Exhibit 10.2

 

EXECUTION COPY

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT (this “Agreement”) is made and entered into effective as of
January 1, 2013 (the “Effective Date”), between TCF FINANCIAL CORPORATION, a
Delaware corporation (the “Company”) and CRAIG R. DAHL (“Executive”).

 

RECITALS:

 

WHEREAS, the Company is a bank holding company and Executive is now and has been
a senior executive of the Company; and

 

WHEREAS, Executive has been elected to the position set forth on Schedule 1
attached hereto;

 

WHEREAS, Executive and the Company wish to enter into this Agreement effective
as of the Effective Date;

 

NOW, THEREFORE, in consideration of the mutual promises and agreements set forth
herein, the parties agree as follows:

 

1.         Employment and Duties. During the term of this Agreement as set forth
in paragraph 2 below, Executive shall be employed in the position set forth on
Schedule 1, with the duties and responsibilities as set forth on Schedule 1, or
such other position(s) at an equivalent or higher level as determined by the
Company’s Board of Directors. In discharging such duties and responsibilities,
Executive may also serve as an executive officer and/or director of any direct
or indirect subsidiary of the Company (collectively, the “TCF Subsidiaries”).
Executive shall report directly to the Company’s Chief Executive Officer (CEO).
During the term of this Agreement, Executive shall apply on a full-time basis
(allowing for usual vacations and sick leave) all of his skill and experience to
the performance of his duties in his positions with the Company and the TCF
Subsidiaries. It is understood that Executive may have other business
investments and participate in other business, charitable, non-profit, or civic
ventures which shall not interfere or be inconsistent with his duties under this
Agreement. Executive shall perform his duties at the Company’s principal
executive offices in Wayzata, Minnesota or at such other location as may be
mutually agreed upon by Executive and the Company; provided that Executive shall
travel to other locations at such times as may be necessary for the performance
of his duties under this Agreement.

 

2.         Term of Employment. This Agreement shall commence on the Effective
Date and shall continue through December 31, 2015.

 

3.         Compensation and Benefits. During the term of this Agreement,
Executive shall be entitled to the following compensation and benefits:

 

(a)        Base Salary, Bonus. Executive shall receive:

 

(i)         Effective January 1, 2013, a base salary of Five Hundred Fifty
Thousand Dollars ($550,000.00) or such other greater amount as the Board of
Directors of the

 

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Company may from time to time determine (the “Annual Base Salary”), payable in
accordance with the Company’s customary payroll practices; and

 

(ii)        Such bonus as may be awarded from time to time by the Board of
Directors or Compensation Committee of the Company.

 

(b)        Stock Incentives. Executive shall be eligible to receive such awards
(the “Equity Awards”), if any, of stock options, restricted stock and stock
appreciation rights as would be made under any stock based plan from time to
time adopted by the Company (the “Stock Plans”) as from time to time determined
by the Board of Directors or Compensation Committee of the Company.

 

(c)        Reimbursement of Expenses. The Company shall reimburse Executive for
all business expenses properly documented, including without limitation,
Executive’s legal fees incurred in the preparation of this Agreement. Any such
payments shall be made no later than 2 ½ months after the end of the calendar
year in which the expense was incurred.

 

(d)       Other Benefits. Executive shall be entitled to participate in and
shall be included in any employee benefit plan, pension plan, supplemental
employee retirement plan, fringe benefit programs or similar plan of the Company
now existing or established hereafter to the extent that he is eligible under
the general provisions thereof.

 

(e)        Perquisites. Executive shall be entitled to other perquisites
provided to executive officers, subject to annual review by the Compensation
Committee of the Board of Directors. Payment of perquisites, if any, shall be
made no later than 2½ months after the end of the calendar year in which
Executive was entitled to such payments.

