RESTATED AGREEMENT
THIS RESTATED AGREEMENT is made and entered into as of this
14 th day of December, 2005, by and between First
Business Financial Services, Inc. (formerly known as First Business
Bancshares, Inc.), a Wisconsin corporation (the
“Corporation”), and its wholly owned subsidiary, First
Business Bank (the “Bank”) (sometimes collectively
referred to as the “Companies”) and Jerome J. Smith,
Chief Executive Officer (“CEO”) of the Corporation (the
“Executive” or “CEO”).
W I T N E S S E T H
WHEREAS , the Executive has discharged the duties as CEO of
the Corporation in a very capable and skillful manner, resulting in
substantial benefits to the Companies; and
WHEREAS, the Companies and the Executive previously entered
into a deferred compensation agreement, originally effective as of
June 23, 1995, which has been periodically amended thereafter;
and
WHEREAS , the Corporation desires the Executive to remain in
its service and to continue to use his knowledge and experience on
behalf of the Companies; and
WHEREAS , the Boards of the Companies have approved the
Companies’ entering into this Restated Agreement with the
Executive in order to reflect the ongoing relationship of the
parties; and
NOW, THEREFORE , in consideration of the prior valuable
services provided by the Executive and in order to induce the
Executive to continue to provide such services to the Companies,
the Companies and the Executive enter into the Restated Agreement,
to provide as follows:
ARTICLE 1
DEFINITIONS
1.1
Definitions . Whenever used in this Agreement, the following
terms shall have the meanings set forth below, and, when the
meaning is intended, the initial letter of the word is
capitalized:
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(a)
“Agreement” or “Restated Agreement” means
this document.
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(b)
“Beneficiary” means the persons or entities designated
or deemed designated by the Executive pursuant to Section 8.2
herein.
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(c)
“Benefit Amount” means the amount of deferred
compensation benefits under Section 2.1.
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(d)
“Boards” mean the Boards of Directors of the Companies
or any committee formed by or appointed by the Boards to administer
this Agreement.
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(e)
“Cause” shall be determined by the Board of Directors
of the Corporation or the Bank, in the exercise of good faith and
reasonable judgment, and shall mean the occurrence of the
Executive’s conviction for committing an act of fraud,
embezzlement, theft, or other act constituting a felony, which is
substantially related to the circumstances of the Executive’s
duties; or material breach by the Executive of the banking laws of
Wisconsin or the United States or any regulation issued by a state
or federal regulatory authority having jurisdiction over the
banking affairs of the Company, or any of its subsidiary, parent,
or affiliated organizations; or an act which disqualifies the
Executive from serving as an officer or director of a bank under
Wisconsin or Federal banking laws. Notwithstanding the foregoing,
“Cause” shall not include the occurrence of any such
conviction, breach or act that does not involve intentional or
willful misconduct on the part of the Executive.
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(f)
“Code” means the United States Internal Revenue Code of
1986, as amended.
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(g)
“Companies” refers collectively to the Corporation and
the Bank, or any successor thereto as provided in Article 7 herein,
and “Company” refers generically to either the
Corporation or the Bank.
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(h)
“Date of Termination” means the date on which the
Executive incurs a Termination of Employment.
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(i)
“Effective Date” means June 23, 1995, the date of the
original agreement.
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(j)
“Executive” means Jerome J. Smith, CEO of the
Corporation.
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(k)
“Salary” means: The average annual monetary
compensation including bonuses but not including employee benefits
paid to the Executive for three of the five calendar years
immediately preceding the year of termination. The three calendar
years used to determine the average shall be the last calendar year
preceding the year of termination, and the Executive’s choice
of two of the remaining four calendar years immediately preceding
the year of termination.
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For
purposes of determining “Salary” under this Section
1.1(k), bonuses paid in a calendar year which are attributable to
performance in a prior calendar year are included in compensation
for such prior calendar year.
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(l)
“Termination of Employment” means the Executive’s
separation from service (within the meaning of Code Section
409A(a)(2)(A)(i) and regulations thereunder) with both of the
Companies (and all entities related to the Companies under Code
Sections 414(b), (c) and (m)) for any reason, which shall include
separation as a result of death, disability, retirement, voluntary
or involuntary termination, or any other reason.
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ARTICLE 2
PAYMENT OF DEFERRED COMPENSATION
2.1
Benefit Amount . The Companies agree to pay to the
Executive, upon the Executive’s Termination of Employment (or
to his designated beneficiary in the event of his death, or, if
none, his estate), deferred compensation in the amount of five (5)
times the Executive’s Salary, less two hundred-thousand and
00/100 ($200,000.00) dollars. Such compensation will be paid out
over a period of five (5) years beginning with the first day of the
first month following the Executive’s Date of Termination.
Such compensation will be paid monthly at a rate of one-sixtieth
(1/60) of the total amount, payable as of the first day of each
month pursuant to the Companies’ normal payroll
practices.
Notwithstanding
the foregoing, unless the Executive ceases to be a “specified
employee” (within the meaning of Code Section
409A(a)(2)(B)(i) and regulations thereunder) before his Date of
Termination, then the first actual payment under this Section 2.1
shall be delayed six (6) months, so that the monthly payments to
which the Executive would be otherwise entitled during the first
six (6) months following Termination of Employment will be
accumulated and paid on the first day of the seventh (7
th ) month following the Executive’s Date of
Termination. Thereafter, monthly payments shall be made as
specified above.
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2.2
Termination of Employment for Cause . In the event of a
Termination of Employment for Cause, all obligations of the
Companies to pay benefits under this Agreement shall immediately
become null and void.
2.3
Health Insurance Continuation . Subject to the
Companies’ ability to provide coverage, the Executive shall
be entitled to continue eligibility for all benefits pursuant to
any and all health benefit plans under which the Executive and/or
the Executive’s family is eligible to receive benefits and/or
coverage immediately prior to the Executive’s Termination of
Employment. These benefits shall be made available by the Companies
to the Executive immediately upon the Executive’s Termination
of Employment and shall continue to be made available for a period
of five (5) years from the Date of Termination. Such benefits shall
be made available to the Executive at the same coverage level as in
effect as of the
