Exhibit 10.3

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (the “Agreement”) is made the 16th day of June, 2019,
by and among PROSPERITY BANK, a Texas banking association having a principal
place of business at 1301 North Mechanic Street, El Campo, Texas 77437
(“Employer”), LEGACYTEXAS BANK, a Texas banking association having a principal
place of business at 5851 Legacy Circle, Suite 1200, Plano, Texas 75024 (the
“Bank”) and Charles D. Eikenberg, an individual who resides in the State of
Texas (“Employee”).

 

WHEREAS, this Agreement is being entered into in connection with the Agreement
and Plan of Reorganization, dated as of June 16, 2019 (the “Merger Agreement”),
by and between Prosperity Bancshares, Inc., a Texas corporation (“Bancshares”),
and LegacyTexas Financial Group, Inc., a Maryland corporation (the “Company”);
and

 

WHEREAS, Employee’s agreement to and compliance with the provisions of Article V
of this Agreement are a material factor, material inducement and material
condition to Bancshares’ participation in the transactions contemplated by the
Merger Agreement.  Moreover, Employee acknowledges that a substantial portion of
the value of the transactions contemplated by the Merger Agreement is Employee’s
promises to refrain from competing with the Bank, Employer, or Bancshares as set
forth in Article V hereof; and

 

WHEREAS, prior to the entry into the Merger Agreement, Employee was an officer
of the Bank and is receiving a considerable benefit as a result of the
transactions contemplated by the Merger Agreement;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, and intending to be legally bound hereby, it is hereby
agreed as follows:

 

ARTICLE I

 

TERM OF EMPLOYMENT

 

1.1  Term.  Provided that Employee is employed by the Bank immediately preceding
the Effective Time (as defined in the Merger Agreement), Employer hereby employs
Employee and Employee hereby accepts employment with Employer under this
Agreement for a period of three (3) years (the “Term”) beginning as of the
Effective Time; provided, however, that this Agreement may be terminated earlier
as hereinafter provided.  However, if (i) the Merger Agreement is terminated for
any reason, (ii) Employee’s employment with the Bank terminates for any reason,
or (iii) the Prior Agreement (as defined below) is not terminated and liquidated
in accordance with Section 1.2 hereof, in each case, before the Effective Time
occurs, (a) Employee will not be employed under this Agreement and all of the
provisions of this Agreement will terminate upon the earlier of the time of
termination of the Merger Agreement or the time of termination of Employee’s
employment with the Bank or, in the case of (iii) above, immediately prior to
the Effective Time, and (b) there will be no liability of any kind under this
Agreement.  Subject to Section 7.6 below, this Agreement shall terminate
automatically upon the expiration of the Term.

 

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1.2  Termination of Prior Agreement.  The Bank and Employee are parties to that
certain Change in Control and Severance Benefits Agreement dated December 2,
2013 (the “Prior Agreement”), which provides for severance benefits pursuant to
its terms and conditions. The Bank and Employee hereby agree to take action to
terminate and fully liquidate the Prior Agreement in accordance with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and
Treasury Regulation Section 1.409A-3(j)(4)(ix)(B) within thirty (30) days prior
to the Effective Time. In connection with such termination and liquidation,
Employee acknowledges that he will not receive Transaction Payments (as defined
in the Prior Agreement) in an aggregate amount greater than the Reduced Payment
(as defined in the Prior Agreement).  The Bank and Employee agree that the Prior
Agreement shall not be deemed to be terminated unless and until the requirements
of Treasury Regulation Section 1.409A-3(j)(4)(ix)(B) are satisfied, including
the requirement that any other agreements, methods, programs and other
arrangements that are required to be aggregated with the Prior Agreement are
terminated and liquidated. Employee acknowledges that, upon the termination of
the Prior Agreement, Employee shall have no further rights under the Prior
Agreement. Employee acknowledges that the benefits that Employee will receive
pursuant to this Agreement constitute consideration to which Employee is not
otherwise entitled and is adequate consideration to support termination of the
Prior Agreement and replacement by this Agreement.