 

(f)        Return of Compensation under Section 304 of the Sarbanes-Oxley Act.
Notwithstanding anything in this Agreement to the contrary, in the event of a
restatement of financial results by the Company, the Audit Committee of the
Board of Directors shall determine (after reasonable notice to Executive and an
opportunity for Executive, together with his legal counsel, to be heard before
the Audit Committee) whether or not repayment of any compensation is required
under Section 304 of the Sarbanes-Oxley Act. If the Audit Committee determines
that such repayment is required, the Committee shall make a demand for repayment
by Executive of any bonus or other incentive-based or equity-based compensation,
and any profits realized from the sale of TCF stock or other TCF securities,
which are required to be returned to the Company as a result of Section 304 of
the Sarbanes-Oxley Act. Executive shall promptly tender such repayment unless he
disputes the findings of the Audit Committee.

 

4.         Termination of Employment.

 

(a)        Termination without Cause. The Company may terminate Executive’s
employment without Cause at any time and for any lawful reason upon thirty (30)
days advance written notice to Executive. In the event Executive’s employment
with the Company is terminated by the Company without Cause during the term of
this Agreement prior to a Change of Control and subject to Executive having
executed and delivered to the Company a general release in the Company’s
customary form, Executive shall be entitled to a lump sum amount equal to two
times Base Salary (as set forth in paragraph 3) payable within thirty (30) days
after the date of termination. In the event Executive’s employment with the
Company is terminated by the

 

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Company without Cause during the term of this Agreement upon or after a Change
of Control and subject to Executive having executed and delivered to the Company
a general release in the Company’s customary form, Executive shall be entitled
to a lump sum amount equal to two times Annual Base Salary (as set forth in
paragraph 3) plus two times the annual bonus (which annual bonus is assumed to
be equal to the Annual Base Salary) payable within thirty (30) days after the
date of termination. In addition to the above payments, in the event of a
termination of the Executive’s employment by the Company without Cause whether
before, upon or after a Change of Control and such termination occurs after the
end of the Company’s fiscal year but prior to the payment of any annual bonus
payable to Executive under the bonus program applicable to such fiscal year, the
Company shall pay Executive the annual bonus earned by Executive under such
bonus program when bonuses are paid to other recipients under such bonus
program, but not later than 2½ months after the end of the calendar year in
which the termination occurs. If Executive timely elects to continue Executive’s
group health and dental insurance coverage pursuant to applicable
COBRA/continuation law and the terms of the respective benefit plans, the
Company shall pay, on Executive’s behalf, the monthly premiums for such coverage
for the lesser of twelve (12) months or such time as Executive’s
COBRA/continuation rights expire.

 

(b)        Termination for Good Reason by Executive. By following the procedure
set forth in paragraph 4(d), Executive shall have the right to terminate his
employment with the Company for “Good Reason” in the event there is: (i) any
material diminution in the scope of Executive’s authority and responsibility,
including, without limitation, as a result of a reallocation of Executive’s job
duties, (provided, however, in the event of any illness or injury which disables
Executive from performing his duties, the Company may reassign Executive’s
duties to one or more other employees until Executive is able to perform such
duties); (ii) a material diminution in Executive’s base compensation (salary,
bonus opportunity, benefits or perquisites); (iii) a material change in
geographic location at which Executive must perform the services; (iv) Executive
is required to report to a supervisor other than the Company’s CEO; or (v) any
other action or inaction that constitutes a material breach by the Company of
this Agreement. If the employment of Executive is terminated by him for Good
Reason prior to a Change of Control and subject to Executive having executed and
delivered to the Company a general release in the Company’s customary form,
Executive shall be entitled to a lump sum amount equal to two times Base Salary
(as set forth in paragraph 3) payable within thirty (30) days after the date of
termination. If the employment of Executive is terminated by him for Good Reason
upon or after a Change of Control and subject to Executive having executed and
delivered to the Company a general release in the Company’s customary form,
Executive shall be entitled to a lump sum amount equal to two times Annual Base
Salary (as set forth in paragraph 3) plus two times the annual bonus (which
annual bonus is assumed to be equal to the Annual Base Salary) payable within
thirty (30) days after the date of termination. In addition to the above
payments, in the event of a termination of the Executive’s employment by
Executive for Good Reason whether before, upon or after a Change of Control and
such termination occurs after the end of the Company’s fiscal year but prior to
the payment of any annual bonus payable to Executive under the bonus program
applicable to such fiscal year, the Company shall pay Executive the annual bonus
earned by Executive under such bonus program when bonuses are paid to other
recipients under such bonus program, but not later than 2½ months after the end
of the calendar year in which the termination occurs. If Executive timely elects
to continue Executive’s group health and dental insurance coverage pursuant to
applicable COBRA/continuation law and the terms of the respective benefit plans,
the Company

 

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shall pay, on Executive’s behalf, the monthly premiums for such coverage for the
lesser of twelve (12) months or such time as Executive’s COBRA/continuation
rights expire.

