UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 18, 2015
GLACIER BANCORP, INC.
(Exact name of registrant as specified in its charter)
Montana
(State or other jurisdiction of incorporation)
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(Commission File Number) |
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(IRS Employer Identification No.) |
000-18911 |
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81-0519541 |
49 Commons Loop
Kalispell, Montana 59901
(Address of principal executive offices) (zip code)
Registrants telephone number, including area code: (406) 756-4200
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the
following provisions (see General Instruction A.2 below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act of (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act of (17 CFR 240.13e-4(c)) |
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers
Glacier Bancorp, Inc. (Glacier) and its subsidiary Glacier Bank
(the Bank, and collectively with Glacier, the Company) has announced that the Company is expanding its executive management team with the addition of Randall M. Randy Chesler (Mr. Chesler).
Mr. Chesler, age 56, brings more than 30 years of experience in the financial services industry, most recently as President of CIT Bank, the Salt Lake City-based banking subsidiary of CIT Group. During his 10 years with CIT, Mr. Chesler
held progressive leadership positions, including President, Small Business Lending and President, Consumer Finance.
On June 18,
2015, the Company entered into an Employment Agreement (the Employment Agreement) with Mr. Chesler to serve as (i) President of the Bank and as a director of the Bank beginning August 1, 2015 and (ii) President and
Chief Executive Officer of the Bank and President and Chief Executive Officer of Glacier beginning January 1, 2017. Upon the recommendation of the nominating committee of the Glacier board of directors, Mr. Chesler will be nominated for
election to the Glacier board of directors in 2016. Below is a summary of the Employment Agreement, which is qualified in its entirety by reference to Exhibit 10.1, which is filed herewith.
The term of the Employment Agreement is August 1, 2015 to December 31, 2017 and may be extended for subsequent one-year terms upon
the approval of the boards of directors of Glacier and the Bank. Mr. Cheslers salary from August 1, 2015 to December 31, 2016 will be $400,000 annually. From January 1, 2017 to December 31, 2017, his annual salary will
be determined by Glaciers board of directors but will not be less than the greater of $631,000 or the 35th percentile of the then-current base salary for chief executive officers of a custom
peer group of Glacier to be developed by the compensation committee of the Glacier board of directors.
Mr. Chesler will be granted
restricted stock of $400,000 in value as a signing bonus, which stock will be granted on August 1, 2015 at the closing price per share of Glacier stock as quoted on the Nasdaq on July 31, 2015, and which will vest ratably on each of the
first four anniversaries of the grant date and become fully vested on August 1, 2019. Mr. Chesler will also receive a cash signing bonus of $100,000, less applicable taxes and withholdings. He is entitled to relocation benefits in
accordance with Glaciers established program, and he may participate in any Glacier program available to senior management for income deferral.
Subject to his continued employment through February 15, 2016 and the terms of the Employment Agreement, Mr. Chesler will be
eligible for certain cash and stock awards including (i) a restricted stock award for 2015 of $200,000 in value, granted on February 15, 2016, which will vest ratably on the first three anniversaries of the grant date and become fully
vested on February 15, 2019 and (ii) a cash incentive award for 2015 of $200,000, payable on February 15, 2016. Mr. Chesler also will become eligible to participate in Glaciers short- and long-term incentive plans beginning
January 1, 2016.
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Mr. Chesler will accrue up to 160 hours of paid vacation each year, will be eligible to
participate in Glaciers employee benefits plans, and will be covered by Glaciers directors and officers liability insurance policy.
If Mr. Cheslers employment is terminated by the Company for cause (as defined) during the term of the Employment Agreement or if
the Employment Agreement terminates because Mr. Chesler dies or is unable to perform his duties for a period of 90 consecutive days, the Company will pay Mr. Chesler the salary earned and any reimbursable expenses incurred through the date
of termination. Mr. Chesler will have no right to receive compensation or other benefits for any period after termination.
If
Mr. Cheslers employment is terminated by the Company without cause (as defined) or by Mr. Chesler for good reason (as defined) during the term of the Employment Agreement, Mr. Chesler will receive a payment equal to the base
salary to which he would have been entitled for the remainder of the term of the Employment Agreement if his employment had not terminated, subject to Mr. Chesler executing and not revoking a release of claims in favor of the Company. Should
Mr. Chesler terminate his employment because the Company fails to employ him as Chief Executive Officer of the Bank and President and Chief Executive Officer of Glacier in accordance with Section 1.B of the Employment Agreement, the
Company will pay Mr. Chesler a payment equal to two times his base salary as President of the Bank, subject to Mr. Chesler executing and not revoking a release of claims in favor of the Company. All such payments must be completed no later
than March 15 of the calendar year following the calendar year in which employment was terminated.
If Mr. Cheslers
employment is terminated by the Company or its successor without cause either following the announcement of a change in control (as defined) that subsequently occurs, or within three years following a change in control, the Employment Agreement
provides that Mr. Chesler will be entitled to receive an amount equal to 2.99 times his then-current annual salary, payable in 36 monthly installments, plus continued employment benefits for 2.99 years following the occurrence of the change in
control or termination as the case may be. This amount (2.99 times annual salary plus continuation of benefits) would also be payable if Mr. Chesler terminates his employment for good reason within three years of a change in control. The
Employment Agreement provides that these payments to be received by Mr. Chesler will be limited to less than the amount that would cause them to be an excess parachute payment within the meaning of Section 280G(b)(2)(A) of the
Internal Revenue Code, but only if such a limitation would result in Mr. Chesler retaining a larger amount, on an after-tax basis, than if he received the entire amount of such payments. In addition, the payments and benefits to be received by
Mr. Chesler will be reduced by any compensation that he receives from the Company or its successor following the change in control and/or after his termination of employment. All payments are subject to Mr. Chesler executing and not
revoking a release of claims in favor of the Company.
