(a) if the term "Association" were substituted for
the term "Holding Company" each time it appears herein.
(b) Subject to sections 14 and 15, Executive shall be entitled to the
payments and benefits contemplated by section 5(c) in the event of his
termination of employment with the Holding Company following a Change of Control
under any of the circumstances described in section 4(a) of this Agreement or
under any of the following circumstances:
(i) resignation, voluntary or otherwise, by Executive at any time
during the term of this Agreement and within ninety (90) days
following his demotion, loss of title, office or significant authority
or responsibility, or following any material reduction in any element
of his compensation and benefits;
(ii) resignation, voluntary or otherwise, by Executive at any
time during the term of this Agreement and within ninety (90) days
following (A) any relocation of his principal place of employment
outside of a 25-mile radius of the principal place of employment
immediately prior to the Change of Control that would require a
relocation of his residence in order to be able to commute to such new
place of employment within a commuting time not in excess of the
greater of 60 minutes or Executive's commuting time prior to the
Change of Control or (B) any material adverse change in working
conditions at such principal place of employment; or
(iii) resignation, voluntary or otherwise, by Executive at any
time during the term of this Agreement following the failure of any
successor to the Holding Company in the Change of Control to include
Executive in any compensation or benefit program maintained by it or
covering any of its executive officers, unless Executive is already
covered by a substantially similar plan of the Holding Company which
is at least as favorable to him.
(c) Upon the termination of Executive's employment with the Holding
Company following a Change of Control under circumstances described in section
4(a) or section 5(b) of this Agreement, the Holding Company shall pay and
provide to Executive (or, in the event of his death, to his estate):
(i) his earned but unpaid compensation (including, without
limitation, all items which constitute wages under applicable law and
the payment of which is not otherwise provided for under this Section
4(b)) as of the date of the termination of his employment with the
Holding Company, such payment to be made at the time and in the manner
prescribed by law applicable to the payment of wages but in no event
later than thirty (30) days after termination of employment;
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(ii) the benefits, if any, to which he is entitled as a former
employee under the employee benefit plans and programs and
compensation plans and programs maintained for the benefit of the
Holding Company's officers and employees;
(iii) continued group life, health (including hospitalization,
medical and major medical), dental, accident and long-term disability
insurance benefits, in addition to that provided pursuant to section
5(c)(ii), and after taking into account the coverage provided by any
subsequent employer, if and to the extent necessary to provide for
Executive, for a period of thirty-six (36) months after termination of
Executive's employment (the "Payment Period"), coverage equivalent to
the coverage to which he would have been entitled under such plans (as
in effect on the date of his termination of employment, or, if his
termination of employment occurs after a Change of Control, on the
date of such Change of Control, whichever benefits are greater) if he
had continued working for the Holding Company during the Payment
Period at the highest annual rate of compensation achieved during that
portion of the term of this Agreement which is prior to Executive's
termination of employment with the Holding Company, it being
understood that Executive's "qualifying event" for purposes of
continuation coverage under COBRA shall occur at the expiration of
this period;
(iv) within five (5) days following his termination of employment
with the Holding Company, a lump sum payment, in an amount equal to
the salary that Executive would have earned if he had continued
working for the Holding Company during the Payment Period at the
highest annual rate of salary achieved during that portion of the term
of this Agreement which is prior to Executive's termination of
employment with the Holding Company. Such lump sum is to be paid in
lieu of all other payments of salary provided for under this Agreement
in respect of the period following any such termination;
(v) within thirty (30) days following his termination of
employment with the Holding Company, a lump sum payment in an amount
equal to the excess, if any, of:
(A) the present value of the aggregate benefits to
which he would be entitled under any and all qualified and
non-qualified defined benefit pension plans maintained by, or
covering employees of, the Holding Company, if he were 100%
vested thereunder and had continued working for the Holding
Company during the Payment Period, such benefits to be
determined as of the date of termination of employment by
adding to the service actually recognized under such plans an
additional period equal to the Payment Period and by adding to
the compensation recognized under such plans for the year in
which termination of employment occurs all amounts payable
under sections 5(c)(i), (iv) and (vi); over
(B) the present value of the benefits to which he is
actually entitled under such defined benefit pension plans as
of the date of his termination;
where such present values are to be determined using the mortality
tables prescribed under section 415(b)(2)(E)(v) of the Code and a
discount rate, compounded monthly equal to the annualized rate of
interest prescribed by the Pension Benefit Guaranty Corporation for
the valuation of immediate annuities payable under terminating
single-employer defined benefit plans for the month in which the
Executive's termination of employment occurs ("Applicable PBGC Rate");
and
(vi) within five (5) days following termination of Executive's
employment with the Holding Company, the payments that would have been
made to Executive under any cash bonus or long-term or short-term cash
incentive compensation plan maintained by, or covering employees of,
the Holding Company if he had continued working for the Holding
Company during the Payment Period and had earned in each calendar year
that ends during the Payment Period a bonus in an amount equal to the
highest annual bonus or incentive award actually paid to him in any
calendar year ending during the three-year period ending on the date
of termination of employment.
