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Exhibit 10.10
EMPLOYMENT AGREEMENT
THIS AGREEMENT, entered into pursuant to authority of a resolution of the
Compensation Committee on the 16th day of October, 1996, effective as of the
16th day of October, 1996, between First Security Corporation (the "Employer"),
and Xxxx X. Xxxxxx (the "Employee").
1. EMPLOYMENT. The Employer hereby employs the Employee, and the Employee
hereby accepts such employment, upon the terms and subject to the conditions
set forth in this Agreement.
2. DUTIES.
2.1 GENERAL DUTIES. As of the date hereof, the Employee's position with
the Employer is that of Executive Vice President, Business Banking Services of
First Security Corporation. Subject to the provisions of paragraphs 6 and 7 of
this Agreement, the Employer may change the title, powers and duties of the
Employee in its sole discretion, and the Employee agrees to perform such duties
upon the terms and subject to the conditions set forth in this Agreement.
2.2 OTHER DUTIES. Employee shall also serve, without additional
compensation, in such other offices and directorships of First Security
Corporation (the "Corporation") and its subsidiaries and related corporations
("Affiliates") that he presently holds, or to which he in the future be elected
or appointed. Upon termination of employment with the Employer, the Employee
shall immediately submit a letter of resignation from all offices and
directorships with the Employer, the Corporation and its Affiliates.
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3. TERM OF EMPLOYMENT. The Employee shall have the right to terminate
employment at any time. The Employer shall have the right to terminate the
Employee's employment at any time with or without cause. Any such termination of
employment under this Agreement shall be subject to the provisions of paragraphs
6 and 7 below.
4. COMPENSATION.
4.1 BASE COMPENSATION. As regular or base compensation for services
rendered to the Corporation and its Affiliates in whatever capacity rendered,
the Employer shall pay to the Employee a regular compensation. The parties
acknowledge that, as of the date of this Agreement, the Employer is paying to
the Employee an annual regular base salary of $195,002, payable semi-monthly.
Such amount may be increased or decreased from time to time in the sole and
absolute discretion of the Employer, without need to amend or, subject only to
the provisions of paragraphs 6 and 7 below.
4.2 ADDITIONAL COMPENSATION. The Employer, in its sole and absolute
discretion, may from time to time offer equity-based incentives or other
incentives or benefits to the Employee, which shall be in addition to such
regular compensation. The Employer may modify or terminate such incentives in
its discretion, and the Employee acknowledges that he shall have no vested
rights in any such incentives, except as expressly provided under the terms
thereof, and subject to the provisions of paragraphs 6 and 7 below.
5. TERM.
5.1 INITIAL TERM. The term of this Agreement shall begin on October 16,
1996, and shall continue for a period of three (3) years (the "Term").
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5.2 AUTOMATIC RENEWAL. The Term of this Agreement and each renewal thereof
shall automatically be renewed for successive periods of three (3) years each,
unless either the Employee or the Employer shall give notice of his or its
intention not to renew not less than six (6) months before the end of the
then-current Term.
5.3 EXTENSION UPON CHANGE OF CONTROL. If a Change of Control (as defined
in paragraph 7.1 below) shall occur during the Term or any renewal thereof, the
Term shall automatically be extended for a period of five years from the date on
which such Change of Control occurs.
