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EXHIBIT 10(f)
STOCK BONUS AGREEMENT
THIS AGREEMENT is entered into on this 30th day of January, 1998, by
and between BancorpSouth, Inc. (the "Company") and AUBREY B. PATTERSON
("Patterson"), a resident of Tupelo, Mississippi, pursuant to the approval of
the Agreement by the Company's board of directors (the "Board") on January 21,
1998.
RECITALS:
WHEREAS, the Company desires to retain the full-time, dedicated
services of Patterson as chief executive officer of the Company, or other
assigned positions, and to be assured of its right to his services in said
capacity;
WHEREAS, Patterson desires to continue to provide services in his role
as chief executive officer of the Company, or in such other senior officer
duties as may be assigned by the Board;
WHEREAS, the Company has previously awarded shares of common stock of
the Company, $2.50 par value, ("Common Stock") to Patterson under the terms of
an agreement which expired April 1, 1997, and the parties desire to renew such
arrangement in a manner that will provide the performance incentives to
Patterson that are set forth herein;
WHEREAS, in order to provide a performance incentive, the Board took
action on January 21, 1998, to grant shares Common Stock to Patterson that are
restricted and subject to a substantial risk of forfeiture which lapses upon the
attainment of certain performance conditions;
WHEREAS, the Company desires for this arrangement be approved by the
shareholders of the Company at the annual meeting following the execution of
this Agreement, and desires that the Common Stock awarded to Patterson hereunder
be treated as performance based compensation as described in section 162(m) of
the Internal Revenue Code of 1986 (the "Code");
NOW, THEREFORE, in consideration of the premises set forth herein and
other mutual agreements and good and valuable consideration hereinafter set
forth, the Company and Patterson hereby agree to the following:
1. Services to be Provided by Patterson. Patterson agrees to continue
as the chief executive officer of the Company, or in any other senior officer
capacity assigned by the Board, pursuant to his employment arrangement with the
Company and agrees to devote substantially all his time to performing the
responsibilities of the President, or other assignments, as set forth in the
by-laws of the Company, to perform such other reasonable services and duties as
may from time to time be assigned to him by the Board and to grant the Company
his undivided loyalty as long as he continues to be employed by the Company.
2. Term. The term of this Agreement shall be from January 21, 1998,
until April 1, 2007. This Agreement is not an employment contract. The existence
of this Agreement shall not affect in any way the Company's right to discharge
Patterson.
3. Bonus Compensation; Stock Ownership. The Company does hereby award
to Patterson 35,000 shares of Common Stock in consideration for the performance
of services to the Company, provided that such shares shall be subject to the
restrictions and risks of forfeiture described herein. Such shares shall be held
by the Company or by an escrow agent, which may be BancorpSouth Bank or another
third-party that is acceptable to Company and Patterson (any of such entities
shall be referred to herein as the "Escrow Agent"); provided that any agreement
between the Company and the Escrow Agent shall be consistent with the terms of
this Agreement and shall not impose any restrictions or risks of forfeiture that
are not set forth herein. The Company shall transfer to the Escrow Agent shares
of Common Stock that are either authorized but unissued shares or shares held in
the treasury of the Company. From and after the date that shares are held for
Patterson's benefit by the Escrow Agent, Patterson shall have no right to
transfer the shares or any other right to the shares except that Patterson shall
be entitled to receive notices of all meetings of shareholders and vote the
shares at such meetings and to receive dividends paid with respect thereto.
However, Patterson shall have full, nonforfeitable rights in such Common Stock
upon the soonest of (i) the expiration of this Agreement pursuant to Section 2,
(ii) the termination of this Agreement pursuant to Section 6(b), or (iii) the
satisfaction of the performance criteria set forth in Section 3(a).
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(a) The Common Stock held by the Escrow Agent shall become
nonforfeitable and shall be released to Patterson on April 1 of each
year at the rate of 3,500 shares per year, provided that the Company
achieves either a .9% Return on Average Assets or a 12.825% Return on
Average Equity for the prior fiscal year of the Company. If such
performance incentives are not achieved for a fiscal year, the shares
that would have been released shall be held by the Escrow Agent and
continue to be held by the Escrow Agent until this Agreement terminates
pursuant to Section 2 or Section 6.