 

ARTICLE II

 

TITLE AND DUTIES OF EMPLOYEE

 

2.1  Title.  As of the Effective Time, Employee is hereby employed by Employer
as Executive Vice President Community Banking.

 

2.2  Primary Duties.  Employee shall perform such duties as are consistent with
Employee’s title set forth above in Section 2.1, and shall perform such other
work as may be assigned to him subject to the instructions, directions, and
control of Employer, which shall be consistent with the type and nature of work
normally performed by senior banking officers and as may be assigned by Employer
from time to time.

 

2.3  Engaging in Other Employment.  While employed by Employer, Employee shall
devote all of his entire productive time, ability, and attention to the business
of Employer during Employer’s normal business hours.

 

ARTICLE III

 

COMPENSATION

 

3.1  Base Salary.  As compensation for employment services rendered under this
Agreement, Employee shall be entitled to receive from Employer an annual rate of
salary (“Base Salary”) of $381,000.00, subject to applicable taxes and
withholdings, paid semi-monthly and prorated for any partial employment period
during the Term of this Agreement.  The Base Salary shall not be reduced during
the Term of this Agreement, but may be increased, in Employer’s sole discretion,
in accordance with the then existing procedures of Employer.

 

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3.2  Bonus.  Prior to the Effective Time, Employee will be paid a bonus by the
Bank for the 2019 calendar year, which bonus shall be consistent with the Bank’s
bonus program in effect as of the date of execution of this Agreement and the
Bank’s past practice.  For each calendar year thereafter, during the Term of
this Agreement, Employee will be eligible for the bonus program in accordance
with Employer’s policies and procedures regarding such bonuses.

 

3.3  Other Compensation.  Employee shall be eligible to participate in the
stock-based incentive compensation programs administered by the Board of
Directors of Bancshares pursuant to the terms of the plans then in effect and in
accordance with Section 5.6 below.

 

3.4  Automobile Allowance.  During the Term of this Agreement, Employer shall
provide Employee with a monthly automobile allowance of $600.00, subject to
applicable taxes and withholdings, paid through the normal payroll practices of
Employer.

 

3.5  Cell Phone Allowance.  During the Term of this Agreement, Employer shall
provide Employee with a monthly cell phone allowance of $100.00, subject to
applicable taxes and withholdings, paid through the normal payroll practices of
Employer.

 

ARTICLE IV

 

REIMBURSEMENT OF EMPLOYEE BUSINESS EXPENSES AND
PARTICIPATION IN EMPLOYER BENEFIT PLANS

 

4.1  Out of Pocket Expenses.  Employee is authorized to incur reasonable
business expenses for promoting the business of Employer, including expenditures
for entertainment, meals and travel and other similar business expenses, in
accordance with Employer policy.  Employer will reimburse Employee from time to
time for all such business expenses; provided, that Employee presents Employer
with appropriate documentation of such expenditures in accordance with
Employer’s established procedures relating to such reimbursements.

 

4.2  Participation in Employer Benefit Plans.  Until the termination of
Employee’s employment, Employee will be eligible to participate in all
compensation programs and employee benefit plans maintained by Employer from
time to time and generally available to the officers and employees of Employer,
subject to the terms of such programs and plans.  Employer reserves the right to
amend or cancel any compensation programs and employee benefit plans at any time
in its sole discretion, subject to the terms of such programs and plans and
applicable law.