The Holding Company and Executive hereby stipulate that the damages which may be
incurred by Executive following any such termination of employment following a
Change of Control are not capable of accurate measurement as of the date first
above written and that the payments and benefits contemplated by this section 5
(c) constitute reasonable damages under the circumstances and shall be payable
without any requirement of proof of actual damage and without regard to
Executive's efforts, if any, to mitigate damages. The Holding Company and
Executive further agree that the Holding Company may condition the payments and
benefits (if any) due under sections 5(c)(iii), (iv), (v), and (vi) on the
receipt of Executive's resignation from any and all positions which he holds as
an officer, director or committee member with respect to the Holding Company or
Association or any subsidiary or affiliate of either of them.
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6. TERMINATION UPON RETIREMENT
Termination of Executive based on "Retirement" shall mean termination
in accordance with the Holding Company's retirement policy or in accordance with
any retirement arrangement established with Executive's consent with respect to
him. Upon termination of Executive upon Retirement, Executive shall be entitled
to all benefits under any retirement plan of the Holding Company and other plans
to which Executive is a party and this Agreement shall be terminated.
7. TERMINATION WITHOUT ADDITIONAL HOLDING COMPANY LIABILITY
In the event that Executive's employment with the Holding Company shall
terminate during the term hereof on account of:
(a) the discharge of Executive for "cause," which, for purposes of this
Agreement shall mean willful misconduct, breach of fiduciary duty involving
personal profit, intentional failure to perform stated duties, willful violation
of any law, rule or regulation (other than traffic violations or similar
offenses) or final cease and desist order, or any material breach of this
Agreement, in each case as measured against standards generally prevailing at
the relevant time in the savings and community banking industry; PROVIDED,
HOWEVER, that Executive shall not be deemed to have been discharged for cause
unless and until the following procedures shall have been followed:
(i) the Board shall adopt a resolution duly approved by
affirmative vote of a majority of the entire Board at a meeting called
and held for such purpose calling for Executive's termination for
cause and setting forth the purported grounds for such termination
("Proposed Termination Resolution");
(ii) as soon as practicable, and in any event within five (5)
days after adoption of such resolution, the Board shall furnish to
Executive a written notice of termination which shall be accompanied
by a certified copy of the Proposed Termination Resolution ("Notice of
Proposed Termination");
(iii) Executive shall be afforded a reasonable opportunity to
make oral and written presentations to the members of the Board, on
his own behalf, or through a representative, who may be his legal
counsel, to refute the grounds set forth in the Proposed Termination
Resolution at one or more meetings of the Board to be held no sooner
than fifteen (15) days and no later than thirty (30) days after the
Executive's receipt of the Proposed Termination Notice ("Termination
Hearings"); and
(iv) within ten (10) days following the end of the Termination
Hearings, the Board shall adopt a resolution duly approved by
affirmative vote of a majority of the entire Board at a meeting called
and held for such purpose (A) finding that in the good faith opinion
of the Board the grounds for termination set forth in the Proposed
Termination Resolution exist and (B) terminating Executive's
employment ("Termination Resolution"); and
(v) as promptly as practicable, and in any event within one (1)
business day after adoption of the Termination Resolution, the Board
shall furnish to the Executive written notice of termination, which
notice shall include a copy of the Termination Resolution and specify
an effective date of termination that is not later than the date on
which such notice is given.
