EXHIBIT 10.3
FIDELITY SOUTHERN CORPORATION
EXECUTIVE CONTINUITY AGREEMENT
This Executive Continuity Agreement (this "Agreement') is made as of March
17, 2005, between Fidelity Southern Corporation ("Fidelity Southern") and Bank
(together with Fidelity Southern collectively referred to as "Fidelity") and
Xxxxx X. Xxxxxx, Xx. (the "Executive").
The purpose of this Agreement is to encourage the Executive to continue
employment with Fidelity after a Change of Control of Fidelity Southern or Bank
by providing reasonable employment security to the Executive and to recognize
the prior service of the Executive in the event of termination of employment
under defined circumstances after any such Change of Control. This Agreement
supersedes and replaces all prior similar written and oral agreements between
the Executive and Fidelity and is in addition to any employment agreement
entered into between Fidelity and the Executive on or after the date hereof.
Section 1. Definitions. For purposes of this Agreement:
(a) "Affiliate" means any entity that is, directly or indirectly
through one or more intermediaries, controlled by Fidelity
Southern or the Bank, as the case may be.
(b) "Annual Base Salary" shall have the meaning set forth in
Section 3.
(c) "Bank" shall mean Fidelity Bank and the successors of all or
substantially all of its business.
(d) "Beneficiary" means the person or entity designated by the
Executive, by a written instrument delivered to Fidelity
Southern, to receive any benefits payable under this Agreement
in the event of the Executive's death. If the Executive fails
to designate a Beneficiary, or if no beneficiary survives the
Executive, such Benefits on the death of the Executive will be
paid to the Executive's estate.
(e) "Board" means the Board of Directors of Fidelity Southern.
(f) "Cause" means:
(1) The willful and continued failure by the Executive to
substantially perform the material duties of the
Executive with Fidelity and/or any Affiliate (other than
any such failure resulting from the disability of the
Executive) for a continuous period of three months,
after a written demand for such performance is delivered
to the Executive at the direction of the Board by the
Chief Executive Officer of Fidelity Southern or by any
person designated by the board of Fidelity Southern or
the Bank, which written demand specifically identifies
the material duties of which Fidelity believes that the
Executive has not substantially performed; or
(2) The willful engaging by the Executive in gross
misconduct materially and demonstrably injurious to
Fidelity. No act, or failure to act, on the Executive's
part shall be considered "willful" unless done, or
omitted to be done, by Executive in the absence of good
faith and without a reasonable belief that the action or
failure to act of the Executive was in the best interest
of Fidelity or any Affiliates.
(g) "Change of Control" means the occurrence hereafter of any
event described in (1), (2) or (3) below.
(1) Any "person" (as such term is used in Sections 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as
amended, the "Act) acquires "beneficial ownership" (as
such term is defined in Rule 13d-3 promulgated under the
Act), directly or indirectly, of equity securities of
Fidelity Southern or the Bank representing more than
fifty percent (50%) of the combined voting power
represented by the outstanding voting securities of
Fidelity Southern or the Bank, as the case may be
("Voting Power").
(2) Individuals who constitute the membership of the Board
or the board of the Bank on the date of this Agreement
(each being hereinafter referred to as the "Incumbent
Board') cease at any time hereafter, to constitute at
least a majority of the Board or the board of the Bank,
provided that any director whose nomination was approved
by a majority of the Incumbent Board will be considered
a member of the Incumbent Board, excluding any such
individual not otherwise a member of the Incumbent Board
whose initial assumption of office is in connection with
an actual or threatened election contest relating to the
election of the directors of Fidelity Southern or the
Bank.
(3) The effective date of a complete liquidation or
dissolution of Fidelity Southern or the Bank, or of the
sale or other disposition of all or substantially all of
the assets of Fidelity Southern or the Bank, as approved
by the shareholders of Fidelity Southern or the Bank, as
the case may be, or the acquisition by a person, other
than Fidelity Southern, of beneficial ownership,
directly or indirectly, of equity securities of the Bank
representing more than fifty percent (50%) of the
combined voting power represented by the Bank's then
outstanding voting securities.
If a Change of Control occurs on account of a series of
transactions, the Change of Control is deemed to have
occurred on the date of the last of such transactions
which results in the Change of Control.
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(h) "Change of Control Period" shall have the meaning set
forth in Section 4(a).
(i) "Code" means the Internal Revenue Code of 1986, amended.
(j) "Commencement Date" shall have the meaning set forth in
Section 3(a).
(k) "Compensation" means the total compensation paid to the
Executive by Fidelity Southern, the Bank and/or by any
Affiliate which is or will be reportable as income under
the Code on Internal Revenue Service Form W-2, (i) plus
any amount contributed by the Executive pursuant to a
salary reduction agreement, which is not includible in
gross income under Code Sections 125 or 402(a) (8) or
under any other program that provides for pre-tax salary
reductions and compensation deferrals; (ii) plus any
amount of the Executive's compensation which is deferred
under any plan or program of Fidelity; and (iii) reduced
by any income reportable on Form W-2 that is
attributable to the exercise of any stock option.
