Document:

Exhibit 10.1

 

FIRST AMENDMENT TO RETENTION AGREEMENT

Between Bank of Hawaii and Kent T. Lucien dated January 20, 2012

 

THIS FIRST AMENDMENT TO RETENTION AGREEMENT (“First Amendment”) is made and entered into on January 20, 2012 (“Effective Date”) by and between Bank of Hawaii Corporation and Bank of Hawaii (collectively “the Bank”) and Kent T. Lucien (“You”).

 

WITNESSETH THAT:

 

WHEREAS, the Bank and You have entered into a certain Retention Agreement dated June 30, 2010 (“Agreement”); and

 

WHEREAS, the Bank and You would like to amend the Agreement by extending your Separation Date from January 31, 2013 to January 31, 2014, and necessarily conforming other contractual terms to such extension;

 

NOW THEREFORE, in consideration of the mutual promises and covenants hereto of the parties, the Bank and You agree to amend the Agreement as follows:

 

1)    The language in Section 1 is deleted in its entirety and replaced with the following:

 

1.    Duties and Compensation until your Departure Date.  You will continue the position of Vice Chair and Chief Financial Officer.  You agree to work diligently in your position (or in any other position to which you may be placed) through January 31, 2014 (“Separation Date”), at which time you will be relieved of all duties and responsibilities.  The Bank may advance your Separation Date to any date before January 31, 2014, or may extend your Separation Date to any date within six (6) months after January 31, 2014.  Any Separation Date after July 31, 2014 will require mutual agreement of the parties in writing.

 

a.    You will be paid your salary and benefits through the Separation Date.

 

b.    You will participate in the Executive Incentive Plan for the calendar years 2012 and 2013, provided you are employed for the duration of the Performance Period as defined in the applicable Plan.

 

c.    The Bank shall recommend that the HR and Compensation Committee authorize your participation in the 2012 Bank of Hawaii Corporation Equity Program at the Vice Chairman level in the first quarter of 2012.

 

 

Kent T. Lucien

1st Amendment to Retention Agreement

January 20, 2012

Page 2 of 4

 

d.    In the event you voluntarily terminate employment prior to the Separation Date, you will receive only your salary and vested benefits through the date of your termination of employment.

 

e.    You acknowledge and agree that no compensation or other payment except as specified in the Agreement as amended by this First Amendment will be owed to you after the Separation Date.

 

2)    The language in Section 3 is deleted in its entirety and replaced with the following:

 

3.      Retention Payment (“Monetary Consideration”).  If you perform your duties to the Bank’s satisfaction through January 31, 2014, (including attaining Performance and Transition Objectives which shall be deemed to be met unless you are otherwise notified prior to December 31, 2013) and comply with the requirements in Section 1, 2, 3, 6, 7, 8, and 9 of this Agreement, you will receive a Retention Payment of $425,000.00, subject to reduction for tax withholding requirements.  The Retention Payment will be paid by the 60th day following January 31, 2014.  After the Separation Date, you will no longer be eligible for contributions or benefit accruals under any of the Bank’s tax-qualified retirement plans or nonqualified deferred compensation plans.  Any outstanding equity grants will expire in accordance with the terms of the applicable agreements.

 

3)    The substantive language in Sections 2(d), 4, 5, 6, 9, 10, 11, and 12 of the Agreement is hereby amended by changing the word “Agreement” to “Agreement as modified by the First Amendment” wherever it appears.

 

4)    The language in Section 14 of the Agreement is deleted in its entirety and replaced with the following:

 

14. Older Workers Benefit Protection Act notice.  The following is required by the Older Workers Benefit Protection Act (OWBPA”):

 

This First Amendment includes a waiver of any claims you may have under the Age Discrimination in Employment Act (“ADEA”) through the Execution Date of the First Amendment.  You have up to twenty-one (21) days from the date of this letter to accept the terms of this First Amendment, although you may accept it at any time within those 21 days.  To properly weigh the advantages and disadvantages of signing this First Amendment and waiving your ADEA claims, you are advised to consult an attorney about this Agreement prior to signing.  If you want to accept the First Amendment prior to the expiration of the 21 days, you will need

 

 

Kent T. Lucien

1st Amendment to Retention Agreement

January 20, 2012

Page 3 of 4

 

to indicate your waiver of the 21-day consideration period by signing in the space indicated below.

 

5)   Unless amended, modified, supplemented and/or controverted by the Bank and You in this First Amendment, all other terms and conditions of said Agreement shall remain in full force and effect.

