EX-10.5







Exhibit 10.5




AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT




     This AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (this “Amendment”), is entered into and is
effective as of January 15, 2009, by and between, on the one hand, FIRST BANCORP (the
“Corporation”), a corporation organized under the laws of the Commonwealth of Puerto Rico (the
“Commonwealth”), and FIRSTBANK PUERTO RICO (the “Bank”), a banking institution organized under the
laws of the Commonwealth that is a wholly-owned subsidiary of the Corporation, and, on the other
hand, Fernando Scherrer (the “Executive”), Chief Financial Officer and Executive Vice President of
the Corporation.



Recitals




     WHEREAS, the Corporation and the Executive entered into a certain Employment Agreement dated
as of July 18, 2006 (the “Employment Agreement”), pursuant to which the Corporation and the Bank
retained the professional services of the Executive, subject to the terms and conditions set forth
therein; and



     WHEREAS, the parties hereto wish to amend the terms of the Employment Agreement in the manner
set forth below.



     NOW THEREFORE, in consideration of the premises herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, each intending to be legally bound hereby, agree as follows:



     1. Definitions. All capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to such terms in the Employment Agreement; provided, however, that for all
purposes the term “Corporation”, whenever utilized in the Employment Agreement, shall include the
Bank, its affiliates, and any other subsidiaries of the Corporation, irrespective of the context of
which such term is utilized.



     2. Particular Amendments to the Employment Agreement. The Employment Agreement is
hereby amended as follows:



     (a) In the event of any payment made pursuant to the provisions of the Employment Agreement
which qualify as an applicable severance from employment or a golden parachute payment, as such
terms are defined in Section 280G of the Internal Revenue Code of 1986, as amended by the
provisions of the Emergency Economic Stabilization Act of 2008, such payment shall not equal or
exceed an amount equal to three times the Executive’s average taxable compensation over the five
years preceding the year of the applicable severance from employment or the golden parachute
payment (the “Compensation”). In accordance herewith, to the extent such severance from employment
or a golden parachute payment exceeds the Compensation, the severance from employment or the golden
parachute payment shall equal the Compensation less one dollar.



     (b) The Bank shall recover from the Executive any bonus or incentive compensation paid to the
Executive based on statements of earnings, gains, or other criteria that are later proven to be
materially inaccurate.



     (c) The limitations imposed herein under paragraph (a) and (b) shall apply during the period
that the United States Department of the Treasury holds an equity or debt position in the
Corporation pursuant to the provision of Section 101(a) of the Emergency Economic Stabilization Act
of 2008.



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     (d) Any severance from employment or golden parachute payment not paid to the Executive as a
result of the provisions of paragraph (a) above shall be paid to the Executive within a period no
longer than ten (10) business days following the date upon which the Department of the Treasury no
longer holds an equity or debt position in the Corporation (the “Deferred Payment Date”)
irrespective of the Executive being an employee of the Corporation on the Deferred Payment Date.



     3. Effectiveness. Except as expressly amended herein, the Employment Agreement shall
continue to be and shall remain in full force and effect in accordance with its terms; and, in such
connection, it is hereby acknowledged and agreed to by the parties hereto that this Amendment is
not intended to cause an extinctive novation of the terms and conditions of, and the obligations of
the respective parties under, the Employment Agreement.



     4. Waiver. The execution, delivery, and effectiveness of this Amendment shall not
operate as a waiver of any right, power, or remedy of the parties to the Employment Agreement nor
constitute a waiver of any provision of the Employment Agreement.



     5. Governing Law. This Amendment shall be governed by and construed in accordance with
the laws of the Commonwealth.



     6. Counterparts. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute but one and the same document.
Delivery of an executed counterpart of a signature page to this Amendment by telecopier shall be as
effective as delivery of a manually executed counterpart of this Amendment.



     7. Severability. Any provision of this Amendment which is prohibited, unenforceable or
not authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition, unenforceability or non-authorization, without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such provision in any
other jurisdiction.



[SIGNATURE PAGE FOLLOWS]




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     IN WITNESS WHEREOF, the parties hereto have executed and delivered, or caused this Amendment
to be duly executed and delivered by their respective officers thereunto as of the date first above
written.



	 	 	 
	FIRST BANCORP
	 
	 	 
	By:

	 	/s/ Luis M. Beauchamp
	Name:

	 	Luis M. Beauchamp
	Title:

	 	President and Chief 

Executive Officer
	 
	 	 
	FIRSTBANK PUERTO RICO
	 
	 	 
	By:

	 	/s/ Fernando Scherrer
	Name:

	 	Fernando Scherrer
	Title:

	 	Executive Vice President 

and Chief Financial Officer






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