(l) "Disability" means a complete inability of the Executive
substantially to perform the employment duties for
Fidelity Southern or Bank or any Affiliate for a period
of at least one hundred and eighty (180) consecutive
days.
(m) "Employment Period" shall have the meaning set forth in
Section 3(a).
(n) "Final Compensation" means the highest of (i) the
Executive's Compensation for the 12 full calendar months
immediately preceding the Change of Control; or (ii) the
Executive's annual base salary rate payable by Fidelity
Southern, the Bank and any Affiliate, in effect
immediately preceding the Change of Control; or (iii)
the Executive's aggregate annual base salary as set by
Fidelity Southern, the Bank and any Affiliate, effective
at any time during the Employment Period.
(o) "Good Reason" will exist with respect to the Executive
if, without the Executive's express written consent the
following events occur after a Change of Control which
are not corrected within thirty (30) days after receipt
of written notice from Executive to Fidelity Southern:
(1) there is a material change in the Executive's
position or responsibilities (including reporting
responsibilities) which, in the Executive's
reasonable judgment, represents an adverse change
from the Executive's status, title, position or
responsibilities immediately prior to the Change
of Control;
(2) the assignment to the Executive of any duties or
responsibilities which are inconsistent with the
position or responsibilities of the Executive
immediately prior to the Change of Control;
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(3) any removal of the Executive from or failure to
reappoint or reelect the Executive to any of the
positions the Executive held immediately prior to
the Change of Control;
(4) there is a reduction in the Executive's rate of
annual base salary or a change in the manner the
incentive compensation of the Executive is
calculated and such change will result in a
reduction of the incentive compensation of
Executive;
(5) the requiring of the Executive to relocate his
principal business office of the Executive to any
place outside a fifteen (15) mile radius from the
Executive's current place of employment in
Atlanta, Georgia, (reasonable required travel on
Fidelity's business which is materially greater
than such travel requirements prior to the Change
of Control shall not constitute a relocation of
the Executive's principal business office);
(6) the failure of Fidelity to continue in effect any
Compensation, Welfare Plan or Individual Life
Insurance Policy in which the Executive is
participating immediately prior to the Change of
Control without substituting plans providing the
Executive with substantially similar or greater
benefits, or the taking of any action by Fidelity
which would materially and adversely affect the
Executive's participation in or materially reduce
the Executive's benefits under any of such plans
or deprive the Executive of any material fringe
benefit enjoyed by the Executive immediately prior
to the Change of Control; or
(7) the material breach of any provision of this
Agreement which is not timely connected by
Fidelity upon thirty (30) days prior written
notice from the Executive.
(p) "Individual Life Insurance Policies" means the Split
Dollar Insurance Plan ("Split Dollar Plan") in the face
amount of $400,000 dated October 3, 1984 (including all
amendments and replacement and substitute policies, as
hereafter mutually agreed in writing) and three Flexible
Premium Adjustable Life Insurance, Universal Life
policies, one issued by Great-West Life & Annuity
Insurance Company ("Great-West") in the face amount of
$6 million, one issued by Life Investors Insurance
Company of America in the face amount of $800,000 and
one issued by Mass Mutual Financial Group in the face
amount of $800,000 each of which is payable to
beneficiaries designated by the Executive, his estate or
trust in lieu thereof.
(q) "Salary Continuance Benefit" means the benefit provided
in Section 4(b).
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(r) "Severance Benefit" means a Salary Continuance Benefit
and/or a Welfare Continuance Benefit.
(s) "Severance Period" means the period beginning on the
date the Executive's employment is terminated by
Fidelity Southern, Bank or any Affiliate, other than for
Cause, Disability or death, or by Executive for Good
Reason and ending on the date eighteen (18) months
thereafter.
(t) "Voting Power" shall have the meaning set forth in
Section 1(g)(1).
(u) "Welfare Continuance Benefit" means the benefit provided
in Section 4(c).
(v) "Welfare Plan" means any medical, prescription, dental,
disability, salary continuation, employee life,
accidental death, travel accident insurance or any other
welfare benefit plan, as defined in Section 3(l) of the
Employee Retirement Income Security Act of 1974, as
amended ("ERISA") made available by Fidelity Southern,
the Bank or any Affiliate in which the Executive is
eligible to participate; provided, however, that the
term "Welfare Plan" shall not include the Individual
Life Insurance Policies.
Section 2. Employment After Change of Control.
If the Executive is employed by Fidelity Southern, the Bank or an
Affiliate on the Commencement Date, such employer will continue to employ
the Executive for the Employment Period.
Section 3. Compensation During Employment Period.