(b) Executive's voluntary resignation from employment with the Holding
Company for reasons other than those specified in section 4(a)(i) or section
5(b);
(c) Executive's death; or
(d) a determination that Executive is eligible for long-term disability
benefits under the Holding Company's long-term disability insurance program or,
if there is no such program, under the federal Social Security Act;
then the Holding Company shall have no further obligations under this Agreement,
other than the payment to the Executive (or, in the event of his death, to his
estate) of his earned but unpaid salary as of the date of the termination of his
employment, and the provi sion of such other benefits, if any, to which he is
entitled as a former employee under the employee benefit plans and programs and
compensation plans and programs maintained by, or covering employees of, the
Holding Company.
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(e) For purposes of section 7(a), no act or failure to act on the part
of Executive shall be considered "willful" unless it is done, or omitted to be
done, by Executive in bad faith or without reasonable belief that Executive's
action or omission was in the best interests of the Holding Company. Any act, or
failure to act, based upon authority given pursuant to a resolution duly adopted
by the Board or based upon the written advice of counsel for the Holding Company
shall be conclusively presumed to be done, or omitted to be done, by the
Executive in good faith and in the best interests of the Holding Company.
8. NOTICE
(a) Any purported termination by the Holding Company or by Executive
shall be communicated by Notice of Termination to the other party hereto. Except
in a termination for cause, such Notice of Termination shall be provided to
Executive not less than thirty (30) days prior to Executive's Date of
Termination. For purposes of this Agreement, a "Notice of Termination" shall
mean a dated written notice which shall (i) indicate the specific termination
provision in this Agreement relied upon; (ii) set forth in detail the facts and
circumstances claimed to provide a basis for termination of Executive's
employment under the provision so indicated; and (iii) specify a Date of
Termination, which shall be not less than thirty (30) days nor more than ninety
(90) days after such Notice of Termination is given, except in the case of a
termination for cause, in which case the Notice of Termination may specify a
Date of Termination as of the date of such Notice of Termination.
(b) "Date of Termination" shall mean the date specified in the Notice
of Termination.
9. POST-TERMINATION OBLIGATIONS
(a) All payments and benefits to Executive under this Agreement shall
be subject to Executive's compliance with paragraph (b) of this Section 9 during
the term of this Agreement and for one (1) full year after the expiration or
termination hereof.
(b) Executive shall, upon reasonable notice and at the Holding
Company's expense, furnish
such information and assistance to the Holding Company as may reasonably be
required by the Holding Company in connection with any litigation in which it or
any of its subsidiaries or affiliates is, or may become, a party.
10. NON-COMPETITION
(a) Upon any termination of Executive's employment hereunder pursuant
to Section 4 hereof, Executive agrees not to compete with the Association and/or
the Holding Company for a period of one (1) year following such termination in
any city, town or county in which the Association and/or the Holding Company has
an office or has filed an application for regulatory approval to establish an
office, determined as of the effective date of such termination, except as
agreed to pursuant to a resolution duly adopted by the Board. Executive agrees
that during such period and within said cities, towns and counties, Executive
shall not work for or advise, consult or otherwise serve with, directly or
indirectly, any entity whose business materially competes with the depository,
lending or other business activities of the Association and/or the Holding
Company. The parties hereto, recognizing that irreparable injury will result to
the Association and/or the Holding Company, its business and property in the
event of Executive's breach of this Subsection 10(a) agree that in the event of
any such breach by Executive, the Association and/or the Holding Company will be
entitled, in addition to any other remedies and damages available, to an
injunction to restrain the violation hereof by Executive, Executive's partners,
agents, servants, employers, employees and all persons acting for or with
Executive. Executive represents and admits that in the event of the termination
of his employment pursuant to Section 4 hereof, Executive's experience and
capabilities are such that Executive can obtain employment in a business engaged
in other lines and/or of a different nature than the Association and/or the
Holding Company, and that the enforcement of a remedy by way of injunction will
not prevent Executive from earning a livelihood. Nothing herein will be
construed as prohibiting the Association and/or the Holding Company from
