Exhibit
10.8


 


CITIZENS BANCSHARES CORPORATION


CHANGE
IN CONTROL AGREEMENT


 


THIS CHANGE IN CONTROL AGREEMENT
(the “Agreement”) is made as of this 1 day of December, 2005 by and between Cynthia
N. Day (the “Executive”) and CITIZENS BANCSHARES CORPORATION, a corporation organized
under the laws of the State of Georgia (the “Company”).


 


RECITALS:


 


WHEREAS, the Executive is
currently employed by the Company and/or one or more of its affiliates as the
Senior Executive Vice President/Chief Operating Officer; and


 


WHEREAS, the Company desires
to enter into an agreement with the Executive to provide change in control benefits
to the Executive upon the terms and conditions set forth herein.


 


NOW, THEREFORE, in
consideration of the mutual covenants herein contained, the parties agree as
follows:


 


1.             Definitions. For purposes of this
Agreement, the following terms and conditions shall have the meanings set forth
in this Section 1:


 


(a)           “Area”
means the geographic area within the boundaries of Fulton and Dekalb Counties in
the State of Georgia. It is the express intent of the parties that the Area as
defined herein is the area where the Executive performs services on behalf of
the Company and its affiliates as of the Effective Date.


 


(b)           “Board
of Directors” means the Board of Directors of the Company.


 


(c)           “Business
of the Company” means the business of commercial banking.


 


(d)           “Cause”
means the occurrence of any of the following events:


 


(i)            material dishonesty, gross negligence or
willful misconduct by Executive in the performance of his duties hereunder
which conduct results in material financial or reputational harm to the Company
or its affiliates;


 


(ii)           conviction (from which no appeal may be, or
is, timely taken) of Executive of a felony;


 


(iii)          initiation of suspension or removal
proceedings against Executive by federal or state regulatory authorities acting
under lawful authority pursuant to provisions of federal or state law or
regulation which may be in effect from time to time;


 

















 


(iv)          knowing violation by Executive of federal or
state banking laws or regulations; or


 


(v)           refusal by Executive to perform a duly
authorized and lawful written directive of the Chief Executive Officer of the Company
or the President of the Bank.


 


(e)           “Change in Control” means the occurrence of any of the
following events on or after the Effective Date:


 


(i)            the acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of voting securities of the corporation where such acquisition
causes such person to own more than fifty percent (50%) of the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors; or


 


(ii)           individuals who as of the Effective Date
hereof, constitute the Board of Directors of the Company (the “Incumbent Board”)
cease for any reason to constitute at least a majority of such Board of
Directors; provided, however, that any individual becoming a director
subsequent to the Effective Date hereof whose election, or nomination for
election by the Company’s shareholders, was approved by a vote of at least
two-thirds of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member such Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board or Directors; or


 


(iii)          a reorganization, merger or consolidation, (a
“Business Combination”) with respect to which persons who were the owners of
the Company immediately prior to such Business Combination do not, immediately
thereafter, own, directly or indirectly, more than fifty percent (50%) of the
then outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election
of directors of the corporation resulting from such Business Combination
(including, without limitation, a corporation that as a result of such
transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one or more subsidiaries);


 


(iv)          the sale, transfer or assignment of all or
substantially all of the assets of the Company and its affiliates to any third
party; or


 


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(v)           a complete liquidation or dissolution of the
Company.


 


(f)            “Code” means the Internal Revenue Code
of 1986, as amended.


 


(g)           “Confidential
Information” means data and information relating to the business of the Company
(which does not rise to the status of a Trade Secret) which is or has been
disclosed to the Executive or of which the Executive became aware as a
consequence of or through its relationship to the Company and which has value
to the Company and is not generally known to its competitors. Confidential
Information shall not include any data or information that has been voluntarily
disclosed to the public by the Company (except where such public disclosure has
been made by the Executive without authorization) or that has been
independently developed and disclosed by others, or that otherwise enters the
public domain through lawful means.