(a) During the period commencing one year prior to a Change of
Control ("Commencement Date") and ending upon the earlier of
(i) three years after a Change of Control or (ii) upon
termination of employment of Executive for any reason by
Executive or by Fidelity Southern or the Bank or any Affiliate
("Employment Period"), the Executive will receive an annual
base salary ("Annual Base Salary"), at least equal to the
greater of (i) the annual base salary payable to the Executive
by Fidelity Southern, the Bank and/or Affiliates in respect of
the twelve full calendar month period immediately preceding
the Commencement Date or (ii) the annual base salary rate of
the Executive payable on and after the Commencement Date and
prior to the Change of Control. During the Employment Period,
the Annual Base Salary will be increased at any time and from
time to time so as to be substantially consistent with
increases in base salaries generally awarded in the ordinary
course of business to other peer executives of Fidelity
Southern, the Bank and Affiliates. Any increase in Annual Base
Salary will not serve to limit or reduce any other obligation
to the Executive under this Agreement. The Annual Base Salary
in effect on the Commencement Date will not be reduced
thereafter nor shall any such increase during the Employment
Period be reduced thereafter.
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(b) During the Employment Period, the Executive will be entitled
to participate in all incentive plans (including, without
limitation, stock option, stock purchase, savings,
supplemental medical and retirement plans) and other programs
and practices applicable generally to other peer executives of
Fidelity Southern, the Bank or any Affiliates, but in no event
will such plans and other programs, practices, including
policies to provide the Executive with incentive
opportunities, savings opportunities and retirement and other
benefit opportunities, in each case, less favorable, in the
aggregate, than those provided by Fidelity Southern, the Bank
or any Affiliates for the Executive under such plans,
practices, policies and program as in effect at any time on
and after the Commencement Date and prior to the Change of
Control.
(c) In addition the method of the calculation of the Executive's
total incentive compensation for each fiscal year, or part
thereof, during the Employment Period will not be changed in
any manner which will result in less total incentive
compensation being paid or payable to Executive by Fidelity
Southern, the Bank and Affiliates in respect of the Employment
Period (or any portion thereof) from the maximum amount that
would have been paid using the method of calculating incentive
compensation under the incentive compensation programs in
effect on and after the Commencement Date and prior to the
Change of Control. The parties agree that Executive shall be
entitled to incentive compensation for services rendered
during part of a fiscal year regardless of the reason for the
termination of employment of Executive.
(d) During the Employment Period the Executive and the eligible
Members of the Executive's family ("Dependents") who
participated (or otherwise provided coverage) on the
Commencement Date and continue to be eligible for
participation in any Welfare Plan, will receive all such
benefits under the Welfare Plans to the extent applicable
generally to other peer executives of Fidelity Southern, the
Bank and Affiliates similarly situated, but in no event will
the Welfare Plans provide benefits for the Executive and
Beneficiaries that are less favorable, in the aggregate, than
the most favorable benefits provided under the Welfare Plans
in effect at any time during the Employment Period.
(e) During the Employment Period, Fidelity Southern will maintain
in place the Individual Life Insurance Policies.
(f) During the Employment Period, the Executive will be entitled
to fringe benefits in accordance with the most favorable
plans, practices, programs and policies of Fidelity Southern,
the Bank and any Affiliate in effect for which the Executive
qualifies or qualified at any time during the Employment
Period including, if more favorable to the Executive, as in
effect at any time on or after the Change of Control with
respect to other peer executives of Fidelity Southern, the
Bank or any Affiliate.
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Section 4. Benefits Upon Termination of Employment.
(a) Provided the Executive executes a "Release" (as defined below)
and does not revoke such Release, the Executive will be
entitled to a Salary Continuance Benefit and a Welfare
Continuance Benefit as hereafter set forth if (i) the
employment of the Executive with Fidelity Southern, the Bank
or any Affiliate is terminated by Fidelity Southern, the Bank
or any Affiliate, other than for Cause, Disability or death,
during the period commencing upon the Commencement Date and
ending three years after a Change of Control ("Change of
Control Period"); or (ii) the Executive terminates his
employment with Fidelity Southern, the Bank or any Affiliate
for Good Reason during the Change of Control Period. Any
termination by the Executive will be communicated by Notice of
Termination to Fidelity Southern given in accordance with
Section 23(b). For purposes of this Agreement, a "Notice of
Termination" means a written notice which (i) indicates the
specific termination provision in this Section relied upon;
(ii) to the extent applicable, sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision
so indicated; and (iii), if applicable, indicates the date of
termination, which shall not be more than 30 days and more
than 60 days after the giving of such notice. The term
"Release" means a general release that releases Fidelity
Southern, the Bank, their Affiliates, shareholders, directors,
officers, employees, employee benefit plans, representatives,
and agents and their successors and assigns from any and all
employment related claims the Executive or the Executive's
successors and beneficiaries might then have against them
(excluding any claims for vested benefits under any employee
pension plan of Fidelity Southern, the Bank or the
Affiliates).
(b) The Salary Continuance Benefit will be the excess of (i) three
times the Executive's Final Compensation over (ii) the
aggregate amount payable under Section 14. The Salary
Continuance Benefit will be payable in seventy-two (72) equal
semi-monthly installments commencing on the 15th or last day
of the month immediately following the date of termination of
employment, whichever date occurs first, and then continuing
on the 15th and last day of each calendar month thereafter
until all such installments are paid. The Salary Continuance
Benefit will be made net of all required Federal and State
withholding taxes and similar required withholdings and
authorized deductions. The Salary Continuance Benefit shall be
payable to the estate of the Executive upon the death of the
Executive after the amounts become payable.
