Exhibit 10.01
PREMIER BANK
SEVERANCE AND CHANGE IN CONTROL PROTECTION AGREEMENT
This Severance and Change in Control Protection Agreement (this “Agreement”), dated as of April 1, 2022 (the “Effective Date”), is entered into by and between Premier Bank (the “Company”), and Varun Chandhok (the “Executive” and, together with the Company, the “Parties”).
WITNESSETH:
WHEREAS, the Executive is a key senior executive employee of the Company; and
WHEREAS, the Company’s Board of Directors (the “Board”) has determined that it is in the best interests of the Company and its shareholders to provide the Executive with the opportunity to earn and receive certain severance payments and benefits in the event the Executive’s employment with the Company were to be terminated in qualifying circumstances, including in connection with a qualifying change in control of the Company, in order to provide the Executive with enhanced financial security, to allow the Company to remain competitive with its peers, and to incentivize the Executive to continue to devote the Executive’s full attention and dedication to the Company notwithstanding the possibility or occurrence of a change in control.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises contained herein and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
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Notwithstanding the foregoing, no event described in clause (v), (vi) or (vii) above will constitute Cause, unless the Company has given the Executive notice of its intention to terminate the Executive for Cause, describing in reasonable detail the events that it believes constitute Cause, and the Executive fails to cure such events to the Company’s satisfaction within fifteen (15) calendar days (or such longer or shorter cure period as the Board determines will apply, in its sole and absolute discretion) after receiving such notice. Any determination of Cause pursuant to clause (v), (vi) or (vii) by the Company will be made by a resolution approved by a majority of the members of the Board.
For purposes of this definition of “Cause”, no act, or failure to act, on the part of the Executive will 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. For this purpose, any act, or failure to act, based upon (A) authority given pursuant to a
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resolution duly adopted by the Board, (B) direction provided by a more senior executive with oversight of the Executive, or (C) the advice of counsel for the Company will 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.
Persons will not be considered to be acting as a group solely because they purchase or own stock of the same corporation at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the Company. Notwithstanding the foregoing, solely for purposes of any payment or benefit under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A, a “Change in Control” will not occur unless such Change in Control also constitutes a “change in the ownership of a corporation,” a “change in the effective control of a corporation,” or a “change in the ownership of a substantial portion of the assets of the corporation,” in each case within the meaning of Code Section 409A.
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No event will constitute Good Reason unless the Executive resigns from employment with the Company within ninety (90) calendar days following the expiration of the Company cure period applicable to such event. Otherwise, any claim of such circumstances as Good Reason will be deemed irrevocably waived by the Executive.
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To the extent that the payment of any amount under this Section 4 constitutes “deferred compensation” for purposes of Code Section 409A, any such payment scheduled to occur during the first sixty (60) calendar days following the CIC Commencement Date will not be paid until the sixtieth (60th) calendar day following the CIC Commencement Date and will include payment of all amounts that were otherwise scheduled to be paid prior thereto. For the avoidance of doubt, to the extent that a Termination covered by this Section 44 occurs within six (6) months prior to a Change in Control (which excludes any termination by the Executive for Good Reason), the payments and benefits under this Section 4 will be conditioned upon, and will not be paid or provided, or commence to be paid or provided, until, the occurrence of a Change in Control within six (6) months following such Termination.
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The payments and benefits provided in this Section 4 will be in addition to any payments and benefits to which the Executive may be entitled under Section 3 hereof.
The following table is provided solely to illustrate the incremental benefits to be paid to the Executive under Section 4 in the event of a Termination by the Company other than for Cause within six (6) months prior to or twelve (12) months following the occurrence of a Change in Control and does not expand, increase, or otherwise modify the benefits outlined in this Agreement:
Illustration Table 1: Termination by Company other than for Cause within six (6) months prior to or twelve (12) months following the occurrence of a Change in Control | |||
| Severance Benefits Payable under Section 3(a) | Incremental Benefit Payable under Section 4 | Total Benefit Payable (Section 3(a) and Section 4 combined) |
Accrued Benefits | Accrued Benefits | No incremental amount | Accrued Benefits |
Base Salary Severance Grant | 12 months Base Salary | 6 months Base Salary | 18 months Base Salary |
Target STIP Award | 1x Target STIP Award | 0.5x Target STIP Award | 1.5x Target STIP Award |
Pro-Rated STIP Award | 1x Pro-Rated STIP Award | No incremental amount | 1x Pro-Rated STIP Award |
Outplacement Services | 12 months up to $12,000 | No incremental amount | 12 months up to $12,000 |
Payment of COBRA Premiums | Up to 18 months | No incremental amount | Up to 18 months |
The following table is provided solely to illustrate the benefits (which are not incremental) to be paid to the Executive under and subject to Section 4 in the event of a Termination by the Executive for Good Reason within twelve (12) months following the occurrence of a Change in Control and does not expand, increase, or otherwise modify the benefits outlined in this Agreement:
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Illustration Table 2: Termination by Employee for Good Reason within twelve (12) months following the occurrence of a Change in Control | |||
| Benefit Payable under Section 3(a) | Benefit Payable under Section 4 CIC Benefits (Termination by Executive for Good Reason) | Total Benefit Payable (Section 3(a) and Section 4 combined) |
Accrued Benefits | Accrued Benefits | No adjustment | Accrued Benefits |
Base Salary Severance Grant | None | 18 months Base Salary | 18 months Base Salary |
Target STIP Award | None | 1.5x Target STIP Award | 1.5x Target STIP Award |
Pro-Rated STIP Award | None | 1x Pro-Rated STIP Award | 1x Pro-Rated STIP Award |
Outplacement Services | None | 12 months up to $12,000 | 12 months up to $12,000 |
Payment of COBRA Premiums | None | Up to 18 months | Up to 18 months |
In the event of any conflict between any of the terms of the foregoing Illustration Tables and any of the other terms of this Agreement, the other terms of this Agreement shall govern.
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Notwithstanding the forgoing, the provisions of this Section 10(c) shall not apply to general advertisements by any person, firm, corporation or other entity with which Executive may be associated or other communications in any form of media not specifically targeting individuals or entities described in this Section 10(c).
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If to the Executive:
At the Executive’s address (or to the facsimile number) shown in the books and records of the Company.
If to the Company:
Premier Bank 601 Clinton Street Defiance, OH 43512 Attention: Chief Human Resources Officer
With a copy (which will not constitute notice) to:
Premier Bank 275 W. Federal Street Youngstown, OH 44502 Attention: Chief Legal Officer
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For so long as Executive is an employee of Company, notice may also be given through the use of the Company’s electronic mail system using the Employee’s Company-provided electronic mail address and the Company-provided electronic mail address of the individual holding the title of Chief Human Resources Officer.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.
COMPANY
By: /s/Sharon Davis
Name: Sharon Davids
Title: EVP, Chief Human Resources Officer
EXECUTIVE
/s/Varun Chandhok
Varun Chandhok
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