 

To accept this First Amendment, please date, sign and return it to the Bank’s Executive Vice President and Director of Human Resources.  (An extra copy for your file is provided.)  Once you do so, pursuant to the OWBPA, you will still have an additional seven (7) days in which to revoke your acceptance.  To revoke, you must send the Bank’s Executive Vice President and Director of Human Resources a written statement of revocation by registered mail, return receipt requested.  If you revoke your acceptance of this First Amendment, the First Amendment will be void.  If you do not revoke, the eighth (8th) day after the date of your acceptance will be the “Effective Date” of this First Amendment. The First Amendment will not be effective and enforceable until the revocation period has expired.

 

BANK OF HAWAII CORPORATION AND

BANK OF HAWAII

 

 

	
By:
    	
 
    	
 
    	
Date:
    	
 
    
	
 
    	
PETER   S. HO
    	
 
    	
 
    	
 
    
	
 
    	
Chairman,   President and CEO
    	
 
    	
 
    	
 
    

 

 

By signing this First Amendment, I acknowledge that I have had the opportunity to review it carefully with an attorney of my choice; that I have read and understand its terms; and that I voluntarily agree to them.

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
Kent T. Lucien
    

 

 

Pursuant to 29 C.F. R. Section 125.22(e)(6), I hereby knowingly and voluntarily waive the twenty-one (21) day pre-execution consideration period set forth in the Older Workers Benefit Protection Act (29 U.S.C. Section 626(f)(1)(F)(i)).

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
Kent T. Lucien
    

 

 

Kent T. Lucien

1st Amendment to Retention Agreement

January 20, 2012

Page 4 of 4

 

EXHIBIT A

 

[To be executed on or after Separation Date]

 

WAIVER AND RELEASE OF CLAIMS THROUGH SEPARATION DATE

 

I  agree that all applicable terms and conditions in my Waiver and Release of Claims set forth in Section 6 of the Agreement dated June 30, 2010 as amended by that certain First Amendment to Retention Agreement dated                           apply with respect to the period of my employment with the Bank from the Execution Date of the First Amendment through my Separation Date.

 

 

UNDERSTOOD AND AGREED:

 

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
Kent T. Lucien
    

 

 

Pursuant to 29 C.F.R. § 1625.22(e)(6), I hereby knowingly and voluntarily waive the twenty-one (21) day pre-execution consideration period set forth in Older Workers Benefit Protection Act (29 U.S.C. § 626(f)(1)(F)(i)).

 

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
Kent T. LucienExhibit 10.2

 

BANK OF HAWAII CORPORATION
 2004 STOCK AND INCENTIVE COMPENSATION PLAN

 

2012 RESTRICTED STOCK GRANT AGREEMENT

 

This Restricted Stock Grant Agreement (“Agreement”) dated January 20, 2012 (“Grant Date”), between Bank of Hawaii Corporation, a Delaware corporation (“Company”), with its registered office at 130 Merchant Street, Honolulu, Hawaii 96813, and the executive of the Company or subsidiary of the Company (“Grantee”) who is specified in the “Notice of 2012 Restricted Stock Grant” (“Notice”) attached hereto.

 

1.            Grant of Restricted Shares.  Effective as of the Grant Date, the Human Resources and Compensation Committee of the Company’s Board of Directors (“Committee”) has granted to Grantee the number of shares of the Company’s common stock (“Restricted Shares”) as specified in the Notice pursuant to the Bank of Hawaii Corporation 2004 Stock and Incentive Compensation Plan, as amended (“Plan”).  The grant of Restricted Shares evidenced by this Agreement is made subject to the terms and conditions of the Plan and of this Agreement.  In case of conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall control.  Certain terms defined in the Plan are used in this Agreement with the meanings given to them in the Plan.

 

2.            Restrictions During Period of Restriction.  Restricted Shares shall be subject to forfeiture by Grantee until the “Restriction Period” terminates as to such Restricted Shares and the Restricted Shares shall vest in Grantee (up to the maximum shares granted under this Agreement) in accordance with the terms of the Plan (including, but not limited to, conditions and restrictions imposed pursuant to Section 8.4 of the Plan) and this Agreement.

 

a.            Restriction Period.  For purposes of this Agreement and with respect to a designated block of Restricted Shares granted under this Agreement, the term “Restriction Period” shall mean the period that commences on the Grant Date and terminates following achievement of the service and financial performance objectives applicable to the block of Restricted Shares as described below.

