Contract
Exhibit 99.1
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of April
28, 2009 (the “Effective Date”), is by and among White River Capital, Inc., an
Indiana corporation (“WRC”), and Xxxx X. Xxx, an individual residing in
California (“Executive”).
WHEREAS,
Executive has served as the President and Chief Operating Officer of WRC since
December 2004; and
WHEREAS,
Castle Creek Capital, L.L.C. (“Castle Creek”), First Chicago Bancorp (“FCB”),
WRC, and Executive entered into an Employment Agreement dated as of June 27,
2008 (the “Prior Agreement”), which WRC and Executive now desire to modify in
certain respects to make it immediately effective and also to confirm and
restate the terms of Executive’s employment, which modifications have also been
acknowledged by Castle Creek and FCB; and
WHEREAS,
by entering into this Agreement, Executive and WRC hereby amend and restate the
Prior Agreement in its entirety as set forth below.
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein and for
other good and valuable consideration, the parties hereby agree as
follows:
1. Effectiveness. This
Agreement shall be effective as of the Effective Date. This Agreement
supersedes any other agreement or understanding Executive has with respect to
his employment with WRC, and the terms and conditions of Executive’s employment
with WRC shall be governed only by this Agreement. The parties hereto
represent, acknowledge and agree that the payments to be provided to Executive
from and after the Effective Date under the terms and conditions of this
Agreement represent reasonable compensation to Executive in exchange for the
personal services to be rendered by Executive for periods from and after the
Effective Date.
2. Definitions. The
terms defined in this Section 2 shall have the respective meanings indicated
below for all purposes of this Agreement.
(a) Affiliate. “Affiliate”
of a Person means a Person that directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with, the
first Person. “Control” means the possession, directly or indirectly, of the
power to direct or cause the direction of the management policies of a Person,
whether through the ownership of voting securities, by contract, as trustee or
executor, or otherwise.
(b) Cause. “Cause”
shall mean any one or more of the following:
i. engaging in a
material dishonest act, including without limitation any material
misrepresentation or intentional omission to state a
material
fact to WRC or the WRC Board, willful breach of fiduciary duty, misappropriation
or fraud against WRC or any of its Affiliates (the “Group”);
ii. any
indictment or similar charge against Executive by a governmental authority
alleging the commission of a felony, or a guilty plea or no-contest plea by
Executive to a felony;
iii. material
failure by Executive to follow WRC’s general policies, reasonable directives or
orders applicable to officers of WRC after failing to cure prior similar
failures within thirty (30) days of receiving written notice thereof from the
WRC Board;
iv. intentional
destruction or theft of any member of the Group’s property or falsification of
documents of any member of the Group;
v. a breach by
Executive of the provisions of Section 14; or
vi. a material
breach by Executive of any other provision of this Agreement and the failure by
Executive to cure such breach within thirty (30) days of the date on which WRC
gives Executive notice thereof.
(c) Date
of Termination. “Date of Termination” shall mean in the case
of Executive’s death, the date of death, in the case of Disability, thirty (30)
days after Notice of Termination is given (provided Executive shall not have
returned to the full-time performance of his duties during such thirty (30) day
period), and in all other cases, the date specified in the Notice of
Termination, which shall be at least thirty (30) days after the date of the
Notice of Termination, unless the termination is by WRC for Cause or by
Executive for Good Reason.
(d) Disability. “Disability”
shall mean Executive is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months.
(e) Good
Reason. “Good Reason” shall mean any one or more of the
following bases for termination of Executive’s employment by Executive during
the Term:
i. the removal
of Executive as the President and Chief Operating Officer of WRC without
Cause;
ii. the
assignment to Executive of any duties inconsistent in any material respect with
Executive’s position, authority, duties or responsibilities as contemplated by
Section 6(a) of this Agreement, excluding for this purpose an isolated,
insubstantial or inadvertent action
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not taken
in bad faith and which is remedied by WRC promptly after receipt of notice
thereof given by Executive;
iii. a material
change of more than 50 miles in the geographical location at which Executive
must perform his duties;
iv. any action by
WRC to materially reduce Executive’s base compensation below the amount
established in Section 7; or
v. any failure
by WRC that would constitute a material breach of this Agreement if WRC has
failed to cure such breach within thirty (30) days of the date on which
Executive gives written notice thereof to the WRC Board.
