EXHIBIT 10.1

 

RETENTION AGREEMENT

 

THIS RETENTION AGREEMENT (this “Agreement”) is made and entered into as of
October 25, 2019, by and between Todd L. Salmans (the “Executive”) and Hilltop
Holdings Inc., a Maryland corporation (together with its affiliates and
subsidiaries, the “Company”).

 

WITNESSETH THAT:

 

The Company has determined that it is in its best interests to ensure that the
Company will have the continued dedication of the Executive following the
assumption of the Executive’s current role as Chief Executive Officer of
PrimeLending, a PlainsCapital Company (“Prime”) by Steve Thompson. Therefore, in
order to accomplish these objectives, the Executive and the Company desire to
enter into this Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth below, and for other good and valuable consideration, it is hereby
covenanted and agreed by the Executive and the Company as follows:

 

1.                   Effective Date. The “Effective Date” shall mean January 1,
2020.

 

2.                   Positions and Duties. Subject to the earlier termination of
the Executive’s employment, the Executive shall have the following duties:

 

a.                   As of the Effective Date, the Executive hereby resigns from
all positions with the Company, other than Chairman of the Board of Directors of
Prime.

 

b.                   Subject to the continued employment of the Executive by the
Company, and excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive agrees to devote his attention and time to
(W) assisting and advising the Chief Executive Officer of Prime with respect to
the transition of the Executive’s roles (X) advising the Chief Executive Officer
of Prime with respect to the business and strategies of Prime; (Y) attending
events hosted by Prime and (Z) remaining active in the mortgage industry.
Notwithstanding the foregoing provisions of this Section 2(b), the Executive may
(i) serve as a director, trustee or officer or otherwise participate in
not-for-profit educational, welfare, social, religious and civic organizations;
(ii) serve as a director of any for-profit business, with the prior consent of
the President of the Company (which consent shall not be unreasonably withheld);
and (iii) acquire passive investment interests in one or more entities, to the
extent that such other activities do not inhibit or interfere with the
performance of his duties under this Agreement or, to the knowledge of the
Executive, conflict in any material way with the business or policies of the
Company or any affiliate thereof. In the event that the Executive is serving as
a director of or otherwise participating in any not-for-profit entity that does
not inhibit or interfere with the performance of his current duties and does not
conflict in any material way with the business or policies of the Company, the
Executive may continue to conduct such activities. As used in this Agreement,
the term “affiliates” shall include any company controlled by, controlling or
under common control with the Company.

 

c.                   Prime shall provide the Executive with an office and an
administrative assistant at the headquarters of Prime while the Executive is
employed by the Company.

 

3.                   Compensation. Subject to the terms of this Agreement, the
Executive shall be compensated for his services on and after the Effective Date
as follows:

 

a.                   Base Salary. The Executive shall receive an annual base
salary of $500,000 (“Annual Base Salary”) and shall be payable in cash at the
times consistent with the Company’s general policies regarding compensation of
employees, but in all events no less frequently than monthly.

 

 

 

 

b.                   Bonus and Long-Term Awards. The Executive shall not be
eligible or entitled to participate in, or the payment or award of, any cash
bonus and long-term incentive awards on or after the Effective Date. The
Executive hereby acknowledges and agrees that he is not entitled to the payment
of any bonus and granting any long-term incentive awards as of the Effective
Date. Notwithstanding the immediately foregoing, (i) restricted stock unit
awards granted to the Executive prior to the Effective Date will continue to
vest in accordance with their respective terms until the Date of Termination
(“hereinafter defined”) and (ii) In consideration of, and subject to the
Executive’s compliance with, the covenants provided in Section 6 and in
consideration of the Executive executing the Release attached as Exhibit A
hereto on the Date of Termination (hereinafter defined), the Executive shall be
entitled to receive his annual incentive bonus in accordance with the program
adopted by the Compensation Committee of the Board of Directors of the Company
for the fiscal year ended December 31, 2019 , subject to the terms of said
annual incentive bonus program, and any such bonus shall be payable under this
Section 3.b.(ii) shall be paid on or before March 15, 2020.

 

c.                   Employee and Fringe Benefits. Subject to continued
employment, the Executive shall be eligible to participate in the employee
welfare plans and programs of the Company as in effect from time to time on the
same basis as such employee welfare plans are generally provided to employees of
the Company from time to time. The Executive hereby acknowledges and agrees that
he is not entitled to the payment of, or reimbursement for, any automobiles or
clubs.

