Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Employment Agreement with Each Of The Chief Financial Officer, Chief Operations Officer, Chief Credit Officer, Chief Administrative Officer and Chief Risk Officer
On June 1, 2022 the Company and Bank entered into an Employment Agreement (each, a “Employment Agreement", and, together, the "Employment Agreements”) with each of Michael J. Fowler, John A. Davis, Kevin L. Lambert, Jennie L. O'Bryan and Amy C. Goodin (each an "Executive"). The Employment agreements are effective June 1, 2022 and the term of the Employment Agreements extends until June 1, 2025 (the “Employment Period”), provided that at the end of each month of the Employment Period, the Employment Period shall extend automatically for an additional month, such that Employment Period shall expire on the third anniversary of such extension date, until any party provides the other parties advance written notice of its desire to cease extending the Employment Period. Pursuant to each Employment Agreement, the base salary for each of Mr. Fowler, Mr. Davis, Mr. Lambert, Ms. O'Bryan and Ms. Goodin will be $275,000, $250,000, $210,000, $208,000 and $150,000 per annum, respectively, and each of Mr. Fowler, Mr. Davis, Mr. Lambert, Ms. O'Bryan and Ms. Goodin will be eligible to receive an annual target bonus of not less than 40%, 25%, 10%, 40% and 10%, respectively, of their base salary with a threshold of 50% of the target bonus opportunity and maximum of 150% of the target bonus opportunity, subject to satisfying applicable performance goals. Each Executive also will be entitled to participate in the Company’s equity award plan and in other employment benefit plans and programs of the Company that are generally applicable to other employees. Additional terms provided for under the Employment Agreements include the following:
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Each Executive's employment may be terminated during the Employment Period at any time by the Company, with or without cause (as defined in the Employment Agreement), or by each Executive with or without good reason (as defined in the Employment Agreement) and is subject to the potential for severance payments as discussed below. |
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In the event, during the Employment Period, that the Company terminates an Executive’s employment without cause or the Executive resigns for good reason, the Executive will be entitled to: •The sum of (A) the portion of the annual base salary due for the period through the date of termination to the extent not theretofore paid and (B) business expenses that have not been reimbursed by the Company as of the date of termination. •Any unpaid annual bonus earned by the Executive in respect of the fiscal year of the Company that was completed on or prior to the date of termination. •An amount equal to the product of the greater of (A) the target annual bonus opportunity for the fiscal year in which the date of termination occurs and (B) the average of the annual bonuses paid or payable to the Executive in respect of the last three full fiscal years prior to the date of termination multiplied by a fraction, the numerator of which is the number of days in the fiscal year in which the date of termination occurs through the date of termination, and the denominator of which is 365. •An amount payable in lump sum equal to one times the annual base salary and bonus amount. •An amount equal to 125% of the monthly premiums for coverage under the Company's health care and life insurance plans for one year. •The vesting of any unvested equity awards held by the Executive as of the date of termination shall be determined in discussion with the Board of Directors of the Company and the Executive considering the circumstances of the termination. |
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The Employment Agreement provides for various customary business protection provisions, including non-competition, non-solicitation, non-disparagement, and confidentiality provisions. |
The above summary of the Employment Agreements is qualified by reference in its entirety to the full Employment Agreements, which are filed as Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 hereto and are incorporated herein by reference.
Change in Control Continuity Agreement with Each Of The Chief Financial Officer, Chief Operations Officer, Chief Credit Officer, Chief Administrative Officer and Chief Risk Officer
On June 1, 2022 the Company and Bank entered into a Change in Control and Continuity Agreement (each, a “CIC Agreement", and, together, the "CIC Agreements”) with each of Michael J. Fowler, John A. Davis, Kevin Lambert, Jennie O'Bryan and Amy Goodin (each an "Executive"). Pursuant to each CIC Agreement, in the event of a termination of the Executive’s employment within three years following, or in anticipation of, a Change in Control (as defined in the CIC Agreement) (a) by the Company without Cause (as
defined in the CIC Agreement) or (b) by the Executive for Good Reason (as defined in the CIC Agreement), the Executive is entitled to a general entitlement of:
•a lump sum payment equal to the Executive’s unpaid annual Base Salary through the date of termination
•the Executive's annual bonus payments earned but not yet paid for any calendar year prior to the year of termination
•the Executive's pro rata annual bonus for the year of termination
•a change-in-control entitlement consisting of
oa lump sum payment equal to the product of (I) the Severance Multiple (one and one-half in the case of Mr. Fowler, Mr. Davis and Mr. Lambert and one in the case of Ms. O'Bryan and Ms. Goodin as defined in the CIC Agreement), multiplied by (II) the sum of (x) Executive’s annual base salary and (y) the annual bonus amount.
oany equity-based awards held by Executive as of the Date of Termination shall vest in full (with any performance goals deemed satisfied at the target level) and shall be settled within thirty (30) days following the Date of Termination.
oan amount equal to the Company’s contributions under the tax-qualified defined contribution plan and any excess or supplemental defined contribution plans sponsored by the Company, in which Executive participates as of immediately prior to the Date of Termination (subject to the terms and qualifications outlined in the CIC Agreement).
oimmediate and unconditional vesting of any unvested stock options and stock grants previously granted to the Executive and the right, for one year following such termination, to exercise any stock options or stock grants held by the Executive.
oan amount equal to the product of (A) the sum of (x) 125% of the monthly premiums for coverage under the Company's health care plans for purposes of continuation coverage under Section 4980B of the Internal Revenue Code with respect to the maximum level of coverage in effect for Executive and Executive’s dependents as of immediately prior to the date of termination, and (y) 125% of the monthly premium for coverage (based on the rate paid by the Company for active employees) under the life insurance plans of the Company, in each case, based on the plans and at the levels of participation in which Executive participates as of immediately prior to the date of termination, multiplied by (B) the number of months in the Severance Period (as defined by the CIC Agreement); and subject to Executive’s payment of any applicable premiums, to the extent administratively practicable, Company shall permit Executive and Executive’s spouse and dependents to continue to participate, at their own cost, in such health care plans during the Severance Period.
othe Company shall, at its sole expense as incurred, provide Executive with outplacement services the scope and provider of which shall be selected by Executive in Executive’s sole discretion, but the cost thereof shall not exceed $25,000.
The above summary of the CIC Agreements is qualified in its entirety by the full text of the form of the CIC Agreement, which is attached hereto as Exhibits 10.6, 10.7, 10.8, 10.9 and 10.10 to this Current Report on Form 8-K.