AGREEMENT
This
Agreement is entered into by and between Citizens Financial Bank and CFS
Bancorp, Inc., both located at 000 Xxxxx Xxxx, Xxxxxxx, Xxxxxxx (collectively,
“Employer”) and Xxxxxx X. Xxxxxxx ("Employee").
WHEREAS,
the parties previously entered into those certain employment agreements dated
July 1, 2006 (collectively, the “Employment
Agreements”);
WHEREAS,
the Employer, by notice given to Employee prior to the date hereof in accordance
with the terms of Employment Agreements, has determined to terminate Employee’s
employment with Employer for reasons other than for Cause (and not due to
Disability); and
WHEREAS,
the parties desire to enter into this Agreement regarding the termination of
his
employment with the Employer.
NOW,
THEREFORE, in consideration of the mutual promises, the receipt and adequacy
of
which are acknowledged, the parties agree as follows:
1. Termination
of Employment. Employee’s last day of employment with Employer
shall be January 31, 2008 (“Termination Date”), which is more than 30 days
following the date notice was given to Employee. Employee hereby
resigns from all offices, directorships and trusteeships effective the
termination of his employment and acknowledges that, in connection
therewith.
2. Separation
Payments and Benefits. Upon Employee’s execution and delivery
to Employer of a general release of all claims against Employer and others
on or
within 15 days after the Termination Date, in the form set forth as Exhibit
A
hereto, which general release is not revoked, Employee shall be entitled to
the
following payments and benefits:
A. Pay
Employee an aggregate cash sum of $196,449, which shall be payable one-half
on
the first regular payroll date day following the effective date of the general
release and the second one-half on the first regular payroll date in January,
2009.
B. Maintain
and provide to Employee, at no cost to Employee, until the first anniversary
of
the Termination Date participation in the following employee benefit plans
in
which he participated on the Termination Date: health and dental benefits on
the
same terms as active employees as in effect on the Termination Date; provided,
(i) such health and dental benefits shall be concurrent with Employee’s
continuation rights under the Consolidated Omnibus Reconciliation Act of 1985,
as amended (“COBRA”); (ii) if Employer during such one-year period shall
terminate or materially reduce any such health and dental benefits offered
to
active employees, Employer shall arrange to provide Employee substantially
similar benefits for the unexpired portion of the one-year period as provided
prior to such termination or material reduction; and (iii) clause (ii)
notwithstanding, Employer shall discontinue such benefits to Employee during
the
one-year benefit period to the extent that Employee is entitled to substantially
similar benefits in connection with full-time employment with a subsequent
employer or otherwise.
C. On
the
date of the first installment payment under paragraph 2(A) hereof, Employer
shall pay to Employee a cash lump sum of $6,316. This amount is paid
to Employee in lieu of continuing benefits for one year following the
Termination Date, and which amount
represents
the premium required to continue group life insurance and group long-term
disability insurance benefits for such period, because Employer
is prohibited from providing such benefits on a post-employment basis under
the terms of the Employer’s applicable benefit plans and underlying group
insurance contracts. Employer shall assist and cooperate with
Employee in obtaining a conversion and assignment of such life insurance and
long-term disability insurance contracts to Employee from the
insurer.
D. On
the
date of the first installment payment under paragraph 2(A) hereof, Employer
shall pay to Employee a cash lump sum of $12,500, which but for this Agreement
would not be payable to Employee. Employee acknowledges that he will
forfeit all unvested restricted stock and other unvested long-term incentives
on
the Termination Date, and all vested stock options will be exercisable following
the Termination Date, as provided under the terms of the applicable incentive
plans and award agreements thereunder.
E. Notwithstanding
Employee’s termination of employment prior to the date 2007 annual bonuses are
payable, Employee shall be entitled to receive a bonus for fiscal year 2007
to
the extent earned based on performance and otherwise payable in accordance
with
the terms of the executive annual incentive plan which (but for this Agreement
otherwise would not be payable to Employee) shall be payable when bonuses are
payable to senior executives of Employer.
F. The
payments and benefits provided to Employee under this paragraph 2 shall be
subject to standard tax withholding and other applicable
deductions.
3. Return
of Property. Employee covenants that he has returned all of
Employer’s property, which he has in his possession, including, but
not limited to, all customer lists, be they electronic and/or hard copies,
the
Employer-owned automobile, and any other Employer-owned computer equipment,
cell
phone, wireless e-mail equipment and other Employer-owned equipment in his
possession or control.
4. No
Admission of Wrongdoing. Employee agrees neither this
Agreement nor the furnishing of the consideration for the release under
paragraph 3 shall be deemed or construed at any time for any purpose as an
admission by Employer of any liability or unlawful conduct of any
kind.