 

d.                   Expense Reimbursement. While the Executive is employed by
the Company, the Company shall reimburse the Executive for all reasonable
expenses incurred by him in the performance of his duties in accordance with the
Company’s policies as in effect from time to time.

 

e.                   Special One-Time Payments. In consideration of, and subject
to the Executive’s compliance with, the covenants provided in Section 6 and in
consideration of the Executive executing the Release attached as Exhibit A
hereto on the Date of Termination, the Company shall pay the Executive the
following amounts: (i) $1,250,000, payable at January 31, 2020; and (ii) an
amount equal to the cost of COBRA for the Executive and his immediate family for
a period of twelve (12) months following the Date of Termination.

 

4.                   Termination of Employment.

 

a.                   Death. Upon the death of the Executive, the Executive’s
employment shall terminate automatically on the Date of Termination.

 

b.                   Termination. The Executive’s employment shall terminable by
the Company at any time for any reason or no reason whatsoever.

 

c.                   Resignation. The Executive shall be entitled to resign at
any time.

 

d.                   Date of Termination. “Date of Termination” means (i) if the
Executive’s employment is terminated by the Company other than for death, the
date of receipt of the notice of termination or any later date specified therein
within 30 days of such notice, (ii) if the Executive’s employment is terminated
by the Executive other than for death, the Date of Termination shall be the date
on which the Executive notifies the Company of such resignation, and (iii) if
the Executive’s employment is terminated by reason of death, the Date of
Termination shall be the date of death of the Executive.

 

e.                   Effect of Termination on Other Positions. If, on the Date
of Termination, the Executive is a member of the Board of Directors of Prime or
the board of directors of any of their affiliates, or holds any other position
with the Company or their respective affiliates, the Executive shall be deemed
to have resigned from all such positions as of the Date of Termination. The
Executive agrees to execute such documents and take such other actions as the
Company may request to reflect such resignation.

 

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5.                   Obligations the Company upon Termination of Employment.
Upon the Date of Termination, this Agreement shall terminate immediately (except
for such provisions of this Agreement that expressly survive termination hereof)
and the Executive shall only be entitled to receive:

 

a.                   The Executive’s Annual Base Salary through the Date of
Termination at the annual rate in effect at the time of the Date of Termination,
payable within ten (10) business days after the Date of Termination;

 

b.                   all earned and unpaid and/or vested, nonforfeitable amounts
owing at the Date of Termination under this Agreement or any compensation and
benefit plans, programs, and arrangements of the Company and its affiliates in
which the Executive theretofore participated, payable in accordance with the
terms and conditions of this Agreement or the plans, programs, and arrangements
(and agreements and documents thereunder) pursuant to which such compensation
and benefits were granted;

 

c.                   reimbursement for any unreimbursed business expenses
properly incurred by the Executive in accordance with the Company’s policy prior
to the Date of Termination (collectively, a through c immediately above shall be
the “Accrued Amounts”); and

 

d.                   Subject to the execution and non-revocation of the Release
attached as Exhibit A hereto by the Executive within thirty (30) days following
the Date of Termination, subject to the Executive’s continued compliance with
the terms of this Agreement and to the extent not already paid by the Company to
the Executive, the payment set forth in Sections 3.e.(i) and 3.e.(ii).

 

6.                   Restrictive Covenants.

 

a.                   Confidential Information. The Executive shall not at any
time, whether during his employment or following the termination of his
employment, for any reason whatsoever, directly or indirectly, disclose or
furnish to any entity, firm, corporation or person, except as otherwise required
by law, any confidential or proprietary information of the Company with respect
to any aspect of its operations, businesses or clients. “Confidential or
Proprietary Information” shall mean information generally unknown to the public
to which the Executive gains access by reason of the Executive’s employment by
or services to the Company and includes, but is not limited to, information
relating to all present or potential customers, business and marketing plans,
sales, trading and financial data and strategies, operational costs, and
employment benefits and compensation. For purposes of this Section 6, the
“Company” shall include its affiliates and each of its and their predecessor and
successor entities.

