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Exhibit 10.13.
EMPLOYMENT AGREEMENT
THIS AGREEMENT, entered into as of this 31st day of January, 1996, by and
between XXXX X. XXXXXX, an individual residing in Hermitage, Pennsylvania (the
"Executive"), and F.N.B. CORPORATION, a Pennsylvania bank holding company (the
"Company"),
WITNESSETH THAT:
WHEREAS, the Executive has been elected as Chief Financial Officer of the
Company;
WHEREAS, the Company desires to assure itself of the continued benefit of
the Executive's services and experience and the Executive desires to continue in
the employ of the Company upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and covenants herein
contained, and intending to be legally bound, the parties hereto agree as
follows:
Section 1. TERM OF EMPLOYMENT.
(a) The term of employment of the Executive under this Agreement
shall be, initially, the three year period commencing on January 1, 1996 and
ending on December 31, 1998. Said term shall be subject to automatic extension
by operation of the provisions of Section 1(b) hereof to a date not later than
December 31, 2008 (beyond which the term of employment shall not be extended
pursuant to Section 1(b) hereof).
(b) At December 31, 1996 and December 31 of each succeeding calendar
year to and including December 31, 2005, the term of employment of the Executive
under this Agreement shall be automatically extended to December 31 of the third
calendar year thereafter unless either party, acting under this Section 1(b),
shall have elected to fix the expiration date of the Executive's term of
employment hereunder. Each of the parties shall have the right, exercisable by
written notice to the other, to terminate the automatic renewal and thereby fix
the expiration of the term of employment under this Section 1, provided such
notice shall have been delivered no earlier than October 1 nor later than
December 31 in any calendar year (commencing in 1996). Notice of termination of
automatic renewal having been given as aforesaid, the term of employment of the
Executive under this Section 1 shall continue until December 31 of the third
calendar year after the year in which such notice is so given. Said term shall
not continue after December 31, 2008 whether or not such notice shall have been
given in the year 2005 as aforesaid.
(c) Notwithstanding the provisions of Sections 1(a) and (b), the
term of employment of the Executive under this Agreement shall be subject
to immediate early termination:
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(i) at the election of the Company, by dismissal of the Executive
from his employment pursuant to resolution of the Board of Directors of
the Company, or failure or refusal of the Board of Directors to re-elect
the Executive to the position of Chief Financial Officer or other office
of the Company; or
(ii) at the election of the Company, upon determination of
disability of the Executive pursuant to Section 4 hereof; or
(iii) upon death of the Executive;
provided, however, that (1) in the event of termination pursuant to paragraph
(i) above without "proper cause" (as defined in Section 5 of this Agreement),
the Company shall thereafter be and remain obligated to pay to the Executive
(or his estate) the compensation and benefits described in Section 3(a), (b)(i)
(to the extent of group life and health insurance coverages), and (c) hereof
until expiration of the term of employment established by Section 1(a) as the
same may theretofore have been extended pursuant to Section 1(b) hereof; (2) in
the event of termination pursuant to paragraph (i) above for proper cause, the
Company shall thereupon be relieved of its obligations to pay any compensation
and benefits under Section 3 hereof (except for accrued and unpaid items); (3)
in the event of termination pursuant to paragraph (ii) above, the provisions of
Section 4 hereof shall apply; and (4) in the event of termination pursuant to
paragraph (iii) above, the Company shall be obligated to pay the Executive's
estate or designated beneficiary the compensation specified in Section 3(a)
hereof until expiration of the term of employment established by Section 1(a)
as the same may theretofore have been extended pursuant to Section 1(b) hereof
or, if earlier, the end of the twelfth calendar month following his death.
Section 2. SERVICES TO BE RENDERED.
The Company hereby agrees to employ the Executive as Vice President
and Chief Financial Officer of the Company to serve at its headquarters office
located in the Hermitage, Pennsylvania area, subject to the terms, conditions
and provisions of this Agreement. The Executive hereby accepts such employment
and agrees to serve without additional compensation, if elected, in any other
senior executive position of the Company reasonably requested of him and as an
officer and/or director of any subsidiary of the Company in accordance with
Section 10 hereof. The Executive shall devote his full-time best efforts to
such employment and shall apply substantially that degree of skill and
diligence in rendering services to the Company and its subsidiaries under this
Agreement as would be applied by a person of ordinary prudence and comparable
experience under similar circumstances. In connection therewith, the Executive
shall report to and be subject to the direction of the Board of Directors, the
Chairman of the Board and the President of the Company. Notwithstanding the
foregoing, the Executive may devote a reasonable amount of his time to his
personal investments and business affairs (including service as a director of
unaffiliated companies) and to civic and charitable activities; provided,
however, the Executive shall not accept any position as a director of any
unaffiliated for-profit business organization without advance approval of the
Company's Chairman of the Board or President (which approval shall not be
unreasonably withheld).
