Exhibit 99.2
EMPLOYMENT AGREEMENT
AGREEMENT by and among Regions Financial Corporation, a Delaware
corporation ("Regions"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc., (the "Company"), and
G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the "Executive") dated as of the 18TH DAY OF OCTOBER, 2006.
Regions and the Company have determined that it is in the best
interests of Regions and its shareholders to assure that the Company will have
the continued dedication of the Executive pending and after the merger (the
"Merger") of Regions and AmSouth Bancorporation.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Effective Date. The "Effective Date" shall mean OCTOBER 18, 2006.
2. Employment Period. Subject to the terms and conditions of this
Agreement, the Company hereby agrees to employ the Executive, and the Executive
hereby agrees to remain in the employ of the Company for the period commencing
on the Effective Date and ending on the earlier of the Date of Termination or
the date this Agreement expires (the "Employment Period"). This Agreement shall
expire on the fourth anniversary of the Effective Date, provided however that on
each anniversary of the Effective Date that occurs before the 62nd birthday of
the Executive, the term of this Agreement shall be extended for one additional
year unless, on or before such anniversary, either the Company or the Executive
notifies the other in writing of its intention not to extend the Agreement for
such additional year.
3. Terms of Employment. (a) Position and Duties. (i) During the
Employment Period, (A) the Executive shall serve as the President and Chief
Executive Officer of the Company, which shall comprise all of Regions'
brokerage, trust, asset management, investment banking, capital market
activities, and, in addition, all other activities of the type conducted by the
Company as of the Effective Date (the "Business"), with such authority, duties
and responsibilities as are commensurate with and as may be consistent with such
positions and titles. The definition above of the Business is intended to be
descriptive of the types of activities (e.g. brokerage) that are being conducted
by the Company as of the Effective Date, and shall be so interpreted. During the
Employment Period the Executive shall report directly to the Chairman of the
Board of Directors of Regions, so long as either ▇▇▇▇▇▇▇ ▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇
holds that position, and thereafter the Executive shall report directly to the
Chief Executive Officer. The Executive's principal place of employment shall be
in Memphis, Tennessee and cannot change without the Executive's consent. If the
current Chairman of the Board of Directors of the Company ceases to be the
Chairman for any reason during the Employment Period, the Executive shall assume
the additional title of Chairman of the Board of Directors of the Company. For
the purpose of this Section, the term "Regions" shall include any entity
controlled by, controlling or under common control with Regions. Notwithstanding
the above, it shall not be a breach of this Agreement for Regions to change the
name or form of business entity of the Company, provided that the Executive
retains responsibilities, positions and titles that are equivalent with respect
to the Business.
(ii) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled, the Executive agrees
to devote substantially all of his attention and time during normal business
hours to the business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to use the
Page 1 of 14
Executive's reasonable best efforts to perform faithfully and efficiently such
responsibilities. The Executive may not engage, directly or indirectly, in any
other business or investment activity that materially interferes with the
Executive's performance of his duties hereunder, is contrary to the business
interests of the Company or any of its affiliates, or requires any significant
portion of Executive's business time. During the Employment Period it shall not
be a violation of this Agreement for the Executive to (A) serve on civic or
charitable boards or committees, and, subject to the approval of the Company's
Board of Directors, on corporate boards or committees, (B) deliver lectures,
fulfill speaking engagements or teach at educational institutions, or (C) manage
personal investments, so long as such activities do not significantly interfere
with the performance of the Executive's responsibilities as an employee of the
Company in accordance with this Agreement. It is expressly understood and agreed
that to the extent that any such activities have been conducted by the Executive
prior to the Effective Date of this Agreement, the continued conduct of such
activities (or the conduct of activities similar in nature and scope thereto)
subsequent to the Effective Date shall not thereafter be deemed to interfere
with the performance of the Executive's responsibilities to the Company.
(b) Compensation. (i) Base Salary. During the Employment Period, the
Executive shall receive an annual base salary ("Annual Base Salary") of no less
than $135,000 to be paid in 12 monthly installments. The Annual Base Salary,
once increased, shall not be decreased.
