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Exhibit 10.1
CENTENNIAL BANK HOLDINGS, INC.
CHANGE IN CONTROL SEVERANCE PLAN
1. Purpose . The purpose of the Centennial Bank
Holdings, Inc. Change in Control Severance Plan (the "
Plan ") is to recruit and foster the continuous
employment of key management personnel of the Company and to
reinforce and encourage their continued attention and dedication to
their duties in the event of any threat or occurrence of a Change
in Control (as defined in Section 2), although no such change
is now apparent or contemplated.
2. Definitions . As used in this Plan, the
following terms shall have the respective meanings set forth
below:
(a) " Annual Bonus " means the annual bonus
awarded under the Company’s Executive Cash Incentive Plan or
Annual Incentive Plan (or, in each case, any predecessor,
substitute or successor plan designated as such by the Board), as
in effect from time to time, or any discretionary annual bonus
awarded by the Board.
(b) " Base Salary " means the Participant’s
annual base salary in effect immediately before the occurrence of
the circumstance giving rise to the Participant’s
termination, or, if greater, the Participant’s annual base
salary in effect immediately before the Change in Control.
(c) " Board " means the Board of Directors of the
Company and, after a Change in Control, the "board of directors" of
the surviving company.
(d) " Bonus Amount " means the average of a
Participant’s 2 Annual Bonuses for the 2 fiscal years ending
before the Participant’s Date of Termination; provided
that (i) if a Participant has been an employee of the Company
through the end of only one fiscal year before the
Participant’s Date of Termination and was eligible for an
Annual Bonus for such fiscal year (including on a pro rata basis),
the Bonus Amount shall be the average of (x) the Annual Bonus
for the fiscal year ending before the Date of Termination (if such
bonus was made on a pro rata basis, such bonus shall be annualized
for the purpose of calculating the Bonus Amount) and (y) the
Participant’s target Annual Bonus, expressed as a percentage
of base salary in the event the relevant goals are 100% achieved,
for the fiscal year in which the Date of Termination occurs and
(ii) if a Participant (x) has been an employee of the
Company through the end of only one fiscal year before the
Participant’s Date of Termination and was not eligible for an
Annual Bonus for such fiscal year or (y) has not been an
employee of the Company through the end of one fiscal year with the
Company before the Participant’s Date of Termination, the
Bonus Amount shall be the Participant’s target Annual Bonus,
expressed as a percentage of base salary in the event the relevant
goals are 100% achieved, for the year in which the Date of
Termination occurs.
(e) " Cause " means (i) an
intentional and continued failure of a Participant to perform
duties with the Company and its subsidiaries (for the avoidance of
doubt, excluding any failure due to physical or mental illness) and
such failure continues after a written demand for substantial
performance is delivered by the Company to the Participant that
specifically identifies the manner in which the Participant has
failed to perform; (ii) an intentional act of illegal conduct
or gross misconduct that is demonstrably injurious (other than to a
de minimis extent) to the business, reputation or regulatory
relationships of the Company; (iii) an intentional act of
fraud, embezzlement or theft in connection with the business of the
Company; (iv) intentional disclosure of confidential
information or trade secrets of the Company or confidential
information relating to customers of the Company or its parent, a
subsidiary or affiliate; (v) an act constituting a felony or a
misdemeanor involving moral turpitude for which the Participant is
convicted by any federal, state or local authority, or to which the
Participant enters a plea of guilty or nolo contendere;
(vi) an act or omission that causes the Participant to be
disqualified or barred by any governmental or self-regulatory
authority from serving in his or her employment capacity or losing
any governmental or self-regulatory license that is reasonably
necessary for the Participant to perform his or her
responsibilities to the Company; or (vii) intentional breach
of corporate fiduciary duty involving personal profit. For the
purposes of this Plan, no act, or failure to act, on the part of
the Participant shall be deemed "intentional" unless done, or
omitted to be done, by the Participant not in good faith and
without reasonable belief that his or her action or omission was in
the best interest of the Company. Notwithstanding the foregoing,
the Participant shall not be deemed to have been terminated for
Cause hereunder unless and until there shall have been delivered to
the Participant a copy of a resolution duly adopted by the
affirmative vote of not less than two-thirds of the members of the
Board then in office at a meeting of the Board called and held for
such purpose (after reasonable notice to the Participant and an
opportunity for the Participant, together with his or her counsel
to be heard before the Board), finding that, in the good faith
opinion of the Board, the Participant had committed an act set
forth above in clauses (i) through (vii) and specifying
the particulars thereof in detail. Nothing herein shall limit the
right of the Participant or his or her beneficiaries to contest the
validity or propriety of any such determination.