 

4.3  Reimbursements and In-Kind Benefits in General.  All reimbursements under
this Agreement shall be paid to Employee as soon as administratively practicable
after Employee has provided the appropriate documentation, but in no event shall
any reimbursements be paid later than the last day of the calendar year
following the calendar year in which the expense was incurred.  Notwithstanding
anything herein to the contrary, to the extent required by Section 409A of the
Code:  (a) the amount of expenses eligible for reimbursement or in-kind benefits
provided under this Agreement during a calendar year will not affect the
expenses eligible for reimbursement or in-kind benefits provided in any other
calendar year, and (b) the

 

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right to reimbursement or in-kind benefits provided under this Agreement shall
not be subject to liquidation or exchange for another benefit.

 

ARTICLE V

 

RESTRICTIVE COVENANTS

 

5.1  Confidential Information.  “Confidential Information” means and includes
the Bank’s and Employer’s, and their affiliated entities’, confidential or
proprietary information or trade secrets.  Confidential Information includes,
but is not limited to, all information not generally known to the public, in
spoken, printed, electronic or any other form or medium, including, but not
limited to the following: information regarding past and current customers and
investors and business affiliates and contractors; information regarding the
industry not generally known to the public; strategies, methods, books, records,
and documents; technical information concerning products, equipment, services,
and processes; procurement procedures, pricing, and pricing techniques;
including contact names, services provided, pricing, type and amount of services
used, financial data; pricing strategies and price curves; positions; plans or
strategies for expansion or acquisitions; budgets; research; financial and sales
data; trading methodologies and terms; communications information; evaluations,
opinions and interpretations of information and data; marketing and
merchandising techniques; electronic databases; models; specifications; computer
programs; contracts; bids or proposals; technologies and methods; training
methods and processes; organizational structure; payments or rates paid to
consultants or other service providers.  Confidential Information includes any
such information that Employee may originate, learn, have access to or obtain,
whether in tangible form or memorized.  Additionally, Employee recognizes that
the Confidential Information is dynamic and ever-changing.  Confidential
Information does not include information that is generally available to and
known by the public, provided that such disclosure to the public is through no
direct or indirect fault of the Employee or person(s) acting on the Employee’s
behalf.  Employee acknowledges that the Bank’s and Employer’s respective
businesses are highly competitive, that this Confidential Information
constitutes a valuable, special and unique asset used by each of the Bank and
Employer in its business, and that protection of such Confidential Information
against unauthorized disclosure and use is of critical importance to the Bank
and Employer.

 

5.2  Promises of Employer and the Bank.  The Bank promises and agrees that
reasonably soon after the execution of this Agreement by Employee, the Bank
shall provide Employee with Confidential Information in an expanded nature than
that already provided to Employee by the Bank.  In addition, Employer promises
and agrees that, reasonably soon after the execution of this Agreement by
Employee and during the Term and as part of the employment under this Agreement,
Employer shall provide Employee with Confidential Information, which will enable
Employee to perform his job for Employer.  In addition, after the Effective
Time, Employee will have immediate access to, or knowledge of, Confidential
Information of third parties, such as actual and potential customers, suppliers,
partners, joint ventures, investors, and financing sources of Employer. 
Employee acknowledges that: (a) the Bank and Employer have devoted substantial
time, effort, and resources to develop and compile the Confidential Information;
(b) public disclosure of such Confidential Information would have an adverse
effect on the businesses of the Bank and Employer; (c) the Bank and Employer
would not disclose such information to the Employee, nor would the Bank or
Employer employ or

 

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continue to employ the Employee without the agreements and covenants set forth
in this Article V; and (d) the provisions of this Article V are reasonable and
necessary to prevent the improper use or disclosure of Confidential Information.

 

5.3  Employee’s Promises.

 

(a)                                 Non-Disclosure Obligations.  Employee agrees
that Employee will not, at any time during the period of his employment with the
Bank or Employer, and after the Employee’s termination date, make any
unauthorized disclosure, directly or indirectly, of any Confidential Information
of the Bank or Employer, or confidential information belonging to third parties
that was obtained by Employee during his employment with the Bank or Employer
(excepting any third party confidential information provided to Employee
independently of Employee’s employment with the Bank or Employer), or make any
use thereof, directly or indirectly, except in performance of Employee’s duties
for the Bank or Employer.  Employee also agrees that Employee shall promptly
deliver to the Bank or Employer, as directed, upon the termination of employment
or at any other time at the Bank or Employer’s request, without retaining any
copies, all documents and other material in Employee’s possession relating to
any Confidential Information or other information of the Bank or Employer, or
Confidential Information regarding third parties learned as an employee of the
Bank or Employer.