(ii) Annual Bonus. With respect to each calendar year during the
Employment Period, the Executive shall receive an annual cash bonus ("Annual
Bonus") of not less than the "Guaranteed Bonus" (as defined below), with the
opportunity to earn an Annual Bonus greater than the Guaranteed Bonus based on
performance and generally consistent with the Company's practices as in effect
prior to the Effective Date, provided that reasonable adjustments shall be made
each year to the financial targets and other business goals of the Business and
the Executive. The Guaranteed Bonus shall be paid in accordance with the
Company's practices for the senior executive officers of Regions (provided that
this sentence shall not affect the computation of the amount of the Guaranteed
Bonus). Except as otherwise provided in Section 5 hereof, the Annual Bonus shall
be prorated for any portion of a calendar year during the Employment Period. The
Guaranteed Bonus for services rendered in a calendar year is 75% of the largest
annual bonus paid or payable to the Executive (before reduction for any
voluntary deferral of income) with respect to services performed in any of the
three preceding calendar years, (with any bonus paid for a portion of any such
preceding calendar year annualized). In making the computation of the Guaranteed
Bonus, there shall be excluded that portion of a prior year's Annual Bonus that
the Company demonstrates would not have been paid but for the minimum bonus
provided for in the preceding sentence.
(iii) Incentive Awards. During the Employment Period, the
Executive shall receive long-term incentive compensation awards under the
Company's and Regions' long-term incentive compensation plans on terms and
conditions no less favorable than those provided to the senior executive
officers of Regions and with a value commensurate with Executive's duties and
responsibilities.
(iv) Other Employee Benefit Plans. During the Employment Period,
except as otherwise expressly provided herein, the Executive shall be entitled
to participate in all employee benefit, welfare, perquisite and other plans,
practices, policies and programs (including participation in supplemental
executive retirement plans afforded the senior executive officers of
Page 2 of 14
Regions, benefits, perquisites, plans, practices, policies and programs with
respect to a change of control) at a level, in the aggregate, at least as
favorable as provided to the senior executive officers of Regions (and any
successor) and at a level that is no less favorable in the aggregate than those
provided to him immediately prior to the Effective Date, provided however (i)
that any legacy benefits and perquisites provided to selected executives of
Regions as a result of agreements, plans or policies in place in an acquired
business before or in connection with the acquisition by Regions of such
business shall not be considered; and (ii) any legacy benefits and perquisites
provided to selected executives of Regions under plans that were closed to new
entrants before the Effective Date of this Agreement shall not be considered;
and (iii) that generally applicable changes to Regions' and the Company's
benefit plans (other than plans that are primarily for the benefit of
executives) and changes to any plans in order to comply with legal, accounting,
securities exchange or other similar external requirements shall not be a breach
of this Agreement.
(iii) Expenses. During the Employment Period, the Executive shall
be entitled to receive prompt reimbursement for all reasonable Expenses incurred
by the Executive in accordance with the Company's policies as in effect from
time to time.
(iv) Office and Support Staff. During the Employment Period, the
Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments as provided generally at any time thereafter
with respect to other peer executives of the Company and shall be provided with
secretarial and administrative assistance on the same basis as provided to him
immediately prior to the Effective Date.
(v) Vacation. During the Employment Period, the Executive shall
be entitled to paid vacation in accordance with the plans, policies, programs
and practices of the Company as in effect with respect to the senior executives
of the Company.
4. Termination of Employment. (a) Death or Disability. The Executive's
employment shall terminate automatically upon the Executive's death during the
Employment Period. If the Company determines in good faith that the Disability
of the Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), it may give to the Executive written
notice in accordance with Section 11(b) of this Agreement of its intention to
terminate the Executive's employment. In such event, the Executive's employment
with the Company shall terminate effective on the 30th day after receipt of such
notice by the Executive (the "Disability Effective Date"), provided that, within
the 30 days after such receipt, the Executive shall not have returned to
full-time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean (i) the absence of the Executive from the Executive's
duties with the Company on a full-time basis for 180 consecutive business days
or, any 180 business days within a period of 365 consecutive days as a result of
incapacity due to mental or physical illness; or (ii) a determination that the
Executive has a disability that is determined to be total and permanent by a
physician selected by the Company or its insurers and acceptable to the
Executive or the Executive's legal representative.
