EX-10.1






October 27, 2017



John A. Heffern


[ADDRESS]



Dear Mr. Heffern:



The Board of Directors (the “Board”) of First BanCorp (the “Corporation”) and FirstBank Puerto
Rico (the “Bank”) is pleased to offer you the position as a Director of the Board of the
Corporation and the Bank. Your service as a Director of the Corporation and the Bank shall be
effective as of October 26, 2017 (the “Effective Date”), the date of effectiveness of this offer
letter (the “Offer Letter”).



The following are the detailed terms of this Offer Letter:




	1.	 	Position/Services.






	 	a.	 	You will be expected to devote a reasonable amount of your business time to
your services to the Bank pursuant to this Offer Letter commensurate with your role as
a member of the Board and as a member or Chair of a Board committee and you agree that
you will not, without the prior written consent of the Bank, directly or indirectly,
provide any material services to any other banking entity which competes in any
material respect with the Bank and its subsidiaries until the earlier of (i) the
termination of your services to the Bank pursuant to this Offer Letter, and (ii) your
resignation as Director (such date, the “Termination Date”), provided however that any
services provided by you to any other banking entity which you have disclosed to the
Bank prior to the presentation of this Offer Letter and which continues to be provided
as of its execution is not prohibited pursuant to this section and shall not require
the prior written consent of the Bank. You may resign as a member of the Board at any
time upon written notice to its Chairman.






	 	b.	 	You shall render services as a member of the Board, as well as a member of any
other committee which you may be appointed to by the Board during your services as a
member of the Board, which may include the appointment as a committee chair. You shall
attend and participate to the maximum extent practicable in such number of meetings of
the Board and of the committee(s) of which you are a member as regularly or specially
called.






	2.	 	Term. Your term as Director shall continue until your successor is duly elected and
qualified or until any resignation by you shall be effective. The position shall be up for
re-election each year at the annual shareholders’ meeting and upon re-election, the terms and
provisions of this Offer Letter (as modified from time to time) shall remain in full force and
effect.






	3.	 	Fees and Compensation.






	 	a.	 	Annual Director’s Fees. Commencing on the Effective Date, you will be paid
fees for your services as a Director in a total amount equal to $115,000 per year (such
amount, the “Annual Fee”). The Annual Fee shall be payable $75,000 in cash (the
“Annual Retainer”) and $40,000 in the form of an annual grant of restricted stock (the
“Restricted Stock”), under the First BanCorp Omnibus Incentive Plan, as amended. The
cash Annual Retainer shall be paid in equal installments on a monthly basis over a
twelve-month period. The Restricted Stock shall be awarded at the beginning of each
twelve-month period during which you are a Director and shall be subject to a
twelve-month vesting period. In addition, you may receive additional compensation in
the form of retainers depending upon the Board committees which you may be appointed to
by the Board during your services as a member of the Board as follows, subject to the
right of the Board to change such fee structure at its discretion based on changed
circumstances:





	 	 	 	 	 	 	 	 	 
	 
	 	Committee Chair	 	Committee Member
	Committee
	 	Retainer	 	Retainer
	 
	 	 	 	 	 	 	 	 
	Audit Committee
	 	$	25,000	 	 	$	5,000	 
	 
	 	 	 	 	 	 	 	 
	Compensation and Benefits Committee
	 	$	5,000	 	 	 	-0- 	 
	 
	 	 	 	 	 	 	 	 
	Corporate Governance and
Nominating Committee
	 	$	5,000	 	 	 	-0- 	 
	 
	 	 	 	 	 	 	 	 
	Asset/Liability Committee
	 	$	5,000	 	 	 	-0- 	 
	 
	 	 	 	 	 	 	 	 
	Credit Committee
	 	$	25,000	 	 	$	5,000	 
	 
	 	 	 	 	 	 	 	 
	Compliance Committee
	 	$	5,000	 	 	 	-0- 	 
	 
	 	 	 	 	 	 	 	 
	Risk Management Committee
	 	$	25,000	 	 	$	5,000	 
	 
	 	 	 	 	 	 	 	 







	 	b.	 	Taxes. You are responsible for paying all Federal, state, and local income or
business taxes, including estimated taxes, self-employment and any other taxes, fees,
additions to tax, interest, or penalties, which may be assessed, imposed, or incurred
as a result of any amounts paid to you pursuant to this Offer Letter. The Bank may
withhold or cause to be withheld from any Annual Fee any Federal, Puerto Rico, state or
local taxes required by law to be withheld with respect to such Annual Fee. By
acceptance of this Agreement, Director agrees to such deductions.






	4.	 	Reimbursement of Board Meeting/Committee Expenses: D&O Insurance and Indemnification.






	 	a.	 	You shall be entitled to receive reimbursement for all reasonable and
substantiated (i) expenses incurred by you in connection with your attending each Board
meeting and any director education meetings, including reasonable and substantiated
business class or equivalent travel expenses and meals and lodging, and (ii) legal
expenses incurred by you in connection with the negotiation of this Offer Letter. All
expenses incurred under this Section 4 will be reimbursed in accordance with the
applicable policies and procedures of the Bank; provided, however, that any amounts
reimbursed in one taxable year will not affect the amounts eligible for reimbursement
by the Bank in a different taxable year, and all reimbursement requests must be
submitted by you no later than December 31 of the calendar year following the calendar
year in which the expense was incurred.






