Exhibit 10.5
 
CHANGE IN CONTROL
SEVERANCE AGREEMENT
 
This CHANGE IN CONTROL SEVERANCE AGREEMENT (this “Agreement”) is entered into as
of the 30th day of September, 2010 (the “Effective Date”), by and between First
Financial Holdings, Inc., a Delaware corporation (the “Company”), and C. Alec
Elmore (the “Executive”).
 
W I T N E S S E T H:
 
WHEREAS, the Executive currently serves as a key employee of the Company or one
of its Subsidiaries (as defined in Section 1 and, together with the Company or
affiliate entity, “First Financial”) and the Executive’s services and knowledge
are valuable to First Financial in connection with the management of First
Financial;
 
WHEREAS, the Board (as defined in Section 1) has determined that it is in the
best interests of the Company and its stockholders to secure the Executive’s
continued services and to ensure the Executive’s continued and undivided
dedication to the Executive’s duties in the event of any threat or occurrence
of, or negotiation or other action that could lead to, or create the possibility
of, a Change in Control (as defined in Section 1); and
 
WHEREAS, the Board has authorized the Company to enter into this Agreement.
 
NOW, THEREFORE, for and in consideration of the promises and the mutual
covenants and agreements herein contained, the Company and the Executive hereby
agree as follows:
 
1. Definitions.  As used in this Agreement, the following terms shall have the
respective meanings set forth below:
 
(a) “Board” means the Board of Directors of the Company.
 
(b) “Cause” means (i) the Executive’s material breach of the Executive’s duties
and responsibilities for First Financial (other than as a result of the
Executive’s Disability) which is (x) demonstrably willful and deliberate on the
Executive’s part, (y) committed in bad faith or without reasonable belief that
such breach is in the best interests of First Financial and (z) not remedied
within ten (10) days after receipt of written notice from First Financial
specifying such breach; (ii) the Executive’s conviction of, or plea of nolo
contendere to, a felony or any crime involving fraud, dishonesty or moral
turpitude; (iii) any act of theft, fraud, misappropriation or malfeasance by the
Executive in connection with the performance of the Executive’s duties to First
Financial which is (x) demonstrably willful and deliberate on the Executive’s
part and (y) committed in bad faith or without reasonable belief that such
breach is in the best interests of First Financial; or (iv) the Executive’s
disqualification or bar by any governmental or self-regulatory authority from
carrying out the Executive’s duties and responsibilities or the Executive’s loss
of any governmental or self-regulatory license that is reasonably necessary for
the Executive to perform the Executive’s duties and responsibilities if (x) the
disqualification, bar or loss continues for more than sixty (60) days and
(y) during that period First Financial uses its good faith efforts to cause the
disqualification or bar to be lifted or the license replaced.
 
 
 

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First Financial must notify the Executive of any event constituting Cause (in
accordance with the provisions of Section 11(b)) within ninety (90) days
following the Board’s (excluding, if applicable, the Executive) knowledge of its
existence or such event shall not constitute Cause under this Agreement.
 
(c) “Change in Control” means the occurrence of any one of the following events:
 
(i) any “person” (as such term is defined in Section 3(a)(9) of the Securities
Exchange Act of 1934 (the “Exchange Act”) and as used in Sections 13(d)(3) and
14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing 25% or more of the combined voting power of the Company’s
then outstanding securities eligible to vote for the election of the Board (the
“Company Voting Securities”); provided, however, that the event described in
this paragraph (i) shall not be deemed to be a Change in Control by virtue of
any of the following acquisitions:  (A) by the Company or any Subsidiary; (B) by
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any Subsidiary; (C) by any underwriter temporarily holding securities
pursuant to an offering of such securities; (D) pursuant to a Non-Control
Transaction (as defined in paragraph (iii) below); or (E) pursuant to any
acquisition by the Executive or any group of persons including the Executive (or
any entity controlled by the Executive or any group of persons including the
Executive);
 
