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Exhibit 10.3
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Wilmington Trust Corporation
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
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December 12, 2008 Via Hand Delivery Ted T.
Cecala
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
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Re:
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United States Department of Treasury Troubled Asset Relief
Program ("TARP")
Capital Purchase Program
("CPP")
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Dear Ted:
Wilmington
Trust Corporation (the " Company ") anticipates entering
into a Securities Purchase Agreement (the " Purchase
Agreement ") with the United States Department of the Treasury
(" Treasury ") that provides for the Company’s
participation in the CPP. If the Company does not participate or
ceases at any time to participate in the CPP, this letter shall be
of no further force and effect.
For the
Company to participate in the CPP and as a condition to the closing
of the investment by the Treasury contemplated by the Purchase
Agreement, the Company is required to establish certain standards
for incentive compensation to its senior executive officers, as
defined by TARP (an "SEO"), and to make certain changes to its
compensation arrangements. To comply with these requirements, and
in consideration of the benefits you will receive as a result of
the Company’s participation in the CPP, you agree as follows:
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1.
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No Golden Parachute Payments . The Company is
prohibiting any Golden Parachute Payment to you during any "CPP
Covered Period." A " CPP Covered Period " is any period
during which Treasury holds an equity or debt position acquired
from the Company in the CPP.
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2.
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Recovery of Bonus and Incentive Compensation. Any
bonus or incentive compensation paid to you during a CPP Covered
Period is subject to recovery, or "clawback," by the Company if the
payments were based on materially inaccurate financial statements
or any other materially inaccurate performance metric criteria. You
will repay us any such amounts within 90 days of our notice to
you that any such compensation has been paid to you.
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3.
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Compensation Program Amendments. Each of the
Company’s compensation, bonus, incentive, and other benefit
plans, arrangements, and agreements (including golden parachute,
severance, and employment agreements) (collectively, "
Compensation
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Arrangements ") with respect to you hereby is amended to
the extent necessary to give effect to Sections 1 and 2 above.
You hereby release and forever discharge the Company and its
affiliates, successors, and assigns (each, a "Releasee") from any
and all claims, both at law and in equity, in connection with this
letter’s modification of your Compensation Arrangements. You
hereby further irrevocably covenant to refrain from, directly or
indirectly, asserting any claim or demand, or commencing or
instituting any proceeding of any kind, against any Releasee based
upon any matter purported to be released in this
Section 3.
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In addition, as a result of the Company’s participation in
the CPP, it is required to review its Compensation Arrangements to
ensure they do not encourage SEOs to take unnecessary or excessive
risks that threaten the value of the Company. To the extent any
such review requires revisions to any Compensation Arrangements
with respect to you, you and the Company agree to negotiate such
changes promptly and in good faith.
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Sections (1) and (2) of this letter are intended to,
and will be interpreted, administered, and construed to, comply
with Section 111 of EESA (and, to the maximum extent
consistent with the foregoing, to permit operation of the
Compensation Arrangements in accordance with their terms before
giving effect to this letter).
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4.
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Miscellaneous . To the extent of any conflict or
inconsistency between the terms of this letter and the terms of any
Compensation Arrangement, the terms of this letter will supersede
the conflicting or inconsistent terms of that Compensation
Arrangement. To the extent not subject to federal law, this letter
will be governed by and construed in accordance with Delaware law.
This letter may be executed in two or more counterparts, each of
which will be deemed an original. A signature transmitted by
facsimile will be deemed an original signature.
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Capitalized
terms not defined herein have the meanings given to them in the
attached appendix. Please acknowledge your agreement to these terms
by signing and completing the date on the appropriate lines below.
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Very truly yours,
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WILMINGTON TRUST CORPORATION
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By:
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/s/ Robert V.A. Harra Jr.
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Name:
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Robert V.A. Harra Jr.
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Title:
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President
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Intending to be legally bound, I agree
with and accept the foregoing terms
on the date set forth below.
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/s/ Ted T. Cecala Ted T. Cecala
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Date: December 12, 2008
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Definitions and Interpretation . Capitized terms herein
have the meanings set forth below:
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"Senior Executive Officer" means the Company’s "senior
executive officers" as defined in subsection 111(b)(3) of EESA.
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•
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"Golden Parachute Payment" has the same meaning as in
Section 111(b)(2)(C) of EESA.
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•
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"EESA" means the Emergency Economic Stabilization Act of 2008,
as published in the Federal Register on October 20, 2008 and,
as implemented by guidance or regulation issued by the Department
of the Treasury.
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•
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"Company" includes any entities treated as a single employer
with the Company under 31 C.F.R. § 30.1(b) (as in effect on
the closing date under the Purchase Agreement (the "Closing
Date")). You also will deliver a waiver pursuant to the Purchase
Agreement, and, as between the Company and you, the term "employer"
in that waiver will be deemed to mean the Company as used in this
letter.
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•
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"CPP Covered Period" shall be limited by, and interpreted in a
manner consistent with, 31 C.F.R. § 30.11 (as in effect on the
Closing Date).
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•
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Sections (1) and (2) of this letter are intended to,
and will be interpreted, administered, and construed to, comply
with Section 111 of EESA (and, to the maximum extent
consistent with the foregoing, to permit operation of the Benefit
Plans in accordance with their terms before giving effect to this
letter).
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Wilmington Trust Corporation
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
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December 12, 2008 Via Hand Delivery Robert
V.A. Harra Jr.