Mr. Chesler is prohibited from using for his own purposes or disclosing
confidential information during the term of the Employment Agreement and for a period of five years after Mr. Cheslers employment has terminated. Mr. Chesler also is prohibited from competing with the Company or its subsidiaries
during the term of the Employment Agreement and for a three- year period following his termination of employment (unless such termination is the result of the Companys election not to renew Mr. Cheslers employment).
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A copy of the Employment Agreement is attached as Exhibit 10.1 and is incorporated herein in its
entirety by reference.
Item 7.01. Regulation FD Disclosure.
A copy of Glaciers press release relating to the announcement described in Item 5.02, dated June 22, 2015, is furnished as Exhibit 99.1 to this
Form 8-K.
Item 9.01 Financial Statements and Exhibits
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10.1 |
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Employment Agreement between Glacier Bancorp, Inc. and Randall Chesler, effective June 18, 2015. |
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99.1 |
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Press Release, dated June 22, 2015. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
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Dated: June 22, 2015 |
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GLACIER BANCORP, INC. |
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/s/ Michael J. Blodnick |
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By: |
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Michael J. Blodnick President and
CEO |
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Exhibit 10.1
EMPLOYMENT AGREEMENT
This AGREEMENT is effective June 18, 2015 (the Effective Date) between Glacier Bancorp, Inc., (Company),
Glacier Bank (Bank) and Randall Chesler (Executive).
RECITALS
A. |
Bank is a wholly owned subsidiary of the Company. Bank desires to retain Executive initially as its President and subsequently as its Chief Executive Officer on the terms and conditions set forth in this Agreement.
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B. |
The Company desires to retain Executive as its President and Chief Executive Officer on the terms and conditions set forth in this Agreement. |
C. |
Executive desires to be employed by the Bank and the Company on the terms and conditions set forth in this Agreement. |
AGREEMENT
1. |
Employment. The Bank and the Company agree to employ Executive in the positions identified below and on the terms and conditions set forth in this Agreement and Executive accepts employment by the Bank and the
Company in the positions set forth below and on the terms and conditions set forth in this Agreement. |
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A. |
Employment as President of Bank. Beginning on August 1, 2015, Executive will be employed as President of the Bank. Executives employment as President of the Bank shall begin on the Effective Date of
this Agreement and continue until the expiration of the Term, unless earlier terminated pursuant to other terms of this Agreement. |
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(1) |
Duties as President of Bank. While employed as President of the Bank, Executive will faithfully and diligently perform Executives assigned duties, which include but are not limited to the following:
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(a) |
Bank Performance. Executive will be responsible for all aspects of the Banks performance, including without limitation, directing that daily operational and managerial matters are performed in a manner
consistent with the Banks and the Companys policies. |
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(b) |
Development and Preservation of Business. Executive will be responsible for the development and preservation of banking relationships and other business development efforts (including appropriate civic and
community activities) of the Bank. |
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(c) |
Report to Company CEO. Executive will report directly to the Chief Executive Officer of the Company. The Chief Executive Officer of the Company may, from time to time, modify Executives title or add,
delete, or modify Executives performance responsibilities to accommodate management succession, as well as any other management objectives of the Bank or of the Company. Executive will assume any additional positions, duties and
responsibilities as may reasonably be requested of Executive with or without additional compensation, as appropriate and consistent with Sections 1.A.(1)(a) and 1.A.(1)(b) of this Agreement. |
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B. |
Employment as Chief Executive Officer of Bank and President and Chief Executive Officer of Company. Beginning on January 1, 2017, in addition to being employed as President of the Bank, Executive shall also
be employed as the Banks Chief Executive Officer and the Companys President and Chief Executive Officer. Executives employment as Chief Executive Officer of the Bank and President and Chief Executive Officer of the Company shall
continue until the expiration of the Term, unless earlier terminated pursuant to other terms of this Agreement. |
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(1) |
Duties as Chief Executive Officer of Bank and President and Chief Executive Officer of Company. While employed as Chief Executive Officer of the Bank and President and Chief Executive Officer of the Company, in
addition to performing the duties as President of the Bank as set forth in Section 1.A(1), above, Executive will also faithfully and diligently perform Executives assigned duties, which include but are not limited to the following:
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(a) |
Company Performance. Executive will be responsible for all aspects of the Companys and Banks performance, including without limitation, directing that daily operational and managerial matters are
performed in a manner consistent with the Companys policies. |
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(b) |
Development and Preservation of Business. Executive will be responsible for the development and preservation of banking relationships, investor relationships and other business development efforts (including
appropriate civic and community activities) of the Bank and the Company. |
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(c) |
Report to Board. Executive will report directly to the Companys board of directors. The Companys board of directors may, from time
to time, modify Executives title or add, delete, or modify Executives performance responsibilities to accommodate management succession, as well as any other management objectives of the Bank or the Company. Executive
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will assume any additional positions, duties and responsibilities as may reasonably be requested of Executive with or without additional compensation, as appropriate and consistent with Sections
1.B(1)(a) and 1.B(1)(b) of this Agreement. |
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C. |
Bank Board. During the Term of this Agreement, Executive will serve as a director of the Bank. |
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D. |
Company Board. Beginning with the election of the Companys board of directors in 2016, the Company will use its best efforts to nominate and recommend Executive for election to the Companys board of
directors. If elected, Executive will serve as a director of the Company. |
2. |
Term. The term of this Agreement begins on August 1, 2015 (the Start Date) and shall terminate at midnight on December 31, 2017 (Term). Following expiration of the Term and