 

(c)        Termination for Cause by the Company. Termination for “Cause” shall
include the following: (i) engaging in willful and recurring misconduct in not
following the legitimate and legal directions of the Board of Directors of the
Company after fair and specific written warning; (ii) conviction of a felony and
all appeals from such conviction have been exhausted; (iii) engaging in habitual
drunkenness after fair written warning; (iv) excessive absence from work which
absence is not related to disability, illness, sick leave or vacations after
fair written warning; or (v) engaging in continuous conflicts of interest
between his personal interests and the interests of the Company after fair
written warning.

 

(d)       Notice and Right to Cure. In the event Executive proposes to terminate
his employment for Good Reason under paragraph (4)(b) above, Executive shall
first provide written notice to the Company of the existence of the condition
described as Good Reason in paragraph 4(b) above not more than 90 days after
Executive’s actual knowledge of the initial existence of the condition. The
Company will have an opportunity to correct any curable situation to the
reasonable satisfaction of Executive within the period of time specified in the
notice which shall not be less than thirty (30) days. If such correction is not
so made or the circumstances or situation is such that it is not curable,
Executive may, within thirty (30) days after the expiration of the time so fixed
within which to correct such situation (but not more than two years after the
initial existence of the Good Reason), give written notice to the Company that
his employment is terminated for Good Reason effective forthwith.

 

(e)        Definition of Change of Control. For the purposes of this Agreement a
“Change of Control” shall be deemed to have occurred if

 

(i)         any “person” as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”) is or becomes the
“beneficial owner” as defined in Rule 13d-3 under the Exchange Act, directly or
indirectly, of securities of the Company representing thirty percent (30%) or
more of the combined voting power of the Company’s then outstanding securities.
For purposes of this clause (a), the term “beneficial owner” does not include
any employee benefit plan maintained by the Company that invests in the
Company’s voting securities; or

 

(ii)        during any period of two (2) consecutive years there shall cease to
be a majority of the Board comprised as follows: individuals who at the
beginning of such period constitute the Board or new directors whose nomination
for election by the Company’s stockholders was approved by a vote of at least
two-thirds (2/3) 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; or

 

(iii)       the stockholders of the Company approve a merger or consolidation of
the Company with any other corporation, other than a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) at least 70% of the combined voting power of the voting

 

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securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of the company approve a plan
of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets;
provided, however, that no change in control will be deemed to have occurred if
such merger, consolidation, sale or disposition of assets, or liquidation is not
subsequently consummated.

 

5.         Covenant Not to Compete; Non-Solicitation Covenants.

 

(a)        Covenant Not to Compete during Employment. During Executive’s
employment under this Agreement, Executive agrees that he will not directly or
indirectly substantially compete with the Company, TCF National Bank or their
subsidiaries, including but not limited to TCF Inventory Finance, Inc., Winthrop
Resources, Inc. TCF Equipment Finance, Inc., and Gateway One Lending & Finance,
LLC, (the “TCF Companies”) in the Relevant Market. The “Relevant Market” is the
States within the United States and the Provinces in Canada where any of the TCF
Companies are doing business or have done business during Executive’s employment
under this Agreement.

 

(b)        Non-Solicitation Covenants. During Executive’s employment under this
Agreement and (i) for one (1) year following a termination of Executive without
Cause by the Company or a termination by Executive for Good Reason if no Change
of Control has occurred at the time of such termination or (ii) for two
(2) years following a termination of Executive without Cause by the Company or a
termination by Executive for Good Reason if a Change in Control occurs prior to
or upon such termination, Executive agrees that, except with the prior written
permission of the Board of Directors of the Company, he will not: (x) offer to
hire, entice away, or in any manner attempt to persuade any officer, employee,
or agent of any of the TCF Companies to discontinue his or her relationship with
any of the TCF Companies, and (y) directly or indirectly solicit, divert, take
away or attempt to solicit any business of any of the TCF Companies as to which
Executive has acquired any knowledge during the term of his employment with any
of the TCF Companies.