 

(b)                                 Restrictive Covenants.  Ancillary to the
consideration to be provided pursuant to this Agreement, including but not
limited to the Bank’s and Employer’s agreement to provide Confidential
Information to Employee and Employee’s agreement not to disclose Confidential
Information, and in order to protect the Confidential Information, Employee
agrees to the non-competition and non-solicitation provisions set forth in this
Section 5.3(b)(1)-(2) (the “Restrictive Covenants”).  Employee agrees that, for
the Restricted Period, as defined below, Employee will not, except as an
employee of the Bank or Employer, in any capacity for Employee or others,
directly or indirectly:

 

(1)                                 Non-Competition Obligations

 

(A)                               anywhere in the geographic area comprised of
the Counties of: Collin, Dallas, Denton, Jack, Parker, Tarrant, Wise
(collectively, the “Market Area”), (a) compete in, engage in, or contribute
knowledge to, a business similar to or otherwise competitive with that of the
Bank or Employer, or (b) compete in, engage in, or contribute knowledge to that
type of business which the Bank or Employer (i) has plans to engage in, or
(ii) has engaged in during the preceding twelve (12) month period if, in either
the case of (i) or (ii), within the twenty-four (24) months before the
termination of Employee’s employment from Employer, Employee had access to
information regarding the proposed plans or the business in which the Bank or
Employer engaged;

 

(B)                         take any action to invest in, own, manage, operate,
control, participate in, be employed or engaged by or be connected in any manner
with any partnership, corporation or other business or entity engaging in a
business similar to or otherwise competitive with that of the Bank or Employer
anywhere within the Market Area.  Notwithstanding the foregoing, the Employee is
permitted hereunder to own,

 

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directly or indirectly, up to one percent (1%) of the issued and outstanding
securities of any publicly traded financial institution conducting business in
the Market Area;

 

(2)                                 Non-Solicitation Obligations

 

(A)                               call on, solicit, service, or attempt to do
any of the foregoing with respect to, customers or prospective customers of the
Bank or Employer if, within the twelve (12) months before the termination of
Employee’s employment with the Bank or Employer, Employee had material contact
with the customer or prospective customer, or had obtained material information
about the customer or prospective customer; or

 

(B)                               hire, retain, call on, solicit for hire or
induce to leave employment, any individual who is or was an employee of the Bank
or the Employer on the date of, or within the three (3) month period before the
date of, such hire, retention, solicitation or inducement, provided that such
individual is an individual whom Employee had contact with, knowledge of, or
association with in the course of Employee’s employment with the Bank or
Employer, and Employee will not assist any other person or entity in such
activities.

 

Notwithstanding anything else provided herein, if Employee is a licensed
attorney, securities broker or real estate broker or agent, Employee shall not
be prohibited from representing or serving as an agent for any insured
depository institution or holding company thereof or other individual or entity
in such capacity.

 

5.4  Restricted Period.  The non-competition obligations set forth in
Section 5.3(b)(1) shall apply from the Effective Time through the end of the
Term, regardless of whether Employee’s employment terminates prior to the end of
the Term, and the non-solicitation obligations set forth in
Section 5.3(b)(2) shall apply from the Effective Time through the later of
(a) the end of the Term, regardless of whether Employee’s employment terminates
prior to the end of the Term or (b) one (1) year following the date of
Employee’s termination of employment with the Bank, Employer or their affiliated
entities (any transfer of employment between the Bank, the Employer, and any
affiliated entities does not constitute termination of employment) (the
restricted time period in the case of non-competition or non-solicitation, as
applicable, is the “Restricted Period”).  However, if the Merger Agreement is
terminated for any reason before the Effective Time occurs, the Restrictive
Covenants will not apply, all of the provisions of this Agreement will
terminate, and there will be no liability of any kind under this Agreement.