subject to and conditioned upon approval of the Companys and the Banks board of directors, the Company and the Bank may continue to employ Executive pursuant to subsequent one (1) year employment agreements to be entered into
between the Company, the Bank and Executive. If the Company and the Bank elect not to renew Executives employment at the expiration of the Term, the Company and the Bank shall provide Executive with notice that Executives employment will
not be renewed on or before October 1, 2017. |
3. |
Extent of Services. Executive will devote all of Executives working time, attention and skill to the duties and responsibilities set forth in Sections 1.A(1), 1.B(1), 1.C and 1.D, as applicable from time to
time. To the extent that such activities do not interfere with Executives duties under Sections 1.A(1), 1.B(1), 1.C and 1.D, Executive may participate in other businesses as a passive investor, but (a) Executive may not actively
participate in the operation or management of those businesses, and (b) Executive may not, without the Companys prior written consent, make or maintain any investment in a business with which the Company, the Bank or any of their
subsidiaries or divisions has an existing competitive or commercial relationship. Additionally, to the extent that such activities do not interfere with Executives duties under Sections 1.A(1), 1.B(1), 1.C and 1.D, Executive may serve on the
board of directors of one or more non-profit organizations or for-profit organizations, provided that Executive shall be prohibited from serving on the board of directors of any financial institutions, banks, bank holding companies or companies with
which the Company, the Bank or any of their subsidiaries or divisions has an existing competitive or commercial relationship. |
4. |
Salary. During the Term of this Agreement, Executive shall receive the following salary: |
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A. |
Salary while employed as President of the Bank. During Executives employment as President of the Bank, specifically, for the period of time from August 1, 2015 through December 31, 2016, Executive
will receive an annual salary of $400,000.00. |
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B. |
Salary while employed as President and CEO of Bank and Company. During Executives employment as President and Chief Executive Officer of the Bank and the Company, specifically, for the period of time from
January 1, 2017 through December 31, 2017, Executives annual salary will be determined by the Companys board of directors based on then current market data for chief executive officers of comparable financial institutions of
the Company, the Companys total assets, Executives job performance, the Companys performance and any other relevant factors as determined by the Companys board of directors; provided, however, that Executives annual
salary for calendar year 2017 shall not be less than the greater of $631,000.00 or the 35th percentile of the then current base salary for chief executive officers of a custom peer group of the
Company to be developed by the Companys Compensation Committee. |
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Payment of Base Salary. Executives annual salary shall be paid in accordance with the Companys regular payroll schedule. Executives annual salary shall be prorated during any partial calendar
year which this Agreement is in effect. |
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Cash Incentive for 2015. Provided that Executive remains employed by the Bank and the Company as of February 15, 2016, the Company shall pay Executive a cash incentive payment for 2015 (to be paid on
February 15, 2016) in the amount of $200,000, less any applicable payroll taxes and withholdings. This cash incentive shall be in lieu of and Executive shall not be entitled to any additional cash incentives for 2015 under the Glacier Bancorp,
Inc. 2015 Short Term Incentive Plan. If Executives employment with the Bank or the Company is terminated for any reason prior to February 15, 2016, this cash incentive shall be forfeited and of no force or effect. |
6. |
Short Term Incentive Plan. Beginning on January 1, 2016, Executive shall be eligible to participate in the Glacier Bancorp, Inc. 2015 Short Term Incentive Plan (STIP). Executive shall be eligible
for cash incentives pursuant to the STIP based on the Company meeting certain financial goals (i.e. Threshold, Target and Max) set by the Companys board of directors at the following levels: |
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Calendar Year |
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Cash Incentive Opportunity as a Percentage of Salary |
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Threshold |
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Target |
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Max |
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2016 |
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0 |
% |
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50 |
% |
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75 |
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2017 |
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0 |
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60 |
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90 |
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All STIP cash incentives shall be awarded and paid in accordance with and subject to the Companys STIP
plan documents, as adopted and amended from time to time by the Companys board of directors. Executive acknowledges having been provided a copy of the Companys STIP plan documents prior to entering into this Agreement.
7. |
Restricted Stock Award for 2015. |
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Award. Provided that Executive remains employed by the Bank and the Company as of February 15, 2016, the Company shall award Executive a
restricted stock award under the Glacier Bancorp, Inc. 2015 Stock Incentive Plan |
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for calendar year 2015 (to be awarded on February 15, 2016) in the amount of $200,000 (the 2015 Restricted Stock Award). If Executives employment with the Bank or the
Company is terminated for any reason prior to February 15, 2016, the 2015 Restricted Stock Award shall be forfeited and of no force or effect. The 2015 Restricted Stock Award may not be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will of by the laws of descent or distribution. |
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B. |
Vesting and Forfeiture of 2015 Restricted Stock Award. The 2015 Restricted Stock Award shall vest ratably over three years as follows: |
One-third (1/3) shall vest on February 15, 2017;
One-third (1/3) shall vest on February 15, 2018; and
One-third (1/3) shall vest on February 15, 2019.
In the event Executives employment with the Company is terminated for any reason whatsoever prior to February 15, 2019, except for
termination as a result of retirement, death or disability, any unvested portion of the 2015 Restricted Stock Award will immediately be forfeited. In the event of Executives retirement, Executive becoming disabled (as defined in Appendix A of
the Glacier Bancorp, Inc. 2015 Stock Incentive Plan) or Executives death, any unvested shares of the 2015 Restricted Stock Award will vest immediately. For purposes of this provision, retirement is defined as meeting the Rule of
80. The Rule of 80 is computed using Executives years of employment with the Bank and/or Company plus the Executives age on their last day of employment. If this number is equal to or greater than 80, the
Executives unvested shares will vest immediately on retirement.