 

(c)        Remedies. If Executive commits a breach, or threatens to commit a
breach, of any of the provisions of this paragraph 5, the Company shall have the
right of specific performance in addition to any rights and remedies otherwise
available at law or in equity.

 

6.         Section 280G.

 

(a)        Certain Payment Reductions. Anything to the contrary notwithstanding,
the amount of any payment, distribution or benefit made or provided by the
Company to or for the benefit of Executive in connection with a change in
control of the Company or the termination of Executive’s employment with the
Company, whether payable pursuant to this Agreement or any other agreement
between Executive and the Company or with any person constituting a member of an
“affiliated group” (as defined in Section 280G(d)(5) of the Internal Revenue
Code of 1986, as amended (the “Code”)) with the Company or with any person whose
actions result in a change of control of the Company (such foregoing payments or
benefits referred to collectively as the “Total Payments”), shall be reduced
(but not below zero) by the amount, if any, necessary to prevent any part of the
Total Payments from being treated as an “excess parachute payment” within the

 

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meaning of Section 280G(b)(l) of the Code, but only if and to the extent such
reduction will also result in, after taking into account all applicable state
and federal taxes (computed at the highest marginal rate) including Executive’s
share of F.I.C.A. and Medicare taxes and any taxes payable pursuant to
Section 4999 of the Code, a greater after-tax benefit to Executive than the
after-tax benefit to Executive of the Total Payments computed without regard to
any such-reduction. For purposes of the foregoing, (i) no portion of the Total
Payments shall be taken into account which in the opinion of tax counsel
selected by the Company and acceptable to Executive does not constitute a
“parachute payment” within the meaning of section 280G(b)(2) of the Code;
(ii) any reduction in payments shall be computed by taking into account that
portion of Total Payments which constitute reasonable compensation within the
meaning of Section 280G(b)(4) of the Code in the opinion of such tax counsel;
(iii) the value of any non-cash benefit or of any deferred cash payment included
in the Total Payments shall be determined by. the Company in accordance with the
principles of Section 280G(d)(3)(iv) of the Code; and (iv) in the event of any
uncertainty as to whether a reduction in Total Payments to Executive is required
pursuant to this paragraph, the Company shall initially make the payment to
Executive and Executive shall be required to refund to the Company any amounts
ultimately determined not to have been payable under the terms of this paragraph
6.

 

(b)        Determination of Certain Payment Reductions. Executive will be
permitted to provide the Company with written notice specifying which of the
Total Payments will be subject to reduction or elimination (the “Reduction
Notice”). But, if Executive’s exercise of authority pursuant to the Reduction
Notice would cause any Total Payments to become subject to any taxes or
penalties pursuant to Section 409A of the Code or if Executive fails to timely
provide the Company with the Reduction Notice, then the Company will reduce or
eliminate the Total Payments in the following order:

 

(i)         first, by reducing or eliminating the portion of the Total Payments
that are payable in cash and

 

(ii)        second, by reducing or eliminating the non-cash portion of the Total
Payments,

 

in each case, in reverse chronological order beginning with payments or benefits
under the most recently dated agreement, arrangement or award.

 

Except as set forth in this paragraph 6(b), any Reduction Notice will take
precedence over the provisions of any other plan, arrangement or agreement
governing Executive’s rights and entitlements to any benefits or compensation.

