EXHIBIT 10.30
TAYLOR CAPITAL GROUP, INC. SENIOR
OFFICER
CHANGE IN CONTROL SEVERANCE PLAN
INTRODUCTION
The Board of Directors of Taylor
Capital Group, Inc. considers the maintenance of a sound management
to be essential to protecting and enhancing the best interests of
the Company (as hereinafter defined), the Bank (as hereinafter
defined), and the Company’s stockholders. In this context,
the Company recognizes that the possibility of a Change in Control
(as hereinafter defined) may exist from time to time, and that this
possibility, and the uncertainty and questions it may raise among
management, may result in the departure or distraction of
management personnel to the detriment of the Company and its
stockholders and the Bank. Accordingly, the Board (as hereinafter
defined) has determined that appropriate steps should be taken to
encourage the continued attention and dedication of members of the
Company’s and Bank’s senior management to their
assigned duties without the distraction which may arise from the
possibility of a Change in Control of the Company or the
Bank.
This Plan does not alter the status
of Participants (as hereinafter defined) as at-will employees of
the Company or Bank. Just as Participants remain free to leave the
employ of the Company or Bank at any time, so too do the Company
and the Bank retain their right to terminate the employment of
Participants without notice, at any time, for any reason. However,
the Company believes that, both prior to and at the time a Change
in Control is anticipated or occurring, it is necessary to have the
continued attention and dedication of Participants to their
assigned duties without distraction, and this Plan is intended as
an inducement for Participants’ willingness to continue to
serve as employees of the Company or Bank (subject, however, to
either party’s right to terminate such employment at any
time). Therefore, should a Participant still be an employee of the
Company or Bank at such time, the Company agrees that such
Participant shall receive the severance benefits hereinafter set
forth in the event the Participant’s employment with the
Company or Bank terminates subsequent to a Change in Control under
the circumstances described below.
ARTICLE I
ESTABLISHMENT OF
PLAN
Effective December 31, 2008,
the Company hereby establishes Taylor Capital Group, Inc. Senior
Officer Change in Control Severance Plan, as set forth in this
document (the “Plan”).
ARTICLE II
DEFINITIONS
As used herein the following words
and phrases shall have the following respective meanings unless the
context clearly indicates otherwise.
(a) “ Affiliate ”
means, with respect to any person, any individual, corporation,
partnership, association, joint-stock company, trust,
unincorporated association or other entity (other than such person)
that directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with that
person.
(b) “ Annual Bonus
” means the gross, annual amount payable to a Participant for
the fiscal year of the Company ending immediately preceding the
Effective Date, or, if higher, the annual amount payable to the
Participant for the fiscal year of the Company ending immediately
preceding the date when notice of termination of the
Participant’s employment was given, under the Company’s
annual incentive compensation (“Success”) program;
provided , that in either case such annual Success bonus
shall be annualized (based on the target bonus for the year) in the
event the Participant was not employed for the entire fiscal year
with respect to which such bonus was paid.
(c) “ Bank ”
means Cole Taylor Bank, a wholly owned subsidiary of the
Company.
(d) “ Board ”
means the Board of Directors of the Company.
(e) “ Cause ”
means (1) the Participant has committed an act of dishonesty
that results, or is intended to result, in material gain or
personal enrichment of the Participant or has, or is intended to
have, a material detrimental effect on the reputation or business
of the Company or the Bank; (2) the Participant has committed
an act or acts of fraud, moral turpitude or constituting a felony
(other than relating to the operation of a motor vehicle);
(3) any material breach by the Participant of any provision of
this Plan that, if curable, has not been cured by the Participant
within thirty (30) days of written notice of such breach from
the Company or the Bank; (4) an intentional act or willful
gross negligence on the part of the Participant that has, or is
intended to have, a material, detrimental effect on the reputation
or business of the Company or the Bank; (5) the
Participant’s refusal, after thirty (30) days written
notice thereof, to perform specific reasonable directives from the
Board or the Board of Directors of the Bank that are reasonably
consistent with the scope and nature of his duties and
responsibilities; or (6) the Participant being barred or
prohibited by any governmental authority or agency from holding his
or her current position at either the Company or the Bank. The
decision to terminate a Participant’s employment for Cause,
to take other action or to take no action in response to any
occurrence shall be in the sole and exclusive discretion of the
Compensation Committee of the Board. No act or failure to act shall
be considered “intentional” unless it is done, or
omitted to be done, by the Participant in bad faith or without
reasonable belief that the Participant’s action or omission
was in the best interests of the Company or the Bank; and provided
further, that no act or omission shall constitute Cause hereunder
absent such a finding by the Compensation Committee of the
Board.
