MANAGEMENT CONTINUITY AGREEMENT
This Management Continuity Agreement ("Agreement") is made and
entered into as of this 2nd day of March, 1999, by and between Illini
Corporation, an Illinois corporation with an office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Company"), and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇ whose address is ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(the "Officer").
WITNESSETH
WHEREAS, the Officer is employed by the Company and the
Company's subsidiary, Illini Bank, an Illinois banking corporation (the
"Bank"), as an officer of the Company and the Bank, respectively, with
the title and salary current at the date of this Agreement as set forth
in this Agreement; and
WHEREAS, the Company wishes to attract and retain highly
qualified executives and to achieve this goal it is in the best
interests of the Company and the Bank to secure the continued services
of the Officer regardless of a change in control of the Company; and
WHEREAS, the Company is willing, in order to provide the
Officer a measure of security with respect to his employment with the
Company and the Bank in the event of a change in control of the Company
so that the officer will be in a position to act with respect to a
possible change in control of the Company in the best interests of the
Company and its shareholders, without concern as to the Officer's own
financial security, and in order to induce the Officer to remain in
employment with the Company and the Bank, to agree that employment of
the Officer shall be terminable only for cause for a limited period
after a change in control of the Company.
NOW, THEREFORE, the Company and the Officer agree as follows:
SECTION 1
EMPLOYMENT
1.1 TERM. The Company shall continue to employ the Officer as
its Vice President of Sales & Service, and shall cause the Bank to
continue to employ the Officer as its Vice President of Sales & Service
and the Officer shall remain in employment with the Company and the
Bank until December 31, 2001 (the "Term") unless terminated prior to
the expiration of the Term pursuant to Section 2.
1.2 COMPENSATION. As compensation for services provided to the
Company and the Bank by the Officer pursuant to this Agreement, the
Company shall cause the Bank to pay the Officer an annual base salary
of $60,000.00, which salary may be increased from time to time by the
Company or the Bank. The Officer shall also be eligible to actively
participate in any other compensation and benefit plans generally
available to executive employees of the Company or the Bank of like
grade and salary including, but not limited to, retirement plans, group
life, disability, accidental death and dismemberment, travel and
accident, and health and dental insurance plans, incentive compensation
plans, stock compensation plans, deferred compensation plans,
supplemental retirement plans and excess benefit plans. Such other
compensation and benefit plans are hereinafter referred to collectively
as the "Compensation and Benefits Plans".
1.3 DUTIES. The Officer shall perform such duties and
functions as are assigned to him by the bylaws of the Company and the
Bank, as amended or restated, the Boards of Directors of the Company
and the Bank, or by a duly authorized committee of the Boards of
Directors of the Company and the Bank. In the event of an actual or
potential Change in Control (as defined in Section 2.9), the Officer
shall perform his duties and function in a manner that is consistent
with the best interest of the Company and its shareholders, without
regard to the effect that the potential or actual Change in Control may
have on the Officer personally.
1.4 DUTY OF LOYALTY. The Officer shall work full-time for the
Company and the Bank only, provided that:
(a.) he may also engage in charitable, civic and
other similar activities;
(b.) with the consent of the Board of Directors of
the Company, he may serve as a director of a business
organization not competing with the Company; and
(c.) he may make such investments and reinvestment in
business activities as shall not require a
substantial portion of his time.
1.5 DUTY NOT TO DISCLOSE CONFIDENTIAL INFORMATION. The Officer
acknowledges that his relationship with the Company and the Bank is one
of high trust and confidence, and that he has access to Confidential
Information (as hereinafter defined) of the Company and the Bank. The
Officer shall not directly or indirectly, communicate, deliver, exhibit
or provide Confidential Information to any person,
firm, partnership, corporation, organization or entity, except as
required in the normal course of the Officer's duties. The duties
contained in this paragraph shall be binding upon the Officer during
the time that he is employed by the Company and following the
termination of such employment. Such duties will not apply to any
such Confidential Information which is or becomes in the public
domain through no action on the part of the Officer, is generally
disclosed to third parties by the Company without restriction on
such third parties, or is approved for release by written
authorization of the Board of Directors of the Company. The term
"Confidential Information" shall mean any and all confidential,
proprietary, or secret information relating to the Company's or the
Bank's business, services, customers, business operations, or
activities and any and all trade secrets, products, methods of
conducting business, information, skills, knowledge, ideas, know-how
or devices used in, developed by, or pertaining to the Company's or
the Bank's business and not generally known, in whole or in part, in
any trade or industry in which the Company or the Bank is engaged.
SECTION 2
TERMINATION
2.1 TERMINATION OF AGREEMENT. Unless sooner terminated in
accordance with the terms of this Section 2, this Agreement shall
terminate at the expiration of the Term, and all obligations hereunder
shall terminate except as specifically set forth in Section 2.5. The
Officer may, with the consent of the Company, continue in the employ of
the Company and the Bank after the expiration of the Term on such terms
and conditions as may be agreed upon by the Company and Officer.
