AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT
(“ Agreement ”) effective as of January 1, 2009
(the “ Effective Date ”), is between Investors
Title Insurance Company, a North Carolina corporation (the “
Company ”), and James A. Fine, Jr. (“
Executive ”).
RECITALS:
WHEREAS, Executive is presently the Executive
Vice President and Chief Financial Officer of the Company and has
made and is expected to continue to make major contributions to the
profitability, growth and financial strength of the
Company;
WHEREAS, the Company desired to secure the
services of the Executive for the future;
WHEREAS, the parties hereto previously entered
into that certain Employment Agreement effective as of November 17,
2003, as amended June 1, 2004 (the “Existing Employment
Agreement”);
WHEREAS, pursuant to Section 16 of the Existing
Employment Agreement, the Existing Employment Agreement may be
amended by the parties hereto; and
WHEREAS, the parties hereto deem it appropriate
to amend and restate the Existing Employment Agreement;
NOW, THEREFORE, in consideration of the mutual
covenants contained herein the parties hereto agree as
follows:
1.
Employment . The Company shall employ Executive, and
Executive accepts continued employment with the Company, upon the
terms and conditions set forth in this Agreement. The term of this
Agreement shall be for a period of five (5) years beginning on the
date hereof, and shall on the first day of each calendar month,
unless either party gives written notice to the other party at
least thirty (30) days prior to such date of intent not to extend
this Agreement, be extended one (1) additional month so that at all
times the term of this Agreement shall be for a period of five (5)
years unless earlier terminated as provided in paragraph 4 hereof
(the “Employment Period”).
2.
Position and Duties .
(a) During the Employment Period, Executive
shall serve as the Executive Vice President and Chief Financial
Officer of the Company or in such other similar position as the
Executive and the Chief Executive Officer shall agree upon and,
subject to the management of the business and affairs of the
Company at the direction of the Chief Executive Officer of the
Company, shall have the normal duties, responsibilities and
authority of an executive serving in such position.
(b) Executive shall report to the Chief
Executive Officer.
(c) During the Employment Period, Executive
shall devote his best efforts and his full business time and
attention (except for participation in charitable and civic
endeavors and management of Executive’s personal investments
and business interests, provided such activities do not have more
than a de minimis effect on Executive’s performance of
his duties under this Agreement) to the business and affairs of the
Company, its parent, subsidiaries and affiliates. Executive shall
perform his duties and responsibilities to the best of his
abilities in a diligent, trustworthy, businesslike and efficient
manner.
(d) Executive shall perform his duties and
responsibilities principally in the Chapel Hill, North Carolina
area and shall not be required to travel outside that area any more
extensively than Executive has done in the recent past in the
ordinary course of the business of the Company.
3.
Compensation and Benefits .
(a) Salary . The Company agrees to pay
Executive a salary during the Employment Period in installments
based on the Company’s practices as may be in effect from
time to time. Executive’s initial salary shall be at the rate
of Two Hundred Fifty Five Thousand Five Hundred Sixty and No/100
Dollars ($255,560) per year, as may be increased from time to time
(the “ Base Salary ”), provided, however, that
if there is a Change in Control (as hereafter defined), the
Executive’s Base Salary as then in effect shall double
effective at the time the Change in Control becomes effective.
Executive’s Base Salary shall be reviewed by the Compensation
Committee of the Board (the “ Compensation Committee
”) and shall be increased, but not decreased, from time to
time at least in an amount as shall be substantially consistent
with increases in base salary generally awarded in the ordinary
course of business to other peer executives of the Company and its
affiliated companies. As used in this Agreement, the term
“affiliated companies” shall include any company
controlled by, controlling or under common control with the
Company.
(b) Bonuses . Executive will be entitled
to such cash bonuses as the Board may determine, in its sole
discretion, from time to time (“ Bonus Compensation
”). Any Bonus Compensation payable hereunder shall be paid no
later than March 15 of the calendar year following the calendar
year in which such cash bonus shall cease to be subject to a
substantial risk of forfeiture under Section 409A of the Internal
Revenue Code of 1986, as amended (the
“Code”).