(b) Cause. The Company may terminate the Executive's employment during
the Employment Period for Cause. For purposes of this Agreement, "Cause" shall
mean:
(i) the continued failure of the Executive to perform
substantially the Executive's duties with the Company or one of its affiliates
(other than any such failure resulting
Page 3 of 14
from incapacity due to physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Board of Directors
of Regions which specifically identifies the manner in which such Board believes
that the Executive has not substantially performed the Executive's duties, or
(ii) the willful engaging by the Executive in illegal conduct or
gross misconduct which is materially and demonstrably injurious to the Company,
or
(iii) conviction of a felony or crime of moral turpitude or
guilty or nolo contendere plea by the Executive with respect thereto, which, in
the case of a crime of moral turpitude, is materially and demonstrably injurious
to the Company; or
(iv) a material breach of Section 9 of this Agreement.
With respect to the events set forth in clauses (i), (ii) or (iv) above, the
Executive shall have ten business days following written notice to the Executive
of the occurrence of such events to cure such event, provided such event is
susceptible to cure. For purposes of this provision, no act or failure to act,
on the part of the Executive, shall be considered "willful" unless it is done,
or omitted to be done, by the Executive in bad faith or without reasonable
belief that the Executive's action or omission was in the best interests of the
Company. Any act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board of Directors of the Company or upon the
instructions of the Chief Executive Officer of Regions or based upon the advice
of counsel for the Company shall be conclusively presumed to be done, or omitted
to be done, by the Executive in good faith and in the best interests of the
Company.
(c) Good Reason. The Executive's employment may be terminated by the
Executive for Good Reason. Termination for Good Reason shall be the Executive's
sole remedy for any claims (other than any claim for compensation or benefits
accrued but unpaid) for a breach by the Company or Regions of Section 3 hereof.
For purposes of this Agreement, "Good Reason" shall mean any of the following
events in the absence of a written consent of the Executive and provided the
Executive gives written notice to the Company within 90 days of the occurrence
of such event and the Company has not cured such event within ten business days
following such notice:
(i) the assignment to the Executive of any duties materially
inconsistent in an adverse respect with the Executive's position (including
status, offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 3(a) of this Agreement, or any other
action by the Company which results in a material diminution in such position,
authority, duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive; or
(ii) any failure by the Company to comply with any of the
provisions of Section 3(b) of this Agreement, other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive; or
(iii) the Company's requiring the Executive to be based at any
office or
Page 4 of 14
location other than that provided in Section 3 hereof; or
(iv) any purported termination by the Company of the Executive's
employment otherwise than as expressly permitted by this Agreement; or
(v) any failure by the Company to comply with and satisfy Section
10(c) of this Agreement; or
(vi) the Executive's good faith determination that, due to any
act or omission by the Company or Regions, the Executive can no longer perform
his duties or responsibilities at the Company or Regions; or
(vii) any other material breach by the Company or Regions of a
material term of this Agreement.
(d) Notice of Termination. Any termination by the Company for Cause,
or by the Executive for Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 11(b) of
this Agreement. For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than thirty
days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive any right of
the Executive or the Company, respectively, hereunder or preclude the Executive
or the Company, respectively, from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder, provided such fact
or circumstance reasonably falls within the basis for termination specified in
the Notice of Termination.
(e) Date of Termination. "Date of Termination" means (i) if the
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein within 30 days of such notice, as the case may
be, (ii) if the Executive's employment is terminated by the Company other than
for Cause or Disability, the date on which the Company notifies the Executive of
such termination or a date within 90 days of receipt of the Notice of
Termination, as specified in such notice, (iii) if the Executive's employment is
terminated by reason of death or Disability, the date of death of the Executive
or the Disability Effective Date, as the case may be and (iv) if Executive's
employment is terminated by the Executive without Good Reason, the date
specified in the Notice of Termination that is no fewer than 90 days following
the Company's receipt of the Notice of Termination.
5. Obligations of the Company upon Termination. (a) Good Reason; Other
Than for Cause, Death or Disability. If, during the Employment Period, the
Company shall terminate the Executive's employment other than for Cause or
Disability or the Executive shall terminate employment for Good Reason:
Page 5 of 14
(i) The Company shall pay to the Executive in a lump sum in cash
within 30 days after the Date of Termination (subject to Section 12 hereof) the
aggregate of the following amounts:
A. The sum of (1) the Executive's Annual Base Salary through the
Date of Termination to the extent not theretofore paid or otherwise
deferred at the election of the Executive; (2) the Executive's Annual Bonus
for the calendar year prior to the calendar year in which the Date of
Termination occurs to the extent not theretofore paid; and (3) the product
of (x) the Guaranteed Bonus for the calendar year in which the Date of
Termination occurs, and (y) a fraction, the numerator of which is the
number of days in the calendar year in which the Date of Termination occurs
through the Date of Termination, and the denominator of which is 365, in
each case to the extent not theretofore paid. The sum of the amounts
described in clauses (1), (2) and (3) above, shall be hereinafter referred
to as the "Accrued Obligations."