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C. |
Terms of 2015 Restricted Stock Award. The 2015 Restricted Stock Award shall be made in accordance with and shall be subject to all terms and conditions of the Companys LTIP (as defined below) plan
documents, as adopted and amended from time to time by the Companys board of directors. Executive acknowledges having been provided a copy of the Companys LTIP plan documents prior to entering into this Agreement. |
8. |
Long Term Incentive Plan. Beginning on January 1, 2016, Executive shall be eligible to participate in the Glacier Bancorp, Inc. 2015 Stock Incentive Plan (LTIP). Executive shall be eligible for
equity awards pursuant to the LTIP based on the Company meeting certain financial goals (i.e. Threshold, Target and Max) set by the Companys board of directors at the following levels: |
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Calendar Year |
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Equity Opportunity as a Percentage of Salary |
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Threshold |
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Target |
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Max |
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2016 |
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0 |
% |
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40 |
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60 |
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2017 |
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0 |
% |
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50 |
% |
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75 |
% |
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All LTIP equity awards shall be made in accordance with and shall be subject to all terms and
conditions of the Companys LTIP plan documents, as adopted and amended from time to time by the Companys board of directors. Executive acknowledges having been provided a copy of the Companys LTIP plan documents prior to entering
into this Agreement.
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A. |
Award. On the Start Date, the Company will award to Executive restricted stock in the amount of $400,000.00 (the Restricted Stock Signing Bonus) under the Companys LTIP. The Restricted Stock
Signing Bonus may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will of by the laws of descent or distribution. |
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B. |
Vesting and Forfeiture of Restricted Stock Signing Bonus. The Restricted Stock Signing Bonus shall vest ratably over a period of four years as follows: |
One-quarter (1/4) shall vest on August 1, 2016;
One-quarter (1/4) shall vest on August 1, 2017;
One-quarter (1/4) shall vest on August 1, 2018; and
One-quarter (1/4) shall vest on August 1, 2019;
In the event Executives employment with the Company is terminated for any reason whatsoever prior to August 1, 2019, except for
termination as a result of retirement, death or disability, any unvested portion of the Restricted Stock Signing Bonus will immediately be forfeited. In the event of Executives retirement, Executive becoming disabled (as defined in Appendix A
of the LTIP) or Executives death, any unvested shares of the Restricted Stock Signing Bonus will vest immediately. For purposes of this provision, retirement is defined as meeting the Rule of 80. The Rule of 80 is
computed using Executives years of employment with the Bank and/or Company plus the Executives age on their last day of employment. If this number is equal to or greater than 80, the Executives unvested shares will vest immediately
on retirement.
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C. |
Terms of Restricted Stock Signing Bonus. The Restricted Stock Signing Bonus shall be made in accordance with and shall be subject to all terms and conditions of the Companys LTIP plan documents, as adopted
and amended from time to time by the Companys board of directors. Executive acknowledges having been provided a copy of the Companys LTIP plan documents prior to entering into this Agreement. |
10. |
Cash Signing Bonus. On the Companys first payroll date after the Start Date, the Company shall pay to Executive a cash signing bonus of $100,000.00, less any applicable payroll taxes and
withholdings. |
11. |
Relocation Benefits. Executive shall be entitled to relocation benefits in accordance with the Companys Tier IV Employee Relocation Benefit program. |
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12. |
Income Deferral. Executive will be eligible to participate in any program available to the Companys senior management for income deferral, for the purpose of deferring receipt of any or all of the
compensation Executive may become entitled to under this Agreement. |
13. |
Vacation and Benefits. |
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A. |
Vacation and Holidays. Executive will accrue up to 160 hours of paid vacation each year, which accrual shall occur ratably over the Companys payroll periods, in addition to all holidays observed by the
Bank. Accrual of vacation time shall be in accordance with the Companys Employee Manual. Executive may carry over, in the aggregate, up to 160 hours of unused vacation to a subsequent year; provided, however, Executive may not accumulate in
excess of 160 hours of paid vacation at any given time (the Cap). Should Executives accumulation of paid vacation reach the Cap of 160 hours, Executive will no longer accrue additional paid vacation until Executive uses some of
Executives accumulated vacation time and Executives accumulated paid vacation balance drops below the Cap. Each calendar year, Executive shall take at least five (5) consecutive days of vacation. |
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Benefits. Beginning on the Start Date, Executive will be entitled to participate in any group life insurance, disability, medical, dental, health and accident insurance plans, profit sharing and pension plans and
in other employee fringe benefit programs the Company may have in effect from time to time for its similarly situated employees, in accordance with and subject to any policies adopted by the Companys board of directors with respect to the
plans or programs, including without limitation, any incentive or employee stock option plan, deferred compensation plan, 401(k) plan, and Supplemental Executive Retirement Plan (SERP). The Company through this Agreement does not obligate itself to
make any particular benefits available to its employees. The Companys change, modification, or termination of any of its benefits during the Term of this Agreement shall not be a breach of this Agreement. |
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Business Expenses. Subject to any applicable Company policies or the rules and regulations of the Internal Revenue Service, the Company will reimburse Executive for ordinary and necessary expenses which are
consistent with past practice at the Company (including, without limitation, travel, entertainment, and similar expenses) and which are incurred in performing and promoting the Banks and the Companys business. Executive will present from
time to time itemized accounts of these expenses. Reimbursement will be made as soon as practicable but no later than the last day of the calendar year following the calendar year in which the expenses were incurred. |
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D. |
Directors and Officers Insurance; Indemnification. Executive will be covered by the Companys directors and officers liability insurance
policy in effect from time to time. To the extent permitted by the Companys Bylaws and the Montana Business Corporation Act, the Company will indemnify Executive in the event Executive is a party or is threatened to be made a party to any
threatened, pending or |
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completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that Executive is or was a director, officer or employee of the Company.