6. PAYMENTS UPON TERMINATION.
6.1 TERMINATION OF EMPLOYMENT BY EMPLOYER.
(a) TERMINATION WITH CAUSE. If the Employer terminates the
Employee's employment with the Employer at any time "with cause" (as defined
below), the Employer shall only be obligated to pay to the Employee, on or
before the effective date of such termination, the Employee's regular
compensation (as in effect on the date of termination) through the effective
date of such termination, and the amounts, if any, required by the terms of any
applicable Plan in accordance with paragraph 11 hereof. For purposes of this
paragraph, the Employer may terminate the Employee "with cause" when the
Employer reasonably determines that:
(i) the Employee intentionally, recklessly or as the result of
gross negligence substantially violates his duties under this Agreement or as
otherwise assigned to him from time to time by the Employer; or
(ii) the Employee commits any act or acts which constitute
dishonesty, commission of a felony, or fraud;
(b) TERMINATION WITHOUT CAUSE. If the Employer shall determine to
terminate the Employee for any reason other than "with cause," as defined by
subparagraph 6.1(a) above, the Employer shall be obligated to pay to the
Employee, on
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or before the effective date of such termination, the Employee's regular
compensation (as in effect on the date of termination) through the effective
date of such termination, and the amounts, if any, required by the terms of any
applicable Plan in accordance with paragraph 11 hereof. In addition, the
following provisions shall apply:
(i) The Employer shall notify the Employee in writing that the
Employee is being terminated;
(ii) A "Guaranteed Compensation Period" shall commence on the
date the Employee receives written notice of termination;
(iii) The Guaranteed Compensation Period shall cease on the
earlier of:
(A) the one year anniversary of the date the
Employee received written notice of termination, or
(B) the first date as of which the Employee is not
willing or available to perform services for the Employer for any reason
including but not limited to death, disability or other employment. For purposes
of determining the Guaranteed Compensation Period, the term "services" shall
mean either the services the Employee was performing on the date the Employee
received written notice of termination or substantially similar services for
which the Employee is suited by experience or training, provided however, that
there shall be no significant change in the nature or scope of the Employee's
authorities or duties. In addition, the Employer shall not require the Employee
to change location from the particular location at which the Employee normally
performed services as of the date the Employee received written notice of
termination to a location outside a 30-mile radius of such prior location or
require the Employee to undertake new and excessive business travel. Also for
purposes of determining the Guaranteed Compensation Period, the terms "willing"
or "available" shall mean that the Employee, with reasonable notice from the
Employer, reports to the Employer and performs the agreed upon services. During
the
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Guaranteed Compensation Period, the Employee shall continue to receive
regular base salary (hereinafter sometimes referred to as "regular compensation"
or "regular base salary"), with payments being made semi-monthly, and shall
continue to be eligible to participate in the Management Annual Cash Incentive
Bonus Program ("MACIBP") in accordance with paragraph 6.1(b)(iv) below. During
the Guaranteed Compensation Period, the Employee shall cease to actively
participate in all other retirement and welfare benefit plans.
(iv) For any Plan Year under the MACIBP that ends during an
Employee's Guaranteed Compensation Period, the Employee shall be entitled to
receive payments for such Plan Year as if all performance goals for such Plan
Year were met at the "target" level. In addition, the Employee shall be entitled
to receive proportionate payment for any partial Plan Year under the MACIBP that
falls within the Employee's Guaranteed Compensation Period. Any such
proportionate payment shall be calculated based on the assumption that all
performance goals for such Plan Year were met at the "target" level for such
partial Plan Year.
(c) TERMINATION WITHOUT CAUSE AFTER CHANGE OF CONTROL. If the
Employer shall determine to terminate the Employee for any reason other than
"with cause," as defined in paragraph 6.1(a) above, and such termination shall
occur after a Change of Control, in addition to the payments provided in
paragraph 6.1(b), the Employer shall be obligated to make the following
payments:
(i) On or before the effective date of the Employee's
termination, the Employer shall pay the Employee's regular compensation (as in
effect on the date of termination) through the effective date of such
termination.
(ii) If the Employee has not attained an Early Retirement Date
as defined in Section 4.01(b) of the First Security Supplemental Executive
Retirement Plan ("SERP"), the Employer shall pay a benefit equal to the benefit
that would have been paid under the SERP as if the Employee had attained an
Early Retirement Date
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and as if consent had been granted. For purposes of the
calculation of this benefit, Early Retirement Percentages (as defined in Section
5.02 of the SERP) will continue to increase at a rate of 3% per year for each
year prior to age 50. No amount shall be paid under this paragraph 6.1(c)(ii) to
the extent that such benefit is payable under the SERP.