(f) Notice
of Termination. Any termination of Executive’s employment by
either WRC or Executive or both, as the case may be, except for a termination
based on Executive’s death, shall be communicated by a written Notice of
Termination.
(g) WRC
Board. “WRC Board” shall mean the Board of Directors of WRC or
a duly authorized committee of such Board.
(h) Person. “Person”
shall mean any natural person, corporation, partnership, association, limited
liability company, trust, governmental authority, or other
entity.
3. Employment. WRC
hereby employs Executive and Executive hereby accepts employment with WRC for
the Term set forth in Section 4 below, in the positions and with the duties and
responsibilities set forth in Sections 5 and 6 below, and upon the other terms
and conditions hereinafter stated.
4. Term. Executive’s
employment as the President, Chief Operating Officer and Secretary of WRC under
this Agreement shall be for the period commencing on the Effective Date and
terminating one year after the Effective Date, or upon Executive’s earlier
death, termination by reason of Disability or termination by mutual agreement or
by either party pursuant to Section 11 (the “Term”).
5. Position. Subject
to Section 6(a) below, Executive shall initially serve as President, Chief
Operating Officer and Secretary of WRC.
6. Duties and
Responsibilities.
(a) WRC hereby
engages Executive as a full-time executive employee and Executive accepts such
employment, on the terms and subject to the conditions set forth in this
Agreement. During the Term, Executive shall devote all of his
business time and best efforts to, and shall perform faithfully, loyally and
efficiently, his duties as an executive of WRC and shall exercise such powers
and fulfill such responsibilities as may be duly assigned to or vested in him by
the
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WRC
Board or the Chief Executive Officer of WRC, consistent with the
responsibilities of an executive officer of WRC. Initially, Executive
shall serve as President, Chief Operating Officer and Secretary of WRC, but
Executive’s title and offices may be changed in the discretion of the WRC
Board.
(b) During the
Term, Executive will not engage in other employment or consulting work or any
trade or business for his own account or on behalf of any other
Person. Notwithstanding the foregoing, Executive may (i) serve on
such corporate, civic, industry or charitable boards or committees as are
approved by the WRC Board (with the exception of Executive’s membership on the
board of Xxxxxxxxxx Bank, a subsidiary of Affinity Financial Corporation, which
shall not require approval of the WRC Board), and (ii) manage his own and his
family’s personal investments, provided that the activities permitted by clauses
(i) and (ii) above shall not, individually or in the aggregate, interfere in any
material respect with the performance of Executive’s responsibilities
hereunder.
7. Salary/Bonus.
(a) For all
services rendered by Executive under this Agreement, WRC shall pay to Executive
an aggregate annual base salary at the rate of $190,000, payable, in equal
installments, in accordance with WRC’s regular payroll procedures.
(b) No later than
two and one-half months after the end of 2009, WRC shall pay to Executive an
annual performance bonus for 2009 of 100% of his annual base salary pro-rated
for that portion of 2009 in which the Executive is employed by WRC (unless this
Agreement is terminated by WRC for Cause or by Executive without Good
Reason). If Executive is still employed by WRC in 2010, WRC also
shall pay to Executive an annual performance bonus for 2010 of 100% of his
annual base salary pro-rated for that portion of 2010 in which Executive is
employed by WRC (unless this Agreement is terminated by WRC for Cause or by
Executive without Good Reason). Such bonuses shall be paid within two
and one-half months following the end of applicable year, in accordance with
WRC’s regular payroll procedures.
(c) WRC
is a party to an Agreement and Plan of Merger with FCB dated June 27, 2008,
providing for the merger of WRC and FCB (the “Merger”). WRC is
currently engaged in discussions with FCB regarding possible alternative terms
of the Merger transaction. In this regard, Executive hereby agrees
that he shall not be paid any amounts, nor shall Executive be provided with any
benefits or other compensation of any kind (including any acceleration of
compensation or benefits) in connection with, or from and after, the Merger
(including in connection with any subsequent termination of employment that
occurs from and after the Merger) other than as set forth in this
Agreement.