B. Three times the sum of (1) the Executive's Annual Base Salary
and (2) the largest annual bonus paid or payable to the Executive (before
reduction for any voluntary deferral of income) with respect to services
performed in any of the three calendar years immediately preceding the year
in which the Date of Termination occurs (with any bonus paid for a portion
of any such preceding calendar year annualized).
(ii) The Company shall permit the Executive to elect COBRA
continuation of medical and dental benefits (collectively "Medical Benefits")
for himself, his spouse and dependents for a period of three years following the
Date of Termination. The Company shall, subject to Section 12 hereof, reimburse
Executive for the excess of the COBRA premium over the premium that would be
charged to Executive for such coverage if Executive were still employed.
(iii) All stock options, long-term incentive awards, restricted
stock, other equity awards and deferred compensation shall immediately vest as
of the Date of Termination and all stock options and similar equity awards shall
remain exercisable for the remainder of their term as though the Executive
remain employed even if such vesting conflicts with the terms of a plan under
which such restricted stock was granted or under which such compensation was
deferred; provided however that such vesting shall not apply to any plan of
deferred compensation that is intended to be qualified under Section 401(a) of
the Internal Revenue Code.
(iv) To the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company and its affiliated companies through the Date of Termination or as a
result of such Termination (such other amounts and benefits shall be hereinafter
referred to as the "Other Benefits").
(vi) It is agreed that the severance benefits provided in this
subsection 5(a) fully compensate the Executive for causes of action under this
Agreement in connection with a termination by the Company or by Regions other
than for Cause, Death or Disability, and the Executive shall have no other
remedy for such action by the Company or Regions with respect to such causes of
action.
Page 6 of 14
(b) Death. If the Executive's employment is terminated by reason of
the Executive's death during the Employment Period, the Company shall pay or
provide the Executive's estate or beneficiary the payments and benefits
described in Section 5 of this Agreement except for Section 5(a)(i)(B). The term
Other Benefits for the purpose of this Section 5(b) shall include death benefits
as in effect on the date of the Executive's death. The Company shall also permit
the Executive's spouse and dependants (collectively, "Beneficiaries") to elect
COBRA continuation of Medical Benefits for a period of three years following the
date of death. The Company shall reimburse the Beneficiaries for the excess of
the COBRA premium over the premium that would be charged to Executive for such
coverage if Executive were still alive and employed, and in the event there is
more than one such Beneficiary, the Company shall allocate any such
reimbursement among the Beneficiaries in an appropriate and equitable manner.
(c) Disability. If the Executive's employment is terminated by reason
of the Executive's Disability during the Employment Period, the Company shall
pay or provide the Executive the payments and benefits described in Section 5 of
this Agreement except for Section 5(a)(i)(B). The term Other Benefits for the
purpose of this Section 5(c) shall include, and the Executive shall be entitled
after the Disability Effective Date to receive, disability and other benefits as
in effect at the Disability Effective Date. The Company shall also permit the
Executive to elect COBRA continuation of medical and dental benefits
(collectively "Medical Benefits") for himself, his spouse and dependents for a
period of three years following the Disability Effective Date. The Company
shall, subject to Section 12 hereof, reimburse Executive for the excess of the
COBRA premium over the premium that would be charged to Executive for such
coverage if Executive were still employed.
(d) Cause: Other than for Good Reason. If the Executive's employment
shall be terminated for Cause or the Executive terminates his employment without
Good Reason during the Employment Period, this Agreement shall terminate without
further obligations of the Executive (except to the extent provided for in
Section 9 hereof) or to the Executive other than the obligation to pay to the
Executive (1) his Annual Base Salary through the Date of Termination; (2) the
Executive's Annual Bonus for the year prior to the calendar year in which the
Date of Termination occurs to the extent not theretofore paid; and (3) Other
Benefits, in each case to the extent not theretofore paid or otherwise deferred
at the election of the Executive.