(iii) On or before the effective date of the Employee's
termination of employment, the Employer shall pay "severance pay" in a single
lump sum amount, determined as follows:
(A) the Employee's "regular monthly compensation" shall
be determined by dividing by twelve (12) the greater of (1) the Employee's
annual regular compensation as in effect as of the last day of the full calendar
month immediately prior to the month in which the Change of Control occurred,
and (2) the Employee's annual regular compensation as in effect as of the last
day of the full calendar month immediately prior to the month in which the
termination occurs;
(B) the Employee's "average monthly bonus" shall be
determined by adding together the total amount of bonus and other cash
incentives received by the Employee during each of the three (3) full calendar
years immediately preceding the year in which the termination occurs, and
dividing the sum by thirty-six. If the Employee has worked less than three (3)
full calendar years, the average monthly bonus shall be determined by adding
together the total amount of bonus and other cash incentives received by the
Employee during the employment period and dividing by the number of months of
employment.
(C) the Employee's "gross severance pay" shall be
determined by adding together the Employee's regular monthly compensation and
average monthly bonus, and multiplying the sum by thirty-six. If the Employee
has worked less than three (3) full calendar years, the "gross severance pay"
shall be determined by adding
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together the total amount of bonus and other cash incentives received by the
Employee during the employment period and dividing by the number of months of
employment.
(D) the net amount of severance pay which the Employer
shall pay to the Employee shall be determined by subtracting from the Employee's
gross severance pay any amounts actually paid to the Employee under the First
Security Severance Pay Plan or any successor severance plan or program sponsored
by the Employer, the Corporation or its Affiliate; provided that such amount may
be further reduced as provided in paragraph 17, below, and shall be subject to
the withholding and offset as provided in paragraph 10.
6.2 TERMINATION BY THE EMPLOYEE
(a) TERMINATION BEFORE A CHANGE OF CONTROL. The Employee may
terminate his employment with the Employer at any time before a change of
control, in which event the Employer shall only be obligated to pay to the
Employee, on or before the effective date of such termination, the Employee's
regular compensation (as in effect on the date of such termination) through the
effective date of termination, and the amounts, if any, required by the terms of
any applicable Plan in accordance with paragraph 11 hereof.
(b) TERMINATION AFTER A CHANGE OF CONTROL. The Employee may
terminate his employment with the Employer at any time after a change of
control, in which event the Employer shall be obligated to pay to the Employee,
on or before the effective date of such termination, the Employee's regular
compensation (as in effect on the date of such termination) through the
effective date of termination, and the amounts, if any, required by the terms of
any applicable Plan in accordance with paragraph 11 hereof. In addition if the
Employee elects to terminate his employment with the Employer due to or as a
result of any "Change in Duties or Compensation" (as defined below) from the
duties and compensation that existed immediately before such Change of Control
occurred, then the Employer shall be obligated to pay to the
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Employee, on or before the thirtieth (30th) day following the date upon which
the Employee gives notice of his intent to terminate his employment, the amount
specified in paragraph 6.1(c) above. The foregoing provisions shall not affect
Employee's entitlement under any plan sponsored by the Corporation or the
Employer as set forth in paragraph 11 hereof.
6.3 LIMITATIONS UPON OBLIGATION TO MAKE PAYMENT. The Employer shall
not be required to make payment under paragraph 6.1(c) or 6.2(b), above, if:
(a) the Employee dies while employed by the Employer; or
(b) the Employee's employment is terminated or the Employee is
transferred as a result of or in connection with a corporate reorganization, the
sale of a subsidiary, a sale of assets, a transfer of a division,
reincorporation, or any similar event, if as part of such event the Employee is
employed or is offered employment by any successor entity in the same position
with no Change in Duties or Compensation as defined by paragraph 7.3, and either
such successor has assumed, or the Employer agrees to remain liable under, this
Agreement.