(ii) individuals who, on the Effective Date, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority
thereof, provided that any person becoming a director subsequent to the
Effective Date, whose election or nomination for election was approved by a vote
of at least two-thirds of the directors comprising the Incumbent Board (either
by a specific vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection to such
nomination) shall be considered a member of the Incumbent Board; provided,
however, that no individual initially elected or nominated as a director of the
Company as a result of an actual or threatened election contest with respect to
directors or any other actual or threatened solicitation of proxies or consents
by or on behalf of any person other than the Board shall be deemed to be a
member of the Incumbent Board;
 
 
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(iii) the consummation of a merger, consolidation, share exchange or similar
form of corporate transaction involving the Company or any of its Subsidiaries
that requires the approval of the Company’s stockholders (whether for such
transaction or the issuance of securities in the transaction or otherwise) (a
“Reorganization”), unless immediately following such Reorganization:  (A) more
than 50% of the total voting power of (x) the corporation resulting from such
Reorganization (the “Surviving Company”), or (y) if applicable, the ultimate
parent corporation that directly or indirectly has beneficial ownership of 95%
of the voting securities eligible to elect directors of the Surviving Company
(the “Parent Company”), is represented by Company Voting Securities that were
outstanding immediately prior to such Reorganization (or, if applicable, is
represented by shares into which such Company Voting Securities were converted
pursuant to such Reorganization), and such voting power among the holders
thereof is in substantially the same proportion as the voting power of such
Company Voting Securities among holders thereof immediately prior to the
Reorganization; (B) no person (other than any employee benefit plan (or related
trust) sponsored or maintained by the Surviving Company or the Parent Company)
is or becomes the beneficial owner, directly or indirectly, of 25% or more of
the total voting power of the outstanding voting securities eligible to elect
directors of the Parent Company (or, if there is no Parent Company, the
Surviving Company); and (C) at least a majority of the members of the board of
directors of the Parent Company (or, if there is no Parent Company, the
Surviving Company) following the consummation of the Reorganization were members
of the Incumbent Board at the time of the Board’s approval of the execution of
the initial agreement providing for such Reorganization (any Reorganization
which satisfies all of the criteria specified in (A), (B) and (C) above shall be
deemed to be a “Non-Control Transaction”);
 
(iv) the stockholders of the Company approve a plan of complete liquidation or
dissolution; or
 
(v) the consummation of a sale (or series of sales) of all or substantially all
of the assets of the Company and its Subsidiaries to an entity that is not an
affiliate of the Company.
 
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because any person acquires beneficial ownership of 25% or more of the
Company Voting Securities as a result of the acquisition of Company Voting
Securities by the Company which reduces the number of Company Voting Securities
outstanding; provided, that, if after such acquisition by the Company such
person becomes the beneficial owner of additional Company Voting Securities that
increases the percentage of outstanding Company Voting Securities beneficially
owned by such person, a Change in Control shall then occur.
 
(d) “Change in Control Termination Period” means the period of time beginning
with a Change in Control and ending two (2) years following such Change in
Control.
 
 
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(e) “Date of Termination” means (i) the effective date on which the Executive’s
employment with First Financial terminates, as specified in a prior written
notice by First Financial or the Executive, as the case may be, to the other,
delivered pursuant to Section 11, or (ii) if the Executive’s employment with
First Financial terminates by reason of death, the date of death of the
Executive.
 
(f) “Disability” means the Executive’s incapacity due to physical or mental
illness, as evidenced by a written statement from a licensed physician
acceptable to First Financial or by the insurance company which insures First
Financial’s long-term disability plan in which the Executive is eligible to
participate which confirms the Executive’s inability to perform due to such
physical or mental illness.
 
