Separation Agreement and Release
Exhibit
10.23
This
Separation Agreement and Release (this “Agreement”) is entered into on this
14th day
of
February, 2006, by and among L. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (“Executive”), West Georgia
National Bank (the “Bank”), and the Bank’s sole shareholder, WGNB Corp. (“WGNB”;
with the Bank and WGNB being collectively referred to as the
“Company”).
WHEREAS,
Executive, the Bank and WGNB are parties to an Employment Agreement, dated
May 27, 2005 (the “Employment Agreement”), pursuant to which Executive has
served as Chief Executive Officer of the Bank and as President and Chief
Executive Officer of WGNB; and
WHEREAS,
Executive, the Bank and WGNB wish to terminate the Employment Agreement and
all
other aspects of the relationship between them; and
WHEREAS,
the
parties wish to set forth fully in this Agreement the terms of separation,
such
that this Agreement will supersede those of the Employment
Agreement;
NOW,
THEREFORE,
for and
in consideration of the payments, benefits and mutual promises set forth below,
the sufficiency of which is acknowledged, Executive, the Bank and WGNB hereby
agree as follows:
1. Employment
Termination.
The
Company and Executive agree that:
(1) Executive’s
last day of employment with the Company was February 11, 2006 (the “Severance
Date”);
(2) Executive’s
“Severance Period” will mean the 24-month period beginning on the Severance
Date; and
(3) This
Agreement was first delivered to the Executive on February 7, 2006 (the
“Delivery Date”).
2. Payments.
The
Bank and WGNB shall be severally liable to Executive for the payments described
in this Section 2; provided, these payments are expressly conditioned upon
Executive’s compliance with Sections 4, 5, 6 and 7 below. To this effect,
the Bank shall pay or transfer to Executive the following:
(a) Final
Paycheck.
His
regular base salary for all periods through his Severance Date at the time
and
in the manner it shall pay other executive officers their base salary for such
periods.
(b) Final
Bonus Payment.
The
remaining balance of his executive bonus for the 2005 fiscal year; provided,
this bonus payment shall be paid at the same time and in the same manner it
is
paid to other executive officers but in no event later than March 15,
2006.
(c) Vacation
Benefit.
Consistent with the Company’s general vacation policy, a lump-sum cash payment
equal to the value of his total earned and unused vacation days as of his
Severance Date.
(d) Severance
Pay.
$300,000 in 24 equal monthly installments of $12,500 commencing on March 1,
2006, with each subsequent installment being due and paid on the day of each
subsequent month within the Severance Period on which other executive employees
receive their first paycheck during that month; provided, the Bank shall pay
all
amounts of said severance pay remaining unpaid as of the last day of the
Severance Period on said last day.
(e) COBRA
Coverage and Premium Payments.
Under
the Consolidated Omnibus Reconciliation Act of 1985, as amended (“COBRA”),
Executive will have the opportunity to elect continuation coverage of his
medical and dental benefits for himself, his spouse and/or eligible dependents
to the extent he and/or they are participating in the Company’s plans for those
benefits as of his Severance Date. If elected in a timely manner, COBRA coverage
generally will end on the last day of the 18th month following his Severance
Date (unless an earlier end date or an extension is required under COBRA).
If
and to the extent Executive timely elects COBRA continuation coverage, then
while his COBRA coverage is in effect for himself during the first 18 mouths
of
his Severance Period, the Bank shall pay 100 percent of the premium amount
for
Executive’s COBRA coverage. Executive, his spouse and/or his dependents shall be
responsible for paying 100 percent of the premium amount for any COBRA coverage
for Executive’s spouse and/or dependents; provided, if the Bank and/or WGNB can
legally and without additional cost (other than the cost of an amendment to
the
Bank’s or WGNB’s cafeteria plan) deduct Executive’s payments for spousal and/or
dependent COBRA benefits from the payments to Executive of his severance pay
(as
described in subsection (d) hereof), the Bank and/or WGNB shall do
so.
(f) Home
Computer.
Ownership of the desktop computer and printer that Executive has maintained
at
his residence; provided, Executive agrees that the Bank will first change the
hard drive in the computer to ensure that no Company information or files
remain.
(g) Contact
List.
An
electronic copy of Executive’s contact list saved from the on his computer at
the Bank.
3. Stock
and Options.
(a) Previously
Vested Shares.
WGNB
shall honor Executive’s exercise of all of his WGNB stock options that vested
prior to February 10, 2006, and thereby shall allow him to purchase 29,493
shares of WGNB stock pursuant to the terms of such options; provided, Executive
agrees not to sell or otherwise transfer or encumber any of such shares until
or
after August 11, 2006, and acknowledges that WGNB may place a legend on the
stock certificate(s) for such shares reflecting such restriction.
(b) Newly
Vested Shares.