(e) After the Employment Period. If the Executive's employment shall
terminate for any reason following the Employment Period, the Company shall pay
to the Executive (1) his Annual Base Salary through the Date of Termination to
the extent not theretofore paid; (2) the Executive's any Annual Bonus for any
year prior to the calendar year in which the Date of Termination occurs to the
extent not theretofore paid; (3) the product of (x) the Guaranteed Bonus, and
(y) a fraction, the numerator of which is the number of days in the calendar
year in which the Date of Termination occurs through the Date of Termination,
and the denominator of which is 365, in each case to the extent not theretofore
paid; and (4) the Other Benefits to the extent not theretofore paid or otherwise
deferred at the election of the Executive.
(f) Cessation of the Medical Benefits. Notwithstanding anything
contained herein to the contrary, in no event shall the Company be required to
provide the Medical Benefits to the Executive, his spouse and dependents, (other
than benefits legally required to be provided under COBRA) to the extent that
the Executive, his spouse or his dependents are entitled to receive comparable
medical or dental benefits from another employer.
Page 7 of 14
6. Non-exclusivity of Rights. Except as specifically provided, nothing
in this Agreement shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice provided by the Company
or any of its affiliated companies and for which the Executive may qualify, nor,
subject to Section 11(f), shall anything herein limit or otherwise affect such
rights as the Executive may have under any contract or agreement with the
Company or any of its affiliated companies. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with the Company or any of
its affiliated companies at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract or
agreement except as explicitly modified by this Agreement.
7. Full Settlement. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off right or action, which the
Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other action by way
of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and, except as provided in Section 5(f), such
amounts shall not be reduced whether or not the Executive obtains other
employment. The Company agrees to pay as incurred, to the full extent permitted
by law, all reasonable legal fees and expenses that the Executive reasonably
incurs as a result of any contest (regardless of the outcome thereof) by the
Company or the Executive (provided that such contest or claim is brought by the
Executive in good faith and the Executive is successful in at least one material
issue raised in such contest or claim) or by others of the validity or
enforceability of, or liability under, any provision of this Agreement or .any
guarantee of performance thereof (including as a result of any contest by the
Executive about the amount of any payment pursuant to this Agreement), plus in
each case interest on any delayed payment at the applicable Federal rate
provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as
amended (the "Code").
8. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payment or distribution or other benefit
or compensation provided by the Company or Regions or any affiliated companies
to or for the benefit of the Executive (whether paid or payable or distributed
or distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this Section
8) (a "Payment") would be subject to the excise tax imposed by Section 4999 of
the Code or any interest or penalties are incurred by the Executive with respect
to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to, such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 8(c), all determinations
required to be made under this Section 8, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such
Page 8 of 14
determination, shall be made by Ernst & Young LLP or such other certified public
accounting firm (other than the auditors of the Company or its affiliates,
unless the Executive consents) reasonably acceptable to the Executive as may be
designated by the Company (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the Executive within 15 business
days of the receipt of notice from the Executive that there has been a Payment,
or such earlier time as is requested by the Company. All fees and expenses of
the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment,
as determined pursuant to this Section 8, shall be paid by the Company to the
Executive within five days of the later of (i) the due date for the payment of
any Excise Tax, and (ii) the receipt of the Accounting Firm's determination. Any
determination by the Accounting Firm shall be binding upon the Company and the
Executive. As a result of the uncertainty in the application of Section 4999 of
the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments which will not have been made
by the Company should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Company
exhausts its remedies pursuant to Section 8(c) and the Executive thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of the
Executive.
(c) The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of the Gross-Up Payment. Such notification shall be given as soon as
practicable but no later than ten business days after the Executive is informed
in writing of such claim and shall apprise the Company of the nature of such
claim and the date on which such claim is requested to be paid. The Executive
shall not pay such claim prior to the expiration of the 30-day period following
the date on which it gives such notice to the Company (or such shorter period
ending on the date that any payment of taxes with respect to such claim is due).
If the Company notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:
(i) give the Company any information reasonably requested by the
Company relating to such claim,
(ii) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any proceedings
relating to such claim;
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment
Page 9 of 14
of costs and expenses. Without limitation on the foregoing provisions of this
Section 8(c), the Company shall control all proceedings taken in connection with
such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and ▇▇▇ for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest to
a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
such claim and ▇▇▇ for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis and shall indemnify and hold
the Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Executive shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.