 

5.5  Restrictive Covenants Reasonable.  The parties to this Agreement hereby
agree that the Restrictive Covenants set forth in this Article V are ancillary
to this Agreement, which is an otherwise enforceable agreement.  Employee agrees
that his promises in this Article V are reasonable and reasonably necessary to
protect the legitimate business interest of the Bank, the Employer, and their
affiliated entities.

 

5.6  Consideration.

 

(a)          In consideration for the above obligations of the Employee, on the
fifth (5th) business day after the Effective Time, Employer shall deliver to
Employee a restricted stock award agreement issued pursuant to the Prosperity
Bancshares, Inc. 2012 Stock Incentive

 

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Plan granting to Employee 3,000 shares of Bancshares restricted common stock
(“Restricted Stock”). The forfeiture restrictions applicable to the Restricted
Stock shall lapse on the third (3rd) anniversary of the grant date, provided
that Employee is employed by Employer on such date.

 

(b)          The Bank promises and agrees that reasonably soon after the
execution of this Agreement by Employee, it shall provide Employee with
Confidential Information in an expanded nature than that already provided to
Employee.

 

(c)          In addition, after the Effective Time, Employer agrees to provide
Employee with access to Confidential Information relating to Employer’s business
and to specialized training regarding Employer’s methodologies and business
strategies, which will enable Employee to perform his job for Employer.  After
the Effective Time, Employee also will have immediate access to, or knowledge
of, new Confidential Information of third parties, such as actual and potential
customers, suppliers, partners, joint venturers, investors, financing
sources, etc. of Employer.

 

5.7  Enforcement and Legal Remedies.  The Bank, Employer and Employee
acknowledge and agree that breach of any of the covenants made by Employee in
this Agreement would cause irreparable injury to the Bank or Employer, which
could not sufficiently be remedied by monetary damages; and, therefore, that the
Bank or Employer shall be entitled to obtain such equitable relief as
declaratory judgments; temporary, preliminary and permanent injunctions, without
posting of any bond, and order of specific performance to enforce those
covenants or to prohibit any act or omission that constitutes a breach thereof.

 

5.8  Tolling.  In the event that Employer shall file a lawsuit in any Court of
competent jurisdiction alleging a breach of the Non-Competition Obligations by
the Employee, then any time period set forth in this Agreement including the
time periods set forth above, will be extended one month for each month the
Employee was in breach of this Agreement, so that Employer is provided the
benefit of the full Restricted Period.

 

ARTICLE VI

 

TERMINATION RIGHTS

 

6.1  Termination for Cause by the Employer.  The Employer may terminate this
Agreement and Employee’s employment for Cause (as defined hereinafter), such
termination to be effective immediately upon written notice to Employee.  Any
termination of Employee’s employment under this Section 6.1 will not be in
limitation of any other right or remedy which the Employer may have under this
Agreement, at law, or in equity.  The term “Cause” means (a) Employee’s fraud,
embezzlement, theft or misappropriation of funds or other property of the
Employer or its affiliated entities, (b) self-dealing or gross negligence in the
performance by Employee of his duties pursuant to this Agreement, (c) the
repeated failure or refusal by Employee to perform his lawful duties to the
Employer as provided herein, other than due to Disability, (d) the commission by
Employee of any willful acts of bad faith or gross misconduct against the
Employer or its affiliated entities, (e) the indictment of Employee for a felony
or other criminal act involving dishonesty or other moral turpitude, whether or
not relating to his

 

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employment with the Employer, (f) the material violation by Employee of a
lawful, established policy or procedure of the Employer and (g) the Employee’s
material breach of any provision of this Agreement; provided that with respect
to clauses (c) and (f) and (g), Employer shall give Employee written notice of
the breach or other failure on the part of Employee and the actions necessary to
correct such breach, if applicable.  If Employee fails to cure the breach or
failure within fifteen (15) days of receipt of such notice or if the breach or
failure is incurable, Employer may proceed to terminate Employee’s employment
for Cause without further notice.