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14. |
Termination of Employment. |
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A. |
Termination by the Company for Cause. If the Company and the Bank terminate Executives employment for Cause (defined below) before the expiration of the Term of this Agreement, the Company will pay
Executive, within 10 business days following the termination of employment, or on the next regularly scheduled pay date, whichever is earlier, the salary earned and expenses reimbursable under this Agreement incurred through the date of termination.
Executive will have no right to receive compensation or other benefits for any period after termination under this Section 14.A. |
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B. |
Termination by the Company without Cause or by Executive for Good Reason. If the Company and the Bank terminate Executives employment without Cause before the expiration of the Term of this Agreement, or
Executive terminates Executives employment for Good Reason (defined below)(other than for Good Reason pursuant to Section 14.H(1)(e)) before the expiration of the Term of this Agreement, the Company will pay Executive a payment equal to
the base salary set forth in Section 4, above, to which Executive would have been entitled for the remainder of the Term of the Agreement if Executives employment had not terminated. If Executive terminates his employment for Good Reason
pursuant to Section 14.H(1)(e), the Company will pay Executive a payment equal to two times Executives base salary as President of the Bank as set forth Section 4.A, above. Payment by the Company to Executive pursuant to this
Section 14.B. is conditioned upon Executive executing and not revoking a release of any and all claims which Executive could assert against the Company and the Bank relating to Executives employment or the termination of Executives
employment in a form acceptable to the Company. All payments made pursuant to this Section 14.B shall be completed no later than March 15 of the calendar year following the calendar year in which Executives employment terminates.
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C. |
Death or Disability. This Agreement terminates (1) if Executive dies or (2) if Executive is unable to perform Executives duties and obligations under this Agreement for a period of 90 consecutive
days as a result of a physical or mental disability arising at any time during the Term of this Agreement, unless with reasonable accommodation Executive could continue to perform Executives essential functions under this Agreement and making
these accommodations would not pose an undue hardship on the Company or result in a direct threat to the health or safety of Executive or others (Disability). If termination occurs under this Section 14.C, the Company shall pay
Executive or Executives estate, within 10 business days following Executives termination of employment, all salary and benefits earned and expenses reimbursable through the date Executives employment terminated. Neither Executive
nor Executives estate will have any right to receive compensation or other benefits for any period after termination under this Section 14.C. |
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D. |
Termination Related to a Change in Control. The following provisions shall survive the expiration of the Term of this Agreement and the termination of Executives employment. |
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(1) |
Termination by Company. If the Company, or its successor in interest by merger, or its transferee in the event of a purchase in an assumption transaction (for reasons other than Executives death,
disability, or for Cause) terminates Executives employment without Cause, as defined in Section 14.G: (a) within three (3) years following a Change in Control (as defined below); or (b) before a Change in Control but on or
after the date that any party either announces or is required by law to announce any prospective Change in Control transaction and a Change in Control occurs within six months after the termination, then Company will provide Executive with the
payment and benefits described in Section 14.D(3) below, provided that Executive executes a release of any and all claims which Executive could assert against the Company or the Bank relating to Executives employment or the termination of
Executives employment in a form acceptable to the Company. |
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(2) |
Termination by Executive. If Executive terminates Executives employment with Good Reason, as defined in Section 14.H, within three (3) years following a Change in Control, the Company will provide
Executive with the payment and benefits described in Section 14.D(3) below, provided that Executive executes a release of any and all claims which Executive could assert against the Company or the Bank relating to Executives employment or
the termination of Executives employment in a form acceptable to the Company. |
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Payments. If Section 14.D(1)(a) or Section 14.D(2) is triggered in accordance with its terms, the Company will: (i) subject to
Sections 14.E and 14.J below, beginning within 30 days after Executives separation from service as defined by Treasury Regulation § 1.409A-1(h) (Separation from Service), pay Executive in 36 substantially equal monthly
installments in an overall amount equal to 2.99 times the Executives annual salary (determined as of the day before the date Executives employment was terminated) and (ii) maintain and provide for 2.99 years following
Executives termination, at no cost to Executive, the benefits described in Section 13.B to which Executive is entitled (determined as of the day before the date of such termination); but if Executives participation in any such
benefit is thereafter barred or not feasible, as determined by the Company, or discontinued or materially reduced, the Company will arrange to provide Executive with benefits substantially similar to those benefits or reimburse Executives
out-of-pocket expenses of obtaining benefits of substantially similar type and |
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value. Subject to Sections 14.E and 14.J below, if Section 14.D(1)(b) is triggered in accordance with its terms, beginning within 30 days after a Change in Control, the Company will pay
Executive in 36 substantially equal monthly installments in an overall amount equal to 2.99 times the Executives annual salary (determined on the day before the date Executives employment was terminated). |
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E. |
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement: |
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(1) |
the total of the payments and benefits described in Section 14.D(3) will be less than the amount that would cause them to be a parachute payment within the meaning of Section 280G(b)(2)(A) of the
Internal Revenue Code; |
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(2) |
the payment and benefits described in Section 14.D(3) will be reduced by any compensation (in the form of cash or other benefits) received by Executive from the Company or its successor after the Change in Control
and/or after Executives termination of employment; and |
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(3) |
Executives right to receive the payments and benefits described in Section 14.D(3) terminates (i) immediately if before the Change in Control transaction closes, Executive terminates Executives
employment without Good Reason, or the Company terminates Executives employment for Cause, or (ii) three years after a Change of Control occurs. |
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(4) |
Notwithstanding anything to the contrary in this or any other agreement or plan, including Section 14.E(1) of this Agreement, to the extent that