(f) " Change in Control " means the occurrence of
any one of the following events:
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(i) any "Person" or "Group" (as such terms are defined in
Section 13(d) of the Securities Exchange Act of 1934 (the "
Exchange Act ") and the rules and regulations
promulgated thereunder) is or becomes the "Beneficial Owner"
(within the meaning of Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company, or of any entity
resulting from a merger or consolidation involving the Company,
representing more than 50% of the combined voting power of the then
outstanding securities of the Company or such entity;
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(ii) the individuals who, as of the date hereof,
are members of the Board (the " Existing Directors
"), cease, for any reason, to constitute more than 50% of the
number of authorized directors of the Company as determined in the
manner prescribed in the Company's Certificate of Incorporation and
Bylaws; provided that if the election, or nomination for
election, by the Company's stockholders of any new director was
approved by a vote of at least 50% of the Existing Directors, such
a new director shall be considered an Existing Director;
provided further , that no individual shall be
considered an Existing Director if such individual initially
assumed office as a result of either an actual or threatened
election contest (" Election Contest ") or other
actual or threatened solicitation of proxies by or on behalf of
anyone other than the Board (a " Proxy Contest "),
including by reason of any agreement intended to avoid or settle
any Election Contest or Proxy Contest; or
(iii) the consummation of a plan of reorganization, merger or
consolidation involving the Company or the sale of all or
substantially all of the assets or deposits of the Company, except
for a reorganization, merger, consolidation or sale where
(A) the stockholders of the Company immediately before such
reorganization, merger, consolidation or sale own directly or
indirectly at least 55% of the combined voting power of the
outstanding voting securities of the Company resulting from such
reorganization, merger or consolidation or purchasing the assets or
deposits (the " Surviving Company ") in substantially
the same proportion as their ownership of voting securities of the
Company immediately before such reorganization, merger,
consolidation or sale, and (B) the Existing Directors
immediately before the execution of the agreement providing for
such reorganization, merger, consolidation or sale constitute at
least half of the members of the board of directors of the
Surviving Company, or of a company beneficially owning, directly or
indirectly, a majority of the voting securities of the Surviving
Company (a " Resulting Parent ").
If there is a reorganization, merger, consolidation or sale of
the Company that does not result in a Change in Control pursuant to
clause (iii), references to "the Company" in this definition will
be deemed to have been replaced by references to the Resulting
Parent (or if there is no Resulting Parent, the Surviving
Company).
(g) " Code " means the Internal Revenue Code of
1986, as amended.
(h) " Company " means Centennial Bank Holdings,
Inc. and the tax-controlled group of which it is a member.
(i) " Date of Termination " means (i) if a
Participant’s employment is terminated for Disability, 30
days after notice of termination is given by the Company (provided
that the Participant shall not have returned to the full-time
performance of his or her duties during such 30 day period);
(ii) if a Participant’s employment is terminated
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by the Participant, the date specified in the
notice of termination, which shall not be less than 30 days after
notice of termination is given (unless the Company selects an
earlier Date of Termination); or (iii) if a
Participant’s employment is terminated for any other reason,
the date specified in the notice of termination.
(j) " Disability " shall occur if a Participant is
incapacitated and absent from his or her duties on a full-time
basis for 4 consecutive months or for at least 180 days (which need
not be consecutive) during any 12 month period.
(k) " Good Reason " means, without the
Participant’s express written consent, the occurrence of any
of the following events after a Change in Control:
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(i) the assignment to the Participant of any duties inconsistent
with his or her title, position, duties, responsibilities and
status with the Company as in effect immediately before the Change
in Control, or any other action by the Company that results in a
diminution of the Participant’s title, duties, position or
reporting relationships, or any removal of the Participant from, or
any failures to re-elect the Participant to, any of such positions,
except in connection with the termination of his or her employment
for Cause or as a result of his or her Disability or death, or
termination by the Participant other than for Good Reason;
provided that insubstantial or inadvertent actions not taken
in bad faith which are remedied by the Company promptly after
receipt of notice thereof given by the Participant shall not
constitute Good Reason;
(ii) any reduction in the Participant’s base salary, or a
significant reduction in the aggregate employee benefits provided
to the Participant, unless such reduction applies equally to other
similarly situated employees of the Company, in each case, which is
not remedied within 10 calendar days after receipt by the Company
of written notice from the Participant of such change or reduction,
as the case may be;
(iii) the Company requiring the Participant to be based more
than 30 miles from the location of his or her place of employment
immediately before the Change in Control, except for normal
business travel in connection with his or her duties with the
Company; or
(iv) the failure by the Company to 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 the Company to expressly assume this Plan and all
obligation hereunder.