 


(h)           “Disability”
means a condition for which benefits would be payable under any long-term
disability coverage (without regard to the application of any elimination
period requirement) then provided to the Executive by the Company or, if no
such coverage is then being provided, the inability of the Executive to perform
the material aspects of the Executive’s duties of employment for a period of at
least one hundred eighty (180) consecutive days as certified by a physician
chosen by the Executive and reasonably acceptable to the Company.


 


(i)            “Effective
Date” means the date on which this Agreement is made as evidenced above.


 


(j)            “Good
Reason” means the occurrence of any of the following events and which is
not corrected by the Company within thirty (30) days after the Executive’s written
notice to the Company or one of its affiliates of the same:


 


(i)            a
material diminution in the Executive’s responsibilities or duties in effect
immediately prior to the effective date of the Change in Control;


 


(ii)           a
material reduction in the Executive’s base salary, incentives and/or benefits
in effect immediately prior to the effective date of a Change in Control;


 


(iii)          elimination
of benefit or incentive programs in which the Executive participates without
availability of comparable replacement programs; or


 


(iv)          a
change of the location of the Executive’s place of employment to more than
fifty (50) miles from the Executive’s principal business office as of the
effective date of a Change in Control.


 


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(k)           “Termination of
Employment” means the
Executive’s termination of employment, for any reason, from the Company and all
affiliates. Notwithstanding the foregoing, an event shall not be deemed to be a
Termination of Employment if it would not qualify as a “separation from service”
pursuant to Code Section 409A and the regulations promulgated thereunder.


 


(l)            “Specified Employee” shall mean a key employee (as defined in Code Section
416(i) without regard to Code Section 416(i)(5)) of the Company (or an entity
which is considered to be single employer with the Company under Code Section
414(b) or 414(c)) at any time during the twelve (12) month period ending on
December 31. Notwithstanding the foregoing, any employee who is a key
employee determined under the preceding sentence will be deemed to be a
Specified Employee solely for the period of April 1 through March 31 following
such December 31 or as otherwise required by the Code Section 409A and the
regulations promulgated thereunder.


 


(m)          “Trade
Secrets”  means information, without
regard to form, including, but not limited to, technical or nontechnical data,
formulas, patterns, compilations, programs, devices, methods, techniques,
drawings, processes, financial data, financial plans, product plans or lists of
actual or potential customers or suppliers which (i) derives economic
value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use, and (ii) is the subject of efforts that
are reasonable under the circumstances to maintain its secrecy.


 


2.             Term. This Agreement shall become
effective as of the Effective Date and shall remain in effect until the effective
date of the Executive’s Termination of Employment; provided, however, if a
Change in Control occurs prior to the Executive’s Termination of Employment, this
Agreement shall remain in effect for two (2) years following the effective date
of such Change in Control.


 


3.             Severance Benefits Upon Termination of Employment.


 


(a)           Amount
of Severance Benefits. If, within three (3) months before or two (2) years following a Change in Control, the Executive
experiences a Termination of Employment due to either (i) an involuntarily
termination by the Company or one of its affiliates without Cause or (ii) a
resignation by the Executive for Good Reason (no later than six (6) months
after the occurrence of the most recent event constituting Good Reason), the Company
shall pay to the Executive an amount equal to one and a half (1.5) times the Executive’s
annual base salary in effect at the time of the Termination of Employment. In
addition, to the extent permitted by the applicable plan or program, the
following employee welfare benefits shall continue in effect at the same level
as in effect immediately prior to the Change in Control for a period of twelve
(12) months following the Termination of Employment (the “Severance Period”):


 


If on the last date of
the Executive’s day of employment, the Executive has any of the following
benefits, those benefits should continue for a period of twelve (12) months 


 


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following the Termination of Employment (the “Severance Period) under
the terms listed below:


 


Medical, Vision,
Prescription Drug, Dental, as limited by COBRA;


Stock Purchase Plan;


YMCA;


Prepaid Legal;


Sam Club; and


Accrued unused vacation
time.