5. Confidentiality;
Trade Secrets; Nonsolicitation.
A. Employee
acknowledges the continuing applicability of his covenant under Section 3(d)
of
each Employment Agreement and further agrees to maintain as confidential any
and
all information or knowledge concerning Employer’s business and its customers
that is not generally known in the banking industry. Employee also agrees to
keep the existence of and the terms and conditions of this Agreement
confidential, and that Employee as well as Employee’s heirs, executors,
administrators and agents, will not directly or indirectly disclose them to
any
person, firm or entity.
B. Section
3(e)(iv) of the Employment Agreement shall apply as if Employee’s employment
voluntarily terminated without Good Reason; provided, Section 3(e)(iv) of the
Employment Agreement is deemed amended to also include a restriction that
Employee not directly or indirectly hire any person who is in the employ of
the
Employer on the date hereof.
6. No
Disparagement. Employee agrees not to engage in any direct or
indirect conduct or communications, written or oral, which may in any way be
deemed to be disparaging of Employer.
7. Remedies. In
addition to all remedies available to Employer hereunder and under the
Employment Agreement, which are reserved hereby, Employee shall forfeit all
unpaid amounts and
2
benefits
provided under paragraph 2 if he shall breach either covenant set forth in
paragraphs 3, 5 or 6 hereof.
8. Amendment. This
Agreement may not be modified, altered or changed except upon express written
consent of both parties wherein specific reference is made to this
Agreement.
9. Entire
Agreement. This Agreement sets forth the entire agreement
between the parties hereto and fully supersedes any prior agreements or
understandings between the parties including, without limitation, the Employment
Agreements. Employee acknowledges Employee has not relied on any
representations, promises, or agreements of any kind made to Employee in
connection with Employee’s decision to enter this Agreement.
10. Binding
Agreement. This Agreement shall be binding on all of the
parties and their respective successors, heirs, legal representatives and
assigns (without regard for its conflict of laws
principles).
11. Governing
Law. This Agreement shall be construed in accordance with the
laws of the State of Indiana.
IN
WITNESS WHEREOF, the parties hereto knowingly and voluntarily executed this
Agreement as of the later date set forth below:
CFS
BANCORP, INC.
BY: /s/ Xxxxxx
X.
Xxxxxx
Xxxxxx X. Xxxxxx
CITIZENS
FINANCIAL BANK, Employer
BY: /s/
Xxxxxx X.
Xxxxxx
Xxxxxx X. Xxxxxx
DATE: December
18, 2007
HAVING
ELECTED TO EXECUTE THIS AGREEMENT, TO RECEIVE THE SUMS AND BENEFITS SET FORTH
HEREIN, EMPLOYEE FREELY AND KNOWINGLY, AND AFTER DUE CONSIDERATION, ENTERS
INTO
THIS AGREEMENT INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS EMPLOYEE HAS
OR
MIGHT HAVE AGAINST EMPLOYER. EMPLOYEE HAS READ THIS AGREEMENT AND
UNDERSTANDS THAT ITS TERMS ARE LEGALLY ENFORCEABLE. EMPLOYEE HAS HAD
THE OPPORTUNITY TO NEGOTIATE WITH EMPLOYER REGARDING THIS AGREEMENT, AND HAS
HAD
THE OPPORTUNITY TO CONFER WITH AN ATTORNEY FOR ASSISTANCE AND
ADVICE. EMPLOYEE HAS ENTERED INTO THIS AGREEMENT KNOWINGLY AND
VOLUNTARILY.
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx
X. Xxxxxxx
DATE: December
31,
2007
3
EXHIBIT
A1
GENERAL
RELEASE OF ALL CLAIMS
This
General Release of All Claims (“Release”) is made in consideration of severance
payments and other benefits provided to the undersigned employee (“Employee”)
under that certain Agreement with Citizens Financial Bank and CFS Bancorp,
Inc.
(collectively and each separately, “Employer”), dated December 31, 2007
(“Agreement”). All capitalized terms not defined herein have the
meaning set forth in the Agreement.