(g) “Good Reason” means, without the Executive’s express written consent, the
occurrence of any of the following events:
 
(i) (A) any change in the authority, duties or responsibilities that is
inconsistent in any material and adverse respect with the Executive’s authority,
position(s), duties, responsibilities or status with First Financial immediately
prior to the Change in Control (including any material and adverse diminution of
such duties or responsibilities) or (B) a material and adverse change in the
Executive’s reporting responsibilities, titles or offices with First Financial
as in effect immediately prior to the Change in Control;
 
(ii) a material reduction by First Financial in the Executive’s rate of annual
base salary or annual target bonus opportunity (including any material and
adverse change in the formula for such annual bonus target) as in effect
immediately prior to the Change in Control or as the same may be increased from
time to time thereafter;
 
(iii) any requirement of First Financial that the Executive be based anywhere
more than fifty (50) miles from the place of business where the Executive is
located at the time of the Change in Control;
 
(iv) the failure of First Financial to continue in effect any employee benefit
plan or compensation plan in which the Executive is participating immediately
prior to the Change in Control and which is material to the Executive’s overall
compensation, unless the Executive is permitted to participate in other plans
providing the Executive with benefits or compensation opportunities which are
not materially less, or the taking of any action by First Financial which would
materially and adversely affect the Executive’s participation in or materially
and adversely reduce the Executive’s benefits or compensation opportunities
under any such plan; or
 
(v) a material breach by First Financial of this Agreement or any other material
agreement in effect between the Executive and First Financial.
 
 
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Any event described in this Section 1(g) which occurs prior to a Change in
Control, but was at the request of a third party who had indicated an intention
or taken steps reasonably calculated to effect a Change in Control and who
effectuates a Change in Control, shall constitute Good Reason following a Change
in Control for purposes of this Agreement (treating the date of such event as
the date of the Change in Control) notwithstanding that it occurred prior to the
Change in Control.  For purposes of this Agreement, any good faith determination
of Good Reason made by the Executive shall be conclusive; provided, however,
that an isolated, insubstantial and inadvertent action taken in good faith and
which is remedied by First Financial promptly after receipt of notice thereof
given by the Executive shall not constitute Good Reason.  The Executive must
provide notice of termination of employment (in accordance with the provisions
of Section 11(b)) within ninety (90) days of the initial existence of an event
constituting Good Reason (including any such event which occurs prior to a
Change in Control pursuant to the first sentence of this paragraph) or such
event shall not constitute Good Reason under this Agreement.  First Financial
shall have thirty (30) days following its receipt of a notice of termination of
employment from the Executive to remedy the condition the Executive claimed to
provide a basis for such termination in the notice of termination.
 
(h) “Nonqualifying Termination” means a termination of the Executive’s
employment with First Financial (i) by First Financial for Cause, (ii) by the
Executive for any reason other than for Good Reason, (iii) as a result of the
Executive’s death or (iv) by First Financial due to the Executive’s absence from
the Executive’s duties with First Financial on a full-time basis for at least
one hundred thirty (130) business days during any consecutive twelve month
period as a result of the Executive’s Disability.
 
(i) “Subsidiary” means any corporation or other entity in which the Company has
a direct or indirect ownership interest of 50% or more of the total combined
voting power of the then outstanding securities or interests of such corporation
or other entity entitled to vote generally in the election of directors or in
which the Company has the right to receive 50% or more of the distribution of
profits or 50% of the assets on liquidation or dissolution.
 
(j) “Target Annual Bonus” means the greater of (i) the annual target bonus for
the calendar year in which the Date of Termination occurs and (ii) the annual
target bonus for the calendar year in which the Change in Control occurs as such
target existed immediately prior to such Change in Control.
 
2. Severance Payments.  Subject to Section 14, Section 15 and Section 16, if the
Executive’s employment with First Financial is terminated (1) during the Change
in Control Termination Period other than by reason of a Nonqualifying
Termination or (2) prior to the Change in Control Termination Period and the
Executive reasonably demonstrates that such termination was at the request of a
third party who had indicated an intention or taken steps reasonably calculated
to effect such Change in Control and who effectuates such Change in Control (or
such termination was otherwise in anticipation of such Change in Control), then
First Financial shall pay or provide the Executive (or the Executive’s
beneficiary or estate) with the following payments or benefits:
 
 
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(a) a lump-sum cash amount within five (5) days following the Date of
Termination equal to the sum of: (i) the Executive’s base salary through the
Date of Termination, and any accrued vacation, in each case to the extent not
theretofore paid; (ii) any unpaid bonus accrued with respect to the fiscal year
ending on or preceding the Date of Termination; and (iii) subject to presentment
of appropriate documentation, any unreimbursed expenses incurred through the
Date of Termination in accordance with Company policy (collectively, the
“Accrued Amounts”);
 