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Section 3. COMPENSATION.
In consideration for services rendered to the Company under this
Agreement (but excluding any directors' fees payable to the Executive), the
Company shall pay and provide to the Executive the following compensation and
benefits.
(a) SALARY. The Company shall pay the Executive a
minimum base salary at the rate of $130,000 per year during the term hereof, to
be paid in accordance with the Company's normal payroll practice, with such
minimum base salary to be adjusted from time to time to reflect (i) such merit
increases as the Board of Directors of the Company may determine are
appropriate and (ii) annual cost of living increases commensurate with those
given key executive officers of The First National Bank of Pennsylvania ("First
National").
(b) FRINGE BENEFITS. The Executive shall be entitled to
(i) vacations, retirement benefits and other fringe benefits, including but not
limited to group life and health insurance coverages, pursuant to the
compensation policies and practices of First National from time to time
prevailing (now and in the future) with respect to persons who are key
executive officers of First National, (ii) the use of office space comparable
to that which he presently occupies, and (iii) participation in any and all
benefits provided for under the January 1, 1986 Deferred Compensation Plan of
First National pursuant to the terms thereof, so long as said Plan shall remain
in effect.
(c) SUPPLEMENTAL RETIREMENT BENEFITS. The Executive
shall also be entitled to such supplemental retirement benefits, if any, as may
be provided by any plan or plans now or hereafter established by the Company
for senior executive officers of the Company and First National.
Section 4. DISABILITY.
The term of employment of the Executive under this Agreement may be
terminated at the election of the Company upon a determination by the Board of
Directors of the Company, made in its sole discretion, that the Executive will
be unable, by reason of physical or mental incapacity, to perform the
reasonably expected duties assigned to him pursuant to this Agreement for a
period longer than six consecutive months or more than nine months in any
consecutive twelve-month period. In the exercise of its discretion, the Board
of Directors shall give due consideration to, among such other factors as it
deems appropriate to the best interests of the Company, the opinion of the
Executive's personal physician or physicians and the opinion of any physician
or physicians selected by the Board of Directors for these purposes. The
Executive shall submit to examination by any physician or physicians so
selected by the Board of Directors, and shall otherwise cooperate with the
Board of Directors in making the determination contemplated hereunder (such
cooperation to include, without limitation, consenting to the release of
information by any such physician(s) to the Board of Directors). In the event
of such termination, the Company shall thereupon be relieved of its obligations
to pay compensation and benefits under Section 3 hereof (except for accrued and
unpaid items) but shall be obligated to pay or provide to the Executive until
the earlier of March 31, 2008 or his death the following:
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(a) For the period of twelve full calendar months next
following the date (the "Disability Date") at which the Executive was unable,
by reason of physical or mental incapacity, to perform and did not perform a
substantial portion of his essential duties hereunder (such date to be
determined by the Board of Directors in its sole discretion), a monthly
disability income benefit in an amount equal to 100% of the base salary (per
month) in effect under Section 3(a) hereof on the Disability Date; and
thereafter a monthly disability income benefit in an amount equal to 60% of the
average monthly base salary paid to the Executive under Section 3(a) hereof
during the twelve full calendar months next preceding the Disability Date. The
Company shall be entitled to credit, against its obligation to pay such
disability benefits, (i) the amounts received from time to time by the
Executive pursuant to any disability income insurance policy maintained by the
Company, (ii) the amounts received from time to time by the Executive as
retirement benefits pursuant to Section 3(b) and (c) hereof, and (iii) the
amounts received from time to time by the Executive as remuneration from any
other employment.
(b) Health insurance coverage comparable to the coverage
provided from time to time for key executive officers of First National, unless
and until the Executive shall have accepted other employment in which health
insurance coverage is available to him at the cost of his new employer.