 

6.2  Termination by Employer Upon Employee’s Disability.  The Employer may
terminate this Agreement and Employee’s employment upon a determination of
Disability (as defined below), such termination to be effective immediately upon
written notice to Employee.  The term “Disability” means Employee’s inability to
perform his usual services to the Employer because of mental or physical illness
or injury for the consecutive days as defined in the Employer’s disability
policy then in effect, which inability to perform will be determined by a
physician reasonably selected by the Employer.

 

6.3  Termination Upon Employee’s Death.  In the event of Employee’s death, this
Agreement and Employee’s employment under this Agreement shall immediately
terminate.

 

6.4  Termination by Employer Other Than for Cause, Disability or Death. 
Notwithstanding anything to the contrary contained in this Agreement, the
Employer may terminate this Agreement and Employee’s employment under this
Agreement for any or no reason during the Term (i.e., other than for Cause or
Disability), such termination to be effective immediately upon the giving of
written notice to Employee from the Employer.

 

6.5  Termination by Employee.  Employee shall have the right, at his election
and for any reason prior to the expiration of the Term of this Agreement, to
voluntarily terminate this Agreement and his employment with Employer upon
thirty (30) days’ written notice.  Such notice requirement may be waived by
Employer at its sole discretion.

 

6.6  Termination by Expiration.  This Agreement shall terminate upon the
expiration of the Term.  Although the Agreement shall expire, Employee’s
employment with Employer shall not automatically terminate upon expiration of
the Term.

 

6.7  Certain Payments Following Termination of Employment.

 

(a)                                 If, during the Term of this Agreement,
Employee’s employment with the Employer is terminated by the Employer for Cause
or Disability, or if Employee voluntarily terminates employment with the
Employer, Employee shall thereafter be entitled to receive from the Employer
payment of any accrued but unpaid Base Salary, less applicable taxes,
withholding, and deductions, through the date of employment termination and
expense reimbursements through the date of such termination for which Employee
is entitled to reimbursement in accordance with Section 4.1 (collectively, the
“Accrued Benefits”), and Employee’s Restrictive Covenants set forth in Article V
shall continue during the Restricted Period.  For the avoidance of doubt, the
Accrued Benefits do not include the yet to be accrued Base Salary that Employee
would have earned had his employment not terminated prior to the expiration of
the Term.

 

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(b)                                 If, during the Term of this Agreement,
Employee’s employment with the Employer is terminated during the Term by the
Employer for any reason other than for Cause or Disability, Employee shall be
entitled to receive from the Employer (1) the Accrued Benefits (payable within
thirty (30) days after the date of termination), and (2) provided Employee has
executed a release in a form reasonably acceptable to the Employer and such
release has become effective prior to the sixtieth (60th) day following the date
of termination, Employee shall be entitled to (A) a lump sum payment equal to
payment of Base Salary for the remaining portion of the Term of this Agreement,
less applicable statutory deductions, payable on the sixtieth (60th) day
following the date of termination, and (B) the forfeiture restrictions
applicable to the Restricted Stock set forth in Section 5.6 hereof shall lapse
on a pro rata basis at a rate of 33% for each full year of employment completed
during the Term.  Further, Employee’s obligations set forth in Article V shall
continue during the Restricted Period.