7. DEFINITIONS.
7.1 CHANGE OF CONTROL. For purposes of this Agreement, "Change of Control"
shall mean the occurrence of any of the following events:
(a) either (i) receipt by the Corporation of a report on Schedule
13D, or an amendment to such a report, filed with the Securities and Exchange
Commission pursuant to Section 13(d) of the Securities Exchange Act of 1934 (the
"1934 Act") disclosing that any person (as such term is used in Section 13(d) of
the 0000 Xxx) ("Person"), is the beneficial owner, directly or indirectly, of
twenty (20) percent or more of the outstanding stock of the Corporation or (ii)
actual knowledge by the Corporation of facts, on the basis of which any Person
is required to file such a report on Schedule 13D, or to make an amendment to
such a report, with the SEC (or would be required to
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file such a report or amendment upon the lapse of the applicable period of time
specified in Section 13(d) of the 0000 Xxx) disclosing that such Person is the
beneficial owner, directly or indirectly, of twenty (20) percent or more of the
outstanding stock of the Company;
(b) the purchase by any Person, other than the Corporation or a
wholly-owned subsidiary of the Corporation, of shares pursuant to a tender or
exchange offer to acquire any stock of the Corporation (or securities
convertible into stock) for cash, securities or any other consideration;
provided that, after consummation of the offer, such Person is the beneficial
owner (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of
twenty (20) percent or more of the outstanding stock of the Corporation
(calculated as provided in paragraph (d) of Rule 13d-3 under the 1934 Act in the
case of rights to acquire stock):
(c) approval by the stockholders of the Corporation of (i) any
consolidation or merger of the Corporation in which the Corporation is not the
continuing or surviving corporation or pursuant to which shares of stock of the
Corporation would be converted into cash, securities or other property, other
than a consolidation or merger of the Corporation in which holders of its common
stock immediately prior to the consolidation or merger have substantially the
same proportionate ownership of common stock of the surviving corporation
immediately after the consolidation or merger as immediately before, or (ii) any
consolidation or merger in which the Corporation is the continuing or surviving
corporation but in which the common stockholders of the Corporation immediately
prior to the consolidation or merger do not hold at least a majority of the
outstanding common stock of the continuing or surviving corporation (except
where such holders of common stock hold at least a majority of the common stock
of the corporation which owns all of the common stock of the Corporation), or
(iii) any sale, lease, exchange or other transfer (in one
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transaction or series of related transactions) of all or substantially all the
assets of the Corporation; or
(d) a change in the majority of the members of the Corporation's
Board of Directors within a 24-month period unless the election or nomination
for election by the Corporation's stockholders of each new director was approved
by the vote of at least two-thirds of the directors then still in office who
were in office at the beginning of the 24-month period.
7.2 DETERMINATION BY BOARD OF DIRECTORS. A determination of the Board of
Directors, or the Executive Committee of the Board of Directors, of the
Corporation that a Change of Control within the above definition has occurred
and its decision to activate a similar provision upon such Change of Control
under any plan or other arrangement shall be final and binding on the
Corporation and all persons interested in the Agreement.
7.3 CHANGE IN DUTIES OR COMPENSATION. For purposes of this Agreement,
"Change in Duties or Compensation" shall mean any one or more of the following:
(a) a significant change in the nature or scope of the Employee's
authorities or duties from those authorities or duties of the Employee
immediately prior to the date upon which a Change of Control occurs;
(b) a reduction in the Employee's regular base salary from that
provided to him immediately prior to the date upon which a Change of Control
occurs;
(c) if the Employee shall be subjected to a material decrease in
compensation or benefits (other than decreases imposed equally upon all
employees);
(d) if the Employer requires the Employee to change location from
the particular location at which Employee was located immediately before such
Change of Control to a location outside a 30-mile radius of such prior location,
or requires the Employee to undertake new and excessive business travel without
the Employee's prior consent; or
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(e) if, as a result of a Change in Control and a change in
circumstances thereafter significantly affecting the position of the Employee,
the Employee is unable to exercise the authorities, powers, function or duties
attached to his position immediately prior to the date on which a Change of
Control occurs.