Section 5. TERMINATION FOR PROPER CAUSE. The occurrence of any of
the following events or circumstances shall constitute "proper cause" for
termination, at the election of the Board of Directors of the Company, of the
term of employment of the Executive under this Agreement, to wit:
(a) the Executive shall voluntarily resign as a director,
officer or employee of the Company or any significant subsidiary without
approval of the Board of Directors of the Company for reasons other than a
breach of this Agreement in any material respect by the Company which has not
been cured within 30 calendar days after the Company's receipt of written
notice of such breach from the Executive;
(b) the perpetration of defalcations by the Executive
involving the Company or any of its affiliates, as established by certified
public accountants employed by the Company, or willful, reckless or grossly
negligent conduct of the Executive entailing a substantial violation of any
material provision of the laws, rules, regulations or orders of any
governmental agency applicable to the Company or its subsidiaries;
(c) the repeated and deliberate failure by the Executive,
after advance written notice to him, to comply with reasonable policies or
directives of the Board of Directors; or
(d) the Executive shall breach this Agreement in any
other material respect and fail to cure such breach within 30 calendar days
after the Executive receives written notice of such breach from the Company.
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Section 6. NON-COMPETITION.
The Executive agrees that during the term of his employment hereunder
and for the Restricted Period (hereinafter defined) after his employment
hereunder terminates or is terminated, he will not in any way, directly or
indirectly, manage, operate, control, accept employment or a consulting
position with or otherwise advise or assist or be connected with, or own or
have any other interest in, or right with respect to the revenues, receipts,
profits or losses of (other than through ownership of not more than 4.9% of the
outstanding shares of a corporation's stock which is listed on a national
securities exchange or in the NASDAQ system) any Competitive Enterprise
(hereinafter defined). For purposes of this Section 6:
(a) "Restricted Period" means the greater of (i) the
period of two years next following the termination of the Executive's
employment for proper cause (which may include, without limitation, his
resignation or any other event specified in Section 5 hereof), or (ii) the
period of time during which the Executive is receiving payments from the
Company pursuant to Section 1(c) or 4 hereof (as the case may be);
(b) "Competitive Enterprise" means any person, firm or
corporation that directly or indirectly (i) is engaged in lending and depositor
services of the kinds generally offered by the Company or in commercial banking
or in any other activity which is competitive with the Company or any of the
Company's present or future subsidiaries and (ii) conducts such business or
other activities described in clause (i) above in any county in which any of
the Company's present or future subsidiaries then operates or in any county
(within or without the Commonwealth of Pennsylvania) contiguous thereto.
The foregoing to the contrary notwithstanding, the provisions of this Section 6
shall not prohibit the Executive, during the Restricted Period, from rendering
services to a Competitive Enterprise if such services are rendered during his
physical presence at a place of business located within the Counties of
Allegheny or Dauphin, Pennsylvania or Cuyahoga, Ohio.
Without limitation of the Company's rights and remedies under this
Agreement or as otherwise provided by law or in equity, it is understood and
agreed between the parties that the right of the Executive to receive and
retain any payments otherwise due to him under this Agreement shall be
suspended and canceled if and for so long as he shall be in violation of the
foregoing covenant not to compete. If and when the Executive shall have cured
such violation and shall have tendered to the Company any and all economic
benefits directly or indirectly received or receivable by him arising
therefrom, such right shall be automatically reinstated but only for the
remainder of the period during which such payments are due him.
If the employment of the Executive hereunder shall have been
terminated without proper cause pursuant to paragraph (i) of Section 1(c)
hereof or because of disability pursuant to paragraph (ii) of Section 1(c)
hereof, and if the Executive shall have duly complied with and observed the
covenants of this Section 6, the Executive may, at his election, be discharged
from the covenants of this Section 6 at any time during the Restricted Period
by filing with the Company a duly executed statement (in form and content
reasonably satisfactory to the Board of Directors of the Company) releasing the
Company (and, if applicable, its insurance carriers) from any and all
obligations it (or they) may have (under Sections 1(c), 3 and 4 or otherwise)
by reason of such termination (except for accrued and unpaid items).
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Section 7. CONFIDENTIALITY.
For purposes of this Agreement, "proprietary information" shall mean
any information relating to the business of the Company or its subsidiaries
that has not previously been publicly released by duly authorized
representatives of the Company and shall include (but shall not be limited to)
Company information encompassed in all marketing and business plans, financial
information, costs, pricing information, and all methods, concepts, or ideas in
or reasonably related to the business of the Company or its subsidiaries and
not in the public domain.