2.2 TERMINATION BY THE OFFICER. The officer may voluntarily
terminate this Agreement by providing thirty days notice to the
Company, in which event the Company shall have no further obligation to
the Officer hereunder from the date of such termination and the Officer
shall have no further obligation to the Company hereunder except the
duty to not disclose Confidential Information in accordance with
Section 1.5. In the event the Officer's employment with the Company and
the Bank is terminated due to the Officer's death, the Company shall
have no further obligation to the Officer, his heirs or legatees
hereunder from the date of such termination, except to pay any benefits
due under the Compensation and Benefit Plans. In the event the
Officer's employment with the Company and the Bank is terminated due to
the Officer's Permanent Disability, the Company shall have no further
obligation to the Officer, hereunder from the date of such termination,
except, to pay benefits due under the Compensation and Benefit Plans.
For purposes of this Agreement, the term "Permanent
Disability" means a physical or mental condition of the Officer which:
(a) has continued uninterrupted for six months;
(b) is expected to continue indefinitely; and
(c) is determined by the Company to render the
Officer incapable of adequately performing
his duties under Section 1.3 of this
Agreement.
2.3 TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company may
terminate this Agreement without cause prior to the Firm Term (as
hereinafter defined), by providing thirty days notice to the Officer.
In such event, the Officer shall have no further obligation to the
Company hereunder, except the duty to not disclose Confidential
Information in accordance with Section 1.5, and the Company shall have
no further obligation to the Officer hereunder from the date of such
termination except (i) to pay to the Officer the salary payments
described in Section 1.2, in the amount in effect on the date of
termination, for a period of six months from the date of termination,
(ii) to pay to the Officer any other benefits due under the
Compensation and Benefit Plans for a period of six months from the date
of termination, and (iii) to pay to the Officer reasonable expenses of
out placement within the financial institutions industry during the six
month period following the date of termination; provided, however, out
placement expenses shall be paid only upon actually incurring such
expense and Officer's furnishing of evidence thereof to the Company and
shall not include moving or relocation expense; and provided, however,
that any benefit to be provided by a Compensation and Benefit Plan may
be provided by the Company through cash of equivalent value or through
a nonqualified arrangement or arrangements if, in the judgment of the
Company, permitting the Officer to participate in such plan after the
date of termination would adversely affect the tax status of such plan.
2.4 TERMINATION BY THE COMPANY WITH CAUSE. Prior to or during
the Firm Term, the Company may terminate this Agreement for Cause. For
purposes of this Agreement, Cause shall mean;
(a) the Officer's willful and material breach of
the provision of this Agreement after the
Board of Directors delivers a written demand
to cure such breach, which specifically
identifies the manner in which the Board of
Directors believes that the Office has not
substantially performed his duties, or
(b) the Officer willfully engages in illegal
conduct or gross misconduct which materially
and demonstrably injures the Company or the
Bank.
For purposes of determining whether "Cause" exists, no act or failure
to act, on the Officer's part shall be considered "willful," unless it
is done, or omitted to be done, by the Officer in bad faith or without
reasonable belief by the Officer that his action or omission was in the
best interest of the Company.
In the event of the Officer's termination for Cause, the
Company will have no further obligation to the Officer under the
Agreement from the date of such termination.
2.5 TERMINATION FOLLOWING CHANGE IN CONTROL. In the event
there is a Change in Control of the Company, as defined in Section 2.6,
during the Term, and:
(a) within the period commencing three months
prior to the date of a Change in Control and
ending six months following the date of the
Change in Control (the "Firm Term"), the
Officer's employment hereunder is terminated
by the Company other than for Cause, as
defined in Section 2.4; or
(b) within the Firm Term, the Officer resigns
from his employment hereunder upon thirty
days written notice given to the Company
within thirty days following a material
change in the Officer's title, authorities
or duties, in effect immediately prior to
the Change in Control, a reduction in the
compensation or a reduction in benefits
provided pursuant to this Agreement or the
Compensation and Benefit Plans below the
amount of compensation and benefits in
effect immediately prior to the Change in
Control, or a change of the Officer's
principal place of employment without his
consent to a city more than 25 miles from
Springfield, Illinois,
then the Officer shall have no further obligation to the Company
hereunder, except the duty not to disclose Confidential Information in
accordance with Section 1.5, and the Company shall have no further
obligation to the Officer hereunder from the date of termination except
(i) to pay to the Officer the salary payments described in Section 1.2,
in the amount in effect on the date of termination, for a period of
twelve months from the date of termination, (ii) to pay to the Officer
any other benefits due under the Compensation and Benefit Plans for a
period of twelve months from the date of termination and (iii) to pay
to the Officer
reasonable expenses of out placement within the financial
institutions industry during the twelve month period following the
date of termination; provided, however, out placement expenses shall
be paid only upon actually incurring such expenses and Officer's
furnishing of evidence thereof to the Company and shall not include
moving or relocation expenses and provided, however, that any
benefit to be provided by a Compensation and Benefit Plan may be
provided by the Company through cash of equivalent value or through
a nonqualified arrangement or arrangements if, in the judgment of
the Company, permitting the Officer to participate in such plan
after the date of termination would adversely affect the tax status
of such plan.