(b) all other payments, benefits or fringe benefits to which the Executive shall
be entitled under the terms of any applicable compensation arrangement or
benefit, equity or fringe benefit plan or program or grant (the “Other
Benefits”);
 
(c) a lump-sum cash amount within five (5) days following the Date of
Termination equal to the product of (i) the Executive’s Target Annual Bonus and
(ii) a fraction, the numerator of which is the number of days in the fiscal year
in which the Date of Termination occurs through the Date of Termination and the
denominator of which is three hundred sixty-five (365);
 
(d) a lump-sum cash amount within five (5) days following the Date of
Termination equal to one (1) time the sum of (i) the Executive’s annual base
salary and (ii) the average of the annual bonuses paid or payable to the
Executive for the three (3) fiscal years ending before the Date of Termination;
provided, however, that (x) if the Executive was not employed by First Financial
for all of such three (3) year period, the average in (ii) above will be based
on such number of completed fiscal years during which the Executive was employed
by First Financial and was eligible to receive an annual bonus and (y) if the
Executive was not employed during any part of such three (3) year period, the
amount in (ii) above will be the Executive’s Target Annual Bonus; and
 
(e) during the one (1) year following the Executive’s termination of employment,
the Executive, the Executive’s spouse and the Executive’s eligible dependants
shall receive employee welfare benefits on a basis that is at least as favorable
as was available to the Executive immediately prior to the Date of Termination
(the “Welfare Benefits”).  However, if First Financial is unable to provide the
Welfare Benefits as a result of tax law requirements or any other applicable
legal requirements, First Financial shall pay the Executive, on the first
business day of each calendar quarter thereafter, in advance, an amount which is
equal to the Executive’s cost of procuring such Welfare Benefits on an after-tax
basis.
 
3. Payments Upon Nonqualifying Termination of Employment.  If the Executive’s
employment with First Financial shall terminate during the Change in Control
Termination Period by reason of a Nonqualifying Termination, then First
Financial shall pay to the Executive (or the Executive’s beneficiary or estate)
within five (5) days following the Date of Termination, a lump-sum cash amount
equal to the Accrued Amounts (other than the amount described in Section
2(a)(ii) if the Executive is terminated by First Financial for Cause) and
provide the Other Benefits.
 
4. Resignations.  Upon any termination of the Executive’s employment with First
Financial for any reason, the Executive shall promptly resign from any position
as an officer, director or fiduciary of the Company or any Company-related
entity.
 
 
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5. Contingent Reduction of Parachute Payments.  If there is a change in
ownership or control of the Company that would cause any payment or distribution
by First Financial or any other person or entity to the Executive or for the
Executive’s benefit (whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise) (a “Payment”) to be
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended (the “Code”) (such excise tax, together with any interest or
penalties incurred by the Executive with respect to such excise tax, the “Excise
Tax”), then the Executive will receive the greatest of the following, whichever
gives the Executive the highest net after-tax amount (after taking into account
federal, state, local and social security taxes): (a) the Payments or (b) one
dollar less than the amount of the Payments that would subject the Executive to
the Excise Tax (the “Safe Harbor Amount”).  If a reduction in the Payments is
necessary so that the Payments equal the Safe Harbor Amount and none of the
Payments constitutes a “deferral of compensation” within the meaning of and
subject to Section 409A (as defined in Section 14) (“Nonqualified Deferred
Compensation”), then the reduction shall occur in the manner the Executive
elects in writing prior to the date of payment.  If any Payment constitutes
Nonqualified Deferred Compensation or if the Executive fails to elect an order,
then the Payments to be reduced will be determined in a manner which has the
least economic cost to the Executive and, to the extent the economic cost is
equivalent, will be reduced in the inverse order of when payment would have been
made to the Executive, until the reduction is achieved.  All determinations
required to be made under this Section 5, including whether and when the Safe
Harbor Amount is required and the amount of the reduction of the Payments and
the assumptions to be utilized in arriving at such determination, shall be made
by a certified public accounting firm designated by First Financial (the
“Accounting Firm”).  All fees and expenses of the Accounting Firm shall be borne
solely by First Financial.  Any determination by the Accounting Firm shall be
binding upon First Financial and the Executive.
 