pursuing any other remedies available to the Association and/or the Holding
Company for such breach or threatened breach, including the recovery of damages
from Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Holding Company and
affiliates thereof, as it may exist from time-to-time, is a valuable, special
and unique asset of the business of the Holding Company. Executive will not,
during or after the term of his employment, disclose any knowledge of the past,
present, planned or considered business activities of the Holding Company or
affiliates thereof to any person, firm, corporation, or other entity for any
reason or purpose whatsoever. Notwithstanding the foregoing, Executive may
disclose any knowledge of banking, financial and/or economic principles,
concepts or ideas which are not solely and exclusively derived from the business
plans and activities of the Holding Company. In the event of a breach or
threatened breach by Executive of the provisions of this section 10, the Holding
Company will be entitled to an injunction restraining Executive from disclosing,
in whole
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or in part, the knowledge of the past, present, planned or considered business
activities of the Holding Company or affiliates thereof, or from rendering any
services to any person, firm, corporation, other entity to whom such knowledge,
in whole or in part, has been disclosed or is threatened to be disclosed.
Nothing herein will be construed as prohibiting the Holding Company from
pursuing any other remedies available to the Holding Company for such breach or
threatened breach, including the recovery of damages from Executive.
11. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS
(a) This Agreement contains the entire understanding between the
parties hereto and supersedes any prior employment agreement between the Holding
Company or any predecessor of the Holding Company and Executive (including
without limitation that certain Employment Agreement between the Holding Company
and Executive (dated , 1993), except that this Agreement shall not affect or
operate to reduce any benefit or compensation inuring to the Executive of a kind
elsewhere provided. No provision of this Agreement shall be interpreted to mean
that Executive is subject to receiving fewer benefits than those available to
him without reference to this Agreement.
(b) The termination of Executive's employment during the term of this
Agreement or thereafter, whether by the Holding Company or by Executive, shall
have no effect on the rights and obligations of the parties hereto under the
Holding Company's qualified or non-qualified retirement, pension, savings, ESOP,
thrift, profit-sharing or stock bonus plans, group life, health (including
hospitalization, medical and major medical), dental, accident and long-term
disability insurance plans or such other employee benefit plans or programs, or
compensation plans or programs, as may be maintained by, or cover employees of,
the Holding Company from time to time.
12. NO 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 execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affected any such action shall be null,
void, and of no effect.
13. MODIFICATION AND WAIVER
(a) Except for increases in the Base Salary as provided for in section
3(a), this Agreement may not be modified or amended except by an instrument in
writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
waiver or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.
14. LIMITATION PROVISIONS
(a) Notwithstanding any other provisions of this Agreement, in the
event that any payment or benefit received or to be received by Executive in
connection with a Change of Control of the Holding Company or the termination of
Executive's employment (whether pursuant to the terms of this Agreement or any
other plan, arrangement or agreement with the Holding Company or the
Association, any person whose actions result in a Change of Control of the
Holding Company or any person affiliated with the Holding Company or the
Association or such person) (all such payments and benefits, including the
payments and benefits provided under this Agreement (the "Severance Payments"),
being hereinafter called "Total Payments") would not be deductible (in whole or
part), by the Holding Company, an affiliate or a person making such payment or
providing such benefit as a result of Section 280G of the Internal Revenue Code
of 1986, as amended (the "Code"), then, to the extent necessary to make such
portion of the Total Payments deductible (and after taking into account any
reduction in the Total Payments provided in such other plan, arrangement or
agreement), the cash Severance Payments shall first be reduced (if necessary, to
zero), and all other Severance Payments shall thereafter be reduced (if
necessary, to zero); PROVIDED, HOWEVER, that Executive may elect (at any time
prior to the delivery of a Notice of Termination hereunder) to have the noncash
Severance Payments reduced (or eliminated) prior to any reduction of the cash
Severance Payments.