2.6 CHANGE IN CONTROL DEFINED. A Change in Control of the Company shall
have occurred:
(a) on the fifth day preceding the scheduled
expiration date of a tender offer by, or
exchange offer by any corporation, person,
other entity or group (other than the
Company or any of its wholly owned
subsidiaries), to acquire Voting Stock of
the Company if:
(i) after giving effect to
such offer such
corporation, person, other
entity or group would own
50% or more of the Voting
Stock of the Company;
(ii) there shall have been
filed documents with the
Securities and Exchange
Commission in connection
therewith (or, if no such
filing is required, public
evidence that the offer
has already commenced);
and
(iii) such corporation, person,
other entity or group has
secured all required
regulatory approvals to
own or control 50% or more
of the Voting Stock of the
Company;
(b) if the shareholders of the Company approve a
definitive agreement to merge or consolidate
the Company with or into another corporation
in a transaction in which neither the
Company nor any of its wholly owned
subsidiaries will be the surviving
corporation, or to sell or otherwise dispose
of all of substantially all of the Company's
assets to any corporation, person, other
entity or group (other than the Company or
any of its wholly owned subsidiaries), and
such definitive agreement is consummated;
(c) if any corporation, person, other entity or
group (other than the Company or any of its
wholly owned subsidiaries) becomes the
Beneficial Owner (as that term is defined in
the Securities and Exchange Commission's
Rule 13d-3 under the Securities Exchange Act
of 1934) of stock representing 50% or more
of the Voting Stock of the Company; or
(d) if during any period of two consecutive
years Continuing Directors cease to comprise
a majority of the Company's Board of
Directors.
The term "Continuing Director' means:
(a) any member of the Board of Directors of the
Company at the beginning of any period of
two consecutive years; and
(b) any person who subsequently becomes a member
of the Board of Directors of the Company,
if:
(i) such person's nomination for
election or election to the Board
of Directors of the Company is
recommended or approved by
resolution of a majority of the
Continuing Directors; or
(ii) such person is included as a
nominee in a proxy statement of the
Company distributed when a majority
of the Board of Directors of the
Company consists of Continuing
Directors.
"Voting Stock" shall mean those shares of the Company entitled
to vote generally in the election of directors.
2.7 TERMINATION OF RELATED OFFICERS. The parties agree that in
the event Officer's employment by the Company is terminated for any
reason, Officer will immediately resign from all other positions or
offices held with the Company, including any directorships with the
Company or the Bank.
2.8 OFFICER'S COSTS OF ENFORCEMENT. The Company shall pay all
expenses of the Officer, including but not limited to attorney's fees,
incurred in enforcing payments by the Company pursuant to this
Agreement.
SECTION 3
MISCELLANEOUS
3.1 ASSIGNMENT OF OFFICER'S RIGHTS. The Officer may not
assign, pledge or otherwise transfer any of the benefits of this
Agreement either before or after termination of employment, and any
purported assignment, pledge or transfer of any payment to be made by
the Company hereunder shall be void and of no effect. No payment to be
made to the Officer hereunder shall be subject to the claims of
creditors of the Officer.
3.2 AGREEMENTS BINDING ON SUCCESSORS. This Agreement shall be
binding and inure to the benefit of the parties hereto and their
respective successors, assigns, personal representatives, heirs,
legatees and beneficiaries.
3.3 NOTICES. Any notice required or desired to be given under
this Agreement shall be deemed given if in writing and sent by first
class mail to the Officer or the Company at his or its address as set
forth above, or to such other address of which either the Officer or
the Company shall notify the other in writing.
3.4 WAIVER OF BREACH. The waiver by either party of a breach
of any provision of this Agreement shall not operate or be construed as
a waiver of any subsequent breach by either the Officer or the Company.
3.5 ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the parties and supersedes the Personal Service
Contract between the Officer, the Company and the Bank, which was
effective October 30, 1996. It may be modified or amended only by an
agreement in writing signed by the party against whom enforcement of
any change or amendment is sought.
3.6 SEVERABILITY OF PROVISIONS. If for any reason any
paragraph, term or provision of this Agreement is held to be invalid or
unenforceable, all other valid provisions herein shall remain in full
force and effect and all paragraphs, terms and provisions of this
Agreement shall be deemed to be severable in nature.
3.7 GOVERNING LAW. This Agreement is made in, and shall be
governed by, the laws of the State of Illinois.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first set forth above.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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Officer
ILLINI CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. Black
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Its: Chairman