(d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 8(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 8(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Section 8(c), a determination
is made that the Executive shall not be entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.
9. Confidential Information: Noncompetition: Nonsolicitation. (a) The
Executive shall hold in a fiduciary capacity for the benefit of the Company and
its affiliates all secret or confidential information, knowledge and data
relating to the Company or any of its affiliates, and their respective
businesses, which shall have been obtained by the Executive during the
Executive's employment by the Company or any of its affiliates (including
service prior to the Effective Date) and which shall not be or become public
knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement). After termination of the Executive's
employment with the Company, the Executive shall not, without the prior written
consent of the Company or as may otherwise be required by law or legal process,
use, communicate or divulge any such information, knowledge or data to anyone
other than the Company and those designated by it.
(b) The Executive agrees that, commencing as of the date hereof,
during the actual term of Executive's employment hereunder and for a period of
the earlier of three years from the Effective Date or one year following the
Date of Termination (the "Protected Period"), other than as a result of a
termination by the Company without Cause or by the Executive for Good
Page 10 of 14
Reason, the Executive will not, without the written consent of the Company,
engage in any business of, or enter the employ of, as a consultant or employee,
or have any interest in, directly or indirectly, any other person, firm,
corporation or other entity engaged in any business that is competitive with the
Business (a "Competing Business"). Subject to Section 3(a)(ii) hereof, nothing
herein shall restrict the Executive from (i) being the beneficial owner of 2% or
less of the outstanding securities of any corporation or other entity whose
securities are listed on any national securities exchange or traded
over-the-counter, if the Executive has no other connection or relationship with
the issuer of such securities; (ii) making personal investments so long as the
investment vehicle is not a Competing Business (it being understood that hedge
funds, mutual funds and other investment entities (in contrast to the asset
managers of such funds) are not Competing Businesses); or (iii) rendering
services as an employee or as a consultant to any person, firm, corporation or
other entity so long as such services are not rendered to the portion of such
entity that is engaged in a Competing Business.
(c) During the Protected Period, the Executive agrees not to hire,
directly or indirectly solicit for employment, or entice or encourage to leave
employment with the Company or its affiliates or Regions or any of its
affiliates (collectively, the "Employer"), any person employed by the Employer
at the time of the Executive's termination of employment. During the Protected
Period, other than following a termination of the Executive by the Company
without Cause or by the Executive for Good Reason, the Executive shall not,
directly or indirectly through any other person or entity, solicit, entice,
persuade or induce any person or entity which is then, or has been within the
twelve months preceding the Date of Termination, a client, customer, or other
person or entity having a material business relationship with the Business to
terminate, reduce, disrupt or otherwise alter adversely its business
relationship with the Company or its affiliates.
(d) In the event of a breach or threatened breach of this Section 9,
the Executive agrees that the Company or its affiliates shall be entitled to
injunctive relief in a court of appropriate jurisdiction, or by an arbitration
panel, to remedy any such breach or threatened breach, and the Executive
acknowledges that damages would be inadequate and insufficient.
(e) Any termination of the Executive's employment or of this Agreement
shall have no effect on the continuing operation of this Section 9.
10. Successors. (a) This Agreement is personal to the Executive and
without the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
(c) Regions and the Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform if no such succession had
taken place.
11. Miscellaneous. (a) This Agreement shall be governed by and
construed in
Page 11 of 14
accordance with the laws of the State of Tennessee, without reference to
principles of conflict of laws. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive:
To the latest address on file with the Company
If to the Company:
Fifty ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
If to Regions:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Any notice given to the Company by Executive
must all be given to Regions, and shall not be considered effective unless given
to Regions. Any notice may be given by electronic means such as e -mail or fax,
in lieu of the delivery methods specified above, provided such electronic notice
is actually received by the party to whom it is addressed (which, in the case of
the Company or Regions, shall be the General Counsel thereof). Notice and
communications shall be effective when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) The Executive's, Regions' or the Company's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Executive, Regions or the Company may have hereunder, including,
without limitation, the right of the Executive to terminate employment for Good
Reason pursuant to Section 4(c) of this Agreement (subject to the Executive's
exercise of such right within the 90 day period as set forth in Section 4(c)),
shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Agreement.
(f) From and after the Effective Date this Agreement shall supersede
any other employment, severance or change of control agreement between the
parties with respect to the subject matter hereof, except as expressly provided
herein.