Executive shall be permitted to exercise the options to purchase 2,629 shares
of
WGNB stock that vest on February 10, 2006; provided, Executive agrees that
he may not exercise said options earlier than August 11, 2006. Executive
shall have fifteen (15) days beginning on August 11, 2006 to exercise said
options after which time said options (if not exercised) will
lapse.
4. Mutual
General Releases.
(a) Executive’s
General Release.
Executive agrees, for himself, his spouse, heirs, executor, administrator,
assigns, insurers, attorneys and other persons or entities acting or purporting
to act on his behalf (the “Executive’s Parties”), to irrevocably and
unconditionally release, acquit and forever discharge the Bank and WGNB, their
affiliates, subsidiaries, directors, officers, employees, shareholders,
partners, agents, representatives, predecessors, successors, assigns, insurers,
attorneys, benefit plans sponsored by the Bank and WGNB and said plans’
fiduciaries, agents and trustees (the “Bank’s Parties”), from any and all
actions, causes of action, suits, claims, obligations, liabilities, debts,
demands, contentions, damages, judgments, levies and executions of any kind,
whether in law or in equity, known or unknown, which the Executive’s Parties
have, have had, or may in the future claim to have against the Bank’s Parties,
including but not limited to those claims arising out of, related to, or
resulting from Executive’s employment with the Bank and WGNB or the termination
thereof. It is understood that this is a general release. This release
specifically includes without limitation any claims arising in tort or contract,
any claim based on wrongful discharge, any claim based on breach of contract,
any claim arising under federal, state or local law prohibiting race, sex,
age,
religion, national origin, handicap, disability or other forms of
discrimination, any claim arising under federal, state or local law concerning
employment practices, and any claim relating to compensation or benefits. This
specifically includes, without limitation, any claim which Executive has or
has
had under Title VII of the Civil Rights Act of 1964, as amended, the Age
Discrimination in Employment Act, as amended (“ADEA”), the Americans with
Disabilities Act, as amended, and the Employee Retirement income Security Act
of
1974, as amended (“ERISA”). Notwithstanding anything herein to the contrary,
Executive shall have a right to, and is not releasing any claim for, (i) any
breach of, or any amounts due or performance of the Bank’s Parties under, this
Agreement, or (ii) any benefits Executive may have accrued or otherwise carved
in the normal course under any employee benefit plan (within the meaning of
ERISA) as of his Severance Date.
(b) Executive’s
ADEA Release.
Executive hereby acknowledges that he is knowingly and voluntarily waiving
and
releasing any rights he may have under ADEA and that the consideration given
for
this Agreement is in addition to anything of value to which he was already
entitled. He further acknowledges that he has been advised by this writing,
as
required by ADEA, that: (A) the waiver and release do not apply to any
rights or claims that may arise on or after the date he executes this release;
(B) he has the right to consult with an attorney prior to executing this
release; (C) he has twenty-one (21) days from the Delivery Date to consider
this release (although he may choose to voluntarily execute this release
earlier); (D) he has seven (7) days following his execution of this release
to revoke the release; and (E) this release shall not be effective until
the date upon which the revocation period has expired, which shall be the eighth
(8th)
day
after he executes this release.
(c) Company’s
Release.
The
Bank and WGNB agree, for the Bank’s Parties, to irrevocably and unconditionally
release, acquit and forever discharge the Executive’s Parties from any and all
actions, cause of action, suits, claims, obligations, liabilities, debts,
demands, contentions, damages, judgments, levies and executions of any kind,
whether in law or in equity, known or unknown, which the Bank’s Parties have,
have had, or may in the future claim to have against the Executive’s Parties,
including but not limited to claims arising out of, related to, or resulting
from Executive’s employment with the Bank and WGNB or the termination thereof.
It is understood that this is a general release. This release specifically
includes without limitation any claims arising in tort or contract, any claim
based on wrongful discharge, any claim based on breach of contract, any claim
arising under federal, state or local law prohibiting race, sex, age, religion,
national origin, handicap, disability or other forms of discrimination, any
claim arising under federal, state or local law concerning employment practices,
and any claim relating to compensation or benefits. Notwithstanding anything
herein to the contrary, the Company shall have a right to, and is not releasing
any claim for, any breach of, or any amounts due or performance of the
Executive’s Parties under, this Agreement. Further and notwithstanding the
foregoing, nothing in this Agreement shall be construed as extinguishing any
debts owed to the Bank under existing loans made to Executive or Executive’s
Parties.
5. Inquiries
and Nondisparagement.