 

b.                   Return of Company Property. All records, files, memoranda,
reports, customer information, client lists, documents and equipment relating to
the business of the Company that the Executive prepares, possesses or comes into
contact with while he is an employee of the Company shall remain the sole
property of the Company. The Executive agrees that upon the termination of his
employment he shall (i) not remove physically, electronically or in any other
way any Confidential or Proprietary Information from premises owned, used or
leased by the Company, (ii) provide to the Company all documents, papers, files
or other material in his possession and under his control that are connected
with or derived from his services to the Company and (iii) retain no copies,
summaries or notes thereof. The Executive agrees that the Company owns all work
product, patents, copyrights and other material produced by the Executive during
the Executive’s employment with the Company.

 

c.                   Nonsolicitation. The Executive agrees that during his
employment with the Company and for the 18-month period beginning on the Date of
Termination (such period, the “Restricted Period”), he shall not (i) hire or
attempt to recruit or hire other employees, directly or by assisting others, nor
shall the Executive contact or communicate with any other employees of the
Company for the purpose of inducing other employees to terminate their
employment with the Company, or (ii) induce or attempt to induce any customer
(whether former or current), supplier, licensee or other business relation of
the Company to cease doing business with the Company, or in any way interfere
with the relationship between any such customer, supplier, licensee or business
relation, on the one hand, and the Company, on the other hand. For purposes
hereof, “other employees” shall refer to employees who are still, or were in the
past six (6) months, actively employed by or doing business with the Company at
the time of the attempted recruiting or hiring.

 

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d.                   Noncompetition. The Executive agrees that, during the
Restricted Period, he shall not engage or invest in, own, manage, operate,
finance, control, participate in the ownership, management, operation, financing
or control of, be employed by, associated with or in any manner connected with,
lend his name or any similar name to, lend his credit to or render services or
advice to any business that provides services of investment banking, retail
brokerage, wealth management, fixed income trading, consumer banking, commercial
banking, financial advisory services, mortgage banking, residential mortgage
brokerage, commercial mortgage brokerage, equipment leasing, personal property
leasing, personal insurance, commercial insurance, title insurance or other
financial services of any type whatsoever anywhere within the State of Texas;
provided, however, the Executive may purchase or otherwise acquire up to (but
not more than) one percent (1%) of any class of securities of any enterprise
(but without participating in the activities of such enterprise) if such
securities are listed on any national or regional securities exchange or have
been registered under Section 12(g) of the Securities Exchange Act of 1934, as
amended.

 

e.                   Non-Disparagement. The Executive agrees not to disclose,
communicate, or publish any disparaging or negative information, writings,
electronic communications, comments, opinions, facts, or remarks, of any kind or
nature whatsoever (collectively, “Disparaging Information”), about any of the
Company and its parents and subsidiaries, their respective employees, owners,
partners, directors, members, agents or contractors (collectively, the
“Applicable Parties”). The Executive acknowledges that in executing this
Agreement, he has knowingly, voluntarily and intelligently waived any free
speech, free association, free press, or First Amendment to the United States
(including, without limitation, any counterpart or similar provision or right
under the Texas Constitution) rights to disclose, communicate, or publish
Disparaging Information concerning or related to the Applicable Parties. The
Executive further acknowledges and agrees that any breach or violation of this
non-disparagement provision shall entitle the Company to seek injunctive relief
to prevent any future breaches of this provision and/or to sue the Executive
under the provisions of this Agreement for the immediate recovery of any damages
caused by such breach. Notwithstanding anything in this Agreement to the
contrary, nothing shall impair any party’s legally protected rights under the
whistleblower provisions of any applicable federal law or regulation, including
under Rule 21F of the Securities Exchange Act of 1934, as amended.

 

f.                    Equitable Remedies. In the event of a breach by the
Executive of his obligations under this Agreement, the Company and its
affiliates, in addition to being entitled to exercise all rights granted by law,
including recovery of damages, will be entitled to specific performance of its
rights under this Agreement. The Executive acknowledges that the Company and its
affiliates shall suffer irreparable harm in the event of a breach or prospective
breach of Section 6 .a, 6.b., 6.c., 6.d. or 6.e. of this Agreement and that
monetary damages would not be adequate relief. Accordingly, the Company shall be
entitled to seek injunctive relief in any federal or state court of competent
jurisdiction located in the State of Texas.