(b) In the event Patterson voluntarily terminates his
employment with the Company other than as provided in Section 6(b)
hereof or if this Agreement is terminated by the Company pursuant to
Section 6(a)(i) hereof prior to April 1, 2007, Patterson shall retain
full ownership of the shares of Common Stock that have been released to
him by the Escrow Agent, but shall forfeit all right, title and
interest in and to any shares of Common Stock still held by the Escrow
Agent, which shares shall be delivered to the Company to be held in
treasury or to be canceled as shall be determined by the Board.
(c) In the event this Agreement is terminated pursuant to
Section 6(b) hereof prior to April 1, 2007, Patterson shall be entitled
to receive all shares of Common Stock held by the Escrow Agent as of
such termination date and shall be entitled to retain full ownership of
all such shares of Common Stock.
4. Covenants of Patterson. Patterson covenants that, as of the date of
this Agreement, he is not in violation of any agreement, covenant, court order,
consent decree, statute or other binding commitment of his to do, or refrain
from doing, any act, and that by entering into this Agreement he will not
thereby violate any such agreement, covenant, court order, consent decree,
statute or other binding commitment.
5. Noncompetition. Patterson agrees not to compete with the Company or
the Bank as follows:
(a) Noncompetition. Patterson agrees that, upon termination of
this Agreement for any cause whatsoever other than a "change in
control" of the Company or of BancorpSouth Bank (the "Bank"), as
defined in Section 6(b) hereof, he will not directly or indirectly, as
principal, agent, employee or in any other capacity, for the term of
two years from the date of such termination of employment, enter into
or engage in the same business now being carried on by the Company or
the Bank or as may be carried on by the Company or the Bank from the
date hereof to the date of Patterson's termination, within the State of
Mississippi, the State of Tennessee, or any other state in which the
Company or the Bank is actively engaged in a business of the Company or
the Bank, or within any state whose banks may conduct banking in any
such state directly or through majority-owned subsidiaries.
Furthermore, during that two-year period he will not, directly or
indirectly, divert or attempt to divert business from the Company or
the Bank.
(b) Respect for employee relationships. Patterson agrees that
upon termination of this Agreement, he will not, without the prior
written consent of the Company, directly or indirectly, as principal,
agent, employee or in any other capacity, for the term of two years
from the date of such termination of employment, hire, entice away or
in any other manner persuade any employee of the Company or the Bank to
discontinue his relationship with the Company or the Bank.
(c) Return of documents. Patterson agrees that, upon
termination of this Agreement for any cause whatsoever, he shall
deliver to the Company all correspondence, agreements, contracts, books
of account, records, files, research, manuals or other documents, and
all copies thereof, relating to, concerning or arising out of the
business and operations of the Company and/or the Bank.
(d) Reasonable nature of restrictions. Patterson represents
and admits that, in the event of the termination of his employment for
any reason whatsoever, his experience and capabilities are such that he
can obtain employment in business not in competition with the Company
and/or the Bank, and that enforcement of a remedy by way of injunction
will not prevent him from earning a livelihood. Patterson further
represents and admits that the period of two years following
termination of his employment with the Company, during which time he
may not compete with the Company and/or the Bank nor disturb the
relationship between the Company and/or the Bank and its employees, is
reasonably necessary to protect the interests of the Company and/or the
Bank and would not unfairly or unreasonably restrict Patterson.
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6. Termination and Severance. It is the contemplation of the parties
hereto that this Agreement shall not be terminated prior to the expiration of
the initial term set forth in Section 2 hereof.
(a) Termination by the Company. Notwithstanding the foregoing,
the Company shall have the immediate right to terminate this Agreement
upon the happening of any of the following events:
(i) an act, in the good faith judgment of the
Board, of dishonesty, embezzlement or fraud against the
Company and/or the Bank; Patterson's conviction of a
misdemeanor involving dishonesty or breach of trust;
Patterson's conviction of a felony; or the issuance of any
order for Patterson's removal as an employee of the Company or
the Bank by any state or federal regulatory agency or court of
competent jurisdiction; or
(ii) the death of Patterson or the mental or
physical illness, disability or incapacity of Patterson which,
in the reasonable and good faith judgment of the Board,
prevents Patterson from performing his duties hereunder and
the continuance of such illness, disability or incapacity for
a period of 90 days.