An isolated, insubstantial and inadvertent action taken in good
faith implicating clauses (i), (ii) or (iii) of this
definition which is fully corrected by the Company before the Date
of Termination specified in the notice of termination shall not
constitute Good Reason. A Participant must provide a notice of
termination for Good Reason within 90 days following the
Participant’s knowledge of existence of the event
constituting Good Reason or such event shall not constitute Good
Reason under this Plan.
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(l) " Participant " means each of
the employees of the Company who are selected by the Board for
coverage by this Plan and identified on Schedule A
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(m) " Qualifying Termination " means a termination
of the Participant’s employment (i) by the Company other
than for Cause or (ii) by the Participant for Good Reason.
Termination of the Participant’s employment with the Company
on account of death, Disability or retirement (in accordance with
the normal retirement policy of the Company as in effect before the
Change in Control) shall not be treated as a Qualifying
Termination. Notwithstanding the preceding sentence, the death or
Disability of the Participant after notice of termination for Good
Reason or without Cause has been validly provided shall be deemed
to be a Qualifying Termination.
(n) " Severance Multiple " means, for each
Participant, a number determined by the Board in its sole
discretion and noted on Schedule A .
(o) " Termination Period " means the period of
time beginning with a Change in Control and ending 2 years
following such Change in Control. Notwithstanding anything in this
Plan to the contrary, if a Participant’s employment with the
Company is terminated before the occurrence of a Change in Control,
the Participant’s employment will be deemed to have been
terminated by the Company without Cause on the day after the
occurrence of the Change in Control if (i) a Change in Control
actually occurs, (ii) during the Change in Control Period (as
defined in Section 16(d)) ending on such Change in Control,
the Participant’s employment is terminated by the Company
other than for Cause or by the Participant for Good Reason or
(iii) the Participant reasonably demonstrates that the Company
terminated the Participant’s employment, or gave the
Participant Good Reason, at the request of a Person (other than the
Company) who has indicated an intention or taken steps reasonably
calculated to effect a Change in Control, or otherwise in
connection with, or in anticipation of, the Change in Control. For
purposes of determining the timing of payments and benefits
to the Participant under Section 4, the date of the actual
Change in Control shall be treated as the Participant’s Date
of Termination under Section 2(i), and for purposes of
determining the amount of payments and benefits owed to the
Participant under Section 4, the date the Participant’s
employment is actually terminated shall be treated as the
Participant’s Date of Termination under
Section 2(i).
3. Eligibility . The Board shall determine in its
sole discretion which employees of the Company shall be
Participants. Once an employee becomes a Participant, the employee
shall remain a Participant until the earlier of (1) the
expiration of the Participant’s "participation period" noted
on Schedule A and (2) the Board’s removal of the
employee as a Participant in this Plan. The Board may remove an
employee as a Participant in this Plan at any time in its sole
discretion except that a Participant may not be removed as a
Participant without his or her prior written consent
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either (i) during a Change in Control Period
or Termination Period or (ii) unless the Company provides
Participant with at least 6 months prior notice of such
removal. For the avoidance of doubt, if a Participant is
removed as a Participant in this Plan pursuant to clause
(ii) in the immediately preceding sentence and during such 6
month notice period a Change in Control Period is triggered
pursuant to which an actual Change in Control occurs, the
Participant shall not be removed or be deemed to have been removed
from this Plan.