 

g.                   Tolling. If the Executive violates any of the restrictions
set forth in this Section 6, the Restricted Period shall be suspended and shall
not run in favor of the Executive from the time of the commencement of any
violation until the time the Executive cures the violation.

 

h.                   Reasonableness. The Executive hereby represents to the
Company that the Executive has read and understands, and agrees to be bound by,
the terms of this Section 6. The Executive acknowledges that the geographic
scope and duration of the covenants contained in this Section 6 are fair and
reasonable in light of (a) the nature and wide geographic scope of the
operations of the Company’s business; (b) the Executive’s level of control over
and contact with the business; and (v) the amount of compensation, trade secrets
and Confidential or Proprietary Information that the Executive is receiving in
connection with the Executive’s employment by the Company. It is the desire and
intent of the Parties that the provisions of this Section 6 be enforced to the
fullest extent permitted under applicable law, whether now or hereafter in
effect and therefore, to the extent permitted by applicable law, the Executive
and the Company hereby waive any provision of applicable law that would render
any provision of this Section 6 invalid or unenforceable.

 

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7.                   Successors. This Agreement is personal to the Executive
and, without the prior written consent of the Company, shall not be assignable
by the Executive. This Agreement and any rights and benefits hereunder shall
inure to the benefit of, and be enforceable by, the Executive’s legal
representatives, heirs or legatees. This Agreement and any rights and benefits
hereunder shall inure to the benefit of, and be binding upon, the Company and
its successors and assigns.

 

8.                   Arbitration. The Executive and the Company acknowledge and
agree that any claim or controversy arising out of or relating to this Agreement
or the breach of this Agreement, or any other dispute arising out of or relating
to the employment of the Executive by the Company, shall be settled by final and
binding arbitration in the City of Dallas, Texas, in accordance with the
Commercial Arbitration Rules of the American Arbitration Association in effect
on the date the claim or controversy arises. All claims or controversies subject
to arbitration shall be submitted to arbitration within six months from the date
the written notice of a request for arbitration is effective. All claims or
controversies shall be resolved by a panel of three arbitrators who are licensed
to practice law in the State of Texas and who are experienced in the arbitration
of labor and employment disputes. These arbitrators shall be selected in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association in effect at the time the claim or controversy arises. Either party
may request that the arbitration proceeding be stenographically recorded by a
Certified Shorthand Reporter. The arbitrators shall issue a written decision
with respect to all claims or controversies within thirty (30) days from the
date the claims or controversies are submitted to arbitration. The parties shall
be entitled to be represented by legal counsel at any arbitration proceeding.
The Executive and the Company acknowledge and agree that each party will bear
fifty percent (50%) of the cost of the arbitration proceeding. The parties shall
be responsible for paying their own attorneys’ fees, if any. The Company and the
Executive acknowledge and agree that the arbitration provisions in this Section
8 may be specifically enforced by either party hereto and submission to
arbitration proceedings compelled by any court of competent jurisdiction. The
Company and the Executive further acknowledge and agree that the decision of the
arbitrators may be specifically enforced by either party in any court of
competent jurisdiction. Notwithstanding the arbitration provisions set forth
above, the Executive and the Company acknowledge and agree that nothing in this
Agreement shall be construed to require the arbitration of any claim or
controversy arising under the restrictive covenants in Section 6 of this
Agreement. The restrictive covenants in Section 6 shall be enforceable by any
court of competent jurisdiction and shall not be subject to arbitration pursuant
to this Section 8. The Executive and the Company further acknowledge and agree
that nothing in this Agreement shall be construed to require arbitration of any
claim for workers’ compensation benefits (although any claims arising under Tex.
Labor Code § 450.001 shall be subject to arbitration) or unemployment
compensation.

 

9.                   Miscellaneous.

 

a.                   Amendment. This Agreement may not be amended or modified
otherwise than by a written agreement executed by all the parties hereto or
their respective successors and legal representatives.

 

b.                   Withholding. The Company may withhold from any amounts
payable under this Agreement such federal, state, local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.

 

c.                   Applicable Law. THE PROVISIONS OF THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF TEXAS, WITHOUT
REGARD TO THE CONFLICT-OF-LAW PROVISIONS OF ANY STATE.