(b) Termination by Patterson. Notwithstanding the foregoing,
Patterson shall have the immediate right to terminate this Agreement
and become fully vested in the shares held by the Escrow Agent in the
event there is a change in control of the Bank or the Company, as
defined in (c) below.
(c) Change in Control. Change in control of an entity shall be
deemed to have occurred if:
(i) any "person" as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended, other than a trustee or other fiduciary holding
securities under an employee benefit plan of the entity or a
corporation controlling the entity or owned directly or
indirectly by the stockholders of the entity in substantially
the same proportions as their ownership of stock of such
entity, becomes the "beneficial owner" (as defined in Rule
13d-3 under said Act), directly or indirectly, of securities
of such entity representing more than 25% of the total voting
power represented by such entity's then outstanding Voting
Securities (as defined below), or
(ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board of such entity and any new director whose election by
the Board or nomination for election by such entity's
stockholders was approved by a vote of at least two-thirds of
the directors then still in office who either were directors
at the beginning of the period or whose election or nomination
for election was previously so approved, cease for any reason
to constitute a majority thereof, or
(iii) the stockholders of such entity approve a
merger or consolidation of such entity with any other
corporation, other than a merger or consolidation which would
result in the Voting Securities of such entity outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting
Securities of the surviving entity) more than 65% of the total
voting power represented by the Voting Securities of such
entity or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of such
entity approve a plan of complete liquidation of such entity
or an agreement for the sale or disposition by such entity of
all or substantially all of its assets.
For purposes of this section "Voting Securities" of an entity shall
mean any securities of the entity which vote generally in the election of its
directors.
7. Merger. Upon a merger or consolidation in which the Company is not
the surviving entity this Agreement shall continue unless terminated by
Patterson pursuant to Section 6(b), and the surviving corporation shall
substitute its common shares having a value equivalent to the value of the
Common Stock for the Common Stock required to be delivered after consummation of
the merger.
8. Election. Patterson may desire to make an election under Section
83(b) of the Code regarding the timing and amount of compensation income to be
recognized by him on account of his receipt of Common Stock. The making of such
an election
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shall be wholly within the discretion of Patterson and it shall be the sole
responsibility of Patterson to see that such election, if desired, is properly
made and timely filed. If Patterson makes such an election, he shall inform the
Company in writing immediately thereafter.
9. Withholding. Whenever Patterson shall recognize compensation income
as a result of the receipt of Common Stock, he shall remit to the Company the
minimum amount of federal and state income and employment tax withholding which
the Bank or the Company is required to remit to the Internal Revenue Service or
applicable state department of revenue in accordance with the then current
provisions of the Code or applicable state law ("Withholding Tax"). The full
amount of the Withholding Tax shall be remitted simultaneously with the filing
of an election described in Section 7 or upon the occurrence of any other event
under this Agreement which results in the recognition of income by Patterson.
The Withholding Tax may be paid by (i) cash, (ii) a certified check or (iii)
delivery of shares of Common Stock with a fair market value equal to the amount
of the Withholding Tax.
10. Nonassignment. No party hereto may assign any rights hereunder. Any
such purported delegation or assignment shall be void.
11. Severability. It is the intention of the Company and Patterson that
the provisions of this Agreement shall be enforced to the fullest extent
permissible under the laws of the State of Mississippi, but that the
unenforceability (or the modification to conform with such laws or public
policies) of any provisions hereof shall not render unenforceable or impair the
remainder of this Agreement. Accordingly, if any provision of this Agreement
shall be determined to be invalid or unenforceable, either in whole or in part,
this Agreement shall be deemed amended to delete or modify, as necessary, the
offending provisions and to alter the balance of this Agreement in order to
render the same valid and enforceable to the fullest extent permissible as
aforesaid.
