EX-10.17 PAYMENT AGREEMENT-MRS. ROSEMARIE SALCEDO



 





EXHIBIT 10.17




PAYMENT AGREEMENT

IN THE EVENT OF A CHANGE OF CONTROL



This PAYMENT AGREEMENT IN THE EVENT OF A CHANGE OF CONTROL (the “Agreement”) is dated December 16,
2005, between Westernbank Puerto Rico (the “Bank”) and Mrs. Rosemarie Santiago Salcedo, also known
as Rosemarie Rodríguez (the “Employee”).




          WHEREAS, the Employee will be serving as Senior Vice-President of Westernbank International
Trade Services; and




          WHEREAS, the Board believes that it is in the best interests of the Bank to encourage the
Employee’s continued employment with dedication to the Bank in the face of potentially distracting
circumstances arising from the remote possibility of a change in control of the Bank, although no
such change is now thought of or contemplated; and




          WHEREAS, the parties desire to enter into this Agreement setting forth the terms and
conditions for the payment of special compensation to the Employee in the event of a termination of
the Employee’s employment in connection with or as a result of a change in control;




          NOW THEREFORE, it is AGREED as follows:





	1.	 	Term. The term of this Agreement shall be for a three (3) year period commencing on
the date mentioned below. You will occupy the position for a term of not less than three
years, from an anticipated starting date of December 21, 2005; with covenant not to compete,
or in any way be engaged, directly or indirectly, in Puerto Rico, during your employment and
for the remainder of the term stated in this agreement, but under no circumstance for less
than one year, which ever is greater, after ceasing employment. Upon your acceptance of your
appointment, you will be paid a signing bonus of $50,000.






	2.	 	Termination of Employment in Connection with a Change in Control.






	 	(a)	 	If during the term of this Agreement there is a change in control of the Bank, the
Employee shall be entitled to receive as a special compensation a lump sum cash payment as
provided for herein, in connection with or within one (1) year after a “Change in Control”
(as defined below) in the event the Employee’s employment is terminated involuntarily by
the Bank without cause in connection with or within one (1) year after a change in control
has occurred. The amount of this payment shall be equal to the annual base compensation
and year-end Christmas bonus paid to the Employee by the Bank during the calendar year
preceding the year in




 









 






	 	 	 	which the Change in Control occurs, multiplied by the number of years remaining in this agreement. Payment under this
Section 2(a) shall be in lieu of any amount that may be otherwise owed to the employee as
damages for the loss of employment, in the event that such loss occurs. No payment
hereunder shall affect the Employee’s entitlement to any vested benefits or other
compensation payments.
	 
	 	(b)	 	For purposes of this Agreement, a “Change in Control” shall be deemed to have
occurred if:






	 	(i)	 	Twenty-five (25) percent or more of ownership, control, power
to vote, or beneficial ownership of any class of voting securities of the Bank
is acquired by any person, either directly or indirectly or acting through one
or more other persons;
	 
	 	(ii)	 	any person (other than any person named as a proxy in
connection with any solicitation on behalf of the Board) holds revocable or
irrevocable proxies, as to the election or removal of three (3) or more
Directors of the Bank, for twenty-five (25) percent or more of the total
number of voting shares of the Company and or Bank;
	 
	 	(iii)	 	any person has received all applicable regulatory approvals
to acquire control of the Bank;
	 
	 	(iv)	 	any person has commenced a cash tender or exchange offer, or
entered into an agreement or received an option, to acquire beneficial
ownership of twenty-five (25) percent or more of the total number of voting
shares of the Bank, whether or not any requisite regulatory approval for such
acquisition has been received, provided that a Change in Control will not be
deemed to have occurred under this clause (iv) unless the Board has made a
determination that such action constitutes or will constitute a Change in
control; or
	 
	 	(v)	 	as the result of, or in connection with, any cash tender or
Exchange offer, merger, or other business combination, sale of assets or
contested election, or any combination of the foregoing transaction, (A) the
persons who were directors of the Bank before such transaction shall cease to
constitute at least a majority of the Board or its successor, or (B) the
persons who were stockholders of the Bank immediately before such transaction
do not own more than fifty (50) percent of the outstanding voting stock of the
Bank or its successor immediately after such transaction.
	 
	 	 	 	For purposes of this Section, a “person” includes an individual, corporation,
partnership, trust, association, joint venture, pool, syndicate,
unincorporated organization, joint-stock company or similar organization or
entity or group acting in concert. A




 









 






	 	 	 	person for these purposes shall be deemed to be a “beneficial owner” as that
term is used in Rule 13d-3 under the Securities Exchange Act of 1934.






	3.	 	No Assignments. This Agreement is personal to each of the parties hereto. No party
may assign or delegate any rights or obligations hereunder without first obtaining the written
consent of the other party hereto. However, in the event of the death of the Employee, all
rights to receive payments hereunder shall become rights of the Employee’s estate claimable
within a twelve (12) month period following the date of death of the Employee.






	4.	 	Amendments or Additions: Action by Board of Directors. No amendments or additions
to this Agreement shall be binding unless in writing and signed by both parties hereto. The
prior approval by a majority affirmative vote of the full Board shall be required in order for
the Bank to authorize any amendments or additions to this Agreement.






	5.	 	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.






	6.	 	Compensation. The special compensation to be received as agreed to herein shall not
exceed in any event $530,000.






	7.	 	Governing Law. This Agreement shall be governed by the laws of the United States to
the extent applicable because of the Bank’s status as a federally insured financial
institution and otherwise by the laws of the Commonwealth of Puerto Rico.





	 	 	 	 	 
	 

	 	 	 	WESTERNBANK Puerto Rico
	 
	 	 	 	 
	Attest:

	 	/s/ César Ruiz
	 	/s/ Jose M. Biaggi Landron
	 	 	 	 	 
	 

	 	(Secretary)

	 	(President)

	 

	 	César Ruiz

	 	Jose M. Biaggi Landron

	 
	 	 	 	 
	 

	 	 	 	Employee:
	 
	 	 	 	 
	 

	 	 	 	/s/ Rosemarie Santiago Salcedo
	 

	 	 	 	 
	 

	 	 	 	  Rosemarie Santiago Salcedo