	 	b.	 	The Bank shall, at its expense, purchase and maintain director’s and officer’s
(“D&O”) insurance in an amount comparable to the amount of D&O insurance provided by
chartered banks with similar total assets and of a similar size and complexity to the
Bank (but in no event less than $10 million), to protect itself and you, as a Director
serving at the request of the Bank, against any expense, liability, or loss, whether or
not the Bank would have the power to indemnify you against such expense, liability, or
loss under applicable law. Such insurance shall be written by an insurer or insurers
admitted to issue such insurance in Puerto Rico and holding a financial strength
rating (“FSR”) of not less than B+ as such FSR is assigned by Best’s and shall be on
terms and conditions as shall be customary in the current market from time to time.
Such coverage shall include a “Side A” coverage available to directors in an amount
comparable to that obtained by other comparable institutions (but in no event less than
$10 million). The Bank shall purchase such coverage on a basis that will provide
protection to you not only during the time of your service as a director of the Board
but also for six years after such service shall terminate for any reason. The Bank
will provide copies of its D&O insurance policies to you upon request and will promptly
advise you of any changes that may occur in its existing coverages.






	 	c.	 	As a Director serving at the request of the Bank, you shall be indemnified by
the Bank to the fullest extent permitted by applicable law against judgments, penalties
(including excise and similar taxes and punitive damages), fines, settlements, and
reasonable expenses (including reasonable attorneys’ and expert witness fees) actually
incurred by you in connection with any actual or threatened proceeding (a “Proceeding”)
relating to or arising from your service as a member of the Board or any committee
thereof with any such expenses being advanced to you within 30 days of your written
request therefore; provided that in any matter covered by paragraph (2) of Article
Ninth of the Articles of Incorporation of the Bank your conduct is not finally adjudged
in a non-appealable decision by a court of competent jurisdiction to have constituted
fraud, bad faith, gross negligence or willful and knowing violation of any law
applicable to the Bank or your service as a director or member of a committee of the
Board, in which case there shall be no indemnification and you shall return any
advances to the Bank (a “Non-Indemnifiable Claim”); provided, further, however, that
you shall be entitled to indemnification in any circumstance in which you acted or
failed to act in reliance upon advice of counsel to the Bank or the Board or any
committee thereof or the court in which such action was brought shall determines upon
application, that despite the adjudication of liability but in view of all the
circumstances of the case, you are fairly and reasonably entitled to indemnity for such
expenses which the court shall deem proper. Your entitlement to indemnification under
this Section 4.c. shall not be limited to your entitlement to protection under any
applicable insurance coverage and to any other indemnification or payment you may be
entitled to under the circumstances under the Bank’s articles of incorporation or
by-laws or under any other agreement. Notwithstanding the foregoing, the Bank shall
not be obligated to provide any indemnification or advancement of expenses when (i) a
Proceeding is between the Bank and you (provided that you shall be entitled to such
indemnification in respect of any action brought by or in the right of the Bank by any
shareholder thereof, i.e., a derivative action, and in respect of any action brought by
you to establish your right to indemnification hereunder or otherwise; providing any
such actions do not constitute a Non-Indemnifiable Claim); or (ii) prohibited by
applicable law or regulation, including 12 C.F.R. part 359.






	 	d.	 	Each and every provision of this Section 4 is separate and distinct so that if
any provision hereof shall be held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect the validity or enforceability of any
other provision hereof. To the extent required, any provision of this Section 4 may be
modified by a court of competent jurisdiction to preserve its validity and to provide
you with the broadest possible indemnification permitted under Puerto Rican law.






	 	e.	 	If any provision of this Section 4 is invalidated on any ground by any court of
competent jurisdiction, the Bank shall nevertheless indemnify you as to any expenses,
judgments, fines, penalties or excise taxes incurred with respect to any Proceeding to
the full extent permitted by any provision hereof that has not been invalidated or by
any other applicable provision of Puerto Rico law.






	5.	 	General Provisions.






	 	a.	 	This Offer Letter supersedes any other agreements or promises made to you by
anyone at the Bank, whether oral or written, and, subject to approval by the Board,
comprises the final, complete, and exclusive agreement between you and the Bank.






	 	b.	 	This Offer Letter shall be governed by the laws of the Commonwealth of Puerto
Rico, without regard to its principles of conflicts or choices of laws.






	 	c.	 	This Offer Letter may be modified only by a written instrument duly executed by
you and an authorized representative of the Bank.






	 	d.	 	This Offer Letter may be executed by the parties in separate counterparts, each
of which, when so executed and delivered, shall be an original, but all of which, when
taken as a whole, shall constitute one and the same instrument.






	 	e.	 	Any notices that are required to be given pursuant to this Offer Letter must be
in writing and may be given by personal delivery, registered or certified mail (postage
prepaid, return receipt requested), facsimile, courier, or overnight mail delivery to
the following addresses:





	 	 	 
	To the Company:
	 	First BanCorp

PO Box 9146

San Juan, PR 00907-0146

	To You:
	 	John A. Heffern

[ADDRESS]








	 	f.	 	The Bank and you hereby consent to the jurisdiction of the Federal and State
courts of the Commonwealth of Puerto for the purpose of hearing any Proceeding between
you and the Bank arising hereunder or in respect to your service as a member of the
Board or any committee thereof.






	 	g.	 	This Offer Letter shall be binding upon, and shall inure to the benefit of you
and your heirs, executors and administrators, whether or not you have ceased to be a
director, and the Bank and its successors and assigns.





(SIGNATURE PAGE FOLLOWS)





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Please sign and date this Offer Letter below and return it to the Bank as soon as possible but
in no event later than October 30, 2017, to indicate your agreement to the terms and conditions
described herein.



We look forward to your favorable reply and to a productive and enjoyable work relationship.



Sincerely,



First BanCorp



By: /s/ Roberto Herencia 


Roberto Herencia


Chairman of the Board



Agreed and Accepted:



By: /s/ John A. Heffern 


John A. Heffern




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