 

(c)                                  If Employee’s employment with the Employer
is terminated upon Employee’s death, Employee’s legal representatives shall
thereafter be entitled to receive from the Employer payment of the Accrued
Benefits within thirty (30) days after the date of death, and Employee’s
Non-Competition Obligations set forth in Article V shall automatically cease.

 

(d)                                 If this Agreement terminates by expiration,
as set forth in Section 6.6, Employee shall be entitled to receive the Accrued
Benefits, and Employee’s Restrictive Covenants set forth in Article V shall
continue during the Restricted Period.

 

6.8  Code Section 409A.

 

(a)                                 Notwithstanding any provision of this
Agreement to the contrary, if at the time of Employee’s termination of
employment with Employer, Employee is a “specified employee” as defined in
Section 409A of the Code, then to the extent that any amount to which Employee
is entitled in connection with the termination of his employment is subject to
Section 409A of the Code, payments of such amounts to which Employee would
otherwise be entitled during the six (6) month period following Employee’s
termination of employment will be accumulated and paid in a lump sum on the
first day of the seventh month after the date of Employee’s termination of
employment.  The first sentence of this paragraph shall apply only to the extent
required to avoid Employee’s incurrence of any additional tax or interest under
Section 409A of the Code or any regulations or Treasury guidance promulgated
thereunder.

 

(b)                                 Notwithstanding any provision of this
Agreement to the contrary, to the extent that any payment under the terms of
this Agreement would constitute an impermissible acceleration of payments under
Section 409A of the Code or any regulations or Treasury guidance promulgated
thereunder, such payments shall be made no earlier than at such times allowed
under Section 409A of the Code.

 

(c)                                  If any provision of this Agreement (or of
any award of compensation) would cause Employee to incur any additional tax or
interest under Section 409A of the Code or any regulations or Treasury guidance
promulgated thereunder, Employer may reform such provision; provided, that
Employer shall (1) maintain, to the maximum extent practicable, the original
intent of the applicable provision without violating the provisions of
Section 409A of the

 

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Code and (2) notify and consult with Employee regarding such amendments or
modifications prior to the effective date of any such change.

 

6.9  Return of Property.  Upon Employee’s termination of employment for any
reason, or at any time upon Employer’s request, Employee (or Employee’s executor
or personal representative in the event of Employee’s death or Disability) shall
immediately return to the Employer all property of the Employer, including, but
not limited to, all keys, credit cards and all other property of the Employer in
Employee’s possession.

 

6.10  Resignation of All Other Positions. Upon termination of the Employee’s
employment for any reason, the Employee shall be deemed to have resigned from
all positions that the Employee holds as an officer or member of the Board (or a
committee thereof) of Employer, the Bank, or any of their affiliates.

 

6.11  Code Section 280G.  If any of the payments or benefits received or to be
received by Employee (including, without limitation, any payment or benefits
received in connection with a change in control or Employee’s termination of
employment, whether pursuant to the terms of this Agreement or any other plan,
arrangement, or agreement, or otherwise) (all such payments collectively
referred to herein as the “280G Payments”) constitute “parachute payments”
within the meaning of Section 280G of the Code and would, but for this
Section 6.11, be subject to the excise tax imposed under Section 4999 of the
Code (the “Excise Tax”), then such 280G Payments shall be reduced in a manner
determined by the Employer that is consistent with the requirements of
Section 409A until no amount payable to Employee will be subject to the Excise
Tax.

 

ARTICLE VII

 

GENERAL PROVISIONS

 

7.1  Notices.  Any notices to be given hereunder by either party to the other
may be effected either by personal delivery in writing or by mail, registered or
certified, postage prepaid with return receipt requested.  Mailed notices shall
be addressed to the parties at the addresses appearing in the introductory
paragraph of the Agreement, but each party may change its address by written
notice in accordance with this paragraph.  Notices delivered personally shall be
deemed communicated as of actual receipt; mailed notices shall be deemed
communicated as of three (3) days after mailing.