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(b) For purposes of the limitation contained in Subsection (a) of this
section 14, (i) no portion of the Total Payments the receipt or enjoyment of
which Executive shall have effectively waived in writing prior to the delivery
of a Notice of Termination shall be taken into account, (ii) no portion of the
Total Payments shall be taken into account which, in the opinion of tax counsel
("Tax Counsel") reasonably acceptable to Executive and selected by the
accounting firm which was, immediately prior to the Change of Control of the
Holding Company, the Holding Company's independent auditor (the "Auditor"), does
not constitute a "parachute payment" within the meaning of Section 280G(b) (2)
of the Code, including by reason of Section 280G(b) (4) (A) of the Code, (iii)
the Severance Payments shall be reduced only to the extent necessary so that the
Total Payments (other than those referred to in clauses (i) or (ii)), in their
entirety constitute reasonable compensation for services actually rendered
within the meaning of Section 280G(b) (4) (B) of the Code or are otherwise not
subject to disallowance as deductions by reason of Section 280G of the Code, in
the opinion of Tax Counsel, and (iv) the value of any noncash benefit or any
deferred payment or benefit included in the Total Payments shall be determined
by the Auditor in accordance with the principles of Sections 280G(d) (3) and (4)
of the Code.
(c) If it is established pursuant to a final determination of a court
or an Internal Revenue Service proceeding that, notwithstanding the good faith
of Executive and the Holding Company in applying the terms of this Section 14,
the aggregate "parachute payments" paid to or for Executive's benefit are in an
amount that would result in any portion of such "parachute payments" not being
deductible by reason of Section 280G of the Code, then Executive shall have an
obligation to pay the Holding Company upon demand an amount equal to the sum of
(i) the excess of the aggregate "parachute payments" paid to or for Executive's
benefit over the aggregate "parachute payments" that could have been paid to or
for Executive's benefit without any portion of such "parachute payments" not
being deductible by reason of Section 280G of the Code; and (ii) interest on the
amount set forth in clause (i) of this sentence at 120% of the rate provided in
Section 1274 (b) (2) (B) of the Code from the date of Executive's receipt of
such excess until the date of such payment. If the Severance Payments shall be
decreased pursuant to section 14(a) hereof, and the benefits under section
5(c)(iii) hereof which remain payable after the application of section 14 hereof
are thereafter reduced pursuant thereto because of the receipt by Executive of
substantially similar benefits, the Holding Company shall, at the time of such
reduction, pay to Executive the lowest of (a) the amount of the decrease made in
the Severance Payments pursuant to section 14 hereof, (b) the amount of the
subsequent reduction in such benefits, or (c) the maximum amount which can be
paid to Executive without being, or causing any other payment to be,
nondeductible by reason of Section 280G of the Code.
15. REQUIRED REGULATORY PROVISION
Notwithstanding anything herein to the contrary, any payments made to
Executive by the Holding Company, whether pursuant to this Agreement or
otherwise, are subject to and conditioned upon compliance with 12 U.S.C.
ss.1828(k) and any regulations promulgated thereunder.
If and to the extent that the foregoing provision shall cease to be
required by applicable law, rule or regulation, the same shall become
inoperative as though eliminated by formal amendment of this Agreement.
16. SEVERABILITY
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
17. HEADING FOR REFERENCE ONLY
The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.
18. GOVERNING LAW
The validity, interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the State of Florida (without regard
to the conflict of laws principles thereof), but only to the extent not
preempted by federal law.
19. INDEMNIFICATION FOR ATTORNEYS' FEES
The Holding Company shall indemnify, hold harmless and defend Executive
against reasonable costs, including legal fees, incurred by him in connection
with or arising out of any action, suit or proceeding in which he may be
involved, as a result of his efforts, in good faith, to defend or enforce the
terms of this Agreement; provided, however, that prior to a Change of Control of
the
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Holding Company, Executive shall have substantially prevailed on the merits
pursuant to a judgment, decree or order of a court of competent jurisdiction or
of an arbitrator in an arbitration proceeding, or in a settlement. For purposes
of this Agreement, any settlement agreement which provides for payment of any
amounts in settlement of the Holding Company's obligations hereunder shall be
conclusive evidence of Executive's entitlement to indemnification hereunder, and
any such indemnification payments shall be in addition to amounts payable
pursuant to such settlement agreement, unless such settlement agreement
expressly provides otherwise.