 

d.                   Severability. The Company and the Executive agree that
should an arbitrator or court declare or determine that any provision of this
Agreement is illegal or invalid, the validity of the remaining parts, terms or
provisions of this Agreement will not be affected and any illegal or invalid
part, term, or provision, will not be deemed to be a part of this Agreement and
there shall be deemed substituted therefor such other provision as will most
nearly accomplish the intent of the parties to the extent permitted by the
applicable law.

 

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e.                   Waiver of Breach. No waiver by any party hereto of a breach
of any provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party of any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time. The failure of any party hereto to take any action by
reason of such breach will not deprive such party of the right to take action at
any time while such breach continues.

 

f.                    Notices. Notices and all other communications provided for
in this Agreement shall be in writing and shall be delivered personally or sent
by registered or certified mail, return receipt requested, postage prepaid, or
prepaid overnight courier to the parties at the addresses set forth below (or
such other addresses as shall be specified by the parties by like notice):

 

To the Company:

 

Hilltop Holdings Inc.

6565 Hillcrest Avenue, 6th Floor

Dallas, Texas 75205

Attention: Corey G. Prestidge

Facsimile: (214) 580-5722

 

  or to the Executive:

At the most recent address maintained by the Company in its personnel records. 

 

Each party, by written notice furnished to the other party, may modify the
applicable delivery address, except that notice of change of address shall be
effective only upon receipt. Such notices, demands, claims and other
communications shall be deemed given in the case of delivery by overnight
service with guaranteed next day delivery, the next day or the day designated
for delivery; or in the case of certified or registered U.S. mail, five days
after deposit in the U.S. mail; provided, however, that in no event shall any
such communications be deemed to be given later than the date they are actually
received.

 

g.                   Compliance with Procedures and Policies. The Executive
agrees that at all times during his employment by the Company that he shall
adhere to and be subject to the policies and procedures of the Company and that
may be in effect from time to time, including any claw-back policy in effect at
the Company that is applicable to similarly situated employees.

 

h.                   Section 409A.

 

i.                     General. In the event that it is reasonably determined by
the Company or the Executive that, as a result of Section 409A, any of the
payments that the Executive is entitled to under the terms of this Agreement or
any nonqualified deferred compensation plan (as defined under Section 409A) may
not be made at the time contemplated by the terms hereof or thereof, as the case
may be, without causing the Executive to be subject to an income tax penalty and
interest, the Company will make such payment (with interest thereon) on the
first day that would not result in the Executive incurring any tax liability
under Section 409A. In addition, other provisions of this Agreement or any other
plan notwithstanding, the Company shall have no right to accelerate any such
payment or to make any such payment as the result of an event if such payment
would, as a result, be subject to the tax imposed by Section 409A.

 

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ii.                     Delayed Payment. To the extent (a) any payments to which
the Executive becomes entitled under this Agreement, or any agreement or plan
referenced herein, in connection with the Executive’s termination of employment
with the Company constitute deferred compensation subject to Section 409A; (b)
the Executive is deemed at the Date of Termination to be a “specified employee”
under Section 409A; and (c) at the Date of Termination, the Company is publicly
traded (as defined in Section 409A), then such payments (other than any payments
permitted by Section 409A to be paid within six (6) months of the Date of
Termination) shall not be made until the earlier of (x) the first day of the
seventh (7th) month following the Date of Termination or (y) the date of the
Executive’s death following the Date of Termination. During any period that
payment or payments to the Executive are deferred pursuant to the foregoing, the
Executive shall be entitled to interest on the deferred payment or payments at a
per annum rate equal to Federal-Funds rate as published in The Wall Street
Journal on the Date of Termination. Upon the expiration of the applicable
deferral period, any payments that would have otherwise been made during that
period (whether in a single sum or in installments) in the absence of this
Section 9(h) (together with accrued interest thereon) shall be paid to the
Executive or the Executive 's beneficiary in one lump sum.

 

i.                    Survivorship. Upon the expiration or other termination of
this Agreement, the respective rights and obligations of the parties hereto
shall survive such expiration or other termination to the extent necessary to
carry out the intentions of the parties under this Agreement.

 

j.                    Entire Agreement. From and after the Effective Date, this
Agreement shall supersede any other employment, severance or change-of-control
agreement between the Executive and the Company with respect to the subject
matter hereof.

 

k.                   Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.