(c) During the Severance Period, the Executive and the Executive's
Dependents will continue to be covered by all Welfare Plans in
which the Executive or Dependents were participating
immediately prior to the date of the Executive's termination
of employment, subject to the eligibility
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requirements of such Welfare Plans on the date of termination
of employment (the "Welfare Continuance Benefit"). Any changes
to any Welfare Plan during the Severance Period will be
applicable to the Executive and Dependents as if he continued
to be an employee of Fidelity Southern, the Bank or any
Affiliate. Fidelity Southern or the Bank will pay or they
shall cause an Affiliate to pay, all or a portion of the cost
of the Welfare Continuance Benefit for the Executive and
Dependents under the Welfare Plans on the same basis as
applicable, from time to time, to active employees covered
under the Welfare Plans and the Executive will pay any
additional costs comparable to those costs paid by active
executives. If such participation in any one or more of the
Welfare Plans included in the Welfare Continuance Benefit is
not possible under the terms of the Welfare Plan or any
provision of law would create any adverse tax effect for the
Executive or Fidelity Southern the Bank or any Affiliate due
to such participation, Fidelity Southern or the Bank will
provide or will cause an Affiliate to provide substantially
identical benefits directly or through an insurance
arrangement or pay the Executive's costs for such Welfare Plan
if continued by Executive, including as permitted under ERISA.
The Welfare Continuance Benefit as to any Welfare Plan will
cease if and when the Executive has obtained coverage under
one or more welfare benefit plans of a subsequent employer
that provide for equal or greater benefits to the Executive
and Dependents with respect to the specific type of benefit
provided under the applicable Welfare Plan.
(d) Fidelity Southern shall maintain the Individual Life Insurance
Policies at all times, including after termination of the
Executive's employment for any reason.
(e) If the Executive violates any of the undertakings set forth in
Sections 10, 11, 12 and 13 of this Agreement after termination
of his employment, any additional compensation and benefits
under this Section 4 shall cease; except that the benefits
under Section 4(d) shall continue to be available under the
terms of the Individual Life Insurance Policies.
(f) (i) Fidelity Southern shall engage the independent
accounting firm regularly utilized by Fidelity Southern
("Accounting Firm") to provide to Fidelity Southern and
Executive, at Fidelity Southern's expense, a
determination of whether any compensation payable to
Executive pursuant to this Agreement (alone or when
added to all other compensation paid or payable to the
Executive by Fidelity, the Bank or any Affiliate) during
the Severance Period constitutes a "parachute payment"
("Parachute Payment") as defined in Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code").
If the Accounting Firm determines that any such
compensation payable to Executive constitutes a
Parachute Payment, the Accounting Firm shall also
determine: (A) the amount of the excise tax to be
imposed under Section 4999 of the
____________
Executive
____________________
Fidelity Southern
____________
Bank
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Code; (B) whether Executive would realize a greater
amount after Federal and Georgia income taxes (assuming
the highest marginal rates then in effect apply) if such
compensation payable to Executive were reduced (assuming
latest payments are reduced first) so that no amount
payable to Executive hereunder (alone or when added to
all other compensation paid or payable to the Executive
by Fidelity, the Bank or any Affiliate) constitutes a
Parachute Payment than the Executive would realize after
Federal and Georgia income taxes (assuming the highest
marginal rates then in effect apply) and after
imposition of the excise tax under Section 4999 of the
Code if the amounts payable to Executive hereunder were
not so reduced; and (C), if the Accounting Firm
determines in (B) above that Executive would realize a
higher amount if the compensation payable to Executive
were so reduced, the amount of the reduced benefit. All
determinations shall be made on a present value basis.
The Accounting Firm shall provide to Fidelity Southern
and to Executive a written report of its calculations
and determinations hereunder as soon as practicable. No
later than fifteen (15) days following receipt by
Executive of the report from the Accounting Firm,
Executive will notify Fidelity Southern in writing of
any disagreement with said report, and, in such case,
Fidelity Southern shall direct the Accounting Firm to
promptly discuss its determinations with an accountant
or other counsel designated by Executive in Executive's
written notice and seek to reach an agreement regarding
same no later than fifteen (15) days after receipt of
the Executive's notice, with Fidelity Southern and
Executive, each bearing the cost of their own
accountants, counsel and other advisers. If no agreement
can be reached, the matter shall be promptly submitted
to binding arbitration under the rules of the American
Arbitration Association before a single arbitrator in
Atlanta, Georgia. The determinations so made shall be
binding on the parties. If it is determined hereunder
that Executive would realize a greater amount after
Federal and Georgia income taxes (assuming the highest
marginal rates then in effect apply) if the compensation
payable to Executive pursuant to this Agreement were
reduced (assuming latest payments are reduced first) so
that no amount payable to Executive hereunder
constitutes a Parachute Payment, then the amounts
payable to Executive pursuant to this Agreement shall be
so reduced.