12. Certain Additional Payments.
(a) Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any payment
or distribution by or on behalf of the Company to or for the benefit of
Patterson as a result of a Change In Control (as defined in Section
280G of the Internal Revenue Code of 1986 (the "Code") (whether paid or
payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional
payments required under this Section 12 (a "Payment")) would be subject
to the excise tax imposed by Section 4999 of the Code, or any interest
or penalties are incurred by Patterson with respect to such excise tax
(such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then
Patterson shall be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after payment by Patterson
of all taxes (including any interest or penalties imposed with respect
to such taxes), including, without limitation, any income taxes (and
any interest and penalties imposed with respect thereto) and Excise Tax
imposed upon the Gross-Up Payment, Patterson retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
(b) Subject to the provisions of Section 12(c), all
determinations required to be made under this Section 12, including
whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by a nationally recognized accounting firm
selected by the Company (the "Accounting Firm"); provided, however,
that the Accounting Firm shall not determine that no Excise Tax is
payable by Patterson unless it delivers to Patterson a written opinion
(the "Accounting Opinion") that failure to pay the Excise Tax and to
report the Excise Tax and the payments potentially subject thereto on
or with Patterson's applicable federal income tax return will not
result in the imposition of an accuracy-related or other penalty on
Patterson. All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Within 15 business days of the receipt of notice
from Patterson that there has been a Payment, or such earlier time as
is requested by the Company, the Accounting Firm shall make all
determinations required under this Section 12, shall provide to the
Company and Patterson a written report setting forth such
determinations, together with detailed supporting calculations, and, if
the Accounting Firm determines that no Excise Tax is payable, shall
deliver the Accounting Opinion to Patterson. Any Gross-Up Payment, as
determined pursuant to this Section 12, shall be paid by the Company to
Patterson within fifteen days of the receipt of the Accounting Firm's
determination. Subject to the remainder of this Section 12, any
determination by the Accounting Firm shall be binding upon the Company
and Patterson; provided, however, that Patterson shall only be bound to
the extent that the determinations of the Accounting Firm hereunder,
including the determinations made in the Accounting Opinion, are
reasonable and reasonably supported by applicable law. As a result of
the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting
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Firm hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. In the
event that it is ultimately determined in accordance with the
procedures set forth in Section 12(c) that Patterson is required to
make a payment of any Excise Tax, the Accounting Firm shall reasonably
determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the
benefit of Patterson. In determining the reasonableness of Accounting
Firm's determinations hereunder, and the effect thereof, Patterson
shall be provided a reasonable opportunity to review such
determinations with Accounting Firm and Patterson's tax counsel.
Accounting Firm's determinations hereunder, and the Accounting Opinion,
shall not be deemed reasonable until Patterson's reasonable objections
and comments thereto have been satisfactorily accommodated by
Accounting Firm.
(c) Patterson shall notify the Company in writing of any
claims by the Internal Revenue Service that, if successful, would
require the payment by the Company of the Gross-Up Payment. Such
notification shall be given as soon as practicable but no later than 30
calendar days after Patterson actually receives notice in writing of
such claim and shall apprise the Company of the nature of such claim
and the date on which such claim is requested to be paid; provided,
however, that the failure of Patterson to notify the Company of such
claim (or to provide any required information with respect thereto)
shall not affect any rights granted to Patterson under this Section 12
except to the extent that the Company is materially prejudiced in the
defense of such claim as a direct result of such failure. Patterson
shall not pay such claim prior to the expiration of the 30-day period
following the date on which he gives such notice to the Company (or
such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If the Company notifies Patterson in
writing prior to the expiration of such period that it desires to
contest such claim, Patterson shall:
I. give the Company any information reasonably requested
by the Company relating to such claim;
II. take such action in connection with contesting such
claim as the Company shall reasonably request in
writing from time to time, including, without
limitation, accepting legal representation with
respect to such claim by an attorney selected by the
Company and reasonably acceptable to Patterson;
III. cooperate with the Company in good faith in order
effectively to contest such claim; and
IV. if the Company elects not to assume and control the
defense of such claim, permit the Company to
participate in any proceedings relating to such
claim;
provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold
Patterson harmless, on an after-tax basis, for any Excise Tax or income
tax (including interest and penalties with respect thereto) imposed as
a result of such representation and payment of costs and expenses.
