Exhibit 10.2
MID AMERICA BANK
SPECIAL TERMINATION AGREEMENT
This
AGREEMENT is made effective as of January 1, 2004 by and between
Mid America Bank, fsb (the “Bank”), a federally
chartered savings institution, with its office at
55th & Holmes Avenue, Clarendon Hills, Illinois, and
Edward A. Karasek (the “Executive”). The Bank is the
wholly-owned subsidiary of the Holding Company (the
“Company”), a corporation organized under the laws of
the State of Delaware.
WHEREAS,
the Bank recognizes the responsibility Executive has with the Bank
and wishes to protect his position therewith for the period
provided in this Agreement; and
WHEREAS,
Executive has been elected to, and has agreed to serve in the
position of Senior Vice President–Internal Audit for the
Bank, a position of substantial responsibility which will require
Executive to manage the internal audit function of the
Bank;
NOW,
THEREFORE, in consideration of the contribution and
responsibilities of Executive, and upon the other terms and
conditions hereinafter provided, the parties hereto agree as
follows:
1.
Term of Agreement . The term of this Agreement shall be
deemed to have commenced as of the date first above written and
shall continue through December 31, 2006. At or near each
anniversary date of the effective date set forth above, the board
of directors of the Bank (“Board”) may extend the
Agreement an additional year. The Board will review the Agreement
and the Executive’s performance annually for purposes of
determining whether to extend the Agreement, and the results
thereof shall be included in the minutes of the Board’s
meeting. In the event the Executive chooses not to renew the
Agreement, the Executive shall provide the Bank with written notice
at least ten (10) days and not more than twenty (20) days prior to
such anniversary date. If either the Bank or the Executive chooses
not to renew the Agreement for an additional period, the Agreement
shall cease at the end of its remaining term unless the
Executive’s employment is voluntarily or involuntarily
terminated with the Bank pursuant to Section 2 hereof.
2.
Payments to Executive upon Change in Control .
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(a)
Upon the occurrence of a Change in Control of the Bank or the
Company (as herein defined) followed at any time during the term of
this Agreement by the voluntary or involuntary termination of
Executive’s employment, other than for Cause, as defined in
Section 2(c) hereof, the provisions of Section 3 shall
apply. Upon the occurrence of a Change in Control, Executive shall
have the right to elect to voluntarily terminate his employment at
any time during the term of this Agreement following any demotion,
loss of title, office or significant authority, reduction in his
annual compensation, or relocation of his principal place of
employment by more than 50 miles from its location immediately
prior to the Change in Control.
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(b)
Definition of a Change in Control. A “Change in
Control” of the Bank or the Company shall mean a change in
control in control of a nature that: (i) would be required to
be reported in response to Item 1 of the current report on
Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
(the “Exchange Act”); or (ii) results in a Change
in Control of the Bank or the Holding Company within the meaning of
the Home Owners Loan Act of 1933 and the Rules and Regulations
promulgated by the Office of Thrift Supervision (or its predecessor
agency), as in effect on the date hereof including Section 574
of such regulations; or (iii) without limitation, such a
Change in Control shall be deemed to have occurred at such time as
(a) any “person” (as the term is used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes
the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities or
makes an offer to purchase and completes the purchase of securities
of the Bank or Company representing 20% or more of the Bank’s
or the Company’s outstanding securities ordinarily having the
right to vote at the election of directors except for any
securities of the Bank purchased by the Company in connection with
the conversion of the Bank to the stock form and any securities
purchased by the Bank’s employee stock ownership plan and
trust; or (b) individuals who constitute the Board of
Directors of the Company or the Bank on the date hereof (the
“Incumbent Board”) cease for any reason to constitute
at least a majority thereof, provided that any person becoming a
director subsequent to the date hereof whose election was approved
by a vote of at least three-quarters of the directors comprising
the Incumbent Board, or whose nomination for election by the
shareholders was approved by the Nominating Committee, shall be,
for purposes of this clause (b), considered as though he were
a member of the Incumbent Board; or (c) merger, consolidation
or sale of all or substantially all the assets of the Bank or
Company occurs; or (d) a proxy statement shall be distributed
soliciting proxies from stockholders of the Company, by someone
other than the current management of the Company, seeking
stockholder approval of a plan of reorganization, merger or
consolidation of the Company or Bank with one or more corporations
as a result of which the outstanding shares of the class of
securities then subject to the Plan are exchanged for or converted
into cash or property or securities not issued by the Bank or the
Company, and such proxy statement proposal is approved by the
shareholders of the Company; or (e) a tender offer is made and
completed for 20% or more of the outstanding securities of the Bank
or Company.
