Exhibit 10.6
RENASANT
CORPORATION
CHANGE IN CONTROL
AGREEMENT
This Change in Control
Agreement (the
“Agreement”) is entered into by and between Stuart R.
Johnson (“Executive”) and Renasant Corporation, a
Mississippi corporation (the “Company”), and is
intended to amend, restate and replace, in its entirety, that
certain Employment Agreement by and between Executive and the
Company dated as of February 10, 1998 (the “Prior
Agreement”).
1.1 “Affiliate” means one or more
subsidiaries or other entities with respect to which the Company
owns (within the meaning of Section 425(f) of the Internal
Revenue Code of 1986, as amended (the “Code”)) 50% or
more of the total combined voting power of all classes of stock or
other equity interests.
1.2 “Base Compensation” means
Executive’s annualized base salary.
1.3 “Board” means the Board of Directors
of the Company.
1.4 “Cause” means that Executive
has:
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a.
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Committed
an intentional act of fraud, embezzlement or theft in the course of
his employment or otherwise engaged in any intentional misconduct
which is materially injurious to the Company’s (or an
Affiliate’s) financial condition or business
reputation;
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b.
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Committed
intentional damage to the property of the Company (or an Affiliate)
or committed intentional wrongful disclosure of Confidential
Information (as defined below);
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c.
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Been
indicted for the commission of a felony or a crime involving moral
turpitude;
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d.
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Willfully
and substantially refused to perform the essential duties of his
position, which has not been cured within 30 days following written
notice by the Company’s Chief Executive Officer;
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e.
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Intentionally,
recklessly or negligently violated any material provision of any
code of ethics, code of conduct or equivalent code or policy of the
Company or its Affiliates applicable to him; or
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f.
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Intentionally,
recklessly or negligently violated any material provision of the
Sarbanes-Oxley Act of 2002 or any of the rules adopted by the
Securities and Exchange Commission implementing any such
provision.
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No act or failure to act on the part
of Executive will be deemed “intentional” if it was due
primarily to an error in judgment or negligence (but not gross
negligence), but will be deemed “intentional” only if
done or omitted to be done by Executive not in good faith and
without reasonable belief that his action or omission was in the
best interest of the Company or an Affiliate.
1.5 “Change In Control” means and shall
be deemed to occur upon a Change in Equity Ownership, a Change in
Effective Control, a Change in the Ownership of Assets or a Change
by Merger. For this purpose:
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a.
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A
“Change in Equity Ownership” means that a person or
group acquires, directly or indirectly in accordance with Code
Section 318, more than 50% of the aggregate fair market value
or voting power of the capital stock of the Company, including for
this purpose capital stock previously acquired by such person or
group; provided, however, that a change in Equity Ownership shall
not be deemed to occur hereunder if, at the time of any such
acquisition, such person or group owns more than 50% of the
aggregate fair market value or voting power of the Company’s
capital stock.
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b.
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A
“Change in Effective Control” means that (i) a
person or group acquires (or has acquired during the immediately
preceding 12-month period ending on the date of the most recent
acquisition by such person or group), directly or indirectly in
accordance with Code Section 318, ownership of the capital
stock of the Company possessing 35% or more of the total voting
power of the Company, or (ii) a majority of the members of the
Board of Directors of the Company is replaced during any 12-month
period, whether by appointment or election, without endorsement by
a majority of the members of the Board prior to the date of such
appointment or election.
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c.
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A
“Change in the Ownership of Assets” means that any
person or group acquires (or has acquired in a series of
transactions during the immediately preceding 12-month period
ending on the date of the most recent acquisition) all or
substantially all of the assets of the Company.
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d.
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A
“Change by Merger” means that the Company shall
consummate a merger or consolidation or similar transaction with
another corporation or entity, unless as a result of such
transaction, more than 50% of the then outstanding voting
securities of the surviving or resulting corporation or entity
shall be owned in the aggregate by the former shareholders of the
Company and the voting securities of the surviving or resulting
corporation or entity are owned in substantially the same
proportion as the common stock of the Company was beneficially
owned before such transaction.
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The Board shall promptly certify to
Executive whether a Change in Control has occurred hereunder, which
certification shall not be unreasonably withheld.
1.6 “Code” means the Internal Revenue
Code of 1986, as amended.
1.7 “Good Reason” means that in
connection with a Change in Control:
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a.
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Executive’s
Base Compensation in effect immediately before such change is
materially diminished;
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b.
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Executive’s
authority, duties or responsibilities are materially diminished
from those performed by Executive prior to the Change in Control;
or
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c.
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There
is a material change in the office or business location at which
Executive is required to perform services, but in no event less
than a change outside the 30-mile radius of the location he was
assigned to prior to the Change in Control.
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No event or condition described in
this Section 1.7 shall constitute Good Reason unless
(a) Executive provides to the Chief Executive Officer notice
of his objection to such event or condition not more 60 days after
Executive first learns of such event, which notice shall be
delivered in writing, (b) such event or condition is not
promptly corrected by the Company, but in no event later than 30
days after receipt of such notice, and (c) Executive resigns
his employment with the Company and its Affiliates not more than 60
days following the expiration of the 30-day period described in
subparagraph (b) hereof.
1.8 “Incentive Bonus” means the amount
paid or payable to Executive under the Company’s Performance
Based Rewards Plan or similar annual cash bonus
arrangement.
1.9 “Termination of employment,”
“separation from service,” and words of similar import
used herein shall mean the later of the date on which (a) an
Executive’s employment with the Company and its Affiliates
ceases, or (b) the Company and such Executive reasonably
anticipate that Executive will perform no further services for the
Company and it’s Affiliates, whether as a common law employee
or independent contractor. Notwithstanding the foregoing, Executive
may be deemed to incur a separation from service hereunder if he
continues to provide services to the Company or an Affiliate,
provided such services are not more than 20% of the average level
of services performed, whether as an employee or independent
contractor, during the immediately preceding 36-month
period.