 

l.                    Class Waiver. The Executive hereby waives the right to
initiate a class, collective, or representative action (“Class Waiver”). Any
disputes concerning the validity of the Class Waiver will be decided by a court
of competent jurisdiction, not pursuant to Section 8. In the event a court
determines that the Class Waiver is unenforceable with respect to any claim, the
Class Waiver shall not apply to that claim, which may then only proceed in
court.

 

m.                 Protection of Trade Secrets. Nothing in this Agreement
diminishes or limits any protection granted by law to trade secrets or relieves
the Executive of any duty not to disclose, use, or misappropriate any
information that is a trade secret, for as long as such information remains a
trade secret.

 

n.                   Defend Trade Secrets Act (DTSA) Notice. Under the federal
Defend Trade Secrets Act of 2016, the Executive shall not be held criminally or
civilly liable under any federal or state trade secret law for the disclosure of
a trade secret that: (a) is made (i) in confidence to a federal, state, or local
government official, either directly or indirectly, or to an attorney; and (ii)
solely for the purpose of reporting or investigating a suspected violation of
law; (b) is made to the Executive’s attorney in relation to a lawsuit for
retaliation against the Executive for reporting a suspected violation of law; or
(c) is made in a complaint or other document filed in a lawsuit or other
proceeding, if such filing is made under seal.

 

o.                   Reports to Government Agencies. The Executive understands
that nothing in this Agreement or any other policy or agreement with the Company
is intended to or shall prohibit the Executive from reporting possible
violations of law or regulation or providing documents to any governmental
agency or entity, including, but not limited to, the Department of Justice, the
Securities and Exchange Commission, the Congress or any Inspector General, or
making other disclosures that are protected under the whistleblower provisions
of federal law or regulation. The Executive further understands that the
Executive is not required to obtain the prior authorization of the Company or
any other person to make any such reports or disclosures, and that the Executive
is not required to notify the Company or any other person that such reports or
disclosures have been made.

 

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IN WITNESS THEREOF, the Executive has hereunto set his hand, and the Company has
caused these presents to be executed in its name and on its behalf, all as of
the day and year first above written.

 

  EXECUTIVE           /s/ TODD L. SALMANS   Todd L. Salmans           HILLTOP
HOLDINGS INC.           By: /s/ JEREMY B. FORD     Name:   Jeremy B. Ford  
Title: President & Co-CEO

 

SALMANS RETETION AGREEMENT SIGNATURE PAGE

 

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Exhibit A

 

RELEASE

 

This Release (this “Release”) is made and entered into as of _____, 20___,
between Hilltop Holdings Inc. and any of its parents, predecessors, successors,
subsidiaries, affiliates or related companies, organizations, managers,
officers, directors, executives, agents, plan fiduciaries, shareholders,
attorneys and/or representatives (hereinafter referred to collectively as the
“Company”) and Todd L. Salmans (“Executive”).

 

WHEREAS, the Company and Executive are parties to the certain Retention
Agreement, dated as of _______________, 2019 (the “Retention Agreement”);

 

WHEREAS, Executive is terminated from all positions with the Company effective
_____, 20__ (the “Separation Date”) and such termination shall constitute a
“separation of service” within the meaning of Section 409A of the Internal
Revenue Code of 1986, as amended (“Section 409A”), and it is the intent of the
parties that the Retention Agreement terminate upon the Separation Date, except
as otherwise provided herein, including, without limitation Section 4 of this
Release; and

 

WHEREAS, the Parties desire to finally, fully and completely resolve all
disputes that now or may exist against the Company, including, but not limited
to those concerning Executive’s employment, the separation of employment with
the Company, and all disputes over benefits and compensation connected with such
employment.

 

NOW, THEREFORE, in consideration of the premises and mutual covenants and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and
Executive agree as follows:

 

1.                   Release and Waiver.

 