(ii) As a result of the uncertainty in the application of
Sections 280G and 4999 of the Code, it is possible that
amounts will have been paid or distributed to the
Executive that should not have been paid or distributed
under this Section 4(e) ("Overpayments"), or that
additional amounts should be paid or distributed to the
Executive under this Section 4(e) ("Underpayments"). If
based on either the
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assertion of a deficiency by the Internal Revenue
Service against Fidelity or the Executive, which
assertion has a high probability of success, or
controlling precedent or substantial authority, an
Overpayment has been made, that Overpayment will be
treated for all purposes as a loan ab initio that the
Executive must repay to Fidelity immediately together
with interest at the applicable Federal rate under
Section 7872 of the Code; provided, however, that no
loan will be deemed to have been made and no amount will
be payable by the Executive to Fidelity unless, and then
only to the extent that, the deemed loan and payment
would either reduce the amount on which the Executive is
subject to tax under Section 4999 of the Code or
generate a refund of tax imposed under Section 4999 of
the Code. If based upon controlling precedent or
substantial authority, an Underpayment has occurred, the
amount of that Underpayment will be paid to the
Executive promptly by Fidelity. Whether an Overpayment
or Underpayment has occurred may be determined in
substantially the same manner as the original
determination.
(iii) Fidelity and the Executive shall each provide the
Accounting Firm access to and copies of any books,
records and documents in the possession of Fidelity or
Executive, as the case may be, reasonably requested by
the Accounting Firm, and otherwise cooperate with the
Accounting Firm in connection with the preparation and
issuance of the determinations and calculations
contemplated by this Section 4(e).
(iv) The federal, state and local income or other tax returns
filed by Executive shall be prepared and filed on a
consistent basis with the determination with respect to
the excise tax payable by Executive. The Executive, at
the request of Fidelity, shall provide Fidelity true and
correct copies (with any amendments) of his federal
income tax return as filed with the Internal Revenue
Service and corresponding state and local tax returns,
if relevant, as filed with the applicable taxing
authority, and such other documents reasonably requested
by Fidelity, evidencing such conformity.
Section 5. Outplacement Services.
If the Executive is entitled to a Severance Benefit under Section 4, the
Executive also will be entitled in addition to receive complete
outplacement services, including job search, interview skill services, job
retaining and education and resume preparation, paid by Fidelity Southern
up to a total cost of $20,000. The services will be provided by a
nationally or regionally recognized outplacement organization selected by
the Executive with the approval of Fidelity Southern (which approval will
not be unreasonable withheld). The services will be provided for up to two
(2) years after the Executive's
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termination of employment or until Executive obtains full-time employment,
whichever occurs first.
Section 6. Death.
If the Executive dies while receiving a Welfare Continuation Benefit, the
Executive's Dependents will continue to be covered under all applicable
Welfare Plans during the remainder of the Severance Period.
Section 7. Setoff.
(a) Except as otherwise provided in Section 7(c) below, payment of
a Severance Benefit will be in addition to any other amounts
otherwise then currently payable to the Executive, including
any accrued but unpaid vacation pay or deferred compensation.
No payments or benefits payable to or with respect to the
Executive pursuant to this Agreement will be reduced by any
amount the Executive may earn or receive from employment with
another employer or from any other source. In no event will
the Executive be obligated to seek other employment or take
any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement
and, except as provided in the last sentence of Section 4(c)
with respect to the Welfare Continuation Benefit or in Section
5 with respect to outplacement services, such amounts will not
be reduced whether or not the Executive obtains other
employment.
(b) Nothing in this Agreement will limit or otherwise affect such
rights as the Executive may have under any other contract or
agreement with Fidelity Southern, the Bank or Affiliates.
Amounts which constitute vested benefits or which the
Executive is otherwise entitled to receive under any plan,
policy, practice or program of or any contract or agreement
(collectively, "programs") with Fidelity Southern, the Bank or
Affiliates at or subsequent to the Executive's termination of
employment will be payable in accordance with such program.
(c) The total amount payable hereunder for Salary Continuation
Benefits and consideration for the non-compete,
non-solicitation and non-disclosure provisions (as set forth
in Section 14) shall not exceed three times the Executive's
Final Compensation. Fidelity Southern, the Bank or an
Affiliate and Executive may be parties to other agreements,
policies, plans, programs or arrangements relating to the
Executive's employment. This Agreement shall be construed and
interpreted so that the Salary Continuance Benefit, Welfare
Continuance Benefit and other payments (including, but not
limited to, payments described in Section 14 below) hereunder
are paid or made available only to the extent that similar
amounts are not paid or made available to the Executive under
any other similar agreements, policies, plans, programs or
arrangements. Without
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limiting the foregoing, any Salary Continuance Benefit,
Welfare Continuance Benefit and other payments (including, but
not limited to, payments described in Section 14 below)
payable under this Agreement shall be reduced by any other
compensation, severance pay, continued welfare benefits,
non-compete payments or other similar amounts that the
Executive receives under any employment or employment-related
agreement with Fidelity Southern, the Bank or any Affiliate
and under any other similar agreements, policies, plans,
programs or arrangements covering the Executive with respect
to Fidelity Southern, the Bank or any Affiliate; it being the
intent of both the Executive and Fidelity Southern, the Bank
or any Affiliate not to provide to the Executive any
duplicative payments, severance pay or welfare benefits
hereunder.