any payment or distribution of any type to or for the benefit of the Executive by the Company (or by any affiliate of the Company, any person or entity who acquires ownership or effective control of the Company or ownership of a substantial portion
of the Companys assets (within the meaning of Section 280G of the Code, and the regulations thereunder), or any affiliate of such person or entity, whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise (the Total Payments), is or will be subject to the excise tax imposed under Section 4999 of the Code (the Excise Tax), then the Total Payments shall be reduced (but not below zero) only if
and to the extent that a reduction in the Total Payments would result in the Executive retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received
the entire amount of such Total Payments. Unless the Executive shall have given prior written notice specifying a different order to the Company to effectuate the foregoing, the Company shall reduce or eliminate the Total Payments, by first reducing
or eliminating the portion of the Total Payments which are not payable in cash and then by reducing or |
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eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as defined herein). Any notice given
by the Executive pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executives rights and entitlements to any benefits or compensation. |
The determination of whether the Total Payments shall be reduced as provided in this Section and the amount of such reduction shall be made at
the Companys expense by the Companys independent auditors (the Accounting Firm). The Accounting Firm shall provide its determination (the Determination), together with detailed supporting calculations and
documentation to the Company and the Executive within ten (10) days of the last day of Executives employment. If the Accounting Firm determines that no Excise Tax is payable by the Executive with respect to the Total Payments, it shall
furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such payments and, absent manifest error, such Determination shall be binding, final and conclusive upon the Company
and the Executive. If the Accounting Firm determines that an Excise Tax would be payable, the Executive shall have the right to accept the Determination of the Accounting Firm as to the extent of the reduction, if any, pursuant to this Section, or
to have such Determination reviewed by another accounting firm selected by the Executive, at the expense of the Company, in which case the determination of such second accounting firm shall be binding, final and conclusive upon the Company and
Executive.
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F. |
Return of Company and Bank Property. If and when Executive ceases, for any reason, to be employed by the Company and the Bank, Executive must return to the Company all keys, pass cards, identification cards, cell
phones, blackberries or other smart phones, tablets, electronic storage devices, company credit cards and any other property of the Company and the Bank. At the same time, Executive also must return to the Company and the Bank all originals and
copies (whether in memoranda, designs, devices, electronic storage devices, tapes, manuals, and specifications) which constitute proprietary or confidential information or material of the Company, the Bank or their subsidiaries or divisions. The
obligations in this paragraph include, without limitation, the return of documents and other materials which may be in Executives desk at work, in Executives car, in Executives place of residence, or in any other location under
Executives control. |
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G. |
Cause. Cause means any one or more of the following: |
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(1) |
Willful misfeasance or gross negligence in the performance of Executives duties; |
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(2) |
Conviction of a crime in connection with Executives duties, conviction of a felony or conviction of a crime of fraud, theft, conversion or dishonesty; or |
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(3) |
Conduct demonstrably and significantly harmful to the Company or the Bank, as reasonably determined on the advice of legal counsel of the Companys board of directors. |
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H. |
Good Reason. Executive terminates employment for Good Reason if all four of the following criteria are satisfied: |
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(1) |
Any one or more of the following conditions (each a Condition) arises without Executives consent: |
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(a) |
The material reduction of Executives salary, unless the reduction is generally applicable to substantially all Company employees (or employees of a successor or controlling entity of the Company);
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(b) |
The material diminution in Executives authority or duties as they exist on the date of this Agreement; |
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(c) |
The material breach of this Agreement by the Company; or |
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(d) |
A material relocation or transfer of Executives principal place of employment to a location outside Flathead County, Montana; |
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(e) |
The Company fails to make Executive Chief Executive Officer of the Bank and President and Chief Executive Officer of the Company, in accordance with Section 1.B of this Agreement, for any reason other than
Executives death, Disability (as defined in Section 14.C), or Executives termination for Cause; and |
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(2) |
Executive gives notice to the Company of the Condition within 90 days of the initial existence of the Condition; |
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(3) |
The Company fails to reasonably remedy the Condition within 30 days following receipt of the notice described in Section 14.H(2) above; and |
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(4) |
Executive terminates employment within 180 days following the initial existence of the Condition. |
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I. |
Change in Control. Change in Control means a change in the ownership or effective control or in the ownership of a substantial portion of the assets of the Company, within the
meaning of Treas Reg. § 1.409A-3(i)(5). |
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J. |
Section 409A Compliance. Notwithstanding anything in this Agreement to the contrary, if any amounts that become due under this Agreement
on account of the |
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termination of Executives employment constitute nonqualified deferred compensation within the meaning of Internal Revenue Code Section 409A, payment of such amounts shall
not commence until Executive incurs a Separation from Service (as defined in Section 14.D(3)). If, at the time of Executives Separation from Service under this Agreement, Executive is a specified employee (under Internal
Revenue Code Section 409A), any amount that constitutes nonqualified deferred compensation within the meaning of Internal Revenue Code Section 409A that becomes payable to Executive on account of Executives Separation
from Service (including any amounts payable pursuant to the preceding sentence) will not be paid until after the end of the sixth calendar month beginning after Executives Separation from Service (the 409A Suspension Period).
Within 14 calendar days after the end of the 409A Suspension Period, Executive shall be paid a lump sum payment in cash equal to any payments delayed because of the preceding sentence, together with interest on them for the period of delay at a rate
not less than the average prime interest rate published in the Wall Street Journal on any day chosen by the Company during that period. Thereafter, Executive shall receive any remaining payments as if there had not been an earlier delay.