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However,
notwithstanding anything contained in this section to the contrary,
a Change in Control shall not be deemed to have occurred as a
result of an event described in (i), (ii) or (iii) (a), (c) or (e)
above which resulted from an acquisition or proposed acquisition of
stock of the Holding Company by a person, as defined in the
OTS’ Acquisition of Control Regulations (12 C.F.R. Section
574) (the “Control Regulations”), who was an executive
officer of the Holding Company on January 19, 1990 and who has
continued to serve as an executive officer of the Holding Company
as of the date of the event described in (i), (ii) or (iii) (a),
(c) or (e) above (an “incumbent officer”). In the event
a group of individuals acting in concert satisfies the definition
of “person” under the Control Regulations, the
requirements of the preceding sentence shall be satisfied, and thus
a change in control shall not be deemed to have occurred, if at
least one individual in the group is an incumbent
officer.
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(c)
Executive shall not have the right to receive termination benefits
pursuant to Section 3 hereof upon Termination for Cause. The
term “Termination for Cause” shall mean termination
because of the Executive’s personal dishonesty, incompetence,
willful misconduct, any breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful
violation of any law, rule or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or
material breach of any material provision of this Agreement. In
determining incompetence, the acts or omissions shall be measured
against standards generally prevailing in the savings institutions
industry. Notwithstanding the foregoing, Executive shall not be
deemed to have been Terminated for Cause unless and until there
shall have been delivered to him a copy of a resolution duly
adopted by the affirmative vote of not less than a majority of the
Board of Directors of the Bank at a meeting of the Board called and
held for that purpose (after reasonable notice to Executive and an
opportunity for him, together with counsel, to be heard before the
Board), finding that in the good faith opinion of the Board,
Executive was guilty of conduct justifying Termination for Cause
and specifying the particulars thereof in detail. The Executive
shall not have the right to receive compensation or other benefits
for any period after Termination for Cause. Any stock options or
limited rights granted to Executive under any stock option plan of
the Bank, the Company or any subsidiary or affiliate thereof, shall
become null and void effective upon Executive’s receipt of
Notice of Termination for Cause and shall not be exercisable by
Executive at any time subsequent to such Termination for
Cause.
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3.
Termination Benefits . (a) Upon the occurrence of a
Change in Control, followed at any time during the term of this
Agreement by the voluntary or involuntary termination of
Executive’s employment, other than for Termination for Cause,
the Bank and the Company shall pay Executive, or in the event of
his subsequent death, his beneficiary or beneficiaries, or his
estate, as the case may be, as severance pay or liquidated damages,
or both, a sum equal to the annual compensation paid to Executive
for the year immediately preceding Executive’s termination.
For purposes of the preceding sentence, compensation shall include
only base salary plus annual cash bonus payments. At the discretion
of Executive, upon an election pursuant to Section 3(e)
hereof, such payment may be made in a lump sum immediately upon
severance of Executive’s employment or paid, on a pro rata
basis, semi-monthly during the thirty-six (36) months following
Executive’s termination.
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(b)
Upon the occurrence of a Change in Control of the Bank or the
Company followed at any time during the term of this Agreement by
Executive’s voluntary or involuntary termination of
employment, other than for Termination for Cause, the Bank shall
cause to be continued life, health and disability coverage
substantially identical to the coverage maintained by the Bank for
Executive and his or her dependents prior
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