Following a Change in Control of the Holding Company, Executive shall
be entitled to reimbursement for all reasonable costs, including attorney's
fees, in challenging any termination of his employment, in seeking to enforce
any of his rights hereunder, or in connection with any tax audit or proceeding
to the extent attributable to the application of Section 4999 of the Code to any
payment or benefit provided hereunder, provided that Executive shall not be
entitled to such reimbursement if the Holding Company proves, by clear and
convincing evidence, that Executive proceeded in such action in bad faith.
Executive shall also be entitled to post-judgment interest at the then-current
prime rate charged by Citibank, NA or any successor thereto, on any money
judgment obtained. Amounts paid pursuant to this paragraph shall be in addition
to all rights to which Executive is otherwise entitled under this Agreement.
20. INDEMNIFICATION AND INSURANCE
(a) During the term of this Agreement and for a period of six (6) years
thereafter, the Holding Company shall cause Executive to be covered by and named
as an insured under any policy or contract of insurance obtained by it to insure
its directors and officers against personal liability for acts or omissions in
connection with service as an officer or director of the Holding Company or
service in other capacities at the request of the Holding Company. The coverage
provided to Executive pursuant to this section 20 shall be of the same scope and
on the same terms and conditions as the coverage (if any) provided to other
officers or directors of the Holding Company.
(b) To the maximum extent permitted under applicable law, during the
term of this Agreement and for a period of six (6) years thereafter, the Holding
Company shall indemnify, and shall cause its subsidiaries and affiliates to
indemnify Executive against and hold him harmless from any costs, liabilities,
losses and exposures to the fullest extent and on the most favorable terms and
conditions that similar indemnification is offered to any director or officer of
the Association or any subsidiary or affiliate thereof.
21. SUCCESSOR AND ASSIGNS
This Agreement will inure to the benefit of and be binding upon
Executive, his legal representatives and testate or intestate distributees, and
the Holding Company and its successors and assigns, including any successor by
merger or consolidation or any other person or firm or corporation to which all
or substantially all of the assets and business of the Holding Company may be
sold or otherwise transferred. Failure of the Holding Company to obtain from any
successor its express written assumption of the Holding Company's obligations
hereunder at least sixty (60) days in advance of the scheduled effective date of
any such succession shall be deemed a material breach of this Agreement unless
cured within ten (10) days after notice thereof by Executive to the Holding
Company.
22. GUARANTEE
The Holding Company hereby agrees to guarantee the payment by the
Association of any benefits and compensation to which Executive is or may be
entitled to under the terms and conditions of the Employment Agreement dated as
of May 20, 1997 between the Association and Executive, a copy of which is
attached hereto as Exhibit A.
23. NON-DUPLICATION
In the event that Executive shall perform services for the Association
or any other direct or indirect subsidiary of the Holding Company, any
compensation or benefits provided to Executive by such other employer shall be
applied to offset the obligations of the Holding Company hereunder, it being
intended that this Agreement set forth the aggregate compensation and benefits
payable to Executive for all services to the Holding Company and all of its
direct or indirect subsidiaries.
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SIGNATURES
IN WITNESS WHEREOF, First Bank of Florida and First Palm Beach Bancorp, Inc.
have caused this Agreement to be executed by their duly authorized officers, and
Executive has signed this Agreement, all as of the day and year first above
written.
ATTEST: FIRST BANK OF FLORIDA
/s/ Xxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxx Xx.
------------------------------ -----------------------
Secretary Duly Authorized Officer
SEAL
ATTEST: FIRST PALM BEACH BANCORP, INC.
(Guarantor)
/s/ Xxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxx, Xx.
------------------------------ ---------------------------
SEAL
WITNESS:
/s/ Xxxxxx X. Xxxxxx By: /s/ R. Xxxxx Xxxxxxx
------------------------------ ---------------------------
Executive
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