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15. |
Confidentiality. Executive will not, during the Term of this Agreement and for a period of five years after Executives employment with the Bank or Company has terminated, use for Executives own
purposes or disclose to any other person or entity any confidential business information concerning the Bank or Company or their business operations, unless (1) the Bank or Company consents to the use or disclosure of confidential information;
(2) the use or disclosure is consistent with Executives duties under this Agreement, or (3) disclosure is required by law or court order. For purposes of this Agreement, confidential business information includes, without limitation,
trade secrets (as defined under the Montana Uniform Trade Secrets Act, Montana Code § 30-14-402), customer information, various confidential information on investment management practices, marketing plans, pricing structure and technology of
either the Bank or Company. Executive will also treat the terms of this Agreement as confidential business information. |
16. |
Noncompetition. During the Term and the terms of any extensions or renewals of this Agreement and for a period of three years after Executives employment with the Bank or Company has terminated, unless such
termination is the result of the Banks and the Companys election not to renew Executives employment, Executive will not, directly or indirectly, as a shareholder, director, officer, employee, proprietor, partner, member, agent,
consultant, lessor, creditor or otherwise |
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A. |
provide management, supervisory or other similar services to any person or entity conducting a banking or lending business in counties in which the Bank or Company or a subsidiary or division of the Bank or the Company
had a branch or office during the term of this Agreement; |
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B. |
persuade or entice, or attempt to persuade or entice any employee of the Bank, the Company or a subsidiary or division of the Bank or the Company to terminate his/her employment with the Bank, the Company or a
subsidiary of the Company; |
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C. |
persuade or entice or attempt to persuade or entice any person or entity with whom Executive had pre-termination communications to change, terminate, cancel, rescind or revoke its banking or contractual relationships
with the Bank, Company or a subsidiary or division of the Bank or the Company. |
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A. |
The Company, Bank and Executive stipulate that, in light of all of the facts and circumstances of the relationship between Executive and the Company and Bank, the agreements referred to in Sections 15 and 16 (including
without limitation their scope, duration and geographic extent) are fair and reasonably necessary for the protection of the Companys and Banks confidential information, goodwill and other protectable interests. If a court of competent
jurisdiction should decline to enforce any of those covenants and agreements, Executive, the Company and Bank request the court to reform these provisions to restrict Executives use of confidential information and Executives ability to
compete with the Company or Bank to the maximum extent, in time, scope of activities and geography, the court finds enforceable. |
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B. |
Executive acknowledges the Bank and the Company will suffer immediate and irreparable harm that will not be compensable by damages alone if Executive repudiates or breaches any of the provisions of Sections 15 or 16 or
threatens or attempts to do so. For this reason, under these circumstances, the Company or the Bank, in addition to and without limitation of any other rights, remedies or damages available to it at law or in equity, will be entitled to obtain
temporary, preliminary and permanent injunctions in order to prevent or restrain the breach, and neither the Company nor the Bank will be required to post a bond as a condition for the granting of this relief. |
18. |
Effect of Covenants. Executive specifically acknowledges the receipt of adequate consideration for the covenants contained in Sections 15 and 16 and that the Company and the Bank are entitled to require Executive
to comply with these Sections. These Sections will survive termination of this Agreement. Executive represents that if Executives employment is terminated, whether voluntarily or involuntarily, Executive has experience and capabilities
sufficient to enable Executive to obtain employment in areas which do not violate this Agreement and that the Companys or Banks enforcement of a remedy by way of injunction will not prevent Executive from earning a livelihood.
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19. |
Company Payment of Executive Legal Fees. The Company will reimburse Executive for the reasonable legal fees incurred by Executive in reviewing and finalizing this Agreement. Such reimbursement will be made within
a reasonable amount of time following Executives presentation of an invoice for the legal fees to the Company. |
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20. |
Jury Waiver. THE PARTIES TO THIS AGREEMENT HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT,
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF EITHER PARTY OR ANY EXERCISE BY ANY PARTY OF THEIR RESPECTIVE RIGHTS UNDER THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL
THIS AGREEMENT, AND ANY CLAIM OR DEFENSE ASSERTING THAT THIS AGREEMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). |
21. |
Miscellaneous Provisions. |
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A. |
Entire Agreement. This Agreement constitutes the entire understanding and agreement between the parties concerning its subject matter and supersedes all prior agreements, correspondence, representations, or
understandings between the parties relating to its subject matter. |
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B. |
Binding Effect. This Agreement will bind and inure to the benefit of the Company and its subsidiaries and their successors and assigns. Subject to the limitation on assignment set forth in Section 20.E, this
Agreement will bind and inure to the benefit of Executive and Executives heirs, legal representatives, successors and assigns. |
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C. |
Litigation Expenses. In the event of any dispute or legal or equitable action arising from this Agreement, the prevailing party shall be entitled to all of its out-of-pocket expenses and costs including, without
limitation, reasonable attorneys fees and costs. |
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D. |
Waiver. The failure of any party to insist upon strict performance of any of the terms and provisions of this Agreement shall not be construed as a waiver or relinquishment of any such terms or conditions or of
any other term or condition and the same shall be and remain in full force and effect. Any waiver by a party of its rights under this Agreement must be written and signed by the party waiving its rights. A partys waiver of the other
partys breach of any provision of this Agreement will not operate as a waiver of any other breach by the breaching party. |
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E. |
Assignment. The services to be rendered by Executive under this Agreement are unique and personal. Accordingly, Executive may not assign any of Executives rights or duties under this Agreement. Any such
assignment or attempted assignment shall be void. |
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F. |
Amendment. This Agreement may be modified only through a written instrument signed by all parties to this Agreement. |
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G. |
Severability. The provisions of this Agreement are severable. The invalidity of any provision will not affect the validity of other provisions of this Agreement. |
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H. |
Governing Law and Venue. This Agreement will be governed by and construed in accordance with Montana law, except to the extent that certain regulatory matters may be governed by federal law. The parties must
bring any legal proceeding based on, arising out of, under or in connection with this Agreement in Flathead County, Montana. |
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I. |
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which taken together will constitute one and the same instrument.
