EXHIBIT 10.VV
EXECUTIVE SEVERANCE
AGREEMENT
AGREEMENT by and between Mercantile Bankshares Corporation
(“Mercshares”), and Alexander T. Mason (the
“Executive”), effective as of the 5th day of November,
2003.
WHEREAS: The Executive has agreed to serve as Vice
Chairman of Mercshares; and
WHEREAS: The Board of Directors of Mercshares (the
“Board”), acting upon the recommendation of its
Compensation Committee, has determined that it is in the best
interests of Mercshares and its shareholders to assure that the
Company will have the continued dedication of the Executive as a
key executive of Mercshares, notwithstanding the possibility,
threat or occurrence of a Change of Control (as defined below) of
Mercshares. The Board believes it is necessary to diminish
the inevitable distraction of the Executive by virtue of the
personal uncertainties and risks created by a pending or threatened
Change of Control, to encourage the Executive’s full
attention and dedication to the Company currently and in the event
of any threatened or pending Change of Control (including
determinations as to the best interests of Mercshares and its
shareholders should the possibility of a Change of Control of
Mercshares arise), and to provide the Executive with compensation
arrangements upon a Change of Control which provide the Executive
with individual financial security and which are competitive with
those of other corporations and, in order to accomplish these
objectives, the Board has caused Mercshares to enter into this
Agreement.
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NOW, THEREFORE, IT IS HEREBY
AGREED AS FOLLOWS :
1.
Certain Definitions .
(a)
“ Cause ” shall mean (i) an act or acts of
personal dishonesty taken by the Executive and intended to result
in substantial personal enrichment of the Executive at the expense
of the Company, (ii) repeated material violations by the Executive
of his duties to the Company (as in effect immediately prior to the
Effective Date) which are demonstrably willful and deliberate on
the Executive’s part and which are not remedied in a
reasonable period of time after receipt of written notice from the
Company, or (iii) the conviction of the Executive of a
felony.
(b)
“ Change of Control ” shall mean:
(i)
The acquisition (other than from Mercshares) by any person, entity
or “group”, within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934 as in effect on the
date hereof (the “Exchange Act”), (excluding, for this
purpose, Mercshares or its subsidiaries, and excluding any
acquisition of securities by any employee benefit plan of
Mercshares or its subsidiaries which shall have occurred prior to
any other event constituting a Change of Control hereunder) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act as in effect on the date hereof) of 20% or
more of either the then outstanding shares of common stock of
Mercshares or the combined voting power of Mercshares’ then
outstanding voting securities entitled to vote generally in the
election of directors (such common stock or then outstanding voting
securities being referred to herein as “Voting
Securities”), calculated on the date of the transaction
causing the foregoing 20% test to be met, without regard to any
limitation upon the voting rights of any acquiring person under
Maryland statutes and without regard to the potential
exercisability of rights, not exercised on such date, pursuant to
any Shareholder Protection Rights Agreement of Mercshares then in
effect; or
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(ii)
Individuals who, as of the date hereof, constitute the Board (as of
the date hereof the “Incumbent Board”) cease for any
reason to constitute at least 75% of the members of the Board,
provided that any person becoming a director subsequent to the date
hereof whose election, or nomination for election by the
shareholders of Mercshares, is approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
(other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the
Directors of Mercshares or other actual or threatened solicitation
of proxies by or on behalf of persons other than the Board) shall
be, for purposes of this Agreement, considered as though such
person were a member of the Incumbent Board; or
(iii)
Approval by the stockholders of Mercshares of (A) a
reorganization, merger, consolidation or statutory share exchange,
in each case, with respect to which persons who are the holders of
the outstanding Voting Securities of Mercshares immediately prior
to such reorganization, merger, consolidation or statutory share
exchange do not, immediately thereafter, own more than 75% of the
combined voting power entitled to vote generally in the election of
directors of the entity resulting from such reorganization, merger,
consolidation or statutory share exchange, or (B) a liquidation or
dissolution of Mercshares or the sale of all or substantially all
of the assets of Mercshares.
(c)
“ Change of Control Period ” shall mean the
period commencing on the date hereof and ending on the third
anniversary of such date; provided , however , that
commencing on the date one year after the date hereof, and on each
annual anniversary of such date (such date and each annual
anniversary thereof hereinafter referred to as the “Renewal
Date”), the Change of Control Period shall be extended
automatically so as to terminate on the third anniversary of such
Renewal Date, unless at least 60 days prior to the Renewal Date the
Company shall give notice that the
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Change of Control Period shall not be so
extended, but no such notice shall be given by the Company which
would cause the Change of Control Period to expire during the term
of any employment agreement between the Company and the
Executive.