8. OBLIGATIONS OF THE EMPLOYEE. The Employee shall perform conscientiously
and to the best of his ability all duties assigned to him by the Employer (in or
with the Corporation, the Employer or any Affiliate), and shall devote his full
time and attention to the performance of such duties to the exclusion of any
other commercial duties or pursuits whatsoever. The Employee shall not become
involved in any personal investment or business which may adversely affect the
business of the Employer, the Corporation or its Affiliates. Compliance by the
Employee with the Standards for Officers and Professionals of First Security
Corporation and Affiliates, as now in effect or as amended from time to time,
shall be a condition of the Employee's continued employment. The Employee shall
affirm compliance with such Standards at least annually, and shall make
disclosures as required by such Standards.
9. CONFIDENTIAL INFORMATION. The Employee acknowledges and recognizes that
the Employer and its Affiliates are in the financial, investment and banking
business, which business is highly competitive, and that the Employee, in his
position, will have access to and become familiar with certain proprietary and
confidential information of the Employer, the Corporation and its Affiliates,
including without limitation customer, investment and financial data of a highly
confidential nature. The Employee hereby agrees not to use, during the course of
his employment or thereafter, any such confidential or proprietary information
or divulge such information to any person, unless the Employer gives its consent
in writing in each instance, or unless the Employee is compelled to disclose
such information by a governmental process. The Employee
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further hereby agrees not to publish orally or in writing any derogatory
information tending to defame or malign or in fact defaming or maligning the
Employer, the Corporation or its Affiliates, or present or former employees or
directors of the Employer, the Corporation or its Affiliates. The Employee also
hereby agrees and warrants that under no circumstances shall the Employee remove
from the Employer's premises any books, records, documents, customer lists,
financial data, or any other documents. The provisions of this paragraph 9 shall
survive any termination of this Agreement or of the Employee's employment with
the Employer.
10. WITHHOLDING FROM AND OFFSET OF SEVERANCE PAYMENTS. The obligation of
the Employer to make the payments referred to in paragraphs 4 and 6 of this
Agreement shall be subject to the following:
(a) TAXES. The Employer shall withhold all applicable federal, state
and local taxes as required by relevant law and regulation then in effect,
including without limitation FICA and other taxes.
(b) DEBTS AND LIABILITIES OF THE EMPLOYEE. The Employer may withhold
from or offset against such payments any liabilities or debts of the Employee to
the Employer, the Corporation and its Affiliates, and may suspend or defer such
payments during the pendency of resolution of any claims of the Employer, the
Corporation and its Affiliates against the Employee of whatsoever nature.
11. APPLICATION TO OTHER PLANS, ETC. Except as otherwise specifically provided
in this paragraph 11, this Agreement shall not determine, govern or effect the
Employee's entitlement to (a) any payments or benefits after severance under the
MACIBP, (b) any accrued vacation or other compensation under any other plan,
policy or arrangement provided by the Employer, the Corporation or its
Affiliates, or (c) any other employee benefit plan or arrangement. Any benefits
to which Employee may be entitled Under
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the SERP, the First Security Incentive Savings Plan, the First Security
Retirement Plan, the First Security ERISA Excess Plan, the First Security
Corporation Comprehensive Management Incentive Plan, the First Security Deferred
Compensation Plan, the First Security Severance Pay Plan, or any other plan now
or hereafter established by the Employer, the Corporation or its Affiliates for
a group of its eligible employees shall be paid, if required by such plan, in
addition to the payments hereunder, in accordance with and limited by the terms
of the respective plans then in effect; provided that:
(a) the severance payments under this Agreement shall not cause an
increase under any pension, welfare or other plan sponsored by the Employer, the
Corporation or any Affiliate; there shall be no accrual of retirement, vacation,
or any pension and/or welfare benefits of any nature as a result of such
severance payments; and the Employee shall not be deemed employed or on a paid
leave for any purpose or for any period of time as a result of such severance
payments.