 


Finally, during the
Severance Period, the Company shall pay to the Executive an amount equal to the
Executive’s cost of COBRA continuation health coverage for the Executive and his
eligible dependents for the Severance Period or if less, the period during
which the Executive and his eligible dependents are entitled to COBRA
continuation coverage. The payments described in this Section 3 shall be collectively
referred to in this Agreement as the “Severance Benefit.”  A termination of the Executive’s employment
due to his death or Disability will not be deemed to be an involuntary
termination of employment by the Company or one of its affiliates without Cause
or a resignation by the Executive for Good Reason.


 


(b)           Golden
Parachute Reduction. Notwithstanding Subsection (a), if the aggregate of
the Severance Benefit and other payments and benefits which the Executive has
the right to receive from the Company and its affiliates (including the value
of any equity rights which become vested upon a Change in Control) (the “Total
Payments”) would constitute a “parachute payment” as defined in Section
280G(b)(2) of the Code, the Executive shall receive the Total Payments unless
the (a) after-tax amount that would be retained by the Executive (after taking
into account all federal, state and local income taxes payable by the Executive
and the amount of any excise taxes payable by the Executive under Code Section
4999 that would be payable by the Executive (the “Excise Taxes”)) if the Executive
were to receive the Total Payments has a lesser aggregate value than (b) the
after-tax amount that would be retained by the Executive (after taking into
account all federal, state and local income taxes payable by the Executive) if
the Executive were to receive the Total Payments reduced to the largest amount
as would result in no portion of the Total Payments being subject to Excise Taxes
(the “Reduced Payments”), in which case the Executive shall be entitled only to
the Reduced Payments. If the Executive is to receive the Reduced Payments, the Executive
shall be entitled to determine which of the Total Payments, and the relative
portions of each, are to be reduced.


 


(c)           Payment
of Severance Benefit. The Severance Benefit shall be paid to the Executive
in a lump sum payment as soon as practicable following the Executive’s
Termination of Employment; provided, however, that if the Executive is a
Specified Employee at the time payment is due hereunder, then the lump sum
payment shall be deferred and paid as soon as practicable following the
expiration of six (6) months from the effective date of the Executive’s
Termination of Employment. The Company shall be 


 


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entitled to withhold appropriate employment and income taxes, if
required by applicable law, if the Severance Benefit becomes payable.


 


4.             Confidentiality.


 


(a)           All Confidential Information and Trade
Secrets and all physical embodiments thereof received or developed by the Executive
while employed by the Company or any of its affiliates are confidential to and
are and will remain the sole and exclusive property of the Company or any of
its affiliates. Except to the extent necessary to perform the duties assigned
to him by the Company, the Executive will hold such Confidential Information
and Trade Secrets in trust and strictest confidence, and will not use,
reproduce, distribute, disclose or otherwise disseminate the Confidential
Information and Trade Secrets or any physical embodiments thereof and may in no
event take any action causing or fail to take the action necessary to prevent,
any Confidential Information and Trade Secrets disclosed to or developed by the
Executive to lose its character or cease to qualify as Confidential Information
or Trade Secrets.


 


(b)           The covenants of confidentiality set
forth herein will apply during the Term of the Executive’s employment to any
Confidential Information and Trade Secrets disclosed by the Company or one of
its affiliates or developed by the Executive prior to or after the date hereof.
The covenants restricting the use of Confidential Information will continue and
be maintained by the Executive for a period of twelve (12) months following
termination of this Agreement. The covenants restricting the use of Trade
Secrets will continue and be maintained by the Executive following termination
of this Agreement for so long as permitted by the then-current Georgia Trade
Secrets Act of 1990, O.C.G.A. § 10-1-760, et. seq.