(A) For
and
in consideration for the payments and benefits provided under paragraph 2
of the Agreement, Employee, on his own behalf and on behalf of his heirs,
executors, administrators, successors and assigns (collectively, the “Releasing
Parties”), knowingly and voluntarily releases and forever discharges Employer
and Employer’s affiliates, subsidiaries, divisions, successors and assigns in
such capacity, and the current, future and former employees, officers,
directors, trustees. attorneys and agents (collectively, the “Released
Parties”), from any and all claims, causes of action, demands, fees and
liabilities of any kind whatsoever, whether known or unknown, against the
Released Parties, the Releasing Parties has, has ever had or may have as of
the
date of execution of this Agreement, including, but not limited to, any alleged
violation of the National Labor Relations Act, as amended; Title VII of the
Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991;
Sections 1981 through 1988 of Title 42 of the United States Code, as
amended; the Employee Retirement Income Security Act of 1974, as amended; the
Immigration Reform and Control Act, as amended; the Americans with Disabilities
Act of 1990, as amended; the Age Discrimination in Employment Act of 1967,
as
amended; the Older Workers Benefit Protection Act of 1990; the Worker Adjustment
and Retraining Notification Act, as amended; the Occupational Safety and Health
Act, as amended; the Family and Medical Leave Act of 1993; Illinois Human Rights
Act; any other federal, state or local civil or human rights laws or any other
local, state or federal law, regulation or ordinance; any public policy,
contract, tort, and common law; and any allegation for costs, fees, or other
expenses including attorneys’ fees incurred in these
matters.
(B) Notwithstanding
anything herein to the contrary, the sole matters to which the above release
of
claims does not apply are Employee’s rights of indemnification and
directors and officers liability insurance coverage to which Employee was
entitled immediately prior to the Termination Date with regard to Employee’s
service as an officer and director of Employer and Employee’s rights under
any tax-qualified pension and claims for accrued vested benefits under any
other
employee benefit plan, policy or arrangement maintained by Employer or under
COBRA.
(C) The
Releasing Parties waive the Releasing Parties’ right to file any charge or
complaint against the Released Parties arising out of Employee’s employment with
or separation from Employer before any federal, state or local court or any
state or local administrative agency, except where such waivers are prohibited
by law. The release under this Release shall not prevent the
Releasing Parties from filing a charge with the Equal Employment Opportunity
Commission, any other federal government agency, and/or any government agency
concerning claims of discrimination, although the Releasing Parties waive the
Employee’s right to recover any damages or other relief in any claim or suit
brought by or through the Equal Employment Opportunity Commission or any other
state or local agency on behalf of the Releasing Parties under the Age
Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964
as
amended, the Americans with Disabilities Act, or any other federal or state
discrimination law, except where such waivers are prohibited by
law.
(D) Employee
affirms he has not filed, has not caused to be filed, and is not presently
a
party to, any claim, complaint, or action against any of the Released Parties
in
any forum or form. Employee
______________________________
1 This
Release will be executed between January 31 and February 15,
2008.
4
further
affirms that he has been paid and/or has received all compensation, wages,
bonuses, commissions, and/or benefits to which Employee may be entitled and
no
other compensation, wages, bonuses, commissions and/or benefits are due to
Employee, except as provided in paragraph 2 of the
Agreement. Employee also affirms he has no known workplace injury.
(E) Employee
has been advised that he had up to twenty-one (21) calendar days, from the
date on which the Agreement was first tendered to Employee, to review the
Agreement, which included this Release as a Exhibit A thereto, and has been
advised in writing to consult with an attorney prior to execution of the
Agreement and this Release. Employee agrees any
modifications, material or otherwise, made to the Agreement prior to or after
its execution do not restart or affect in any manner the original twenty-one
(21) calendar day consideration period.
(F) Employee
may revoke this Release for a period of seven (7) calendar days following
the day Employee executes and delivers this Release to Employer. Any
revocation within this period shall be submitted, in writing, to Employer and
state, “I hereby revoke my acceptance of our Agreement.” The
revocation shall be personally delivered to Employer’s Chief Executive Officer,
or his designee, or mailed to Employer, Attention to such individual, addressed
to Employer’s headquarters offices, postage prepaid, and postmarked within seven
(7) calendar days of execution of this Agreement. This Release
and all payments and benefits to which Employee shall become entitled under
paragraph 2 of the Agreement shall become effective and enforceable on the
first
(1st) day following the expiration of the seven (7)-day revocation period in
which this Release is not revoked. If the last day of the revocation
period is a Saturday, Sunday, or legal holiday in Indiana, then the seven
(7)-day revocation period shall not expire until the next following day which
is
not a Saturday, Sunday, or legal holiday.
(G) This
Release shall be governed by the internal laws (and not the choice of laws)
of
the State of Indiana, except for the application of pre-emptive Federal
law.
PLEASE
READ THIS AGREEMENT CAREFULLY. IT CONTAINS A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS.
Date:
______________,
2008 ____________________________________
Xxxxxx
X.
Xxxxxxx