(b) The calculation of the amount of severance pay to be paid under
this Agreement shall be reduced by any severance payments that may be due under
the First Security Severance Pay Plan or any successor severance plan or program
then sponsored by the Employer, the Corporation or an Affiliate, that are
actually paid to the Employee. The Employer's right to cancel or reduce any plan
or program now or hereafter in effect shall not be reduced or affected by the
Agreement.
12. ACKNOWLEDGMENTS AND REPRESENTATIONS. The Employee hereby represents
and acknowledges that:
(a) no promises of any special treatment or provision have been made
by any person to the Employee;
(b) nothing in this Agreement shall be construed to limit or prevent
the Employer, the Corporation or any Affiliate from reducing, discontinuing,
terminating or amending any benefit plans or programs in any manner permitted by
law.
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(c) the Employee's legal counsel has reviewed this Agreement, and
the Employee has had an opportunity to consult with an attorney or other person
or advisor of his choice in connection with the execution of this Agreement.
13. NO FIDUCIARY RELATIONSHIP. Nothing contained in this Agreement and no
action taken pursuant to the provisions of this Agreement shall create or be
construed to create a trust of any kind, or a fiduciary relationship between (a)
the Employer, the Corporation or any of its Affiliates, and (b) the Employee or
any other person.
14. NO ASSIGNMENT OF BENEFITS. The rights of the Employee or any other person
to the payment of compensation or other payments under this Agreement may not be
assigned, transferred, pledged, or encumbered in any manner, either voluntarily
or involuntarily. Any attempt to so transfer or otherwise dispose of such
interest shall be void.
15. MERGER OR CONSOLIDATION. In the event of any consolidation or merger of
the Employer into or with another corporation or entity, or the sale of all or
substantially all of the assets of the Employer to another corporation, person
or entity, such person, corporation or entity shall assume the Employer's
obligations under this Agreement and become obligated to perform all of the
terms and conditions hereof. The Employee's employment shall not be deemed to
have terminated in any such event for purposes of this Agreement.
16. NO FUNDING. The Employer shall be under no obligation whatsoever to
purchase or maintain any contract, policy, arrangement or other asset to provide
the benefits under this Agreement. Further, any contract, policy, arrangement,
or other asset which the Employer may utilize to assure itself of the funds to
provide the benefits
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required hereunder shall not serve in any way as security to the Employee for
the Employer's performance under this Agreement. The rights accruing to the
Employee hereunder shall be solely those of an unsecured creditor of the
Employer.
17. LIMITATION ON GOLDEN PARACHUTE PAYMENTS.
17.1 REDUCTION OF BENEFITS. Any provision of the Agreement to the contrary
notwithstanding, in the event that the independent auditors most recently
selected by the Corporation's or the Employer's Board of Directors (the
"Auditors") determine that any payment or transfer by the Employer to or for the
benefit of the Employee, whether paid or payable (or transferred or
transferable) pursuant to the terms of this Agreement or otherwise (a
"Payment"), would be nondeductible by the Employer for federal income tax
purposes because of the provisions covering "excess parachute payments" in
section 280G of the Internal Revenue Code of 1986, as amended, or any successor
code or law (the "Code"), then the aggregate present value of all payments shall
be reduced (but not below zero) to the Reduced Amount. For purposes of this
paragraph 17, the "Reduced Amount" shall be the amount, expressed as a present
value, which maximizes the aggregate present value of the Payments without
causing any Payment to be nondeductible by the Employer because of section 280G
of the Code.