8. Employee
Benefits. During the Term, WRC shall provide or cause to be
provided to Executive and to Executive’s dependents, at WRC’s expense,
substantially similar
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disability,
medical and dental benefits provided to other similarly situated executives of
WRC. During any waiting period for insurance eligibility, any COBRA
costs incurred by or with respect to Executive and Executive’s dependents will
be paid by WRC.
9. Vacation. Executive
shall be entitled to four (4) weeks vacation for each year during the
Term. In the event that the full vacation is not taken by Executive
during the Term, no vacation time shall accrue for use in future periods, except
as approved by the WRC Board.
10. Business
Expenses. Executive will be reimbursed for all reasonable,
ordinary and necessary business expenses incurred by Executive in connection
with Executive’s employment (to be supported by receipts and other documentation
as required by the Internal Revenue Code of 1986, as amended (the “Code”)), and
in conformance with WRC’s normal procedures). Except as otherwise
expressly provided herein, to the extent any expense reimbursement under this
Section 10 is determined to be subject to Section 409A of the Code (“Section
409A”), the amount of any such expenses eligible for reimbursement in one
calendar year shall not affect the expenses eligible for reimbursement in any
other taxable year, in no event shall any expenses be reimbursed after the last
day of the calendar year following the calendar year in which Executive incurred
such expenses, and in no event shall any right to reimbursement be subject to
liquidation or exchange for another benefit.
11. Termination. Subject
to the terms and conditions of this Agreement, either WRC or Executive may
terminate the employment of Executive at any time prior to or upon the
expiration of the Term, with or without Cause or Good Reason.
12. Payments During Disability
and Upon Termination. Executive or his estate shall be
entitled to the following payments during a period of Disability, upon
Executive’s death, or upon termination of Executive’s employment by Executive or
WRC, as the case may be.
(a) During any
period that Executive fails to perform his full-time duties with WRC as a result
of incapacity due to physical or mental illness, until such time as Executive
returns to the full-time performance of his duties or the Date of Termination if
Executive’s employment is terminated for Disability, Executive shall continue to
receive his base salary at the rate in effect at the commencement of any such
period minus any disability benefits received by him under any insurance or
disability plan of WRC. If terminated for Disability or in the event
of his death, Executive or his estate, as the case may be, shall additionally be
entitled to receive the severance compensation provided for in subsection
12(c)(i) (reduced by any disability benefits received by him under any insurance
or disability plan of WRC), and subsection 12(c)(ii).
(b) If (1)
Executive’s employment is terminated by Executive without Good Reason, or (2)
Executive’s employment is terminated by WRC for Cause, then WRC shall pay
Executive his full base salary through the Date of Termination at the rate in
effect at the time Notice of Termination is given, plus all other amounts or
benefits to which Executive is entitled through such date under any plan,
arrangement or practice in effect at the time of such termination, minus any
amounts owed by Executive to WRC. Notwithstanding the preceding
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sentence,
Executive shall not be entitled to receive any bonus applicable to the period in
which termination occurs, and WRC shall have no further obligations to Executive
under this Agreement (other than under COBRA and for vested and accrued benefits
and accrued and unpaid vacation).