 

7.2  Entire Agreement.  This Agreement sets forth the entire agreement of the
parties relating to the subject matter hereof, and, effective after the
Effective Time, supersedes any other employment agreements or understandings,
written or oral, between the Employer or its predecessors and the Employee,
including, without limitation, the Prior Agreement.  The Employee has no oral
representations, understandings or agreements with the Bank or Employer or any
of their officers, directors or representatives covering the same subject
matters as this Agreement.  The Agreement is the final, complete and exclusive
statement and expression of the agreement between the Bank, Employer and the
Employee and of all the terms of this Agreement, and it cannot be varied,
contradicted or supplemented by evidence of any prior or contemporaneous oral or
written agreements.

 

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7.3  Governing Law.  All questions concerning the validity, operation and
interpretation of this Agreement and the performance of the obligations imposed
upon the parties hereunder shall be governed by the laws of the State of Texas. 
Exclusive venue of any dispute relating to this Agreement shall be, and is
convenient in, Harris County, Texas.  Employee agrees that he will not contest
venue in Harris County, Texas or the application of Texas laws to any dispute
relating to, connected with or arising under this Agreement.

 

7.4  Modification.  This Agreement shall not be amended, modified, or altered in
any manner except in writing signed by both parties.

 

7.5  Failure to Enforce Not Waiver.  Any failure or delay on the part of the
Bank, Employer or Employee to exercise any remedy or right under this Agreement
shall not operate as a waiver.  The failure of either party to require
performance of any of the terms, covenants or provisions of this Agreement by
the other party shall not constitute a waiver of any of the rights under the
Agreement.  No forbearance by either party to exercise any rights or privileges
under this Agreement shall be construed as a waiver, but all rights and
privileges shall continue in effect as if no forbearance had occurred.  No
covenant or condition of this Agreement may be waived except by the written
consent of the waiving party.  Any such written waiver of any term of this
Agreement shall be effective only in the specific instance and for the specific
purpose given.

 

7.6  Survival.  Notwithstanding anything in this Agreement to the contrary, upon
the expiration or other termination of this Agreement following the Effective
Time, the respective rights and obligations of the parties hereto shall survive
such expiration or other termination to the extent necessary to carry out the
mutual intention of the parties under this Agreement, including, without
limitation, the provisions of Article V.

 

7.7  Partial Invalidity.  If any provision of this Agreement is held by a court
of competent jurisdiction to be invalid, void, or unenforceable, the remaining
provisions shall remain in full force and effect, as if this Agreement has been
executed without any such invalid provisions having been included.  Such invalid
provision shall be reformed in a manner that is both (i) legal and enforceable,
and (ii) most closely represents the parties’ original intent.

 

7.8  Counterparts.  This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original, but all of which shall constitute one
and the same instrument.

 

7.9  Successors and Assigns.  This Agreement shall be binding upon and shall
inure to the benefit of the Bank, Employer and Employee, and their respective
heirs, executors, administrators, successors and assigns, including, without
limitation, any successor by merger, consolidation or stock purchase of the
Bank, Employer and any entity or person that acquires all or substantially all
of the assets of the Bank or Employer.

 

[Signature Page Immediately Follows]

 

11

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IN WITNESS WHEREOF, the parties hereto have caused this Employment Agreement to
be duly executed as of the date first written above.

 

 

 

PROSPERITY BANK

 

EMPLOYER

 

 

 

 

 

/s/ David Zalman

 

Name:

David Zalman

 

Title:

Senior Chairman and Chief Executive Officer

 

 

 

 

 

LEGACYTEXAS BANK

 

THE BANK

 

 

 

 

 

/s/ Kevin J. Hanigan

 

Name:

Kevin J. Hanigan

 

Title:

President and CEO

 

 

 

 

 

EMPLOYEE

 

 

 

 

 

/s/ Charles D. Eikenberg

 

Charles D. Eikenberg

 

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