6. Withholding.  First Financial may withhold from all payments due to the
Executive (or the Executive’s beneficiary or estate) hereunder all taxes which,
by applicable federal, state, local or other law or regulation, First Financial
is required to withhold therefrom and all other amounts or charges required to
be withheld or deducted.
 
7. Reimbursement of Legal Expenses.  First Financial shall, on a quarterly
basis, upon presentment of appropriate documentation (which submission shall be
made within forty-five (45) days after the end of such quarter), reimburse the
Executive for all legal fees and expenses, if any, incurred by the Executive in
connection with any contest or dispute arising under this Agreement (a
“Dispute”) on or after a Change in Control (or otherwise related to a Change in
Control), except that the Executive shall reimburse First Financial (to the
extent permitted under applicable law) for the fees and expenses advanced (a) in
the event the Executive’s claims are determined to have been advanced by the
Executive in bad faith or were frivolous, or (b) to the extent that such legal
fees and expenses are determined to be unreasonable.
 
 
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8. Termination of Agreement.  This Agreement shall be effective on the Effective
Date and shall terminate two (2) years after the date of any written
notification from First Financial to the Executive terminating this Agreement;
provided, however, that if a Change in Control occurs while this Agreement is
still operative, any written notification to the Executive terminating this
Agreement (including any written notification given prior to such Change in
Control), shall not be effective prior to the end of the Change in Control
Termination Period; and provided, further, that this Agreement shall continue in
effect following any termination that is not a Nonqualifying Termination which
occurs prior to such termination with respect to all rights and obligations
accruing as a result of such termination.
 
9. Scope of Agreement.  Nothing in this Agreement shall be deemed to alter the
“at-will” nature of the Executive’s employment or entitle the Executive to
continued employment with First Financial.
 
10. Successors; Binding Agreement.
 
(a) This Agreement shall not be terminated by any Reorganization.  In the event
of any Reorganization, the provisions of this Agreement shall be binding upon
the surviving or resulting corporation or the person or entity to which such
assets are transferred, in which case the term “Company” will mean such
surviving or resulting corporation or acquiror and references to “First
Financial” will mean such surviving or resulting corporation or acquiror and its
subsidiaries and affiliate entities.
 
(b) First Financial agrees that concurrently with any Reorganization that does
not constitute a Non-Control Transaction, it will cause any successor or
transferee unconditionally to assume, by written instrument delivered to the
Executive (or the Executive’s beneficiary or estate), all of the obligations of
First Financial hereunder.  Failure of First Financial to obtain such assumption
prior to the effectiveness of any such Reorganization shall be a material breach
of this Agreement and shall constitute Good Reason hereunder and shall entitle
the Executive to compensation and other benefits from First Financial in the
same amount and on the same terms as the Executive would be entitled hereunder
if the Executive’s employment were terminated following a Change in Control
other than by reason of a Nonqualifying Termination.  For purposes of
implementing the foregoing, the date on which any such Reorganization becomes
effective shall be deemed the date Good Reason occurs, and shall be the Date of
Termination, if requested by the Executive.
 
(c) This Agreement is personal to the Executive and without the prior written
consent of First Financial shall not be assignable by the Executive.  This
Agreement shall inure to the benefit of, and be enforceable by, the Executive’s
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.  If the Executive shall die while any
amounts would be payable to the Executive hereunder had the Executive continued
to live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to such person or persons appointed
in writing by the Executive to receive such amounts or, if no person is so
appointed, to the Executive’s estate.
 