Without limiting the foregoing provisions of this Section 12, the
Company shall have the right, at its sole option, to assume the defense
of and control all proceedings in connection with such contest, in
which case it may pursue or forego any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in
respect of such claim and may either direct Patterson to pay the tax
claimed and sue for a refund or contest the claim in any permissible
manner, and Patterson agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs Patterson to
pay such claim and sue for a refund, the Company shall advance the
amount of such payment to Patterson, on an interest-free basis and
shall indemnify and hold Patterson harmless, on an after-tax basis,
from any Excise Tax or income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or with respect
to any imputed income with respect to such advance; and further
provided that any extension of the statute of limitations relating to
payment of taxes for the taxable year of Patterson with respect to
which such contested amount is claimed to be due is limited solely to
such contested amount. Furthermore, the Company's right to assume the
defense of and control the contest shall be limited to issues with
respect to which a Gross-Up Payment would be payable hereunder and
Patterson shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other
taxing authority.
(d) If, after the receipt by Patterson of an amount advanced
by the Company pursuant to Section 12 Patterson becomes entitled to
receive any refund with respect to such claim, Patterson shall (subject
to the Company's complying with the requirements of Section 12(c))
promptly pay to the Company the amount of such refund (together with
any interest paid or credited thereon after taxes applicable thereto).
If, after the receipt by Patterson of an amount advanced by the Company
pursuant to Section 12(c), a determination is made that Patterson is
not entitled to a refund with respect to such claim and the Company
does not notify Patterson in writing of its intent to contest such
denial of refund prior to the expiration of 30 days after such
determination, then such advance shall, to the extent of such denial,
be
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forgiven and shall not be required to be repaid and the amount of
forgiven advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.
13. Miscellaneous. (a) The existence of this Agreement shall not affect
in any way the right or power of the company to make or authorize any
adjustment, reclassification, reorganization or other change in its capital or
business structure, any merger or consolidation of the Company, any issue or
debt or equity securities having preferences or priorities as to the Common
Stock or the rights thereof, the dissolution or liquidation of the Company, any
sale or transfer of all or any part of its business or assets, or any other
corporate act or proceeding.
(b) This Agreement may only be amended or modified in writing
as agreed upon by all the parties hereto.
(c) All notices or other communications pursuant to this
Agreement shall be in writing and shall be deemed to have been duly
given, if by hand delivery, upon receipt thereof, or if mailed by
certified or registered mail, postage prepaid, three days following
deposit in the United States mail, and in any event, to be addressed to
all of the parties as follows:
to the Company, at
One Mississippi Plaza
Tupelo, Mississippi 38801
to Patterson, at
One Overdale Drive
Tupelo, Mississippi 38801
or to such other address as shall hereafter be provided by proper notice to the
other parties.
(d) The captions and headings herein are for convenience of
reference only and shall not be deemed to be a part of the substance of
this Agreement.
(e) This Agreement shall be construed and interpreted
according to the laws of the State of Mississippi.
(f) The foregoing contains the entire and only agreement
between the parties respecting the subject matter hereof, and any
representation, promise or condition in connection therewith not
incorporated herein shall not be binding upon either party.
(g) The foregoing agreement shall be binding upon the parties
hereto and there respective heirs, successors and assigns.
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IN WITNESS WHEREOF, the parties have executed this Agreement
the day and year first above written.
BANCORPSOUTH, INC.
By:
----------------------------------------
Its:
---------------------------------------
-------------------------------------------
AUBREY B. PATTERSON
STOCK BONUS
ESCROW AGREEMENT
THIS AGREEMENT is entered into as of this 30th day of January, 1998,
among Aubrey B. Patterson, a resident of Tupelo, Mississippi ("Patterson"),
BancorpSouth, Inc. (the "Company") and BancorpSouth Bank as escrow agent
("Escrow Agent").