(c) Expense Reimbursement . The Company
shall reimburse Executive for all reasonable expenses incurred by
Executive during the Employment Period in the course of performing
his duties under this Agreement that are consistent with the
Company’s policies in effect from time to time with respect
to travel, entertainment and other business expenses, subject to
the Company’s requirements applicable generally with respect
to reporting and documentation of such expenses.
(d) Supplemental Retirement Cash Payment
. During the portion of the Employment Period following December
31, 2008, on an annual basis (and in no event later than March 15
of each calendar year), the Company shall make a cash payment equal
to the amount that the Company would have contributed to such
Executive’s account under the Section 401(k) Plan as
Non-Elective Company Contributions during such calendar year if
Non-Elective Company Contributions to the Section 401(k) Plan for
such calendar year had not been limited by Code Sections
401(a)(17), 401(k)(3), 401(m), 402(g), and 415(c) less the
Non-Elective Company Contributions actually contributed to such
Executive’s account under the Section 401(k) Plan during such
calendar year. Such amounts shall constitute Compensation within
the meaning of the Investors Title Insurance Company Nonqualified
Deferred Compensation Plan.
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(e) Compensation for Serving on Board .
Executive shall be entitled to no extra compensation for serving on
the Company’s or its affiliated companies’ Boards of
Directors.
(f) Vacation and Sick Leave . Executive
shall be entitled annually to thirty (30) days of paid vacation and
to unlimited sick leave, provided the Employment Period is subject
to termination for disability as provided under paragraph 4(b). The
vacation leave shall be cumulative; provided, however, that
Executive shall not be compensated for any unused vacation
leave.
(g) Other Benefits . Executive shall be
entitled during the Employment Period to participate, on the same
basis as other executives of the Company, in such other benefits
for which substantially all of the executives of the Company are
from time to time generally eligible, as determined from time to
time by the Board.
4.
Employment Period .
(a) The Employment Period shall continue until
terminated as provided in subsection (b) below. Notwithstanding
anything herein to the contrary, whether a termination of
employment has occurred for purposes of any deferred compensation
payable hereunder and subject to Code Section 409A shall be
determined in a manner consistent with Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) and the
Company’s 409A Policy, if any.
(b) The Employment Period shall end upon the
first to occur of any of the following events:
(i) Executive’s death;
(ii) the Company’s termination of
Executive’s employment on account of Executive’s having
become unable (as determined by the Board in good faith) to perform
regularly Executive’s duties hereunder by reason of illness
or incapacity for a period of more than one hundred eighty (180)
consecutive days, plus accrued vacation days (“
Termination for Disability ”);
(iii) the Company’s termination of
Executive’s employment for Cause (“ Termination for
Cause ”);
(iv) the Company’s termination of
Executive’s employment other than pursuant to subsections
(b)(ii) or (iii) above (“ Termination without Cause
”) by means of advance written notice of at least sixty (60)
days;
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(v) Executive’s termination of his
employment for Good Reason by means of advance written notice to
the Company at least thirty (30) days prior to the effective date
of such termination (“ Termination by Executive for Good
Reason ”);
(vi) Executive’s retirement at any time
following his 50 th birthday, upon written notice to the
Company of at least six (6) months (“ Retirement
”);
(vii) Executive’s termination of his
employment within thirty (30) days following a Change in Control by
written notice to the Company.