(f) “ Change in Control
” means the occurrence of any of the following
events:
(i) A change in the ownership of
the Company or the Bank . A change in the ownership of the
Company or the Bank shall occur on the day that any one person, or
more than one person acting as a Group, except for the Taylor
Family, acquires ownership of stock of the Company or the Bank
that, together with all other stock held by such person or Group,
constitutes more than fifty percent (50%) of the total fair
market value or total voting power of the stock of the Company or
the Bank.
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(ii) A change in the effective
control of the Company or the Bank. A change in the effective
control of the Company or the Bank occurs on the earlier of the
date that a majority of the members of the Board or the
Bank’s Board of Directors is replaced during any twelve
(12) month period by directors whose appointment or election
is not endorsed by a majority of the members of the Board or the
Bank’s Board of Directors prior to the date of the
appointment or election; provided, however, that, if one person, or
more than one person acting as a Group, is considered to
effectively control the Company or the Bank, the acquisition of
additional control of the Company or the Bank by the same person or
persons is not considered a change in the effective control of the
Company or the Bank.
(iii) A change in the ownership
of a substantial portion of the Company’s or the Bank’s
assets. A change in the ownership of a substantial portion of
the Company’s or the Bank’s assets occurs on the date
that any one person, or more than one person acting as a Group,
acquires (or has acquire during the twelve (12) month period
ending on the date of the most recent acquisition by such person)
assets from the Company or the Bank or the Bank that have a total
Gross Fair Market Value (as defined below) equal to or more than
fifty percent (50%) of the total Gross Fair Market Value of
all of the assets of the Company or the Bank or the Bank
immediately prior to such acquisition or acquisitions; provided,
however, that, a transfer of assets by the Company or the Bank or
the Bank is not treated as a change in the ownership of such assets
if the assets are transferred to:
(1) a stockholder of the Company or
the Bank (immediately before the asset transfer) in exchange for or
with respect to its stock; or
(2) an entity, 50% or more of the
total value or voting power of which is owned, directly or
indirectly, by the Company or the Bank.
(g) “ Gross Fair Market
Value ” means the value of the assets of the Company or
the Bank (as applicable), or the value of the assets being disposed
or, determined without regard to any liabilities associated with
such assets; and
(h) “ Group ”
shall have the meaning ascribed to such term in Sections
(i)(5)(v)(B), (vi)(D) or (vii)(C), as applicable, of Treasury
Regulation Section 1.409A-3.
(i) “ Change in Control
Period ” means the continuous period commencing on the
Effective Date and ending on the first anniversary of the Effective
Date.
(j) “ COBRA Continuation
Coverage ” means the medical, dental and vision care
benefits that the Participant and his Qualifying Family Members
elect and are eligible to receive upon the Participant’s
termination of employment with the Employers pursuant to
Section 4980B of the Code, and Section 601 et.al. of the
Employee Retirement Income Security Act of 1974, as amended. For
this purpose, an Executive’s Qualifying Family Members are
his spouse and his dependent children to
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the extent they are eligible for,
and elect to receive, continuation coverage under such
Section 4980B and Section 601 et.al. Notwithstanding any
other provision of this Agreement, COBRA Continuation Coverage
under this Agreement shall terminate for any individual when it
terminates under the terms of the applicable benefit plan of the
Company in accordance with such Section 4980B and
Section 601 et.al.