(c) If (1)
Executive’s employment is terminated by WRC other than for Cause, (2)
Executive’s employment is terminated by Executive for Good Reason, (3)
Executive’s employment is terminated by mutual agreement of Executive and WRC,
or (4) the Executive’s employment terminates at the expiration of the Term, then
Executive shall be entitled to the following:
i. Within 30
days of the Date of Termination, WRC shall pay to Executive a lump sum payment
in cash equal to: (A) any unpaid base salary through the Date of Termination,
plus (B) one year’s base salary at the rate in effect at the Date of
Termination, plus (C) $190,000; and
ii. Executive
shall be entitled to any other compensation and benefits granted under this
Agreement (other than base salary and the $190,000 payment, which are addressed
in subparagraph (i)), for and through the end of the then-remaining Term, which,
for purposes of clarity, shall include any annual performance bonus described in
Section 7(b) above to which Executive is entitled as of the Date of
Termination. Such benefits shall be determined in accordance with
WRC’s employee benefit plans and other applicable programs, policies and
practices then in effect as though Executive was still then in the employ of
WRC. The provisions of this Agreement, and any payment provided for
hereunder, shall not reduce any amounts otherwise payable, or in any way
diminish Executive’s existing rights, or rights which accrue solely as a result
of the passage of time under any benefit plan, employment agreement or other
contract, plan or arrangement.
13. Confidentiality. Except
as provided in the next two sentences, Executive covenants and agrees that all
information, knowledge or data of or pertaining to the Group, or pertaining to
any other Person with which they or any of them may do business during the Term
and which is not generally known in the relevant trade or industry (and whether
relating to methods, merchandising, processes, techniques, discoveries, pricing,
sales practices, marketing or any other proprietary matters) (the “Company
Information”) shall be kept secret and confidential at all times during and
after the termination or expiration of this Agreement and shall not be used or
divulged by him outside the scope of his employment as contemplated by this
Agreement, except as WRC may otherwise expressly authorize. In the
event that Executive is requested in a judicial, administrative or governmental
proceeding to disclose any of the Company Information, Executive will promptly
so notify WRC so that WRC may seek a protective order at WRC’s expense or other
appropriate remedy and/or waive compliance with this Agreement. If such
protective order or other remedy is not obtained or WRC waives compliance with
this Agreement and disclosure of any of the Company Information is required,
Executive may furnish the material so required to be furnished, but Executive
will furnish only that portion of the Company Information which is legally
required and will exercise his best
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efforts
to ensure that confidential treatment will be accorded the Company Information
furnished.
14. No-Hire. Executive
agrees and acknowledges that the services of Executive pursuant to this
Agreement are unique and extraordinary, and that the Group will be dependent
upon Executive for the development and growth of their business and related
functions. Executive agrees, during the Term and for a period of two
years after the Date of Termination or expiration of the Term, not to conduct or
participate (directly or indirectly, including through one or more Affiliates)
in hiring, attempting to hire or assisting any other Person in hiring or
attempting to hire, or inducing to leave the employ of any member of the Group,
any employee or officer of any member of the Group, or any person who was an
employee or officer of any member of the Group within the six-month period prior
to the Date of Termination. This Section 14 shall not apply to
Executive with respect to Xxxxxx Xxxxxxx. Executive agrees that if
Executive acts in violation of this Section, the number of days Executive is in
such violation will be added to any periods of limitation on Executive’s
activities specified herein.
15. Section
409A. If and to the extent that any payment or benefit is
determined by WRC to constitute “non-qualified deferred compensation” subject to
Section 409A and is payable hereunder to Executive by reason of his termination
of employment, then (a) such payment or benefit shall be made or provided to
Executive only upon a “separation from service” as defined for purposes of
Section 409A under applicable regulations and (b) if Executive is a “specified
employee” (within the meaning of Section 409A and as determined by WRC), such
payment or benefit shall not be made or provided before the date that is six
months after the date of Executive’s separation from service. Any
amount not paid in respect of the six month period specified in the preceding
sentence will be paid to Executive in a lump sum with the first payment made
after the end of such six month period (or if no other payment is then due, then
promptly after the expiration of such six month period.)
16. Monies Owed to
WRC. Upon the termination of Executive’s employment with WRC,
Executive hereby authorizes WRC to deduct from Executive’s final wages or other
monies due to Executive (other than amounts that would constitute “deferred
compensation” pursuant to Section 409A) all debts or financial obligations owed
to WRC by Executive.
17. Remedies. Executive
understands and agrees that the Group will be irreparably damaged in the event
that Section 14 of this Agreement is violated. Executive agrees that
WRC shall be entitled (in addition to any other remedy to which it may be
entitled, at law or in equity) to an injunction to redress breaches of such
Section of this Agreement and to specifically enforce the terms and provisions
thereof.