WHEREAS, the Company has granted to Patterson 35,000 shares of the
Company's Common Stock, $2.50 par value, ("Common Stock") which are subject to
certain restrictions and risks of forfeiture that are described in the Stock
Bonus Agreement, dated January 30, 1998, between Patterson and the Company (the
"Stock Agreement");
WHEREAS, pursuant to the Stock Agreement, the Company and Patterson
have agreed that the shares of Common Stock granted thereunder shall be held in
escrow until such restrictions and risks of forfeiture have lapsed, at which
time the shares are to be released to Patterson; and
WHEREAS, the Company is the sole shareholder of the Escrow Agent, and
Escrow Agent is willing to hold the shares of Common Stock described in the
Stock Agreement pending their release to Patterson or forfeiture to the Company;
NOW, THEREFORE, in consideration of the premises set forth herein and
other mutual agreements and good and valuable consideration hereinafter set
forth, the parties hereby agree as follows:
1. Transfer of Stock to Escrow Agent. Upon the issuance of the Common
Stock under the Stock Agreement, the Company shall issue ten stock certificates
to the Escrow Agent, each for 3,500 shares of the Common Stock, registered in
the name of Aubrey B. Patterson. Certificates issued upon the execution of the
Stock Agreement are referred to herein as "Certificates." Each Certificate will
bear a legend substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS OF AN ESCROW AGREEMENT, DATED APRIL 1, 1998, AMONG
AUBREY B. PATTERSON, BANCORPSOUTH, INC. AND BANCORPSOUTH BANK,
AS ESCROW AGENT, AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN
COMPLIANCE WITH SUCH AGREEMENT. A COPY OF THE ESCROW AGREEMENT
IS AVAILABLE AT THE PRINCIPAL OFFICES OF BANCORPSOUTH, INC.
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Upon issuance Patterson will, or will cause the Company to, deposit the
Certificates with the Escrow Agent, together with one stock power for each
Certificate, duly executed in blank, to be held by the Escrow Agent in
accordance with the terms of this Agreement.
2. Release of Shares From Escrow. The Escrow Agent will hold the
Certificates until they are released. A Certificate, and the attendant stock
power, shall be released to Patterson upon April 1, 1998 and upon each
succeeding April 1 while he is employed by the Company, until all Certificates
have been released to Patterson or forfeited to the Company pursuant to the
terms of the Stock Agreement.
(a) Notwithstanding the foregoing, upon receipt, prior to April l
of any year, of a certificate signed by the majority of the
Company's Board of Directors or the Company's Secretary
certifying that according to the Company's annual report for
the Company's year ending on the preceding December 31, the
Company's Return on Average Assets was less than .9% or its
Return on Average Equity was less than 12.825%, the Escrow
Agent will retain the Certificate that was to be delivered to
Patterson on April 1 of the year that follows such December
31, and shall hold such Certificate until it is forfeited or
becomes vested under the terms of the Stock Agreement.
(b) On April 1, 2007, the Escrow Agent shall deliver to Patterson
all Certificates in its possession, together with the
accompanying stock powers, that have not been forfeited
pursuant to the terms of the Stock Agreement.
(c) Upon delivery of the Certificates to Patterson, they will bear
appropriate state and federal securities legends as directed
by the Company and appropriate stop transfer instructions will
be noted in the stock records of the Company.
3. Effect of Termination of Employment. Notwithstanding the provisions
of Section 2 hereof, the Escrow Agent shall deliver all certificates held to
Patterson or the Company in the event of Patterson's termination of employment
prior to the expiration of this Agreement, in accordance with the following:
(a) Upon receipt of a certificate signed by the majority of the
Company's Board of Directors (excluding Patterson) and the
Company's Secretary certifying that Patterson's employment
with the Company and/or the Bank has been terminated in
accordance with the provisions of Section 6(a)(i) of the Stock
Agreement, or if Patterson voluntarily terminates his
employment with the Company and/or the Bank and the provisions
of Section 6(b) do not apply, the Escrow Agent will complete
the stock powers relating to all Certificates held by it and
deliver such Certificates, together with the accompanying
stock powers, to the Company.
(b) If Patterson's employment with the Company and/or the Bank has
been terminated in accordance with the provisions of Section
6(a)(ii) or 6(b) of the Stock Agreement, the Escrow Agent will
deliver to Patterson all Certificates held by it with the
accompanying stock powers.
4. Shareholder Rights. During the period that the Escrow Agent holds
any of the Certificates, Patterson shall be entitled to notice of all meetings,
annual or special, of stockholders of the Company at which stockholders have the
right to vote and Patterson shall be entitled to vote all shares represented by
such Certificates held by the Escrow Agent at any such meeting upon any matter
upon which stockholders of the Company have the right to vote. Patterson shall
not be entitled to any of the other attributes of ownership of the shares
subject to escrow, nor shall he have the right to pledge, hypothecate or
otherwise encumber such shares; provided, however, that Patterson shall be
entitled to receive cash dividends paid with respect to any shares held in
escrow. In the event the Company increases or decreases the number of shares of
Common Stock outstanding by means of a stock split, stock dividend or
recapitalization, certificates representing any additional shares which
Patterson would be entitled to receive as the record holder of any shares of
Common Stock subject to escrow shall automatically be delivered by the Company
to the Escrow Agent and such shares shall be subject to the terms of this
Agreement as if they were part of the Certificates in respect of which they were
received.