The Executive agrees to regard and preserve as confidential all
proprietary information that has been or may be developed or obtained by the
Executive in the course of his employment with the Company and its
subsidiaries, whether he has such information in his memory or in writing or
other physical form. The Executive shall not, without written authorization
from the Company to do so, use for his benefit or purposes, nor disclose to
others, either during the term of his employment hereunder or thereafter,
except as required by the conditions of his employment hereunder, any
proprietary information connected with the business or development of the
Company or its subsidiaries. This prohibition shall not apply after the
proprietary information has been voluntarily disclosed to the public,
independently developed and disclosed by others, or otherwise enters the public
domain through lawful means.
Section 8. REMOVAL OF DOCUMENTS OR OBJECTS.
The Executive agrees not to remove from the premises of the Company,
except as an employee of the Company in pursuit of the business of the Company
or any of its subsidiaries or affiliates, or except as specifically permitted
in writing by the Company, any document or object containing or reflecting any
proprietary information. The Executive recognizes that all such documents and
objects, whether developed by him or by someone else, are the exclusive
property of the Company.
Section 9. INJUNCTIVE RELIEF.
It is understood and agreed by and between the parties hereto that the
services to be rendered by the Executive hereunder are of a special, unique,
extraordinary and intellectual character, which gives them a peculiar value,
the loss of which may not be reasonably or adequately compensated in damages,
and additionally that a breach by the Executive of the covenants set out in
Sections 6, 7 and 8 of this Agreement will cause the Company great and
irreparable injury and damage. The Executive hereby expressly agrees that the
Company shall be entitled to the remedies of injunction, specific performance
and other equitable relief to prevent a breach of Sections 6, 7 and 8 of this
Agreement by the Executive. This provision shall not, however, be construed as
a waiver of any of the remedies which the Company may have for damages or
otherwise.
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Section 10. SUBSIDIARIES.
It is understood and agreed by the parties hereto that, at the
election and direction of the Company's Board of Directors and without
modification of the terms and provisions hereof, the Executive shall also serve
as an executive officer of any one or more subsidiaries of the Company and,
when and as so determined by the Board and any such subsidiary, the rights,
duties and obligations of the Company expressed and implied in this Agreement
shall inure to the benefit of and bind any subsidiary with the same force and
effect as would obtain if the subsidiary were a party hereto jointly and
severally with the Company.
Section 11. MERGER OR CONSOLIDATION.
In the event of the merger or consolidation of the Company with
another corporation, and as a result of such merger or consolidation, the
shareholders of the Company as of the day preceding such transaction will own
less than 51% of the outstanding voting securities of the surviving
corporation, or in the event that there is (in a single transaction or series
of related transactions) a sale or exchange of 80% or more of the Common Stock
of the Company for securities of another entity in which shareholders of the
Company will own less than 51% of such entity's outstanding voting securities,
or in the event of the sale by the Company of a substantial portion of its
assets to an unrelated third party, the Executive shall have the right, at his
sole option, to terminate his employment under this Agreement upon 30 days'
advance written notice, provided such written notice shall have been delivered
to the Company during the period beginning upon public announcement of the
subject transaction and ending not more than 60 days after the effective date
of such transaction. The Executive shall thereupon be entitled to receive from
the Company a cash bonus (the "Cash Bonus") whose "present value" (as defined
in paragraph (4) of subsection (d) of Section 280G of the Internal Revenue Code
of 1986, as amended (the "Code")) on the closing date of such transaction is
equal to two hundred percent (200%) of the Executive's "base amount" (as
defined in paragraph (3) of subsection (b) of said subsection (b) of said
Section 280G). (Said present value of the Cash Bonus is hereinafter referred
to as the "Initial Present Value".) The Cash Bonus shall be paid as follows:
an amount equal to one-third (1/3) of the Initial Present Value shall be paid
on the effective date of the termination of his employment hereunder; an
additional amount whose present value on the said closing date under Section
280G(d)(4) was one-third of the Initial Present Value shall be paid on the last
day of the sixth month following such effective date; and a final amount whose
present value on the said closing date under Section 280G(d)(4) was equal to
one-third of the Initial Present Value shall be paid on the last day of the
twelfth month following such effective date. If the Executive does not elect
to terminate this Agreement as aforesaid, then this Agreement shall remain in
effect and be assigned and transferred to the Company's successor in interest
as an asset of the Company, and the Company shall cause such assignee to assume
the Company's obligations hereunder; and in such event the Executive hereby
confirms his agreement to continue to perform his duties and obligations
according to the terms and conditions hereof for such assignee or transferee of
this Agreement. It is understood and agreed, however, that the scope of the
Executive's services under Section 2 of this Agreement shall be appropriately
modified, at the election of such successor, to cover the segment of such
successor's enterprise represented by the Company's assets and operations at
the time of such aforementioned transaction.