 
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11. Notices.  (a) For purposes of this Agreement, all notices and other
communications required or permitted hereunder (each, a “Notice”) shall be in
writing and shall be sent by either party by personal delivery, e-mail,
facsimile (with a Notice contemporaneously given by another method specified in
this Section 11), recognized overnight commercial courier or United States mail
(certified and return receipt requested, postage prepaid) and shall be deemed to
have been duly given when delivered or five (5) days after deposit in the United
States mail, addressed as follows:
 
 
If to the Company:
First Financial Holdings, Inc.

 
2440 Mall Drive

 
Charleston, South Carolina 29406

 
Attention: Corporate Counsel

 
Facsimile: (843) 529-5884

 
 
If to the Executive:
To the Executive’s last address (or to the last

 
facsimile number) shown on the records

 
of First Financial

 
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt (or refusal of receipt).
 
(b) A written notice of the Executive’s Date of Termination by First Financial
or the Executive, as the case may be, to the other, shall (i) indicate the
specific termination provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Executive’s employment under the
provision so indicated and (iii) specify the termination date (which date shall
be not less than thirty (30) nor more than sixty (60) days after the giving of
such notice or, if later, the date of the Change in Control if the Executive
gives notice of an event described in Section 1(g) which occurs prior to a
Change in Control).  The failure by the Executive or First Financial to set
forth in such notice any fact or circumstance which contributes to a showing of
Good Reason or Cause shall not waive any right of the Executive or First
Financial hereunder or preclude the Executive or First Financial from asserting
such fact or circumstance in enforcing the Executive’s or First Financial’s
rights hereunder.
 
12. Full Settlement; No Mitigation.  First Financial’s obligation to make any
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall be in lieu of and in full settlement of all other severance or
similar payments to the Executive under any other severance or employment
agreement between the Executive and First Financial, any severance plan of First
Financial and any statutory entitlement (including notice of termination,
termination pay and/or severance pay).  First Financial’s obligations hereunder
shall not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action which First Financial may have against the Executive or
others.  In no event shall the Executive be obligated to seek other employment
or take other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and, except as provided
in Section 2(e), such amounts shall not be reduced whether or not the Executive
obtains other employment.
 
 
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13. GOVERNING LAW; VALIDITY.  THE INTERPRETATION, CONSTRUCTION AND PERFORMANCE
OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF SOUTH CAROLINA WITHOUT REGARD TO THE
PRINCIPLE OF CONFLICTS OF LAWS.  THE INVALIDITY OR UNENFORCEABILITY OF ANY
PROVISION OF THIS AGREEMENT SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF
ANY OTHER PROVISION OF THIS AGREEMENT, WHICH OTHER PROVISIONS SHALL REMAIN IN
FULL FORCE AND EFFECT.
 
14. Section 409A of the Code.  The intent of the parties hereto is that payments
and benefits under this Agreement comply with Section 409A of the Code and the
regulations and other guidance promulgated thereunder (“Section 409A”), to the
extent subject thereto, and, accordingly, to the maximum extent permitted, this
Agreement shall be interpreted and administered to be in compliance
therewith.  Notwithstanding anything herein to the contrary: (a) if at the time
of the Executive’s termination of employment with First Financial, the Executive
is a “specified employee” as defined in Section 409A and the deferral of the
commencement of any payments or benefits otherwise payable or provided hereunder
as a result of such termination of employment is necessary in order to prevent
any accelerated or additional tax under Section 409A, then the payment of any
such payments or benefits shall be delayed and paid on the first business day of
the seventh month following the Executive’s termination of employment with First
Financial in accordance with the requirements of Section 409A (or the earliest
date as is permitted under Section 409A); (b) if any other payments of money or
other benefits due to the Executive hereunder could cause the application of an
accelerated or additional tax under Section 409A, such payments or other
benefits shall be deferred if deferral will make such payment or other benefits
compliant under Section 409A, or otherwise such payment or other benefits shall
be restructured, to the extent possible, in a manner, determined by the Board
that does not cause such an accelerated or additional tax; (c) to the extent
required in order to avoid accelerated taxation and/or tax penalties under
Section 409A, the Executive shall not be considered to have terminated
employment with First Financial for purposes of this Agreement and no payment
shall be due to the Executive under this Agreement until the Executive would be
considered to have incurred a “separation from service” from First Financial
within the meaning of Section 409A; and (d) each amount to be paid or benefit to
be provided to the Executive pursuant to this Agreement, which constitute
deferred compensation subject to Section 409A, shall be construed as a separate
identified payment for purposes of Section 409A.  To the extent required to
avoid an accelerated or additional tax under Section 409A, amounts reimbursable
to the Executive under this Agreement shall be paid to the Executive on or
before the last day of the year following the year in which the expense was
incurred, the amount of expenses eligible for reimbursement (and in-kind
benefits provided to the Executive) during any one year may not effect amounts
reimbursable or provided in any subsequent year and in no event shall any right
to reimbursement or receipt of in-kind benefits be subject to liquidation or
exchange for another benefit; provided, however, that with respect to any
reimbursements for any taxes which the Executive would become entitled to under
the terms of this Agreement, the payment of such reimbursements shall be made by
First Financial no later than the end of the calendar year following the
calendar year in which the Executive remits the related taxes.  First Financial
shall consult with the Executive in good faith regarding the implementation of
the provisions of this Section 14.
 