5. Rights and Obligations of Escrow Agent.
(a) The Escrow Agent shall not be liable to any person for any act
by it except for gross negligence or willful misconduct by the
Escrow Agent. Each of Patterson and the Company, severally,
agrees to indemnify and hold
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harmless the Escrow Agent for all liabilities of the Escrow
Agent arising from the doing of any act or the failure to do
any act except if such conduct constituted gross negligence or
willful misconduct by the Escrow Agent.
(b) The Escrow Agent shall be obligated only for the performance
of such duties as are specifically set forth herein and may
rely and shall be protected in relying or refraining from
acting on any instrument reasonably believed by it to be
genuine and to have been signed or presented by the proper
party or parties. Except as set forth in Section 5(a), the
Escrow Agent shall not be personally liable for any act it may
do or omit to do hereunder as Escrow Agent while acting in
good faith and in the exercise of its own good judgment, and
any act done or omitted by it pursuant to the advice of its
own attorneys shall be conclusive evidence of such good faith.
(c) In case the Escrow Agent obeys or complies with any order,
judgment or decree of any court, it shall not be liable to any
of the parties hereto or to any other person, firm or
corporation by reason of such compliance, notwithstanding any
such order, judgment or decree being subsequently reversed,
modified, annulled, set aside, vacated or found to have been
entered without jurisdiction.
(d) The Escrow Agent shall be entitled to employ such legal
counsel and other experts as it may deem-necessary properly to
advise it in connection with its obligations hereunder. The
Escrow Agent may rely upon the advice of such counsel, and may
pay such counsel reasonable compensation therefor.
(e) The Company agrees to reimburse Escrow Agent for all expenses
incurred by it in the performance of its services under this
Agreement. The Escrow Agent agrees to maintain adequate
records and in such form and detail to support any claim for
reimbursement hereunder and to furnish such records or copies
to the Company as it may request.
6. Right to Information. If the Escrow Agent reasonably requires other
or further instruments in connection with this Agreement or its obligations in
respect hereto, Patterson, and the Company each agree that he or it shall
furnish such instruments.
7. Retainment of Shares. Disputes. It is understood and agreed that
should any dispute arise with respect to the delivery and/or ownership or right
of possession of the securities held by the Escrow Agent hereunder, the Escrow
Agent is authorized and directed to retain in its possession without liability
to anyone all or any part of said securities until such dispute shall have been
settled either by mutual written agreement of the parties concerned or by a
final order, decree or judgment of a court of competent jurisdiction after the
time for appeal has expired and no appeal has been perfected, but the Escrow
Agent shall be under no duty whatsoever to institute or defend any such
proceedings, whether by interpleader or otherwise.
8. Miscellaneous.
(a) This Agreement may only be amended or modified in writing
executed by the parties hereto.
(b) All notices or other communications pursuant to this Agreement
shall be in writing and shall be deemed to have been duly
given, if by hand delivery, upon receipt thereof, or if mailed
by certified or registered mail, postage prepaid, three days
following deposit in the United States mail, and in any event,
to be addressed to:
the Company, at
One Mississippi Plaza
Tupelo, Mississippi 38801
Patterson, at
One Overdale Drive
Tupelo, Mississippi 38801
Escrow Agent, at
One Mississippi Plaza
Tupelo, Mississippi 38801
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or to such other address as shall hereafter be provided by
proper notice to the other parties.
(c) This Agreement shall be construed and interpreted according to
the internal laws of the State of Mississippi.
(d) The foregoing, in conjunction with the Stock Agreement,
contains the entire and only agreement between the parties
respecting the subject matter hereof, and any representation,
promise or condition in connection therewith not incorporated
herein or therein shall not be binding upon either party.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
BANCORPSOUTH, INC.
By:
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Aubrey B. Patterson
Its:
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BANCORPSOUTH BANK
By:
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Its:
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