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EXHIBIT
10.13
SEVERANCE AGREEMENT AND
RELEASE
This Severance Agreement and
Release (“Agreement”) is between 1 st
Independence
Bank (“Bank”), a banking corporation chartered by the
Commonwealth of Kentucky, and 1 st Independence Financial
Group, Inc. (“1 st Independence”), a Delaware
corporation (collectively, “Employer”), and Arthur L.
Freeman (“Executive”), a resident of the Commonwealth
of Kentucky:
I.
Recitations
1.01. Executive currently
serves as the Chairman and Chief Executive Officer of 1
st Independence and Chairman of the
Bank.
1.02. Executive is party to
that certain Employment Agreement, dated July 9, 2004, by and
between the Executive, 1 st Independence and the
Bank (the “Employment Agreement”).
1.03 Executive desires to
retire as an officer and employee of 1 st
Independence
and the Bank and resign as a director for 1 st
Independence
and the Bank, effective as of April 29, 2005.
1.04. In recognition of the
service provided by Executive to 1 st
Independence
and the Bank, 1 st Independence and the Bank believe it would be
in their best interest to continue certain benefits to Executive on
the terms and conditions set forth in this Agreement.
1.05. Executive agrees to
resign his employment with Employer and his service as a Director
on 1 st Independence and Bank’s Board of
Directors in consideration of the payment and benefits set forth in
Section IV of this Agreement.
II. Intention of the
Parties
2.01. Employer and Executive
intend and expect that Executive shall surrender and renounce all
privileges and rights that derive from his employment by Employer
(including, but not limited to, the privileges and rights derived
under the Employment Agreement), and the separation thereof, and
service as a Director of 1 st Independence and the
Bank, except any and all rights Executive has pursuant to any
pension or other retirement benefit plan, profit sharing, stock
option, employee stock ownership, or other plans (the
“Plans”) in which Executive participated as of the
Resignation Date shall be provided subject to and in accordance
with the applicable provisions thereof.
III. Agreements of
Executive
3.01. Resignation.
Executive’s employment with employer will terminate on April
29, 2005 (the “resignation date”). Effective on the
resignation date, executive will be relieved of all
duties for and responsibilities with
employer. Executive hereby resigns any and all officer, director
and other positions with employer or any of its affiliates or plans
effective on the resignation date.
3.02. Consideration.
The severance payment and benefits set forth in Section IV of this
Agreement are in addition to whatever is otherwise owed to
Executive by Employer and shall be the only payment and benefits
stemming from Executive’s employment with Employer to which
he shall be entitled following his resignation.
3.03. No Admission of
Liability. Executive agrees that the payment and benefits set
forth in Section IV of this Agreement shall not be deemed or
construed at any time for any purpose as an admission of liability
or violation of any applicable law by Employer. Liability for any
and all claims is expressly denied by Employer.
3.04. Release.
Executive agrees that in consideration of the payment and benefits
set forth in Section IV of this Agreement, Executive hereby
releases and forever discharges Employer and its officers,
directors, representatives, successors and assigns, and all persons
acting by, through, under, or in concert with any of them, from all
legal and equitable causes of action, that exist or have accrued as
of the date of this Agreement, whether known or unknown, suspected
or unsuspected including, but not limited to, all charges,
complaints, claims, demands, liabilities, and obligations of any
kind or nature that could be asserted against Employer by reason of
Executive’s employment relationship with Employer, or
separation thereof, or by Executive’s shareholder
relationship with Employer. This irrevocable and unconditional
release includes, but is not limited to, claims arising pursuant to
the Civil Rights Act of 1866; Title VII of the Civil Rights Act of
1964, as amended; the Age Discrimination in Employment Act, as
amended (“ADEA”); the Older Workers Benefit Protection
Act (“OWBPA”); the Americans with Disabilities Act; the
Family and Medical Leave Act; the Employee Retirement Income
Security Act of 1974, as amended; the Kentucky Civil Rights Act;
the Kentucky Equal Opportunities Act; any state wage and hour laws;
any state contract or tort law including, but not limited to,
wrongful termination, breach of contract, breach of fiduciary duty,
and infliction of emotional distress; any claims for
attorneys’ fees; or claims for any rights to future
employment, wages and benefits with Employer other than those set
forth herein. This is not a release or discharge of any of
Employer’ continuing obligations set forth in this Agreement.
This release does not relieve Employer of any obligations to
indemnify Executive or advance costs under any indemnification
agreement or provision of Employer’s Articles of
Incorporation or Bylaws.
3.05.
Non-Disparagement. Executive agrees that for the period
beginning on the date of execution of this Agreement and ending on
July 9, 2007, he shall make no disparaging comments about Employer
or any of its officers or directors to any third
parties.
3.06. Voluntary
Execution. Executive acknowledges and agrees that he is
executing this Agreement of his own free will and is not executing
this Agreement under any type of coercion or duress.
3.07. Consideration and
Waiver Period. Executive acknowledges and agrees
that
Employer has informed him that he has a
period of time of not less than twenty-one (21) days within which
to consider this Agreement or a reasonable facsimile thereof.
Executive acknowledges that he has been advised by Employer that,
in the event he executes this document, he is entitled to revoke
his waiver of rights or claims arising under the ADEA and OWBPA
within seven (7) days after executing this document and that this
Agreement will not and does not become effective or enforceable
until the seven (7) day revocation period has expired. This
revocation must be in writing and personally delivered, or sent by
certified mail, postmarked no later than the seventh (7
th ) day following the execution of this
Agreement, to N. William White, President, 1 st
Independence
Bank, P.O. Box 1433, New Albany, IN 47151.
IV. Agreements of
Employer
4.01. Severance
payment. Provided executive has not made a revocation pursuant
to section 3.07 hereof, and in consideration of executive’s
resignation and the surrender of all rights executive may have
against employer that stem from his employment with or service as
an officer or director of employer, or the termination thereof, or
as a shareholder of employer, all pursuant to this agreement,
employer shall pay executive in a lump sum in cash an amount equal
to executive’s base compensation, as defined in the
employment agreement, from the resignation date until July 9, 2007,
which lump sum amount is $285,000. Employer shall pay that lump sum
amount, less required withholding for income and employment taxes,
on or before may 13, 2005.
4.02. Benefits. Except
as otherwise provided herein, Executive’s participation in
Employer’s employee and director benefit plans in which
Executive was entitled to participate immediately prior to the
Resignation Date shall terminate in accordance with the provisions
of such plans.
4.03 Health Insurance.
Executive is entitled, under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (“COBRA”), to
continue his coverage under the Employer’s group health plan
for a period 18 months following his Resignation Date. If the
Executive elects to continue this coverage under COBRA, the
Employer will reimburse the Executive for all premiums paid by the
Executive for himself, his spouse and any dependent children for
such coverage. If needed, Employer will extend that COBRA coverage
and continue reimbursement through July 9, 2007. The reimbursement
of COBRA premiums or the provision of the extended
coverage
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