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Exhibit 10.6 BANCTRUST FINANCIAL GROUP, INC.
CHANGE IN CONTROL COMPENSATION AGREEMENT
This Change in Control Compensation
Agreement (this "Agreement") is dated as of the 1st day of January,
2009 by and among BancTrust Financial Group, Inc., an Alabama
corporation having its principal place of business in Mobile,
Alabama ("BancTrust"), BankTrust, an Alabama banking corporation
and wholly-owned subsidiary of BancTrust ("BankTrust" and together
with BancTrust the "Company"); and Michael D. Fitzhugh (the
"Executive"). RECITALS :
A. The Compensation Committee of
the Board of Directors of BancTrust has recommended, and the Board
of Directors has approved, that BancTrust and its subsidiaries
enter into agreements with key executives of the Company designated
from time to time by the Compensation Committee to provide for
compensation under certain circumstances after a change in control.
B. Executive is a key executive
of the Company and has been selected by the Compensation Committee
to enter into this Agreement.
C. If the Company, or any
subsidiary of the Company that employs Executive as a key executive
officer (an "Applicable Subsidiary"), should become subject to any
proposed or threatened Change in Control (as hereinafter defined),
the Board of Directors of the Company believes it imperative that
the Company and the Board of Directors be able to rely upon
Executive to continue in his position and that the Company be able
to receive and rely upon his advice, if requested, as to the best
interests of the Company and its shareholders, without concern that
he might be distracted by the personal uncertainties and risks
created by such a proposal or threat.
D. If the Company should
receive any such proposal, Executive may be called upon to assist
in the assessment thereof, advise management and the Board of
Directors as to whether such proposal would be in the best
interests of the Company and its shareholders, and take such other
actions above and beyond his regular duties as the Board might
determine to be appropriate. NOW,
THEREFORE, as assurance to the Company that it will have the
continued dedication of Executive and the availability of his
advice and counsel notwithstanding the possibility, threat or
occurrence of an effort to take over control of BancTrust or any
Applicable Subsidiary, as an inducement to Executive to remain in
the employ of the Company, in consideration of the mutual covenants
and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and Executive agree as follows:
1. Services During
Certain Events . In the event any person, firm or
corporation unaffiliated with the Company begins a tender or
exchange offer, circulates a proxy to shareholders, or takes other
steps to effect a Change in Control (as hereinafter defined),
Executive agrees that he will not voluntarily leave the employ of
the Company on less than 4 months written notice to the
Chairman of the Board or Chairman of the Executive Committee of the
Company, will render the services expected of his position and will
act in all things related to the possible Change in Control in the
manner he believes in good faith to be in the best interests of the
shareholders of the Company until such person, firm or corporation
has abandoned or terminated his or its efforts to effect a Change
in Control or until a Change in Control has occurred.
2. Termination Following
Change in Control . Except as provided in Section 4,
the Company will provide or cause to be provided to Executive the
rights and benefits described in Section 3 in the event that
Executive’s employment is terminated at any time within two
years following a Change in Control (as such term is defined in
this Section 2) under the circumstances stated in (a) or
(b) below:
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(a) by
the Company without Executive’s consent and where Executive
is willing and able to continue providing his services, i.e., for
reasons other than for "cause" (as such term is defined in
Section 4) or other than as a consequence of Executive’s
death, permanent disability or attainment of the date he or she
reaches "full retirement age" as provided under the statutes and
regulations governing Social Security benefits in the United States
of America ("Normal Retirement Date"); or
(b) by
Executive within 120 days following the occurrence of any of
the following events: (i) a material reduction in
Executive’s base salary from his or her base salary
immediately prior to the Change in Control; (ii) a reduction
in Executive’s total annual compensation paid by the Company
as reported by the Company on Form W-2 ("W-2 Compensation") such
that Executive’s W-2 Compensation is materially less than the
average of Executive’s annual W-2 Compensation from the
Company for the three most recently completed years prior to the
Change in Control (or the average of Executive’s annual W-2
Compensation from the Company for his or her entire period of
employment with the Company, if less than three full years, with
compensation annualized for periods of less than a full year); or
(iii) a material change in the geographic location at which
Executive must perform his services without the Executive’s
consent, meaning, the transfer of Executive, without his consent,
to a location requiring a change in his residence or a material
increase in the amount of travel normally required of Executive in
connection with his employment;
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provided, however, that Executive must provide the Company
notice of the occurrence of such event within 90 days after
the occurrence of such event and give the Company an opportunity to
remedy the condition within 30 days thereafter, and, if such
condition has been timely remedied, the Company will not be
required to provide any of the rights and benefits described in
Section 3. For purposes of this
Agreement, a "Change in Control" is hereby defined to be:
(1) a merger, consolidation or other corporate reorganization
of the Company or any Applicable Subsidiary in which either the
Company or the Applicable Subsidiary fails to survive, other than a
merger of the Applicable Subsidiary into the Company or another
subsidiary of the Company; (2) disposition by the Company of
an Applicable Subsidiary; (3) the acquisition of the
beneficial ownership by one person or a closely related group of
persons of as much as 40% of the outstanding voting stock of the
Company or an Applicable Subsidiary, unless the acquisition of
stock resulting in such ownership by such person or related group
had been approved in advance by the Board of Directors of the
Company; or (4) as may otherwise be defined by the Board of
Directors from time to time. 3.
