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PAYMENT AGREEMENT
IN THE EVENT OF A CHANGE OF CONTROL
This PAYMENT
AGREEMENT IN THE EVENT OF A CHANGE OF CONTROL (the
“Agreement”) is dated January 31, 2006 between
W Holding Company, Inc. and Westernbank Puerto Rico (the
“Company” and “Bank”) and Mr. Ricardo
Cortina (the “Employee”).
WHEREAS,
the Employee is currently serving as First Vice-President and the
Chief Lending Officer of the Bank; and
WHEREAS,
the Board believes that it is in the best interests of the Company
and the Bank to encourage the Employee’s continued employment
with dedication to the Bank in the face of potentially distracting
circumstances arising from the remote possibility of a change in
control of the Company and or Bank, although no such change is now
thought of or contemplated; and
WHEREAS,
the parties desire to enter into this Agreement setting forth the
terms and conditions for the payment of special compensation to the
Employee in the event of a termination of the Employee’s
employment in connection with or as a result of a change in
control;
NOW THEREFORE,
it is AGREED as follows:
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1.
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Term . The initial term of this Agreement
shall be for a two (2) year period commencing on the date
hereof. This Agreement shall be automatically renewed for one (1)
additional year on the first and each subsequent anniversary date
of this Agreement, unless the Company and or Bank gives contrary
written notice to the Employee sixty (60) days prior to such
renewal date. References herein to the term of this Agreement shall
include the initial term and any additional years for which this
Agreement is renewed.
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2.
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Termination of Employment in
Connection with a Change in Control .
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(a)
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If
during the term of this Agreement there is a change in control of
the Company and or the Bank, the Employee shall be entitled to
receive as a special compensation a lump sum cash payment as
provided for herein, in connection with or within one (1) year
after a “Change in Control” (as defined below) in the
event the Employee’s employment is terminated voluntarily by
the Employee or involuntarily by the Company and or the Bank
without cause in connection with or within one (1) year after
a change in control has occurred. The amount of this payment shall
be equal to three (3) times the annual base compensation,
year-end Christmas bonus, and special bonuses, if any, paid to the
Employee by the Company and or Bank during the calendar year
preceding the year in which the Change in Control occurs. Payment
under this Section 2(a) shall be in lieu of any amount that may be
otherwise owed to the
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employee as
damages for the loss of employment, in the event that such loss
occurs. Payment under this Section 2(a) shall not be reduced by any
compensation which the Employee may receive from
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