(k) “ Code ”
means the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
(l) “ Compensation
” means the sum of (i) the Participant’s gross,
annual base salary at the greater of the rate in effect on the
Effective Date of the Change in Control or the rate in effect
immediately prior to the date when notice of termination of the
Participant’s employment was given and (ii) the Annual
Bonus. Compensation, for purposes of applying the multiplier in
subparagraph 4.2(a)(1) of this Agreement, does not include any
accrued balances in the 1997 Long Term Incentive Plan (or its
successor) or any other compensation program in which the
Participant participates.
(m) “ Effective Date
” means the date on which a Change in Control
occurs.
(n) “ ERISA ”
means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations issued thereunder.
(o) “ Good Reason
” means the occurrence of any of the following events with
respect to a Participant, unless, (i) such event occurs with
the Participant’s express prior written consent,
(ii) the event is an isolated, insubstantial or inadvertent
action or failure to act which was not in bad faith is remedied by
the Company promptly after receipt of notice thereof given by the
Participant, (iii) the event occurs in connection with the
termination of the Participant’s employment for Cause,
disability or death or (iv) the event occurs in connection
with the Participant’s voluntary termination of employment
other than due to the occurrence of one of the following
events:
(i) the assignment to the
Participant by the Company or the Bank of any duties which are
materially and adversely inconsistent with, or are a material
diminution of, the Participant’s positions, duty, title,
office, responsibility and status with the Company or the Bank,
including without limitation, any diminution of the
Participant’s position or responsibility in the decision or
management processes of the Company or the Bank, or any removal of
the Participant from, or any failure to reelect the Participant to,
any of such positions;
(ii) a material reduction by the
Company or the Bank in the Participant’s rate of base salary
or bonus opportunity as in effect on the Effective Date or as the
same may be increased from time to time during the term of the
Agreement;
(iii) a change in the
Participant’s principal office to a location outside of Cook
County, Lake County, or Dupage County, Illinois (which is
considered to be a material geographic change for purposes of
Section 409A of the Code);
(iv) a material breach of the terms
of this Plan by the Company or the Bank; or
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(v) any failure by any successor or
assignee of the Company to continue this Agreement in full force
and effect.
Anything herein to the contrary
notwithstanding, the Participant shall be required to give written
notice to the Board that the Participant believes an event has
occurred that constitutes a Good Reason event within ninety
(90) days of the initial occurrence, which written notice
shall specify the particular act or acts, on the basis of which the
Participant intends to so terminate the Participant’s
employment, and the Company shall then be given the opportunity,
within thirty (30) days of its receipt of such notice, to cure
said event. Participant’s termination shall not be considered
to be a termination for Good Reason unless such termination occurs
during the Change in Control Period.
(p) “ Participant
” means an individual who has met, and at the time of a
Change in Control continues to meet, the requirements of Article
III below.
(q) “ Separation
Benefits ” means the benefits described in subparagraph
4.2(a) below.
(r) “Taylor Family”
means (i) Iris Taylor and the Estate of Sidney J. Taylor,
(ii) a descendant (or a spouse of a descendant) of Sidney J.
Taylor and Iris Taylor, (iii) any estate, trust, guardianship
or custodianship for the primary benefit of any individual
described in (i) or (ii) above, or (iv) a
proprietorship, partnership, limited liability company, or
corporation controlled directly or indirectly by one or more
individuals or entities described in (i), (ii), or
(iii) above.
ARTICLE III
ELIGIBILITY
3.1 Participation .
Participants in the Plan are Group Senior Vice Presidents or
Executive Vice Presidents of the Company or of the Bank on or after
December 31, 2008 who have been designated as Participants
herein by the Compensation Committee of the Board in writing; and
provided that such a Participant will not be entitled to Separation
Benefits if he or she is not a Group Senior Vice President or
Executive Vice President at the time of the Change in Control;
provided, further that any reduction of a Participant’s
position prior to, but in connection with, a Change in Control
shall be of no effect for purposes of this Section 3.1.
Notwithstanding the foregoing, a Participant shall not be entitled
to receive Separation Benefits (or any other benefits under the
Plan), if the Part
