Exhibit 10.2
STATE OF NORTH
CAROLINA
COUNTY OF WAKE
EXECUTIVE
CONSULTATION,
SEPARATION FROM SERVICE
AND
DEATH BENEFIT
AGREEMENT
THIS EXECUTIVE CONSULTATION,
SEPARATION FROM SERVICE AND DEATH BENEFIT AGREEMENT
(“Agreement”) is made and entered into this 3rd day of
February, 2009, to be effective as of the 1st day of January, 2005,
by and between FIRST-CITIZENS BANK & TRUST COMPANY
, a North Carolina banking corporation with its principal office in
Raleigh, Wake County, North Carolina (“Company”) and
FRANK B. HOLDING (“Executive”);
W I T N E S S E T
H
WHEREAS , Executive is an employee of Company who has
provided guidance, leadership and direction in the growth,
management and development of Company and has learned trade
secrets, confidential procedures and information, and technical and
sensitive plans of Company; and
WHEREAS , Company desires to limit Executive’s
availability to other employers or entities which are in
competition with Company following Executive’s separation
from service with Company; and
WHEREAS , Company has offered to Executive a
non-competition arrangement and a consultation arrangement together
with a death benefit arrangement for Executive’s designated
beneficiary or estate, as applicable, and the parties hereto have
reached an agreement concerning those arrangements and other
matters contained herein and desire to set forth the terms and
conditions thereof.
NOW, THEREFORE
, for and in consideration of the
mutual promises and undertakings herein set forth, Executive and
Company hereby agree as follows:
1. Administration of the
Agreement . The
Agreement shall be administered by the Board of Directors of the
Company or its delegate (the “Administrator”). Subject
to the provisions of the Agreement, the Administrator shall have
full and final authority in its discretion
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to take any action with respect to the Agreement
including, without limitation, the authority to (i) determine
all matters relating to the payments; (ii) establish, amend
and rescind rules and regulations for the administration of the
Agreement; and (iii) construe and interpret the Agreement, to
interpret rules and regulations for administering the Agreement and
to make all other determinations deemed necessary or advisable for
administering the Agreement. Except to the extent otherwise
required under Section 409A of the Internal Revenue Code of
1986, as amended (“Code”), the Administrator shall have
the authority, in its sole discretion, to accelerate the date that
any Consultation Payments or Separation Payments which were not
otherwise vested or earned shall become vested or earned in whole
or in part without any obligation to accelerate such date with
respect to any other employee. The Administrator also may in its
sole discretion determine that Executive’s rights or payments
under the Agreement shall be subject to reduction, cancellation,
forfeiture or recoupment due to conduct by Executive that is
determined by the Administrator to be detrimental to the business
or reputation of the Company, including, without limitation, upon
termination of employment for cause; violation of policies of the
Company; or breach of non-solicitation, noncompetition,
confidentiality or other restrictive covenants that apply to the
Executive. In addition to action by meeting in accordance with
applicable laws, any action of the Administrator with respect to
the Agreement may be taken by a written instrument signed by the
Administrator (including, where the Board or a committee serves as
the Administrator, by written consent signed by all of the members
of the Board, or all of the members of a committee, and any such
action so taken by written consent shall be as fully effective as
if it had been taken by a majority of the members at a meeting duly
held and called). No individual shall be liable while acting as
Administrator for any action or determination made in good faith
with respect to the Agreement, and any such individual shall be
entitled to indemnification and reimbursement in the manner
provided in the Company’s certificate of incorporation and
bylaws and/or under applicable law.
2. Consultation Payments
. Following
Executive’s separation from service with Company on or after
his Vesting Date (as defined in Section 7), Company shall pay
to Executive the sum of TWELVE THOUSAND FOUR HUNDRED THIRTY-EIGHT
and 92/100 Dollars ($12,438.92) per month, beginning six months and
one week after Executive’s date of separation for a period of
ten (10) years, or until Executive’s death, whichever
first occurs (“Consultation Payments”). If Executive
should die during the ten-year period during which
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Consultation Payments are being made under this
Paragraph 2, then those payments shall terminate.
The monthly Consultation Payments
shall be paid for and in consideration of Executive’s
support, sponsorship, advisory and other services provided to
Company (“Consultation Services”), such sum to be
payable to Executive whether or not Executive’s Consultation
Services are utilized in said month by Company. Except as set forth
below, Consultation Payments hereunder shall be payable each month
without deductions and Executive agrees to be solely responsible
for the payment of all income and other taxes out of said funds and
all Social Security, self-employment and any other taxes or
assessments, if any, applicable on said compensation.