(d)
“ Date of Termination ” shall mean for purposes
of this Agreement the date of receipt of the Notice of Termination
or any later date specified therein, as the case may be;
provided , however , that if the Executive’s
employment is terminated by the Company other than for Cause or
Disability, the Date of Termination shall be the date on which the
Company notifies the Executive of such termination.
(e)
“ Effective Date ” shall mean the first date
during the “Change of Control Period” on which a Change
of Control occurs provided that the Executive is employed by the
Company on such date. Anything in this Agreement to the
contrary notwithstanding, if the Executive’s employment with
the Company has terminated for any reason prior to the first date
on which a Change of Control occurs, this Agreement shall be null
and void as of the date of such termination of employment;
provided , however , that if it is reasonably
demonstrated that such termination (i) was at the request of a
third party who has taken steps reasonably calculated to effect a
Change of Control, or (ii) otherwise arose in connection with
or anticipation of a Change of Control, then for all purposes of
this Agreement the “Effective Date” shall mean the date
immediately prior to the date of such termination.
(f)
“ Good Reason ” shall mean any of the following
actions which is effected by the Company without the consent of the
Executive:
(i)
The assignment to the Executive of any duties inconsistent in any
respect with the Executive’s position immediately prior to
the Effective Date (including status, offices, titles and reporting
requirements, authority, duties or responsibilities) or any other
action by the Company that results in a diminution in such position
or in the nature and quality of Executive’s office
facilities, secretarial and support assistance, excluding for this
purpose an isolated, insubstantial and inadvertent
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action that is not taken in bad faith and that
is remedied by the Company promptly after receipt of notice thereof
given by the Executive;
(ii)
Any reduction in Executive’s compensation or benefits from
the levels of compensation and benefits in effect immediately prior
to the Effective Date (whether or not such reduction would be
permitted under any employment agreement), including but not
limited to salary, bonuses (under an annual incentive compensation
plan or otherwise), expense allowance, vacation time or other
vacation benefits, excusal from performance of duties under Company
policies or agreements (by reason of illness, disability or other
factors), continuance of all Executive benefits and benefit plans
and preservation of Executive’s levels of participation and
benefits thereunder (including any agreement between the Company
and Executive, incentive compensation plan, deferred compensation
arrangement, pension or other retirement or profit-sharing plan,
thrift and medical reimbursement plan, health insurance or other
health or disability plan, life insurance plan, omnibus stock plan,
stock option plan, stock purchase plan, stock appreciation right
plan, or any other Executive benefit plan or provision for fringe
benefits in effect immediately prior to the Effective Date), other
than an isolated, insubstantial or inadvertent failure to provide
compensation or benefits that is remedied by the Company promptly
after receipt of notice thereof given by the Executive;
(iii)
The Company’s requiring the Executive to be based at any
office or location other than the Company’s principal offices
within the City of Baltimore, except for travel reasonably required
in the performance of the Executive’s
responsibilities;
(iv)
Any purported termination by the Company of the Executive’s
employment otherwise than as expressly contemplated hereunder in
the case of Cause, or death pursuant to Section 2(a) of this
Agreement, or Disability pursuant to Section 2(b) of this
Agreement; or
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(v)
Any failure by the Company to comply with and satisfy Section 6(c)
of this Agreement.
For purposes of this Agreement, any
good faith determination of “Good Reason” made by the
Executive shall be conclusive.
(g)
“ Notice of Termination ” shall mean a written
notice (from the Executive to the Company, or from the Company to
the Executive, as the case may be) that (i) indicates the specific
basis for termination of employment, (ii) sets forth in reasonable
detail the facts and circumstances claimed to provide the basis for
termination of the Executive’s employment, and (iii) if the
Date of Termination is other than the date of receipt of such
notice, specifies the termination date (which date shall be not
more than 15 days after the giving of such notice). The
failure by the Executive to set forth in a Notice of Termination
any fact or circumstance that contributes to a showing of Good
Reason shall not waive any right of the Executive hereunder or
preclude the Executive from asserting such fact or circumstance in
enforcing his rights hereunder.
2.
Obligations of the Company upon Termination .
(a)
Death . If the Executive’s employment is
terminated by reason of the Executive’s death prior to the
delivery (i) by the Executive to the Company of a Notice of
Termination for Good Reason or (ii) by the Company to the Executive
of any notification of termination of the Executive’s
employment other than for Cause or Disability, then this Agreement
shall terminate without further obligations to the
Executive’s legal representatives under this
Agreement.
(b)
Disability . If the Executive’s employment is
terminated by reason of the Executive’s Disability, this
Agreement shall terminate withou