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2.
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Change
in Control Benefits:
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2.1 Termination In Connection
With a Change in Control. If Executive’s employment is involuntarily
terminated by the Company, without Cause, or Executive terminates
his employment with the Company for Good Reason, either occurring
during the 24-month period following a Change in Control
(Executive’s “Eligible Termination”), the Company
shall pay or provide to Executive the following:
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a.
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Executive’s
Incentive Bonus with respect to the Company’s completed
fiscal year immediately preceding Executive’s Eligible
Termination, to the extent such amount has not been paid as of the
change; such amount shall be paid on the payment date generally
applicable to such bonus.
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b.
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If
Executive and/or his dependants timely elect to continue group
medical coverage in accordance with Code Section 4980B with
respect to the group medical plan sponsored by the Company or an
Affiliate (excluding for this purpose any health flexible spending
account described in Code Sections 125 and 105(h)), the Company
shall pay to Executive the amount of the continuation coverage
premium for the same type and level of coverage received by
Executive and his electing dependants immediately prior to
Executive’s Eligible Termination for the period such coverage
is actually provided in accordance with Code Section 4980B,
but not in excess of 18 months; payment hereunder shall be made on
the first business day of each calendar month following
Executive’s timely coverage election, and, to facilitate the
payment of Executive’s group medical plan premiums, may, in
the discretion of the Company, be remitted directly by the Company
to such plan or other appropriate person.
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c.
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Vesting
shall be accelerated, any restrictions shall lapse, and all
performance objectives shall be deemed satisfied as to any
outstanding grant or award made to Executive under the
Company’s 2001 Long-Term Incentive Compensation Plan, as the
same may be amended, restated or superseded from time to
time.
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d.
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The
Company shall pay to Executive an additional amount equal to 2.00
times the aggregate of Executive’s (i) Base Compensation
in effect prior to such change, and (ii) average Incentive
Bonus paid with respect to the two whole calendar years preceding
such change; the amount determined hereunder shall be paid in the
form of a single-sum not more than 30 days following such
change.
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2.2 Limitation on
Payments. If the
aggregate present value of all payments and benefits due to
Executive under this Agreement and any other payment or benefit due
to Executive from the Company or an Affiliate or any successor
thereto on account of a Change in Control (the “Aggregate
Payments”) would be subject to the excise tax imposed by Code
Section 4999, such payments or benefits shall be reduced by
the minimum amount necessary to result in no portion of the
Aggregate Payments, so reduced, being subject to such tax. The
determination of whether a reduction is required hereunder shall be
made by the Company’s registered independent public
accounting firm and shall be binding upon the parties hereto. To
the extent practicable, Executive shall be entitled to select the
payments or benefits subject to reduction.
2.3 Specified Employee
Delay. In the event the
Company determines that Executive is a “specified
employee” within the meaning of Code Section 409A as of
his Eligible Termination, then, notwithstanding any provision of
this Agreement to the contrary, the Company shall postpone until
the first business day of the seventh calendar month following such
termination (the “Delayed Payment Date”) any payment or
benefit hereunder which is deemed on account of Executive’s
separation from service and not otherwise permitted to be paid or
furnished in accordance with the provisions of Code
Section 409A and the guidance promulgated thereunder. Any
payment made as of Executive’s Delayed Payment Date shall
include the principal amount of all payments suspended between
Executive’s Eligible Termination and such date, without
liability for interest or other loss of investment
opportunity.
2.4 Other Benefits and
Payments. Amounts payable
or provided under this Section 2 shall be in lieu of and not
in addition to any severance pay or similar post-termination
benefit or payment otherwise provided under any severance pay or
similar plan, policy or arrangement maintained by the Company or
its Affiliates. Notwithstanding the foregoing, nothing contained
herein shall affect the payment or provision of any amount or
benefit which the Company and its Affiliates are required by law to
pay or provide.
2.5 Further Limitation on
Payments. As a condition
of the receipt of any cash payment hereunder, Executive
acknowledges that the Board retains the discretion to reduce the
amount of the benefit to the extent necessary to ensure that all
cash benefits paid under this Agreement on account of a Change in
Control, when aggregated with similar change in control severance
benefits paid under separate plans, policies and arrangements
maintained by the Company and its Affiliates, excluding for this
purpose payments made under certain employment agreements between
the Company and/or Renasant Bank and certain of their executive
officers, do not exceed a specified amount, which will be
determined by the Board in good faith at the time a Change in
Control occurs. The purpose of this limit is to ensure that all
severance benefits payable on account of a Change in Control will
not be excessive, when considered in the aggregate. If a reduction
is required, the Board shall furnish notice to Executive, and, to
the extent practicable, the amount of the reduction will be applied
on a pro rata basis to all affected executive, officers and
employees.
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3.
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Limitations
On Activities:
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3.1 Consideration for Limitation
on Activities. Executive
acknowledges that the execution of this Agreement and the payments
described herein constitute consideration for the limitations on
activities set forth in this Section 3, the adequacy of which
is hereby acknowledged.
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3.2 Intellectual
Property. The parties
hereto agree that the Company owns all Intellectual Property (as
defined below) and associated goodwill. Executive agrees to assign,
and hereby assigns to the Company, without further consideration or
royalty, the ownership of and all rights to such property and
goodwill. The Company shall possess the right to own, obtain and
hold in its name any right, registration, or other protection or
recordation associated with such Intellectual Property, and
Executive agrees to
