EXHIBIT 10.6
[SUPERIOR FINANCIAL CORP LETTERHEAD]
January 1, 1998
Mr. Marvin Scott
7495 Lazy Acres Road
Pass Christian, Mississippi 39571
Dear Marvin:
The purpose of this letter is to confirm our discussions with respect to
your employment by SFC Acquisition Corp. (the "Parent") which has been organized
for the purpose of acquiring Superior Federal Bank, FSB (the "Company").
Effective Date: January 9, 1998 or shortly thereafter based on your
official resignation date from your current employer.
Position: You will serve as President of both the Parent and the
Company, following its acquisition.
Compensation: For all services rendered by you during your
employment, you will be paid an annual base salary of
$150,000, or $12,500 per month, subject to periodic
increases as the board of directors of the parent may
approve. You will be paid a targeted annual bonus of
$50,000 based on the accomplishment of both annual and
long-term goals to be approved by the board of
directors of the parent.
Benefits You will be provided the right to participate in the
normal employee benefits plans as the Company may have
in effect upon its acquisition. You will be provided
with the use of a full size automobile along with
insurance coverage and associated expenses upon your
employment. Also, you will be provided a $500,000 term
life insurance policy during the period from your
resignation of your current employer to the closing of
the acquisition of the
Company by the Parent. Thereafter, you will
participate in the Company life insurance plan.
Relocation Expenses: You will be provided with temporary living expenses
in Arkansas, including hotel, apartment, meals, and
utilities expenses until the earlier of your move
into a new home in Arkansas, or December 31, 1998;
payment or reimbursement for all costs of packing
and moving your household goods, furniture and other
belongings from your present home to your new home,
and all costs incurred by you and your family in
making up to three trips for house-hunting.
The Parent or Company will, until your present home
is sold, reimburse you for interest costs on the
purchased of a new home, and, if your present home
is not sold by December 31, 1998, shall purchase
your present home at fair-market value as determined
by the average of three then-current appraisals of
the property.
The Parent or Company will reimburse you for all
closing costs associated with both the sale of your
current home and the purchase of your new home. If
your current home is not sold to the Company, you
will be reimbursed for all real estate commissions
in connections with the sale.
Stock Options: You will receive options, for a term of ten (10)
years, to acquire an amount of common stock, valued
at the initial offering price of $10. equal to two
and one-half percent (2.5%) of the aggregate
proceeds of the equity private placement. Vesting
shall be in accordance with the following schedule:
20% vesting at the closing of the Parent's
acquisition of the Company;
20% vesting upon successful consummation of a
public offering of equity securities of
the Parent;
20% vesting upon the stock reaching a market
value (adjusted for stock splits, stock
dividends, or other changes in capital
structure), based upon an average of the
closing price over (10) consecutive days
(the "Market Value") of at least $15 per
share;
20% vesting when such Market Value reaches
$20 per share; and;
20% vesting when such Market Value reaches
$25 per share.
If a public offering is not consummated by December
8, 2002,
2
options shall vest in accordance with the
following schedule:
20% vesting at Closing;
20% vesting upon the Company's annual return on
average assets ("ROAA") attaining 125 basis
points;
20% vesting upon the Company's annual ROAA
attaining 140 basis points;
20% vesting upon the Company's annual ROAA
attaining 155 basis points;
20% vesting upon the Company's annual ROAA
attaining 175 basis points;
provided that such vesting shall be cumulative
and accelerated upon the company's having attained
a stated annual ROAA basis point target in any
fiscal year.
All options whether under the equity private
placement or under the public offering shall become
fully vested upon a change in control as defined in
the next paragraph.
Change in Control: A "Change in Control" of the Company on the Parent
shall mean the occurrence of a transaction the
result of which is that more than twenty-five
percent of the outstanding shares of the Company
or the Parent, or any successor thereof, are
acquired by any person or entity, or group acting
in concert, which, prior, to such transaction owned
or controlled less than twenty-five percent of the
shares of the Company or of the Parent except that
this definition shall not apply to a corporate
reorganization.
In the event of a Change in Control of the Company
or the Parent subsequent to the date hereof, this
agreement shall be terminated and you shall receive
compensation of 2.99 times your annualized total
compensation for the twelve months preceding the
change in control, including bonuses.
Personal Investment: You will be allowed to make a personal investment in
the Parent within your personal capacity.
Club Membership: Based on approval of the Parent's board of
directors, you will be provided with funds, net of
taxes, sufficient to enable you to purchase
membership in one club with facilities at which you
could engage in business entertainment on behalf of
the Parent or Company. You will be reimbursed, net
of taxes, for monthly dues, periodic assessments,
and other such costs of membership. You will be
responsible for any personal charges that you may
incur in
3
utilizing the club.
Parent's Undertaking: Following its acquisition of Company, Parent shall
cause Company to be bound by any obligation
undertake by Parent in this letter.
I believe this letter summarized the terms agreed upon in our
discussions. Except as to the explicit provisions expressed herein, no contract
or other arrangement exists between the undersigned parties. This agreement
shall be governed by the law of the State of Arkansas. If you concur, please
sign the enclosed copy of this letter and return it to me.
Sincerley yours,
/s/ C. Stanley Bailey
C. Stanley Bailey
AGREED TO:
/s/ C. Marvin Scott
- -------------------
4