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
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|
|
|
Re:
|
|
United States Department of Treasury Troubled Asset Relief
Program ("TARP")
Capital Purchase Program
("CPP")
|
Dear Bob:
Wilmington
Trust Corporation (the " Company ") anticipates entering
into a Securities Purchase Agreement (the " Purchase
Agreement ") with the United States Department of the Treasury
(" Treasury ") that provides for the Company’s
participation in the CPP. If the Company does not participate or
ceases at any time to participate in the CPP, this letter shall be
of no further force and effect.
For the
Company to participate in the CPP and as a condition to the closing
of the investment by the Treasury contemplated by the Purchase
Agreement, the Company is required to establish certain standards
for incentive compensation to its senior executive officers, as
defined by TARP (an "SEO"), and to make certain changes to its
compensation arrangements. To comply with these requirements, and
in consideration of the benefits you will receive as a result of
the Company’s participation in the CPP, you agree as
follows:
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1.
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No Golden Parachute Payments . The Company is
prohibiting any Golden Parachute Payment to you during any "CPP
Covered Period." A " CPP Covered Period " is any period
during which Treasury holds an equity or debt position acquired
from the Company in the CPP.
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|
|
|
|
|
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2.
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Recovery of Bonus and Incentive Compensation . Any
bonus or incentive compensation paid to you during a CPP Covered
Period is subject to recovery, or "clawback," by the Company if the
payments were based on materially inaccurate financial statements
or any other materially inaccurate performance metric criteria. You
will repay us any such amounts within 90 days of our notice to
you that any such compensation has been paid to you.
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|
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3.
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Compensation Program Amendments . Each of the
Company’s compensation, bonus, incentive, and other benefit
plans, arrangements, and agreements (including golden parachute,
severance, and employment agreements) (collectively, "
Compensation
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|
|
|
|
Arrangements ") with respect to you hereby is amended to
the extent necessary to give effect to Sections 1 and 2 above.
You hereby release and forever discharge the Company and its
affiliates, successors, and assigns (each, a "Releasee") from any
and all claims, both at law and in equity, in connection with this
letter’s modification of your Compensation Arrangements. You
hereby further irrevocably covenant to refrain from, directly or
indirectly, asserting any claim or demand, or commencing or
instituting any proceeding of any kind, against any Releasee based
upon any matter purported to be released in this
Section 3.
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In addition, as a result of the Company’s participation in
the CPP, it is required to review its Compensation Arrangements to
ensure they do not encourage SEOs to take unnecessary or excessive
risks that threaten the value of the Company. To the extent any
such review requires revisions to any Compensation Arrangements
with respect to you, you and the Company agree to negotiate such
changes promptly and in good faith.
|
|
|
|
|
|
|
|
|
|
Sections (1) and (2) of this letter are intended to,
and will be interpreted, administered, and construed to, comply
with Section 111 of EESA (and, to the maximum extent
consistent with the foregoing, to permit operation of the
Compensation Arrangements in accordance with their terms before
giving effect to this letter).
|
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|
|
|
|
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4.
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Miscellaneous . To the extent of any conflict or
inconsistency between the terms of this letter and the terms of any
Compensation Arrangement, the terms of this letter will supersede
the conflicting or inconsistent terms of that Compensation
Arrangement. To the extent not subject to federal law, this letter
will be governed by and construed in accordance with Delaware law.
This letter may be executed in two or more counterparts, each of
which will be deemed an original. A signature transmitted by
facsimile will be deemed an original signature.
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Capitalized
terms not defined herein have the meanings given to them in the
attached appendix. Please acknowledge your agreement to these terms
by signing and completing the date on the appropriate lines
below.
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Very truly yours,
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WILMINGTON TRUST CORPORATION
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By:
Name:
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/s/ Ted T. Cecala Ted T. Cecala
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Title:
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Chairman of the Board and Chief Executive
Officer
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Intending to be legally bound, I agree
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with and accept the foregoing terms
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on the date set forth below.
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/s/ Robert V.A. Harra Jr. Robert V.A. Harra Jr.
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Date: December 12, 2008
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Definitions and
Interpretation . Capitized terms herein have the meanings set
forth below:
|
|
•
|
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"Senior Executive Officer" means the Company’s "senior
executive officers" as defined in subsection 111(b)(3) of EESA.
|
|
|
|
|
|
|
|
•
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"Golden Parachute Payment" has the same meaning as in
Section 111(b)(2)(C) of EESA.
|
|
|
|
|
|
|
|
•
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"EESA" means the Emergency Economic Stabilization Act of 2008,
as published in the Federal Register on October 20, 2008 and,
as implemented by guidance or regulation issued by the Department
of the Treasury.
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|
|
|
|
|
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•
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"Company" includes any entities treated as a single employer
with the Company under 31 C.F.R. § 30.1(b) (as in effect on
the closing date under the Purchase Agreement (the "Closing
Date")). You also will deliver a waiver pursuant to the Purchase
Agreement, and, as between the Company and you, the term "employer"
in that waiver will be deemed to mean the Company as used in this
letter.
|
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|
|
|
|
|
|
•
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"CPP Covered Period" shall be limited by, and interpreted in a
manner consistent with, 31 C.F.R. § 30.11 (as in effect on the
Closing Date).
|
|
|
|
|
|
|
|
•
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|
Sections (1) and (2) of this letter are intended to,
and will be interpreted, administered, and construed to, comply
with Section 111 of EESA (and, to the maximum extent
consistent with the foregoing, to permit operation of the Benefit
Plans in accordance with their terms before giving effect to this
letter).
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