(d) To the extent that federal, state or local law requires
Fidelity Southern, the Bank or an Affiliate to provide notice
and/or make a payment to the Executive because of involuntary
termination of employment, the severance pay available under
this Agreement for periods for which the Executive is not
required to report to work shall be reduced, but not below
zero, by the amount of any such mandated payments.
Section 8. No Interest in Benefit.
No interest of the Executive or any Beneficiary, or any right to receive
any payment or distribution hereunder, will be subject in any manner to
sale, transfer, assignment, pledge, attachment, garnishment, or other
alienation or encumbrance of any kind, nor may such interest or right to
receive a payment or distribution be taken, voluntarily or involuntarily,
for the satisfaction of the obligation or debts of, or other claims
against, the Executive or Beneficiary, including claims for alimony,
support, separate maintenance, and claims in bankruptcy proceedings.
Section 9. Benefits Unfunded.
All rights under this Agreement of the Executive and Beneficiaries will at
all times be entirely unfunded, and no provision will at any time be made
with respect to segregating any assets of Fidelity or any Affiliate for
payment of any amounts due hereunder. The Executive and Beneficiaries will
have only the rights of general unsecured creditors of Fidelity.
Section 10. Covenant Not to Compete.
The Executive agrees that during his employment with Fidelity Southern or
Bank and for a period of eighteen (18) months after termination of the
Executive's employment with Fidelity Southern or Bank for any reason, that
the Executive shall not, on his own behalf or on another's behalf, work in
any management or executive capacity in the business of providing banking
or banking related services. This restriction shall apply only within a
50-mile radius of 0000 Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000. The
Executive agrees that because of the nature of Fidelity Southern's and
Bank's business, the nature of the
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Executive's job responsibilities, and the nature of the Confidential
Information and Trade Secrets of Fidelity Southern and Bank which Fidelity
Southern and Bank will give the Executive access to, any breach of this
provision by the Executive would result in the inevitable disclosure of
Fidelity Southern's and Bank's Trade Secrets and Confidential Information
to its direct competitors.
Section 11. Non-Solicitations of Customers.
Executive agrees that during his employment with Fidelity Southern or Bank
and for a period of eighteen (18) months after termination of his
employment with Fidelity Southern or Bank for any reason, Executive will
not will not directly or indirectly solicit, contact, call upon,
communicate with or attempt to communicate with any client or customer of
Fidelity Southern or Bank for the purpose of providing banking or banking
related services. This restriction shall apply only to any client or
customer of Fidelity Southern or Bank with whom Executive had material
contact during the last twelve months of Executive's employment with
Fidelity Southern or Bank. "Material contact" means interaction between
Executive and the client or customer which takes place to further the
business relationship. "Clients" and "customers" include, but are not
limited to, depositors and commercial loan customers.
Section 12. Non-Solicitations of Employees.
Executive agrees that during his employment with Fidelity Southern or Bank
and for a period of eighteen (18) months after termination of his
employment with Fidelity Southern or Bank for any reason, Executive will
not recruit, hire or attempt to recruit or hire, directly or by assisting
others, any other employee of Fidelity Southern or Bank with whom
Executive had material contact during Executive's employment with Fidelity
Southern or Bank. This restriction shall apply only to recruiting, hiring
or attempting to recruit or hire any employee for the purpose of working
in the business of providing banking or banking related services.
Section 13. Confidentiality, Proprietary Information and Inventions.
(a) During the term of Executive's employment with Fidelity
Southern or Bank, and at all times thereafter, Executive shall
not use or disclose to others, without the prior written
consent of Fidelity Southern and Bank, any Trade Secrets (as
hereinafter defined) of Fidelity Southern or Bank, or any
subsidiary thereof or any of their customers, except for use
or disclosure thereof in the course of the business of
Fidelity Southern or Bank (or that of any subsidiary), and
such disclosure shall be limited to those who have a need to
know.
(b) During the term of Executive's employment with Fidelity
Southern or Bank, and for eighteen (18) months after
termination of his employment with Fidelity Southern or Bank
for any reason, Executive shall not use or disclose to others,
without the prior written consent of Fidelity Southern and
Bank, any Confidential Information (as hereinafter defined) of
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Fidelity Southern or Bank, or any subsidiary thereof or any of
their customers, except for use or disclosure thereof in the
course of the business of Fidelity Southern or Bank (or that
of any subsidiary), and such disclosure shall be limited to
those who have a need to know.