17.2 NOTICE TO THE EMPLOYEE. If the Auditors determine that any Payment
would be nondeductible by the Employer because of section 280G of the Code, then
the Employer shall promptly give-notice of such determination to the Employee,
together with a detailed calculation thereof and of the Reduced Amount. The
Employee may then elect, in his sole discretion, which and how much of the
Payments shall be eliminated or reduced (as long as after such election the
aggregate present value of the Payments equals the Reduced Amount), and shall
advise the Employer in writing of his election within 10 days of receipt of
such notice. If no such election is made by the Employee within such 10-day
period, then the Employer may elect which and how
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much of the Payments shall be eliminated or reduced (as long as after such
election the aggregate present value of the Payments equals the Reduced Amount),
and shall advise the Employer in writing of his election within 10 days of
receipt of such notice. If no such election is made by the Employee within such
10-day period, then the Employer may elect which and how much of the Payments
shall be eliminated or reduced (as long as after such election the aggregate
present value of the Payments equals the Reduced Amount) and shall promptly
notify the Employee of such election. For purposes of this paragraph 17, present
value shall be determined in accordance with section 280G(d)(4) of the Code. All
determinations made by the Auditors under this paragraph 15 shall be binding
upon the Employer and the Employee and shall be made within sixty (60) days of
the date a payment becomes payable or transferable.
17.3 PAYMENT. As promptly as practicable following such determination and
the elections hereunder, the Employer shall pay or transfer to or for the
benefit of the Employee such amounts as are then due to him under the Agreement
and shall promptly pay or transfer to or for the benefit of the Employee in the
future such amounts as become due to him under the Agreement.
17.4 OVERPAYMENTS AND UNDERPAYMENTS. As a result of uncertainty in the
application of section 280G of the Code at the time of an initial determination
by the Auditors hereunder, it is possible that Payments will have been made by
the Employer which should not have been made (an "Overpayment"), or that
additional Payments which will not have been made by the Employer could have
been made (an "Underpayment"), consistent in each case with the calculation of
the Reduced Amount hereunder. In the event that the Auditors, based upon the
assertion of a deficiency by the Internal Revenue Service against the Employer
or the Employee that the Auditors believe has a high probability of success,
determine that an Overpayment has been made, such Overpayment shall be treated
for all purposes as a loan to the Employee which he shall repay to the Employer,
together with interest at the applicable federal rate provided in section
7872(b)(2) of the Code; provided, however, that no amount shall be payable by
the Employee to the Employer if and to the extent that such payment would not
reduce the amount which is subject to taxation under section 4999 of the Code.
In the event that the Auditors determine that an Underpayment has
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occurred, such Underpayment shall promptly be paid or transferred by the
Employer to or for the benefit of the Employee, together with interest at the
applicable federal rate provided in section 7872(f)(2) of the Code.
17.5 DEFINITION OF "EMPLOYER". For purposes of this paragraph 17 only, the
term "Employer" shall include affiliated corporations to the extent determined
by the Auditors in accordance with section 280G(d)(5) of the Code.
18. ARBITRATION. Any controversy or claim arising out of or relating to this
Agreement or the breach thereof shall be settled by arbitration before a law
trained arbitrator in accordance with the American Arbitration Association rules
then applicable and judgment upon the award rendered may be entered in any court
having jurisdiction thereof. Each party to such arbitration shall have an
unlimited number of strikes or objections to the arbitrators on any list of
arbitrators submitted by the American Arbitration Association. The Employer
shall pay any and all attorney's fees incurred by the Employee in connection
with the resolution of any controversy or claim arising out of or relating to
this Agreement or the breach thereof.
19. NOTICES. All notices, requests, consents and demands shall be given to or
made upon the parties at their respective addresses set forth below, or at such
other address as a party may designate in writing delivered to the other party.