In
response to inquiries concerning Executive’s employment with the Company and the
termination of that employment, the statements of the Company and its
representatives will always be and remain consistent with the content of the
press release announcing Executive’s termination of employment, a copy of which
is attached hereto as Exhibit A. Executive, on the one hand, and WGNB and
the Bank, on the other hand, covenant and agree not to make or publish any
disparaging, derogatory, critical, unflattering, or otherwise negative comments
about the other, whether true or untrue, to any person or entity, or to make
any
statements from which a disparaging, derogatory, critical, unflattering, or
otherwise negative meaning could reasonably be inferred; provided, if Executive
or any representative of WGNB or the Bank is required by law to testify, provide
information or give a statement under oath, nothing in this provision is
intended to prevent or discourage them from doing so truthfully.
6. Restrictive
Covenants.
The
obligations contained in Section 4 of the Employment Agreement are
incorporated herein by reference, and the time periods in Sections 4.6, 4.7
and 4.10 shall be treated as expiring at the end of the Severance
Period.
7. Cooperation
in Defense of Claims.
Executive agrees to cooperate in the defense of any claim to which WGNB or
the
Bank is a party or to which WGNB or the Bank becomes a party which reasonably
requires his cooperation. Cooperation shall include, but not be limited to,
meeting with counsel for WGNB or the Bank, making himself available for
testimony without requiring a subpoena, and providing documents and information
to WGNB or the Bank as reasonably required. The Company shall make good efforts
to schedule any meetings, hearings or other events that require Executive’s lime
in a manner that does not interfere with any employment or other obligations
he
may have. To the extent Executive incurs any out-of-pocket expenses (for
example, travel or parking expenses), the Bank and/or WGNB shall reimburse
him
for such expenses under policies similar to those applicable to expense
reimbursements of Company executive officers.
8. Unasserted
Claims.
Executive hereby represents he has no knowledge of any nonfrivolous claims
that
may be asserted against the Bank or WGNB, that arise solely out of Executive’s
actions or inactions, and that he believes may result in a successful claim
against the Bank or WGNB.
9. Miscellaneous.
(a) Invalidity
of Any Provision.
It is
the intention of the parties hereto that the provisions of this Agreement shall
be enforced to the fullest extent permissible under the laws of each state
and
jurisdiction in which such enforcement is sought, but that the unenforceability
(or the modification to conform with such laws) of any provision hereof shall
not render unenforceable or impair the remainder of this Agreement which shall
be deemed amended to delete or modify, as necessary, the invalid or
unenforceable provisions. The parties further agree to alter the balance of
this
Agreement in order to render the same valid and enforceable. The terms of the
restrictive covenant provisions of this Agreement shall be deemed modified
to
the extent necessary to be enforceable and, specifically, without limiting
the
foregoing, if the term of the applicable restrictive covenant is too long to
be
enforceable, it shall be modified to encompass the longest term which is
enforceable; and, if the scope of the geographic area of the applicable
restrictive covenant is too great to be enforceable, it shall be modified to
encompass the greatest area that is enforceable.
(b) Applicable
Law.
This
Agreement shall be construed and enforced in accordance with the laws of the
State of Georgia.
(c) Arbitration.
In the
event of a controversy or claim arising out of this Agreement which cannot
be
settled by the parties or their legal representatives, other than a claim by
WGNB or the Bank against Executive under Section 6 hereof for which they seek
specific performance or injunctive relief, it will be resolved exclusively
by
arbitration conducted in Georgia by one arbitrator in accordance with the rules
of the American Arbitration Association, and judgment upon the award may be
entered in any court having jurisdiction. All arbitration hearings will be
commenced within ninety (90) days of the demand for arbitration; provided,
the
arbitrator will, upon a showing of cause, be permitted to extend the
commencement of such hearing. By executing this Agreement, the parties agree
to
submit personal and subject matter jurisdiction to the Superior Court of ▇▇▇▇▇▇▇
County, Georgia for purposes of enforcing the arbitration provision, enforcing
an arbitration award or vacating an arbitration award.
(d) Waiver
of Breach.
The
waiver of a breach of any provision of this Agreement by a party hereto shall
not operate or be construed as a wavier of any subsequent breach by the other
party hereto.
(e) Successors
and Assigns.
This
Agreement shall inure to the benefit of the Bank and WGNB and its Affiliates,
and their respective successors and assigns. This Agreement shall inure to
the
benefit of and be enforceable by the Executive’s estate and/or legal
representatives.
(f) Assignment
of Agreement.
This
Agreement may not be assigned by any of the parties without the express written
consent of the other parties to this Agreement; provided, however, that the
provisions of this Agreement shall inure to the benefit of and be binding upon
each successor of WGNB or the Bank, whether by merger, consolidation, transfer
of all or substantially all assets, or otherwise.
(g) Notices.
All
notices, demands and other communications hereunder shall be in writing and
shall be delivered in person or deposited in the United States mail, certified
or registered, with return receipt requested, as follows:
|
(1)
|
If
to the Executive:
|
Mr.
L. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
|
|
|
(2)
|
If
to the Bank or WGNB:
|
West
Georgia National Bank
▇.▇.
▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Chairman
|
|
|
With
a copy to:
|
▇▇▇▇
▇. ▇▇▇▇
The
▇▇▇▇ Legal Group LLC
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
||
(h) Entire
Agreement.
This
Agreement contains the, entire agreement of the parties with respect to the
subject matter hereof. All understanding and agreements heretofore made between
the parties hereto with respect to the subject matter of this Agreement are
merged into this document which alone fully and completely expresses their
agreement. This Agreement may not be uliauged orally but only by an agreement
in
writing signed by both parties.
(i) Application
of Code Section 409A.
It is
the intent of the parties to this Agreement that this Agreement shall be
interpreted, construed and operated in compliance with any applicable provisions
of Code Section 409A. To the extent that future regulations issued pursuant
to
Code Section 409A require any amendments to this Agreement, the parties agree
that they will consent to, and make, such amendments.
(j) Captions.
The
captions appearing in this Agreement arc inserted only as a matter of
convenience and in no way define, limit, construe or describe the scope or
intent of any provisions of this Agreement or in any way affect this
Agreement.
IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement under seal as of this 14th day
of
February, 2006.
| EXECUTIVE: | ||
| |
|
|
| By: | /s/ L. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
|
L. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ |
||
| WGNB CORP. | ||
| |
|
|
| By: | /s/ R. ▇▇▇▇▇ ▇▇▇▇▇ | |
|
Title: Chairman, Executive Compensation and Management Succession Committee |
||
| WEST GEORGIA NATIONAL BANK | ||
| |
|
|
| By: | /s/ ▇.▇. ▇▇▇▇▇, ▇▇. | |
|
Title: Chairman, Board of Directors |
||
EXHIBIT
A
WGNB
Corp. Announces Resignation of its President and Chief Executive Officer of
West
Georgia National Bank
CARROLLTON,
Ga.-(BUSINESS WIRE)--Feb. 6, 2006--WGNB Corp. (NASDAQ: WGNB ), the holding
company for West Georgia National Bank, the thirty-ninth highest performing
publicly traded community bank under $1 billion in assets in the nation
according to US Banker, and one of only 38 publicly traded financial
institutions in the nation under $2 billion market cap admitted by Sandler
▇’▇▇▇▇▇ & Partners, L.P., to its 2005 Bank & ▇▇▇▇▇▇ ▇▇-All Stars, today
announced the resignation of its President and Chief Executive Officer L.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
▇▇▇▇▇▇
has been with WGNB for more than 28 years. Prior to joining WGNB , he was an
Assistant National Bank Examiner for the Comptroller of the Currency,
Administrator of National Banks, under the United States Treasury Department
for
three years. During his 28 years of involvement with the bank, total assets
have
grown from $25million to $524miliion and market Capitalization has grown to
more
than $126 million. ▇▇▇▇▇▇ joined WGNB in January 1978. In March of 1991 he
was
named President and Chief Executive Officer and elected to the Boards of WGNB
Corp. and West Georgia National Bank.
“WGNB
is
a great institution with an impressive history,” said L. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇. “We
have just finished the fifteenth consecutive year of annual earnings growth.
This is the right time for me, personally, to stop down from my positions at
WGNB Corp. and West Georgia National Bank.”
“▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ has served the bank and this community with extraordinary spirit and
dedication and with a long and enviable list of accomplishments,” said W.T.
“▇▇▇▇▇” Green, Jr., Chairman of the Board of WGNB Corp. “The momentum generated
under his leadership will carry on into the future.”
Dealty
▇▇▇▇▇▇, President and Director of West Georgia National Bank and Executive
Vice
President of WGNB Corp., has been appointed by the Board as Interim CEO of
WGNB
Corp.
Chairman
Green added “I am confident in the depth of the WGNB management team developed
by Leighton, our deeply embedded culture of customer service and our long
history of community involvement, all of which make us an Industry
leader.”
About
WGNB Corp,
WGNB
Corp. stock is traded on the NASDAQ Small Cap market under the symbol WGNB.
West
Georgia National Bank has seven full service locations in Carrollton, Bowdon,
Villa Rica and Douglasville. The bank currently has assets of $516,000,000.
For
more information about West Georgia National Bank, visit the company’s Web site
at ▇▇▇.▇▇▇▇.▇▇▇.
Interested parties may contact ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer, via
email at ▇▇▇▇▇@▇▇▇▇.▇▇▇
or at
WGNB Corp., ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Except
for historical information contained in this press release, the matters
discussed consist of forward-looking information under the Private Securities
Litigation Reform Act of 1995. The accuracy of the forward-looking information
is necessarily subject to and involves risk and uncertainties, which could
cause
actual results to differ materially from forward-looking information. These
risk
and uncertainties include but are not limited to, general economic conditions,
competition and other factors, included in filings with the Securities and
Exchange Commission.