Page 12 of 14
12. Compliance with Section 409A. In the event any amount becomes
payable hereunder that is deferred compensation for purposes of Section 409A of
the Internal Revenue Code, and is not a short term deferral for such purpose and
is not otherwise exempt from the application of Section 409A, (a "409A Payment")
such 409A Payment shall be subject to the rules in this Section 12, Without
limiting the foregoing, the following payments shall be presumed to be 409A
Payments unless regulations or other legal authority issued subsequent to the
Effective Date provide an exemption: (1) any reimbursement of COBRA premiums;
and (2) payment of severance pursuant to Section 5(a)(i)(B) hereof.
(a) Any 409A Payment that is deferred or payable pursuant to a plan
maintained by Regions or the Company (other than this Agreement), or pursuant to
an election by the Executive, shall be payable at the time and in the method
specified in such plan or election; provided however that if such plan or
election fails to comply with Section 409A and has not been amended to comply
with Section 409A, then the following provisions of this Section 12 shall
control.
(b) Any 409A payment not described in subsection (a) shall be paid at
the time otherwise specified in this Agreement, except that any payment that is
payable following the Date of Termination or by reference to the Date of
Termination (other than termination due to death), shall be payable no earlier
than the 409A Date. If the Executive is a "specified employee" under Section
409A (with an identification date of December 31) on the date such 409A Payment
would otherwise be made, the 409A Date with respect to such payment is the date
that is 6 months after the Executive's separation from service for purposes of
Section 409A. If the Executive is not a specified employee, then the 409A Date
with respect to such payment shall be the date of the Executive's separation
from service. Any payment to be made on the 409A Date in accordance with this
subsection (b) may be made within 60 days of such date, if such date is the date
of separation from service, and within 30 days of such date, if such date is six
months after separation from service. Any payment which would, under the
applicable plan of deferred compensation, be a short term deferral, but which
fails to qualify as a short term deferral due to the accelerated vesting
provisions of subsection 5(a) hereof or subsection 5(c) hereof, and which
consequently would fail to comply with Section 409A if paid in accordance with
the applicable plan, shall be considered a 409A payment that is not described in
subsection (a) above, and shall be paid in accordance with this subsection (b).
(c) If any extension of the period of time to exercise an option would
subject the Executive to taxes or penalties for failure to comply with Section
409A, such extension shall not be made and the parties shall negotiate in good
faith to provide the Executive with a benefit of equivalent economic effect (or
as close as possible thereto) that either complies with or is excepted from
Section 409A, provided that such benefit shall not have a greater cost to the
Company or Regions than the extension. The determination as to whether an
extension would fail to comply with Section 409A shall be made collaboratively
by the parties, and no party shall have any liability to another party for
failure to determine correctly the effect of Section 409A on any transaction.
13. Expense of Employment Agreement. The Company shall reimburse the
Executive for the reasonable attorney's fees and expenses incurred by the
Executive in connection with the preparation, negotiation or review of this
Agreement.
14. Regions hereby guarantees the full and faithful performance by the
Company
Page 13 of 14
of its obligations hereunder.
15. Indemnification. The Company and Regions shall, to the maximum
extent permitted by applicable law, limit the Executive's liability and
indemnify the Executive and hold the Executive harmless from and against any
claim, loss or cause of action arising from or out of the Executive's
performance of duties as an officer, director or employee of the Company and/or
Regions or in any capacity, including any fiduciary capacity, in which the
Executive serves at the request of the Company and/or Regions. For the purpose
of this Section 15, applicable law shall include all applicable local, State and
Federal laws, including those laws specifically applicable to banks and bank
holding companies.
16. Director's and Officer's Liability Insurance. During the
Employment Period and any additional period during which any claim arising from
or out of the Executive's performance of duties as an officer, director or
employee of the Company and/or Regions or in any capacity, including any
fiduciary capacity, in which the Executive serves at the request of the Company
and/or Regions, might be brought against the Executive, the Executive shall be
entitled to the same director's and officers' liability insurance coverage at
the same level as the Company and/or Regions provides generally to its then
current officers, executives and employees.
* * *
IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the
authorization from its Board of Directors, each of Regions and the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.
/s/ G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman
REGIONS FINANCIAL CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: EVP & Director of Corporate
---------------------------------
Human Resources
---------------------------------
Page 14 of 14