 

(1)          Component Conditioned on Service

 

One-third of the total Restricted Shares granted hereunder shall be subject to the termination of the Restriction Period under this Section 2.a(1) that is conditioned on service and the achievement of positive net income (which one-third block is referred to hereunder as the “Service Shares”) as follows:

 

(a)          On February 28, 2013, with respect to one-third of the Service Shares provided that (I) Grantee remains an Employee through December 31, 2012, and (II) the Committee shall have certified with respect to the fiscal year ending December 31, 2012, that the Company has achieved positive net income as publicly announced by the Company in its earnings release for that period (“Net Income Performance Objective”).

 

 

(b)          On December 31, 2013, with respect to one-third of the Service Shares provided that (I) Grantee remains an Employee through December 31, 2013, and (II) the Net Income Performance Objective is satisfied.

 

(c)          On December 31, 2014, with respect to one-third of the Service Shares provided that (I) Grantee remains an Employee through December 31, 2014, and (II) the Net Income Performance Objective is satisfied.

 

(2)          Component Conditioned on First-Tier Performance

 

One-third of the total Restricted Shares granted hereunder shall be subject to the termination of the Restriction Period under this Section 2.a(2) that is conditioned on service and the achievement of financial performance criteria at no less than the second-tier peer group level (which one-third block is referred to hereunder as the “First-Tier Shares”) as follows:

 

(a)          On February 28, 2013, with respect to one-third of the First-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2012, and (II) the Committee shall have certified with respect to the fiscal year ending December 31, 2012, that the Company’s “Return on Assets”, or “Return on Equity”, or “Stock Price to Book Ratio v. Peers” falls within the top two quartiles of the 2012 Regional Bank Index or the 2012 U.S. Bank Index that has been designated by the Committee on or before the Grant Date and as the same may be revised from time to time to delete organizations that cease to be publicly-held (“First-Tier Performance Objective”).

 

For purposes of this Agreement the terms “Return on Assets”, “Return on Equity”, and “Stock Price to Book Ratio vs. Peers” shall mean such terms as determined and reported with respect to the Company for purposes of placement under designated 2012 Regional Bank Index and the 2012 U.S. Bank Index.

 

(b)          On December 31, 2013, with respect to one-third of the First-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2013, and (II) the First-Tier Performance Objective is satisfied.

 

(c)          On December 31, 2014, with respect to one-third of the First-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2014, and (II) the First-Tier Performance Objective is satisfied.

 

(3)          Component Conditioned on Second-Tier Performance

 

One-third of the total Restricted Shares granted hereunder shall be subject to the termination of the Restriction Period under this Section 2.a(3) that is conditioned on service and the achievement of financial performance criteria at

 

2.

 

the first-tier peer group level (which one-third block is referred to hereunder as the “Second-Tier Shares”) as follows:

 

(a)          On February 28, 2013, with respect to one-third of the Second-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2012, and (II) the Committee shall have certified with respect to the fiscal year ending December 31, 2012, that the Company’s “Return on Assets”, or “Return on Equity”, or “Stock Price to Book Ratio vs. Peers” falls within the top quartile of the 2012 Regional Bank Index or the 2012 U.S. Bank Index that has been designated by the Committee on or before the Grant Date and as the same may be revised from time to time to delete organizations that cease to be publicly-held (“Second-Tier Performance Objective”).

 

(b)          On December 31, 2013, with respect to one-third of the Second-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2013, and (II) the Second-Tier Performance Objective is satisfied.

 

(c)          On December 31, 2014, with respect to one-third of the Second-Tier Shares provided that (I) Grantee remains an Employee through December 31, 2014, and (II) the Second-Tier Performance Objective is satisfied.

 

b.            Committee Determinations. This Agreement shall be interpreted in a manner consistent with the requirements of the performance-based compensation exception under Code Section 162(m).  The Committee shall endeavor to certify whether the service and financial performance objectives described in Section 2.a of this Agreement have been satisfied on or prior to the scheduled time of vesting as specified in Section 2.a.  In the event that the Committee has not done so, it shall make such determination as soon thereafter as possible and, if the satisfaction of the service and financial performance objectives have been certified, the Restricted Shares subject to vesting shall vest at the time of the making of such certification.

 

c.            Other Termination of Restriction Period.  The Restriction Period shall terminate and all theretofore unvested and unforfeited Restricted Shares shall vest in Grantee upon the earliest to occur of the following:  (i) the death of Grantee; (ii) the Grantee is no longer an Employee due to “disability” within the meaning of that term under Code Section 409A and the regulations promulgated thereunder; or (iii) the occurrence of a “Change in Control” in accordance with Article 15 of the Plan.