 

7.         Section 409A of the Internal Revenue Code. The arrangements described
in this Agreement and the Equity Awards are intended to comply with Section 409A
of the Internal Revenue Code to the extent such arrangements are subject to that
law. Only to the extent the payments set forth in paragraphs 4(a) and 4(b) of
this Agreement are subject to Code Section 409A, and only to the further extent
Executive is a “specified employee” (within the meaning of Section 409A),
payments of Base Salary or annual bonus as provided in those paragraphs shall
not be made until the date which is six (6) months and one day after Executive
incurs a “separation of service” (within the meaning of Section 409A) and on
such pay date, the Company shall pay

 

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Executive all payments that otherwise would have been paid during such six-month
period but for Executive’s status as a “specified employee.” The parties agree
that they will negotiate in good faith regarding amendments necessary to bring
this Agreement into compliance with the terms of that Section or an exemption
therefrom as interpreted by guidance issued by the Internal Revenue Service. The
parties further agree that to the extent any part of this Agreement fails to
qualify for exemption from or satisfy the requirements of Section 409A, the
affected arrangement may be operated in compliance with Section 409A pending
amendment to the extent authorized by the Internal Revenue Service. In such
circumstances the Company will administer this Agreement in a manner which
adheres as closely as possible to the existing terms and intent of the Agreement
while complying with Section 409A. This paragraph does not restrict the
Company’s rights (including, without limitation, the right to amend or
terminate) with respect to this Agreement to the extent such rights are reserved
under the terms of this Agreement.

 

8.         Attorney’s Fees. In the event of a dispute between the Company and
Executive relating to Executive’s services hereunder or the terms or performance
of this Agreement, including, but not limited to, paragraphs 3(f) and 4(d) of
this Agreement, the Company shall promptly pay Executive’s reasonable expenses
of attorney’s fees and expenses in connection with such dispute upon delivery of
periodic billings for same, provided that (i) Executive shall promptly repay all
amounts paid under this paragraph 8 at the conclusion of such dispute if the
resolution thereof includes a finding that Executive did not act in good faith
in the matter in dispute or in the dispute proceeding itself, and (ii) no claim
for expenses of representation shall be submitted by Executive unless made in
writing to the Board of Directors within 90 days after receipt of billing for
such representation. Any such payment shall be made promptly, and in any event
no later than the end of the calendar year following the year in which the
expense was incurred.

 

9.         Other Benefits. The benefits provided under this Agreement shall,
except to the extent otherwise specifically provided herein, be in addition to,
and not in derogation or diminution of, any benefits that Executive or his
beneficiary may be entitled to receive under any other plan or program now or
hereafter maintained by the Company or TCF Subsidiaries.

 

10.       Successors. The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all of the business and/or assets of the Company, to expressly
assume and agree to perform its obligations under this Agreement in the same
manner and to the same extent that the Company would be required to perform them
if no succession had taken place unless, in the opinion of legal counsel
mutually acceptable to the Company and Executive, such obligations have been
assumed by the successor as a matter of law. Executive’s rights under this
Agreement shall inure to the benefit of and shall be enforceable by, Executive’s
legal representative or other successors in interest, but shall not otherwise be
assignable or transferable.

 

11.       Other Agreements. This Agreement supersedes and replaces as of the
Effective Date all prior agreements or understandings relating to the terms of
Executive’s service with the Company. This Agreement does not supersede or
replace any agreement between the Company and Executive pursuant to any plans or
programs of the Company, including any stock option agreement, restricted stock
agreement or supplemental retirement agreement.

 

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12.       Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement effective as
of the day and year first written above.

 

WITNESS:

TCF FINANCIAL CORPORATION

 

 

 

 

/s/ Pamela J. Gordley

/s/ William A. Cooper

 

By: William A. Cooper

 

Its: Chairman and Chief Executive Officer

 

 

 

 

WITNESS:

 

 

 

 

 

/s/ Joseph T. Green

/s/ Craig R. Dahl

 

Craig R. Dahl

 

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SCHEDULE 1

 

Position: Vice Chairman and Executive Vice President, Lending

 

Duties: Overall responsibility for (i) TCF’s Lending segment, including Retail
Lending, Commercial Real Estate and Business Lending, Leasing and Equipment
Finance, Inventory Finance, Auto Finance and (ii) any similar or complementary
businesses in which Company may engage, to the extent that Company engages in
such lines of business. Such duties shall include, without limitation, overall
responsibility for products, pricing, strategy and marketing related to the
Company’s Lending segment, as well as overall supervisory responsibilities for
employees in the Lending segment.

 

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