Unless otherwise agreed in this Agreement, all notices, requests, consents and
demands shall be given or made by personal delivery, by confirmed air courier,
by telegram, by facsimile transmission ("fax"), or by certified first class
mail, return receipt requested, postage prepaid, to the party addressed to such
address. If sent by confirmed air courier, such notice shall be deemed to be
given upon the earlier to occur of the date upon which it is actually received
by the addressee or the business day upon which delivery is made at such address
as confirmed by the air courier (or if the date of such confirmed delivery is
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not a business day, the next succeeding business day). If mailed, such notice
shall be deemed to be given upon the earlier to occur of the date upon which it
is actually received by the addressee or the third business day following the
date upon which it is deposited in a first-class postage-prepaid envelope in the
United States mail addressed to such address. If given by fax, such notice shall
be deemed to be given upon the date it is actually received by the addressee. If
given by telegram, such notice shall be deemed to be given upon the earlier to
occur of the date actually received by the addressee or the business day
following the date upon which it is delivered to the telegraph company.
If to the Employer:
First Security Corporation
00 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
If to the Employee:
Xxxx X. Xxxxxx
0000 Xxxx Xxxxxx Xxxx
Xxxxxx, Xxxx 00000
20. ASSIGNMENT. The Employee may be transferred from employment with the
Employer to employment with another corporation that was affiliated with the
Employer prior to the date on which a Change of Control occurs, in which case
such other corporation or affiliate shall be substituted for the Employer
hereunder, and no termination of the Employee's employment shall be deemed to
have occurred. The Employee may not assign the benefit of this Agreement or
delegate his obligations under this Agreement. Subject to the foregoing
limitation upon assignment and
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delegation, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective legal representatives, successors, agents, heirs
and assigns.
21. DETERMINATION BY THE EMPLOYER. The Employee shall not make any
determinations regarding this Agreement. If the Employee is the President of the
Employer at a time that a determination is to be made by the Employer pursuant
to this Agreement, such determination shall be made by the Board of Directors of
the Employer or an authorized delegates of such Board of Directors.
22. GOVERNING LAW. This Agreement shall be construed in accordance with,
and governed by the substantive laws of, the State of Utah, without reference
to principles governing choice or conflicts of laws.
23. ENFORCEMENT OF SEVERANCE PROVISION. In the event that after a Change of
Control a dispute between the parties on entitlement to severance payments under
this Agreement results in litigation, the Employer shall pay after the
conclusion of such litigation such Employee's costs arising out of or in
connection with such litigation, including without limitation court costs and
reasonable attorneys' fees.
24. CAPTIONS. The captions used herein are for ease of reference only and
shall not define or limit the provisions hereof.
25. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter contained herein, and
there are no covenants, terms or conditions, express or implied, other than as
set forth or referred to herein. This Agreement supersedes all provisions of any
prior employment agreement between the Employee and the Employer, and all other
prior agreements between the
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parties hereto relating to all or part of the subject matter herein. No party
has made any representations, oral or written, modifying or contradicting the
terms of this Agreement. The parties may not amend, modify or cancel this
Agreement except as provided herein or by a written agreement signed by all of
the party to this Agreement. No promises of any nature have been made in
connection with the employment or continued employment of the Employee other
than as set forth in this Agreement, and provided further that it is expressly
agreed that the Employee shall be entitled to only such benefits as are
expressly provided by the various plans of the Corporation and the Employer for
eligible employees to the extent the Employee qualifies for such benefits
strictly in accordance with the terms and provisions of such plans as now in
effect or as modified from time to time.
IN WITNESS WHEREOF, the parties have executed this Agreement on the ____ day of
,__________ 1996.
THE EMPLOYER: THE EMPLOYEE:
FIRST SECURITY CORPORATION
By:_________________________________ _________________
Title: Member of the Board Xxxx X. Xxxxxx
of the Employer, and
President of First
Security Corporation
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