 

d.            Forfeiture of Unvested Restricted Shares.  Each block of Restricted Shares that remains unvested and unforfeited shall be forfeited and transferred to the Company upon the first to occur of: (i) except as provided in Section 2.c of this Agreement, Grantee’s ceasing to be an Employee for any reason, whether voluntary or involuntary; and (ii) the making of the determination that the financial performance objective applicable to the block of Restricted Shares has not been satisfied for such block under Section 2.a of this Agreement.  Grantee’s employment shall not be treated as

 

3.

 

terminated in the case of a transfer of employment within the Company and its subsidiaries or in the case of sick leave and other approved leaves of absence.

 

e.            Transfer Restriction.  During the Period of Restriction for a particular Restricted Share, such Restricted Share shall be subject to the restrictions on transferability set forth in Section 8.3 of the Plan.

 

3.            Issuance of Shares; Registration; Withholding Taxes.  Restricted Shares shall be issued in Grantee’s name, shall bear the restrictive legend specified in Section 8.5 of the Plan (and such other restrictive legends as are required or deemed advisable by the Company under the provisions of any applicable law), and shall be held by the Company until all restrictions lapse or such shares are forfeited as provided herein.  The Restricted Shares as to which the Restriction Period has terminated shall be delivered to Grantee upon such termination.  The Company may postpone the issuance or delivery of the Shares until (a) the completion of registration or other qualification of such Shares or transaction under any state or federal law, rule or regulation, or any listing on any securities exchange, as the Company shall determine to be necessary or desirable; (b) the receipt by the Company of such written representations or other documentation as the Company deems necessary to establish compliance with all applicable laws, rules and regulations, including applicable federal and state securities laws and listing requirements, if any; and (c) the payment to the Company in accordance with Article 17 of the Plan of any amount required by the Company to satisfy any federal, state or other governmental withholding tax requirements related to the issuance or delivery of the Shares.  Grantee shall comply with any and all legal requirements relating to Grantee’s resale or other disposition of any Shares acquired under this Agreement.

 

4.            Share Adjustments.  The number and kind of Restricted Shares or other property subject to this Agreement shall be subject to adjustment in accordance with Section 4.2 of the Plan.

 

5.            Rights as Shareholder.  Unless otherwise provided herein, Grantee shall be entitled to all of the rights of a shareholder with respect to the Restricted Shares, including the right to vote such Shares and to received dividends and other distributions (not including share adjustments as described in Section 4 above) payable with respect to such Shares from and after the Grant Date.  Grantee’s rights as a shareholder shall terminate with respect to any Restricted Shares forfeited by Grantee.

 

6.            Amendment.  This Agreement may be amended by the Committee at any time based on its determination that the amendment is necessary or advisable in light of any addition to, or change in, the Code or regulations issued thereunder or any federal or state securities law or other law or regulation, or the Plan, or based on any discretionary authority of the Committee under the Plan.  Unless necessary or advisable due to a change in law, any amendment to this Agreement which has a material adverse effect on the interest of Grantee under this Agreement shall be adopted only with the consent of Grantee.

 

7.            Section 83(b) Election.  Grantee shall promptly deliver to the Company a copy of any election filed by Grantee in respect of the Restricted Shares pursuant to Code Section 83(b).

 

4.

 

8.            Notices.  Any notice or other communication made in connection with this Agreement shall be deemed duly given when delivered in person or mailed by certified or registered mail, return receipt requested, to Grantee at Grantee’s address shown on Company records or such other address designated by Grantee by similar notice, or to the Company at its then principal office, to the attention of the Corporate Secretary of the Company.  Furthermore, such notice or other communication shall be deemed duly given when transmitted electronically to Grantee at Grantee’s electronic mail address shown on the Company records or, to the extent that Grantee is an active employee, through the Company’s intranet.

 

9.            Miscellaneous.  This Agreement and the Plan set forth the final and entire agreement between the parties with respect to the subject matter hereof, which shall be governed by and shall be construed in accordance with the laws of the State of Hawaii, to the extent not governed by federal law.  This Agreement shall bind and benefit Grantee, the heirs, distributees and personal representative of Grantee, and the Company and its successors and assigns.  This Agreement may be signed in counterparts, each of which shall be deemed an original, and said counterparts shall together constitute one and the same instrument.  Capitalized terms not herein defined shall have the meanings prescribed to them under the Plan.

 

BY ACCEPTING THE RESTRICTED SHARES GRANTED UNDER THIS 2012 RESTRICTED STOCK GRANT AGREEMENT, GRANTEE AGREES TO ALL THE TERMS AND CONDITIONS DESCRIBED IN THIS AGREEMENT AND IN THE PLAN.

 

5.

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