 


5.             Noncompetition. In the event that the Executive is
entitled to receive the Severance Benefit under this Agreement, the Executive
agrees that, for twelve (12) months following the Executive’s termination of
employment, the Executive will not (except on behalf of or with the prior
written consent of the Company), within the Area, either directly or
indirectly, on his own behalf or in the service or on behalf of others, as an
employee or in any other capacity which involves duties and responsibilities
similar to those undertaken for the Company or any of its affiliates, engage in
any business which is the same as or essentially the same as the Business of
the Company.


 


6.             Nonsolicitation. In the event that the Executive is
entitled to receive the Severance Benefit under this Agreement, the Executive
agrees that, for twelve (12) months following the Executive’s termination of
employment:


 


(a)           the Executive will not (except on behalf
of or with the prior written consent of the Company), on the Executive’s own
behalf or in the service or on behalf of others, solicit, divert or appropriate
or attempt to solicit, divert or appropriate, directly or by assisting others,
any business from any of the customers of the Company or its affiliates,
including actively sought prospective customers, with whom the Executive has or
had material contact during the last two (2) years of the Executive’s
employment, for


 


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purposes of providing
products or services that are competitive with those provided by the Company
and its affiliates; and


 


(b)           the Executive will not on the Executive’s
own behalf or in the service or on behalf of others, solicit, recruit or hire
away or attempt to solicit, recruit or hire away, directly or by assisting
others, any employee of the Company or its affiliates, whether or not such
employee is a full-time employee or a temporary employee of the Company or its
affiliates and whether or not such employment is pursuant to a written
agreement and whether or not such employment is for a determined period or is
at will.


 


7.             Enforcement of Covenants
and Remedies.
The Executive agrees that the covenants contained in Sections 4, 5, and 6
hereof are the essence of this Agreement; that each of the covenants is
reasonable and necessary to protect the business, interest and properties of
the Company, and that irreparable loss and damage will be suffered by the Company
should he breach any of the covenants. In the event that the Company reasonably
determines that the Executive has breached any of his obligations pursuant to
Sections 4, 5, and 6 hereof, which remain uncured after the expiration of
thirty (30) days following the delivery of written notice of such breach to the
Executive by the Company, the Executive will forfeit any amounts owed to the Executive
under Section 3 hereof which have not previously been paid to the Executive. The
Executive also agrees and consents that, in addition to all the remedies
provided by law or in equity, the Company shall be entitled to specific
performance of this Agreement and to both temporary and permanent injunctions
to prevent a breach or contemplated breach by the Executive of the covenants in
Sections 4, 5 and 6 hereof.


 


8.             No Mitigation. No amounts or
benefits payable to the Executive hereunder shall be subject to mitigation or
reduction by income or benefits the Executive receives from other sources.


 


9.             Continued Employment. Nothing in
this Agreement shall entitle Executive to continued employment with the Company
or any of its affiliates or to continued tenure in any specific office or
position. The Executive’s employment with the Company or any of its affiliates shall
be terminable at the will of the Company, with or without Cause.


 


10.           Assignment. If the Company sells,
assigns, or transfers a majority of its business and assets to any person or
entity, or if the Company merges into or consolidates or otherwise combines
with any person which is a continuing or successor entity (such acquiring or
successor entity to be referred to herein as the “Acquiring Entity”), then the Company
shall assign all of its right, title and interest in this Agreement to the
Acquiring Entity and the Acquiring Entity shall assume and perform all of the
terms, conditions and provisions imposed by this Agreement upon the Company. In
the event the Company assigns this Agreement as permitted by this Agreement and
the Acquiring Entity assumes this Agreement, all further rights and obligations
of the Company shall cease and terminate and the “Company” as defined herein
will refer to the Acquiring Entity.