For and in consideration of said
monthly Consultation Payments to Executive, Executive will provide
Consultation Services as an independent contractor to Company, as
and when Company may request, which services may be provided with
respect to all phases of Company’s business and particularly
those phases in which Executive has particular expertise and
knowledge. Executive’s services shall be limited to those of
an independent contractor, shall not be on a day-to-day regularly
scheduled operational basis and shall be provided only when
Executive is reasonably available and willing, which willingness
will not be unreasonably withheld.
Effective as of Executive’s
date of separation, Executive and Company agree that Executive
shall be, under the terms of this Agreement, an independent
contractor, and Executive agrees that Executive’s rights and
privileges and obligations are only as provided in this Agreement
as to matters covered herein. Notwithstanding the foregoing, if
Company determines that the Consultation Payments are compensation
for other than payments for Consultation Services, and such
payments shall be subject to any and all applicable withholding,
Social Security, employment, income and other taxes or assessments,
if any, under applicable tax law, the said payments shall be
subject to the required withholdings.
3. Separation Payments
. Following
Executive’s separation from service with Company on or after
his Vesting Date (as defined in Section 7), Company shall pay
to Executive the sum of THIRTY-SEVEN THOUSAND THREE HUNDRED SIXTEEN
and 74/100 Dollars ($37,316.74) per month, beginning six months and
one week after Executive’s date of separation for a period of
ten (10) years, or until Executive’s death, whichever
first
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occurs (the “Separation Payments”).
Such payments shall be subject to any and all applicable
withholding, Social Security, employment, income and other taxes or
assessments, if any, under the applicable tax law. If Executive
should die during the ten-year period during which payments are
being made under this Paragraph 3, then those payments shall
terminate and future payments, if any, shall be made to
Executive’s designated beneficiary(ies) or Executive’s
estate in accordance with the provisions of Paragraph 4 of this
Agreement.
4. Continuation of
Payments . Following
Executive’s death during the original ten-year period of
payments under Paragraph 3 above, the sum of FORTY-NINE THOUSAND
SEVEN HUNDRED FIFTY-FIVE and 66/100 Dollars ($49,755.66) per month
shall be paid to such individual or individuals as Executive shall
have designated in writing as his beneficiary(ies) as provided in
Paragraph 13 below or, in the absence of such designation, to
Executive’s estate, as applicable, beginning the first
calendar month following the date of Executive’s death and
continuing thereafter until the expiration of said original
ten-year period. Once the monthly payments have begun to Executive,
whether paid by Company or as otherwise provided herein, the
maximum payment period under this Agreement shall be ten
(10) years.
5. Covenant Not To
Compete. For and in
consideration of the monthly payments described in Paragraphs 2 and
3, Executive agrees not to become an officer or employee of,
provide any consultation to, nor participate in any manner with,
any other entity of any type or description involved in any major
element of business which Company is performing at the time of
Executive’s separation from service with the Company, nor
will Executive perform or seek to perform any consultation or other
type of work or service with any other firm, person or entity,
directly or indirectly, in any such business which competes with
Company, whether done directly or indirectly, in ownership,
consultation, employment or otherwise. Executive agrees not to
reveal to outside sources, without the consent of Company, any
matters, the revealing of which could, in any manner, adversely
affect or disclose Company’s business or any part thereof,
unless required by law to do so. This Covenant Not To Compete by
Executive is limited to the geographic area consisting of each
county or like jurisdictional entity in which either Company or any
banking or investment entity owned directly or indirectly by the
parent of Company shall maintain a banking or other business office
at the time of Executive’s separation from service, shall
exist for and during the term of all payments to be made under
Paragraphs 2 and 3, whether made directly by Company or as
otherwise provided herein, and shall not prevent
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Executive from purchasing or acquiring, as an
investor only, a financial interest of less than 5% in a
business or other entity which is in competition with
Company.
Executive acknowledges that the
remedy at law for breach of Executive’s Covenant Not To
Compete will be inadequate and that Company shall be entitled to
injunctive relief as to any violation thereof; however, nothing
herein shall be construed as prohibiting Company from pursuing any
ot