 
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15. TARP Requirements.  For so long as First Financial is subject to the
requirements of the Troubled Asset Relief Program under the Emergency Economic
Stabilization Act of 2008, including the Interim Final Rule and any other rules
and regulations thereunder, as amended (the “TARP Requirements”), the provisions
of this Agreement are subject to and shall be, to the fullest extent possible,
interpreted to be consistent with the TARP Requirements, which terms control
over the terms of this Agreement in the event of any conflict between the TARP
Requirements and this Agreement.  Notwithstanding anything in this Agreement to
the contrary, in no event shall any payment or benefit under this Agreement vest
or be settled, paid or accrued, if any such vesting, settlement, payment or
accrual would be in violation of the TARP Requirements or other applicable law.
 
16. FDIC Golden Parachute Payments.  If any payment or benefit under this
Agreement would otherwise be a golden parachute payment within the meaning of
Section 18(k) of the Federal Deposit Insurance Act, the payment or benefit will
not be made unless permitted under applicable law.  First Financial will use its
best efforts promptly to apply to the appropriate federal banking agency for a
determination that any golden parachute payment is permissible.  Any payment or
benefit under this Agreement that is determined permissible will be paid in
accordance with its terms or, if due before the date of determination, will be
paid within thirty (30) days of determination together with interest at the
applicable federal rate (as defined in Section 1274(d) of the Code).
 
17. Miscellaneous.  No provision of this Agreement may be modified or waived
unless such modification or waiver is agreed to in writing and signed by the
Executive and by a duly authorized officer of First Financial.  No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or any prior or subsequent time.  Failure by the
Executive or First Financial to insist upon strict compliance with any provision
of this Agreement or to assert any right the Executive or First Financial may
have hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason or First Financial to terminate employment
for Cause, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.  This Agreement sets forth the
entire agreement of the parties hereto in respect of the subject matter
contained herein.  No agreements or representations, oral or otherwise, express
or implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement.  Except as otherwise
specifically provided for herein, the rights of, and benefits payable to, the
Executive or the Executive’s estate or beneficiaries pursuant to this Agreement
are in addition to any rights of, or benefits payable to, the Executive or the
Executive’s estate or beneficiaries under any other employee benefit plan or
compensation program of First Financial.
 
18. Section Headings.  The section headings used in this Agreement are included
solely for convenience and shall not affect, or be used in connection with, the
interpretation of this Agreement.

 
 
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19. Counterparts.  This Agreement may be executed (including by facsimile or
other electronic transmission confirmed promptly thereafter by actual delivery
of executed counterparts) in counterparts, each of which shall be deemed to be
an original and all of which together shall constitute one and the same
instrument.
 
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a
duly authorized officer of the Company on the Effective Date.
 

 

 
FIRST FINANCIAL HOLDINGS, INC.
 

 
By:           /s/ R. Wayne Hall_______
Name:  R. Wayne Hall
Title:  President and CEO

 
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