Rights and Benefits Upon Termination . In the event
of the termination of Executive’s employment under any of the
circumstances set forth in Section 2 hereof ("Termination"),
the Company agrees to provide or cause to be provided to Executive
the following rights and benefits:
(a)
Salary and Other Payments at Termination . Executive
shall be entitled to receive payment in cash equal to three times
the sum of Executive’s annualized compensation, as such term
is defined in this Section 3(a), based upon the annual rate of
pay for services provided to the Company for the Executive’s
taxable year preceding the Executive’s taxable year in which
the Termination occurs (adjusted for any increase during that year
that was expected to continue indefinitely if the Termination had
not occurred). However, if such amount, when combined with other
payments or
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benefits that are aggregated with such amount pursuant to the
requirements of the Internal Revenue Code of 1986, as amended (the
"IRC"), exceeds the limit provided in Section 280G of the IRC
or any corresponding or similar provision of the IRC for the
imposition of tax penalties on such payments (but excluding IRC
Section 162(m) or corresponding or similar provisions regarding
deductibility of such payments), the amount shall be reduced to the
highest amount allowed to avoid such penalties. Payment shall be
made in one lump sum 15 days after the Termination to
Executive or the personal representative of Executive’s
estate if Executive dies during such 15-day period.
For purposes of this Agreement,
"annualized compensation" shall mean the amounts earned by
Executive for personal service rendered to the Company and its
affiliates as reportable on Treasury Department Form W-2, including
bonuses, and excluding the following: (1) moving and
educational expenses, (2) income included under
Section 79 of the IRC and (3) income imputed to Executive
from personal use of employer-owned automobiles and employer paid
club dues. Earnings shall not include any income attributable to
grants of and dividends on shares awarded under any stock-based
incentive compensation plan.
(b)
Medical Insurance . The Company shall reimburse
Executive for COBRA premiums paid by Executive, not reimbursed by
any third party and allowable as a deduction under Section 213
of the IRC (disregarding the requirement of Section 213(a) that the
deduction is available only to the extent that such expenses exceed
7.5 percent of adjusted gross income) during Executive’s
applicable COBRA continuation period as permitted by
Section 409A of the IRC. Anything herein to the contrary
notwithstanding, if during such period Executive should enter into
the employ of another company or firm which provides medical
insurance coverage, the Company’s reimbursement shall
cease.
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(c)
Other Benefit Plans . The specific arrangements
referred to in this Section 3 are not intended to exclude
Executive’s participation in other benefit plans in which
Executive currently participates or which are or may become
available to executive personnel generally in the class or category
of Executive or to preclude other compensation or benefits as may
be authorized by the Board of Directors from time to time.
(d)
No Duty to Mitigate . Executive’s entitlement
to benefits hereunder shall not be governed by any duty to mitigate
his damages by seeking further employment nor, except as
specifically provided above in Section 3(b), and subject to
the covenants of Section 10, be offset by any compensation or
benefit which he may receive from future employment.
(e)
Substantial Risk of Forfeiture . Executive un
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