a.                   Release by Executive. In consideration of the payments set
forth in the Retention Agreement, and such other consideration, that being good
and valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged by Executive, Executive, on his own behalf and on behalf of
his agents, administrators, representatives, executors, successors, heirs,
devisees and assigns (collectively, the “Releasing Parties”) hereby finally,
unconditionally, irrevocably and absolutely fully releases, remises, acquits and
forever discharges the Company and all of its affiliates, and each of their
respective officers, directors, shareholders, equity holders, members, partners,
managers, agents, employees, consultants, independent contractors, attorneys,
advisers, fiduciaries, plan administrators, successors and assigns
(collectively, the “Released Parties”), jointly and severally, from any and all
claims, rights, demands, debts, obligations, losses, liens, agreements,
contracts, covenants, actions, causes of action, suits, services, judgments,
orders, counterclaims, controversies, setoffs, affirmative defenses, third party
actions, damages, penalties, costs, expenses, attorneys’ fees, liabilities and
indemnities of any kind or nature whatsoever, direct or indirect (collectively,
the “Claims”), whether asserted, unasserted, absolute, fixed or contingent,
known or unknown, suspected or unsuspected, accrued or unaccrued or otherwise,
whether at law, in equity, administrative, statutory or otherwise, in any forum,
venue or jurisdiction, whether federal, state, local, administrative, regulatory
or otherwise, and whether for injunctive relief, back pay, fringe benefits,
reinstatement, reemployment, or compensatory, punitive or any other kind of
damages, which any of the Releasing Parties ever have had in the past or
presently have against the Released Parties, and each of them, arising from or
relating to Executive s employment with the Company, or the termination of that
employment or any circumstances related thereto, or any other matter, cause or
thing whatsoever, including, without limitation, all claims arising under or
relating to employment, employment contracts, stock options, stock option
agreements, restricted stock, restricted stock agreements, restricted stock
units, restricted stock unit agreements, equity interests, deferred
compensation, employee benefits or purported employment discrimination or
violations of civil rights of whatever kind or nature, including, without
limitation, all claims arising under the Age Discrimination in Employment Act
(“ADEA”), the Employment Non-Discrimination Act (“ENDA”), the Lilly Ledbetter
Fair Pay Act, the Americans with Disabilities Act of 1990, the Family and
Medical Leave Act of 1993, the Equal Pay Act of 1963, the Rehabilitation Act of
1973, Title VII of the United States Civil Rights Act of 1964, 42 U.S.C. § 1981,
the Civil Rights Act of 1991, the Civil Rights Acts of 1866 and/or 1871, the
Genetic Information and Nondiscrimination Act (“GINA”), the Employee Retirement
Income Security Act of 1974; the Immigration Reform and Control Act; the Older
Worker Benefit Protection Act; the Workers Adjustment and Retraining
Notification Act; the Occupational Safety and Health Act; the Employee Polygraph
Protection Act, the Uniformed Services Employment and Re-Employment Act; the
National Labor Relations Act; the Labor Management Relations Act; the
Sarbanes-Oxley Act of 2002; the Texas Labor Code, the Texas Payday Law, the
Texas Commission on Human Rights Act or Chapter 21; or any other applicable
foreign, federal, state or local employment discrimination statute, law or
ordinance, including, without limitation, any workers’ compensation, disability,
whistleblower protection or anti-retaliation claims under any such laws, claims
for wrongful discharge, breach of contract, breach of express or implied
contract or implied covenant of good faith and fair dealing, and any other
claims arising under foreign, state, federal or common law, as well as any
expenses, costs or attorneys’ fees. Executive further agrees that Executive will
not file or permit to be filed on Executive’s behalf any such claim.
Notwithstanding the preceding sentence or any other provision of this Release,
this release is not intended to interfere with Executive’s right (i) to file a
charge with the Equal Employment Opportunity Commission (the “EEOC”) or any
state human rights commission in connection with any claim he believes he may
have against the Company, (ii) to participate in an investigative proceeding of
any federal, state, or local governmental agency, or (iii) to report possible
violations of law or regulations to any governmental agency or entity, including
disclosures that are protected under the whistleblower provisions of federal law
or regulation. However, by executing this Release, Executive hereby waives the
right to recover in any proceeding Executive may bring before the EEOC or any
state human rights commission or in any proceeding brought by the EEOC or any
state human rights commission on Executive’s behalf. Executive also agrees to
waive any right or ability to be a class or collective action representative or
to otherwise recover damages in any putative or certified class, collective, or
multi-party action or proceeding relating to Claims released in this Release
and/or against any Released Parties.