(c) Upon termination of employment with Fidelity Southern or Bank
for any reason, Executive shall not take with him any
documents or data of Fidelity Southern or Bank or any
subsidiary or of any customer thereof or any reproduction
thereof and agrees to return any such documents and data in
his possession at that time.
(d) Executive agrees to take reasonable precautions to safeguard
and maintain the confidentiality and secrecy and limit the use
of all Trade Secrets and Confidential Information of Fidelity
Southern, Bank and all subsidiaries and customers thereof.
(e) Trade Secrets shall include only such information constituting
a "Trade Secret" within the meaning of subsection 10-1-761(4)
of the Georgia Trade Secrets Act of 1990, including as
hereafter amended. Confidential Information shall include all
information and data which is protectable as a legal form of
property or non-public information of Fidelity Southern or
Bank or their customers, excluding any information or data
which constitutes a Trade Secret.
(f) Trade Secrets and Confidential Information shall not include
any information (A) which becomes publicly known through no
fault or act of Executive; (B) is lawfully received by
Executive from a third party after termination of employment
without a similar restriction regarding confidentiality and
use and without a breach of this Agreement; or (C) which is
independently developed by Executive and entirely unrelated to
the business of providing banking or banking related services.
(g) Executive agrees that any and all information and data
originated by Executive while employed by Fidelity Southern or
Bank and, where applicable, by other employees or associates
under Executive's direction or supervision in connection with
or as a result of any work or service performed under the
terms of Executive's employment, shall be promptly disclosed
to Fidelity Southern and Bank, shall become Fidelity Southern
and/or Bank's property, and shall be kept confidential by
Executive. Any and all such information and data, reduced to
written, graphic, or other tangible form and any and all
copies and reproduction thereof shall be furnished to Fidelity
Southern and Bank upon request and in any case shall be
returned to Fidelity Southern and Bank upon termination of
Executive's employment with Fidelity Southern or Bank.
(h) Executive agrees that Executive will promptly disclose to
Fidelity Southern and Bank all inventions or discoveries made,
conceived, or for
14
the first time reduced to practice in connection with or as a
result of the work and/or services Executive performs for
Fidelity Southern or Bank.
(i) Executive agrees that he will assign the entire right, title,
and interest in any such invention or inventions and any
patents that may be granted thereon in any country in the
world concerning such inventions to Fidelity Southern and
Bank. Executive further agrees that Executive will, without
expense to Fidelity Southern or Bank, execute all documents
and do all acts which may be necessary, desirable, or
convenient to enable Fidelity Southern and Bank, at its
expense, to file and prosecute applications for patents on
such inventions, and to maintain patents granted thereon.
Section 14. Consideration for Non-Compete, Non-Solicitation and
Non-Disclosure Provisions.
In consideration of the Executive's undertakings set forth in Sections 10,
11, 12 and 13 above, with respect to periods after termination of
employment, Fidelity Southern or Bank will pay the Executive thirty six
(36) equal semi-monthly installments, each installment in an amount equal
to sixty percent (60%) of his Annual Base Salary in effect immediately
prior to the termination of employment divided by 24, commencing on the
15th or last day of the month immediately following the date of
termination of employment, whichever date occurs first, and on the 15th
and last day of each calendar month thereafter until all such installments
are paid. If the Executive violates any of the undertakings set forth in
Sections 10, 11, 12 and 13 of this Agreement, the Executive waives and
forfeits any and all rights to any further payments under this Agreement,
including but not limited to, any additional payments, compensation or
Severance Benefits he may otherwise be entitled to receive under this
Agreement.
Section 15. Specific Performance.
Because of Executive's knowledge and experience, Executive agrees that
Fidelity Southern, the Bank and Affiliates shall be entitled to specific
performance, an injunction, temporary injunction or other similar
equitable relief in addition to all other rights and remedies it might
have for any violation of the undertakings set forth in Sections 10, 11,
12 or 13 of this Agreement. In any such court proceeding or arbitration,
Executive will not object thereto and claim that monetary damages are an
adequate remedy.
Section 16. Indemnification of Executive.
Fidelity Southern, the Bank or Affiliates shall indemnify Executive and
shall advance reasonable reimbursable expenses incurred by Executive in
any proceeding against Executive, including a proceeding brought by or in
the right of Fidelity Southern, the Bank or any Affiliate, as a director
or officer of Fidelity Southern, the Bank or any Affiliate thereof, except
claims and proceedings brought by Fidelity Southern, the Bank or any
Affiliate against Executive, to the fullest extent permitted under the
Georgia Business Corporation Code, and the Articles of Incorporation and
By-Laws of Fidelity
15
Southern, the Bank or any applicable Affiliate, as such Code, Articles or
By-Laws may be amended from time to time hereafter.
Section 17. Applicable Law.
This Agreement will be construed and interpreted in accordance with the
laws of the State of Georgia without reference to its conflict of laws
rules.
Section 18. No Employment Contract.
Nothing contained in this Agreement shall be construed to be an employment
contract between the Executive and Fidelity.
Section 19. Severability.