 


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11.           Dispute Resolution. The Company and the Executive agree that any
dispute between the Executive and the Company or its officers, directors,
employees, or agents in their individual or Company capacity relating to the
interpretation, enforcement or breach of this Agreement, shall be submitted to
a mediator for non-binding, confidential mediation. If the matter cannot be
resolved with the aid of the mediator, the Company and the Executive mutually
agree to arbitration of the dispute. The arbitration shall be in accordance
with the then-current Employment Dispute Resolution Rules of the American
Arbitration Association (“AAA”) before an arbitrator who is licensed to
practice law in the State of Georgia. The arbitration shall take place in or
near Atlanta, Georgia. The Company and the Executive agree that the procedures
outlined in this provision are the exclusive method of dispute resolution.


 


12.           Attorneys’ Fees. In the event of the use of any dispute resolution
program related to a controversy arising
under or in connection with this Agreement, the party prevailing
in such dispute resolution program shall be entitled to receive from the other
party all reasonable costs and expenses, including without limitation attorneys’
fees, incurred by the prevailing party in connection with such dispute
resolution program, and the other party shall pay such costs and expenses to
the prevailing party promptly upon demand by the prevailing party. The amount
of reasonable attorneys’ fees shall be determined by the trier of fact in its
sole discretion but, in any event, shall not exceed $10,000.


 


13.           Notice. All notices, consents, waivers and
other communications required or permitted by this Agreement shall be in
writing and shall be deemed given to a party when (a) delivered to the
appropriate address by hand or by nationally recognized overnight courier service
(costs prepaid); (b) sent by facsimile with confirmation of transmission by the
transmitting equipment; or (c) received or rejected by the addressee, if sent
by certified mail, return receipt requested, in each case to the following
addresses or facsimile numbers and marked to the attention of the person (by
name or title) designated below (or to such other address, facsimile number or
person as a party may designate by written notice to the other parties):


 


	
  If to the
  Company, to the Company at:

  	
   

  	
  Citizens
  Bancshares Corporation

  
	
   

  	
   

  	
  Attention: Chairman

  
	
   

  	
   

  	
  Ray M. Robinson

  
	
   

  	
   

  	
  75 Piedmont Ave., N.E.

  
	
   

  	
   

  	
  Atlanta, Georgia 30303

  
	
   

  	
   

  	
   

  
	
  If
  to the Executive, to the Executive at:

  	
   

  	
  Mrs.
  Cynthia N. Day

  
	
   

  	
   

  	
  3687
  Spring Hill Road, S.E.

  
	
   

  	
   

  	
  Smyrna,
  Georgia 30080

  



 


14.           Headings. Sections or other
headings contained herein are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.


 


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15.           Entire Agreement. This Agreement contains
the entire understanding of the parties with respect to the subject matter
hereof.


 


16.           Release. Prior to payment of any Severance Benefit pursuant
to this Section 3, the Company shall have the right to require the Executive to
sign, and the Executive hereby agrees to sign, a release, as described herein,
and the Company may withhold payment of such amount until the period during
which the Executive may revoke such waiver (normally seven (7) days) has
elapsed. The release shall provide the release and discharge of the Company and
related persons and entities from any and all such actions, suits, proceedings,
claims, demands or causes of action, in any way directly or indirectly related
to or connected with the Executive’s employment with the Employer and or the
termination of the employment with the Employer, including, but not limited to,
claims relating to discrimination in employment.


 


17.           Severability. In the event that one
or more of the provisions of this Agreement shall be or become invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein shall not be affected thereby.


 


18.           Governing Law. To the full extent
controllable by stipulation of the parties, this Agreement shall be interpreted
and enforced under Georgia law.


 


19.           Amendment. This Agreement may not
be modified, amended, supplemented or terminated except by a written agreement
between the Company and the Executive.


 


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IN WITNESS WHEREOF, each
of the parties has executed this Agreement as of the date and year first above
written.


 


	
   

  	
  CITIZENS
  BANCSHARES CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Print Name: James E.
  Young

  	
   

  
	
   

  	
   

  
	
   

  	
  Title: President &
  CEO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date: 

  	
   

  
							



 


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