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J. |
Attorney Representation. Executive is aware that in any contract, including this Agreement, the interests of the parties may conflict and that there may be issues upon which only an attorney is qualified to
advise. Executive acknowledges that Executive was free to and was encouraged to retain an attorney to thoroughly discuss all aspects of this Agreement. Executive further acknowledges that Executive had an opportunity to read and review
this Agreement and that Executive is knowingly, voluntarily and of Executives own free will entering into this Agreement. |
We would appreciate it if you would return a signed copy of this Agreement to Mick Blodnick no later than June 15, 2015.
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Company: |
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GLACIER BANCORP, INC. |
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By: |
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/s/ Michael J. Blodnick |
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Michael J. Blodnick, Chief Executive Officer |
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Date: |
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6/15/2015 |
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Bank: |
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GLACIER BANK |
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By: |
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/s/ Michael J. Blodnick |
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Michael Blodnick, Chief Executive Officer |
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Date: |
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6/15/2015 |
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Executive: |
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/s/ Randall Chesler |
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Randall Chesler |
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Date: |
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June 18, 2015 |
16
Exhibit 99.1
NEWS RELEASE
June 22, 2015
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FOR IMMEDIATE RELEASE |
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Contact: Michael J. Blodnick
(406) 751-4701 |
GLACIER BANCORP, INC. SELECTS RANDALL M. CHESLER
TO BECOME PRESIDENT OF GLACIER BANK AND TO
SUCCEED MICK BLODNICK AS CEO OF
GLACIER BANCORP IN 2017
KALISPELL,
MONTANA - Glacier Bancorp, Inc. (NASDAQ: GBCI) today announced that the company is expanding its executive management team with the addition of Randall M. Randy Chesler. Chesler will serve in the newly created position of President of
Glacier Bank, the companys sole banking subsidiary, and will immediately be appointed to the board of Glacier Bank and will be nominated for election to GBCIs board at next years annual meeting. Mick Blodnick will continue to serve
as President and CEO of Glacier Bancorp and CEO of Glacier Bank until his retirement at the end of 2016. It is our full expectation that Randy will succeed me as CEO, said Blodnick. I plan to work closely with Randy through the end
of 2016 to ensure a smooth leadership transition.
We are delighted to have someone of Randys caliber join our team, stated
Blodnick. We conducted an extensive internal and external search for this position and considered many highly-qualified candidates. Randy rose to the top not only in view of his talent and experience, but as a person with the leadership traits
and quality of character that fit well with the Glacier organization.
Chesler brings more than 30 years of experience in the financial services
industry, most recently as President of CIT Bank, the Salt Lake City-based banking subsidiary of CIT Group. During his ten years with CIT, Chesler held progressive leadership positions, including President, Small Business Lending and President,
Consumer Finance. During his tenure at CIT, the banks total assets grew from less than $500 million to more than $20 billion. Prior to CIT, Chesler was President and CEO of Size Technologies, a consumer payments software company; General
Manager of US Bankcard for Associates First Capital; Executive Vice President of Visa U.S.A.; and an executive at Citigroup.
As President of Glacier
Bank, Chesler will report to Blodnick and will have oversight of Glaciers banking businesses and other key customer-facing products and services. Im delighted to join such an outstanding banking organization and have the
opportunity to work with some of the best people in the business, at every level, stated Chesler.
Blodnick noted that Cheslers diverse background will complement the exceptional depth of community banking
talent across Glaciers 13 banking divisions. As we continue our growth toward $10 billion in assets and beyond, we recognize the importance of adding management talent and perspective gained from leading large, diverse and growing
banking organizations. I look forward to working closely with Randy and the entire Glacier team over the next year and a half to build on our success while remaining true to the business model and culture that define us. Glacier previously
announced Blodnicks intention to retire as CEO at the end of 2016, while continuing to serve on the companys Board of Directors.
A native of
the West, Chesler complements his extensive banking experience with a commitment of service to industry and community groups. He currently serves on the Board of Directors of the Utah Bankers Association and the Utah Community Reinvestment
Corporation. He is a past Board member of the American Financial Services Association. Chesler will begin his role as President of Glacier Bank on August 3, 2015.
About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is a regional
bank holding company providing commercial banking services in 82 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and is the parent company for Glacier Bank,
Kalispell and Bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown, all operating in Montana; as well as Mountain West Bank, Coeur
dAlene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah; First Bank of Wyoming, Powell and First State Bank, Wheatland, each operating in
Wyoming; North Cascades Bank, Chelan, operating in Washington; and Bank of the San Juans, Durango, operating in Colorado.
Visit Glaciers website at
http://www.glacierbancorp.com
Forward Looking Statements
This news release includes forward looking statements, which describe managements expectations regarding future events and developments such as the
benefits of the business combination transaction involving the Company and Montana Community Banks, Inc., continued success of the Companys style of banking and the strength of the local economies in which it operates. Future events are
difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. In addition to discussions about risks and uncertainties set forth from time
to time in the Companys public filings, factors that may cause actual results to differ materially from those contemplated by such forward looking statements include, among others, the following possibilities: (1) local, national and
international economic conditions are less favorable than expected or have a more direct and pronounced effect on the Company than expected and adversely affect the companys ability to continue its internal growth at historical rates and
maintain the quality of its earning assets; (2) projected business increases following strategic expansion or opening or acquiring new banks and/or branches are lower than expected; (3) costs or difficulties related to the integration of
acquisitions are greater than expected; or (4) legislation or regulatory requirements or changes adversely affect the businesses in which the Company is engaged.
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