In the event any provision of this Agreement is held illegal or invalid,
the remaining provisions of this Agreement will not be affected thereby.
Section 20. Successors.
(a) The Agreement will be binding upon and inure to the benefit of
the Fidelity Southern, the Bank, Affiliates, the Executive and
their respective heirs, representatives and successors.
(b) Fidelity Southern and Bank will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of Fidelity Southern, the Bank or Affiliates, as the
case may be, to assume expressly and agree to perform this
Agreement in the same manner and to the same extent that
Fidelity Southern and Bank would be required to perform it if
no such succession had taken place. As used in this Agreement,
"Fidelity Southern" will mean Fidelity Southern as herein
defined and any successor to its business and/or assets which
assumes this Agreement by operation of law or otherwise.
Section 21. Litigation Expenses.
(a) Fidelity Southern and the Bank agree to pay or reimburse
Executive promptly as incurred, to the full extent permitted
by law, all legal fees and expenses which the Executive may
reasonably incur as a result of any contest (regardless of the
outcome thereof unless a court of competent jurisdiction
determines that the Executive acted in bad faith in initiating
the contest) by Fidelity Southern, the Bank, any Affiliate,
the Executive or others regarding the validity or
enforceability of, or liability under, any provision of this
Agreement (including as a result of any contest by the
Executive about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment
at the applicable Federal rate provided for in the Internal
Revenue Code Section 7872 (f)(2)(A);
_____________
Executive
___________________
Fidelity Southern
_____________
Bank
16
provided however, that the reasonableness of the fees and
expenses must be determined by an independent arbitrator,
using standard legal principles, mutually agreed upon by
Fidelity Southern or the Bank, as the case may be, and the
Executive in accordance with rules set forth by the American
Arbitration Association.
(b) If there is any dispute between Fidelity Southern, the Bank or
any Affiliate and the Executive, in the event of any
termination of the Executive's employment by Fidelity
Southern, the Bank or Affiliate or by the Executive, then,
unless and until there is a final, nonappealable judgment by a
court of competent jurisdiction declaring that the Executive
is not entitled to benefits under this Agreement, Fidelity
will pay or cause to be paid all amounts, and provide all
benefits, to the Executive and/or the Executive's family or
other Beneficiaries, as the case may be, that Fidelity or any
Affiliate would be required to pay or provide pursuant to this
Agreement. Fidelity Southern, the Bank and Affiliates will not
be required to pay any disputed amounts pursuant to this
subsection except upon receipt of an undertaking (which may be
unsecured) by or on behalf of the Executive to repay all such
amounts to which the Executive is ultimately adjudge by such
court not to be entitled.
Section 22. Future Employers.
Fidelity Southern, the Bank or any Affiliate may notify anyone employing
Executive or evidencing an intention to employ Executive as to the
existence and provisions of this Agreement and may provide any such person
or organization a copy of this Agreement. Executive agrees that for a
period of 18 months after termination of Executive's employment with
Fidelity Southern or the Bank for any reason, Executive will provide
Fidelity Southern and Bank the identity of any employer Executive goes to
work for along with Executive's job title and anticipated job duties with
such employer.
Section 23. Miscellaneous.
(a) Amendments/Waivers. No provision of this Agreement may be
modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and the
writing is signed by the Executive and Fidelity Southern and
the Bank. A waiver of any breach of or compliance with any
provision or condition of this Agreement is not a waiver of
similar or dissimilar provisions or conditions. This Agreement
may be executed in one or more counterparts, all of which will
be considered one and the same agreement.
(b) Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be in
writing and shall be deemed to have been given upon receipt
when delivered by hand or upon delivery to the address of the
party determined pursuant to this Section 23 when delivered by
express mail, overnight courier or other similar method to
17
such address or by facsimile transmission (provided a copy is
also sent by registered or certified mail or by overnight
courier), or five (5) business days after deposit of the
notice in the US mail, if mailed by certified or registered
mail, with postage prepaid addressed to the respective party
as set forth below, which address may be changed by written
notice to the other parties:
If to Fidelity Southern or Bank:
Fidelity Southern Corporation
0000 Xxxxxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Chief Executive Officer
If to Executive:
Xxxxx X. Xxxxxx, Xx.
c/o Fidelity Southern Corporation
0000 Xxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
(c) Confidentiality. The Executive agrees that Executive will not
discuss the Executive's employment and resignation or
termination (including the terms of this Agreement) with any
representatives of the media, either directly or indirectly,
without the prior written consent and approval of Fidelity
Southern and the Bank.
Section 24. Entire Agreement.
No agreement or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by a party which
is not expressly set forth in this Agreement. This Agreement sets forth
the entire understanding of the parties with respect to the subject matter
hereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
FIDELITY SOUTHERN CORPORATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chairman, Compensation Committee
FIDELITY SOUTHERN BANK
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chairman, Compensation Committee
EXECUTIVE
/s/ Xxxxx X. Xxxxxx, Xx.
----------------------------------------
Xxxxx X. Xxxxxx, Xx.
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