4. Payments Upon Termination of Employment . If
during the Termination Period the employment of the Participant is
terminated pursuant to a Qualifying Termination, then, subject to
the Participant’s execution of a Separation Agreement and
Release in the form attached to this Plan as Schedule C (the
" Separation Agreement and Release "), the Company
shall provide to the Participant:
(a) his or her 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 to which he or she is entitled under any
compensation plan of the Company, as the case may be, in effect
immediately before the Change in Control, at the time such payments
are due;
(b) within 8 days following the Date of Termination (or, if
later, the execution by the Participant of the Separation Agreement
and Release), but in no event before the date on which such
Separation Agreement and Release becomes effective (including the
expiration of any applicable revocation period), a lump sum cash
payment equal to the result of multiplying (i) the
Participant’s current target Annual Bonus, expressed as a
percentage of base salary in the event the relevant goals are 100%
achieved, for the year in which the Date of Termination occurs by
(ii) a fraction, (A) the numerator of which is the number
of days elapsed from the beginning of the relevant period for which
performance is measured in determining such Annual Bonus until the
Date of Termination and (B) the denominator of which is the
number of days of such relevant period;
(c) within 8 days following the Date of Termination (or, if
later, the execution by the Participant of the Separation Agreement
and Release), but in no event before the date on which such
Separation Agreement and Release becomes effective (including the
expiration of any applicable revocation period), a lump sum cash
payment equal to the result of multiplying (i) the sum of
(A) the Participant’s Base Salary, plus (B) the
Participant’s Bonus Amount by (ii) the
Participant’s Severance Multiple;
(d) for the number of years from the Date of Termination equal
to the Severance Multiple, continued provision of medical, dental,
and vision benefits to the Participant, his or her spouse and his
or her eligible dependants on the same basis as such benefits are
then currently provided to such Participant (the " Medical
Benefits "); provided that such benefits shall be
secondary to any other coverage obtained by the Participant;
provided further that if the Company’s welfare
plans do not permit such coverage, the Company will provide the
Participant the Medical Benefits with the same tax effect; and
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(e) if the Participant is subject to any excise
tax imposed under Section 4999 of the Code (the " Excise
Tax ") by reason of a Change in Control, then the Company
shall pay to the Participant an amount as specified in Schedule
B .
Except as otherwise expressly provided pursuant to this Plan,
this Plan shall be construed and administered in a manner which
avoids duplication of compensation and benefits which may be
provided under any other plan, program, policy, or other
arrangement or individual contract. In the event a Participant is
covered by any other plan, program, policy, individually negotiated
agreement or other arrangement, in effect as of his or her Date of
Termination, that may duplicate the payments and benefits provided
for in this Section 4, the Board is specifically empowered to
reduce or eliminate the duplicative benefits provided for under the
Plan.
This Plan does not abrogate any of the usual entitlements which
a Participant has or will have, first, while a regular employee,
and subsequently, after termination, and thus a Participant shall
be entitled to receive all benefits payable to him or her under
each and every qualified plan, welfare plan and any other plan or
program relating to benefits and deriving from his or her
employment with the Company, but solely in accordance with the
terms and provisions thereof.
5. Withholding Taxes . The Company may withhold
from all payments due to the Participant (or his or her beneficiary
or estate) hereunder all taxes which, by applicable federal, state,
local or other law, the Company is required to withhold
therefrom.
6. Reimbursement of Expenses . If a Change in
Control actually occurs and any contest or dispute shall arise
under this Plan involving termination of a Participant’s
employment with the Company or involving the failure or refusal of
the Company to perform fully in accordance with the terms hereof,
the Company shall reimburse the Participant on a current basis for
all reasonable legal fees and related expenses, if any, incurred by
the Participant in connection with such contest or dispute,
provided that the Participant shall be required to repay
immediately any such amounts to the Company to the extent that a
court or an arbitration panel issues a final and non-appealable
order setting forth the determination that the position taken by
the Participant was frivolous or advanced by the Participant in bad
faith.
7. Scope of Plan . Nothing in this Plan shall be
deemed to entitle the Participant to continued employment with the
Company, and if a Participant’s employment with the Company
shall terminate before a Change in Control, the Participant shall
have no further rights under this Plan (except as specifically
provided herein); provided that any termination of a
Participant’s employment during the Termination Period shall
be subject to all of the provisions of this Plan.
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8. Certain Additional Agreements under
Section 409A . In the event the payment of any amounts
under this Plan would be treated as non-qualified deferred
compensation under Section 409A of the Code, such payment will
be delayed for 6 months after the Date of Termination if required
in order to avoid additional tax under Section 409A of the
Code. If a Participant dies within 6 months following such
termination of employment, any such delayed payments shall not be
further delayed, and shall be immediately payable to his or her
estate in accordance with the applicable provisions of this
Plan.
9. Part
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