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Section 12. SUCCESSORS, ASSIGNS, ETC.
This Agreement shall be binding upon, and shall inure to the benefit
of, the Executive and the Company and their respective permitted successors,
assigns, heirs, legal representatives and beneficiaries.
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 effect any such action shall be null,
void and of no effect; provided, however, that nothing in this Section 12 shall
preclude the assumption of such rights by executors, administrators or other
legal representatives of the Executive or his estate and their assigning any
rights hereunder to the person or persons entitled thereto.
Nothing in this Agreement shall preclude the Company from consolidating
or merging into or with, or transferring all or substantially all of its assets
to, another corporation which assumes this Agreement and all obligations and
undertakings of the Company hereunder. Upon such a consolidation, merger or
transfer of assets and assumption, the term, "Company," as used herein shall
mean such other corporation and this Agreement shall continue in full force and
effect.
Section 13. NOTICES.
All notices and other communications which are required or may be
given under this Agreement shall be in writing and shall be deemed to have been
given if delivered personally or sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed as follows:
(a) To the Company: F.N.B. Corporation
Hermitage Square
Hermitage, Pennsylvania
Attention: Secretary
(b) To the Employee: Xx. Xxxx X. Xxxxxx
0000 Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
or to such other place as either party shall have specified by notice in
writing to the other. A copy of any notice or other communication given under
this Agreement shall also be sent to the Treasurer of the Company addressed to
such officer at the then principal office of the Company.
Section 14. GOVERNMENTAL REGULATION.
Nothing contained in this Agreement shall be interpreted, construed or applied
to require
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the commission of any act contrary to law and whenever there is any conflict
between any provision of this Agreement and any statute, law ordinance, order
or regulation, the latter shall prevail; but in such event any such provision
of this Agreement shall be curtailed and limited only to the extent necessary
to bring it within applicable legal requirements.
Section 15. ARBITRATION.
Any dispute or controversy as to the validity, interpretation,
construction, application or enforcement of, or otherwise arising under or in
connection with this Agreement, shall be submitted at the request of either
party hereto for resolution and settlement through arbitration in Pittsburgh,
Pennsylvania in accordance with the rules then prevailing of the American
Arbitration Association. Any award rendered therein shall be final and binding
on each of the parties hereto and their heirs, executors, administrators,
successors and assigns, and judgment may be entered thereon in any court having
jurisdiction. The foregoing provisions of this Section 15 shall not be deemed
to limit the rights and remedies reserved to the Company under and pursuant to
Section 9 hereof.
Section 16. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Pennsylvania.
Section 17. DIVISIBILITY.
Should a court or arbitrator declare any provision hereof to be
invalid, such declaration shall not affect the validity of the Agreement as a
whole or any part thereof, other than the specific portion declared to be
invalid.
Section 18. HEADINGS.
The headings to the Sections and paragraphs hereof are placed herein
for convenience of reference only and in case of any conflict the text of this
Agreement, rather than the headings, shall control.
Section 19. ENTIRE AGREEMENT; AMENDMENT.
This Agreement sets forth the entire understanding of the parties in
respect of the subject matter contained herein and supersedes all prior
agreements, arrangements and understandings relating to the subject matter and
may only be amended by a written agreement signed by both parties hereto or
their duly authorized representatives.
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IN WITNESS WHEREOF, on the 31st day of January, 1996 the parties
hereto have executed this Agreement to be effective as of the date first above
written.
WITNESS: EXECUTIVE
/s/ XXXXXX X. XXXXX /s/ XXXX X. XXXXXX
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Xxxx X. Xxxxxx
ATTEST: F.N.B. CORPORATION
/s/ XXXXX X. XXXX By: /s/ XXXXXXX X. XXXXXXXX
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Title: Executive Vice President
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