(c) For purposes of this Agreement, “
Cause ” shall mean:
(i) the Executive’s conviction of, or plea
of guilty or nolo contendere to, any crime involving
dishonesty or moral turpitude;
(ii) the commission by Executive of a fraud
against the Company or any of its parent, subsidiaries or
affiliates for which he is convicted;
(iii) gross negligence or willful misconduct by
Executive with respect to the Company or any of its parent,
subsidiaries or affiliates which causes material detriment to the
Company or any of its parent, subsidiaries or
affiliates;
(iv) the falsification or manipulation of any
records of the Company or any of its parent, subsidiaries or
affiliates;
(v) repudiation of this Agreement by Executive
or Executive’s abandonment of employment with the Company or
any of its parent, subsidiaries or affiliates;
(vi) breach by Executive of any of the
‘agreements in paragraphs 6 and 7 hereof prior to the end of
the Employment Period;
(vii) failure or refusal of Executive to perform
his duties with the Company or any of its parent, subsidiaries or
affiliates or to implement or follow the policies or directions of
the Board within thirty (30) days after a written demand for
performance is delivered to Executive by the Board that
specifically identifies the manner in which the Board believes that
Executive has not performed his duties or failed to implement or
follow the policies or directions of the Board.
(d) For purposes of this Agreement,
(i) “Good Reason” shall mean any
breach by the Company of this Agreement that is material and that
is not cured within thirty (30) days after written notice thereof
to the Company from Executive;
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(ii) “Change in Control” shall be
deemed to have occurred upon the occurrence of any of the following
events:
(A) Any “person” (as such term is
used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”)), other than
Executive or his affiliates or immediate family members, is or
becomes the “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company, or its parent, Investors Title Company,
representing 50% or more of the combined voting power of the
Company’s or Investors Title Company’s outstanding
securities then entitled ordinarily (and apart from rights accruing
under special circumstances) to vote for the election of directors;
or
(B) Individuals who are “Continuing
Directors” (as hereinafter defined) of Investors Title
Company cease for any reason to constitute at least a majority of
its Board of Directors; or
(C) A sale of more than 50% of the assets
(measured in terms of monetary value) of the Company or Investors
Title Company is consummated; or
(D) Any merger, consolidation, or like business
combination or reorganization of the Company or Investors Title
Company is consummated that results in the occurrence of any event
described in subparagraph (A), (B) or (C) above.
(iii) “Continuing Directors” shall
mean:
(A) the directors of Investors Title Company in
office on the date of this Agreement; or
(B) any successor to any such director (and any
additional director) who after the date of this Agreement (i) was
nominated or selected by a majority of the Continuing Directors in
the office at the time of his or her nomination or selection and
(ii) who is not an “affiliate” or
“associate” (as defined in Regulation 12B under the
Exchange Act) of any person who is the beneficial owner, directly
or indirectly, of securities representing 50% or more of the
combined voting power of the Company’s outstanding securities
then entitled ordinarily to vote for the election of
directors.
5.
Post-Employment Period Payments .
(a) If the Employment Period ends pursuant to
paragraph 4 hereof for any reason, Executive shall cease to have
any rights to salary, options, expense reimbursements or other
benefits other than: (i) any salary which has accrued but is
unpaid, a prorated Bonus Compensation for the year of termination,
not less than the Executive’s pro rata share of his average
bonus paid over the prior three years, and any reimbursable
expenses which have been incurred but are unpaid as of the end of
the Employment Period (all of which shall be paid within thirty
(30) days of termination), (ii) any option rights or plan benefits
which by their terms extend beyond termination of Executive’s
employment (but only to the extent provided in any option
theretofore granted to Executive or any other benefit plan in which
Executive has participated as an employee of the Company), (iii)
any benefits to which Executive is entitled under Part 6 of
Subtitle B of Title I of the Employee Retirement Income Security
Act of 1974, as amended (“COBRA”), (iv) any
accumulations and benefits to which employee is entitled under the
Nonqualified Supplemental Retirement Benefit Plan and a
Nonqualified Deferred Compensation Plan, and (v) any other
amount(s) payable pursuant to the succeeding provisions of this
paragraph 5.
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(b) If the
Employment Period ends pursuant to paragraph 4 hereof on account of
Executive’s death, Termination for Disability or Retirement,
the Executive or, in the event of death, his beneficiary (as
identified to the Company in writing) shall be entitled to receive
the following: (i) except in the case of the Executive’s
death, a lump sum payment of three times the Executive’s then
current base salary, but in no event less than $766,680 (ii) except
in the case of the Executive’s death, a lump sum payment of
three times the average of the Bonus