 

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b.                   Except as required by law and as provided for in Section
1(a), Executive agrees that Executive will not commence, maintain, initiate or
prosecute, or cause, encourage, assist, volunteer, advise or cooperate with any
other person or entity to commence, maintain, initiate or prosecute, any action,
lawsuit, proceeding, charge, petition, complaint or Claims before any court,
agency or tribunal against the Released Parties arising from, concerned with or
otherwise related to, in whole or in part, Executive’s employment with the
Released Parties or any of the matters discharged and released in this Release. 
Executive represents and agrees that, prior to signing this Release, he has not
filed, assigned or pursued any complaints, charges or lawsuits of any kind with
any court, governmental or administrative agency, or arbitral forum against the
Company, or any other person or entity released under this Section 1, asserting
any claims whatsoever.  Executive understands and acknowledges that, in the
event he commences any proceeding in violation of this Release, he waives and is
estopped from receiving any monetary award or other legal or equitable relief in
such proceeding.

 

c.                   Executive represents and warrants that Executive is not
aware of any (i) violations, allegations or claims that the Company has violated
any federal, state or foreign law of any kind, or (ii) any facts or
circumstances relating to or giving rise to any alleged violations, allegations
or claims that the Company has violated any federal, state or foreign law of any
kind, of which Executive has not previously made Hilltop Holdings Inc.’s General
Counsel aware.  If Executive learns of any such information, Executive shall
immediately inform the General Counsel of Hilltop Holdings Inc.

 

2.                   Knowing and Voluntary Release. Executive understands it is
his choice whether to execute this Release and that his decision to do so is
voluntary and is made knowingly.

 

3.                   No Prior Representations or Inducements. Executive
represents and acknowledges that in executing this Release, he does not rely,
and has not relied, on any communications, statements, promises, inducements, or
representation(s), oral or written, by any of the Released Parties, except as
expressly contained in this Release. Any amendment to this Release must be
signed by all parties to this Release.

 

4.                   Retention Agreement. Executive hereby agrees and
acknowledges that Sections 6, 8 and 9 of the Retention Agreement are of a
continuing nature and expressly survive the expiration, termination or
cancellation of the Retention Agreement and such obligations of Executive shall
not be released pursuant to this Release. Except as set forth in the immediately
preceding sentence, Executive and the Company acknowledge and agree that the
Retention Agreement is terminated.

 

5.                   Binding Release and Survival. This Release shall inure to
the benefit of, and be enforceable by, Executive’s and the Company’s respective
personal or legal representatives, executors, administrators, assigns,
successors, heirs, distributees, devisees, and legatees.

 

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6.                   Severability. The Company and Executive agree that should
an arbitrator or court declare or determine that any provision of this Release
is illegal or invalid, the validity of the remaining parts, terms or provisions
of this Release will not be affected and any illegal or invalid part, term, or
provision, will not be deemed to be a part of this Release and there shall be
deemed substituted therefor such other provision as will most nearly accomplish
the intent of the parties to the extent permitted by the applicable law.

 

7.                   Entire Agreement and Counterparts. This Release constitutes
the entire agreement between the parties hereto concerning the subject matter
hereof. The Company and Executive agree that this Release may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall be deemed one and the same instrument.

 

8.                   Time to Consider Release. The Company advises Executive in
writing to consult with an attorney before executing this Release. Executive
further acknowledges that the Company has given him a period of twenty-one (21)
calendar days within which to review and consider the provisions of this
Release. Executive understands that if he does not sign this Release before the
twenty-one (21) calendar day period expires, certain payment set forth in the
Retention Agreement will be withdrawn automatically.

 

9.                   Revocation. Executive understands and acknowledges that he
has seven (7) calendar days following the execution of this Release to revoke
his acceptance of this Release. This Release will not become effective or
enforceable, and the payments and certain other benefits described in Section 5
of the Retention Agreement (unless specifically provided otherwise) will not
become payable, until after this revocation period has expired without his
revocation. If Executive does not revoke this Release within the revocation
period, the Company will send Executive the payments in accordance with the
terms of Section 5 of the Retention Agreement.

 

I ACKNOWLEDGE THAT I HAVE CAREFULLY READ THE FOREGOING, THAT I UNDERSTAND ALL OF
ITS TERMS AND THAT I AM RELEASING CLAIMS AND THAT I AM ENTERING INTO IT
VOLUNTARILY.

 

SIGNATURE PAGE FOLLOWS

 

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IN WITNESS THEREOF, Executive and the Company hereto evidence their agreement by
their signatures.

 

  EXECUTIVE           Todd L. Salmans       COMPANY:       Hilltop Holdings Inc.
          By:                                          Name:   Title:

 

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