18. Successors and
Assigns. This Agreement is a personal contract, and the rights
and interests of Executive hereunder and under the awards and plans referred to
herein may not be sold, transferred, assigned, pledged, encumbered, or
hypothecated by him, except as may be expressly permitted by the provisions of
such awards or plans and that payments due Executive hereunder shall be payable
to his heirs or fiduciaries upon his death. Except as may be
expressly provided otherwise herein, this Agreement shall be binding upon WRC
and inure to the benefit of WRC and its Affiliates, and its successors and
assigns, including (but not limited
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to) any
corporation or other entity which may acquire all or substantially all of WRC’s
assets or business or into or with which WRC or an Affiliate may be consolidated
or merged.
19. Jurisdiction and Governing
Law. Any controversy or claim arising out of or relating to
this Agreement, or any breach thereof shall be governed by and construed in
accordance with the laws of California, without giving effect to principles of
conflicts of laws thereof.
20. Entire
Agreement. This Agreement contains all the understandings
between the parties hereto pertaining to the matters referred to herein, and
supersedes all undertakings and agreements, whether oral or in writing,
previously entered into by them with respect thereto. No
representations or warranties of any kind or nature relating to any member of
the Group or their respective businesses, assets, liabilities, operations,
future plans or prospects have been made by or on behalf of the Group to
Executive, nor have any representations or warranties of any kind or nature been
made by Executive to the Group.
21. Amendment or Modification,
Waiver. No provision of this Agreement may be amended or
waived unless such amendment or waiver is agreed to in writing, signed by
Executive and by a duly authorized officer of each of the parties to this
Agreement. No waiver by any party hereto of any breach by another
party hereto of any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of a similar or dissimilar condition
or provision at the same time, any prior time or any subsequent
time.
22. Notices. Any
notice to be given hereunder shall be in writing and delivered personally or by
overnight courier or sent by registered or certified mail, postage prepaid,
return receipt requested, addressed to each of the parties to this
Agreement:
To:
Xxxx X.
Xxx
000 Xxx
Xxxxxxx Xxxxx
Xxxxxx
Xxxxx, XX 00000
With a
copy to:
Xxxx, Forward, Xxxxxxxx & Scripps
LLP
000 X. Xxxxxxxx, Xxxxx
0000
Xxx Xxxxx, XX 00000
Attention: Xxxxx X.
Xxxxxx
Facsimile: (000) 000-0000
To:
Chief Executive Officer
White
River Capital, Inc.
0000 Xxxxxxxxxx Xxx, Xxxxx
X
Xxxxxxxxxxxx, XX 00000
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With a
copy to:
Xxxxxx
& Xxxxxxxxx LLP
00 X.
Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx,
XX 00000
Attention: Xxxx
X. Xxx
Facsimile:
(000) 000-0000
Any
notice delivered personally shall be deemed given on the date delivered, any
notice transmitted by fax machine shall be deemed delivered upon receipt of
confirmation of fax transmission, any notice delivered by overnight courier
shall be deemed given the day after deposit with a courier, and any notice sent
by registered or certified mail, postage prepaid, return receipt requested,
shall be deemed given three days after mailing.
23. Severability. If
any provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid and
unenforceable, shall not be affected thereby, and each provision hereof shall be
validated and shall be enforced to the fullest extent permitted by
law.
24. Survivorship. The
respective rights and obligations of the parties hereunder shall survive any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.
25. Headings. All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed by
reference to the heading of any section or paragraph.
26. Withholding
Taxes. All payments to Executive under this Agreement shall be
reduced by any applicable federal, state or city withholding taxes.
27. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which together shall be one and the same
agreement.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
White
River Capital, Inc.:
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/s/
Xxxx X. Xxxxxxxxx, III
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By:
Xxxx X. Xxxxxxxxx, III
Title:
Chief Executive Officer
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/s/
Xxxx X. Xxx
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Xxxx
X. Xxx
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