Employment Agreement - Jones

EMPLOYMENT AGREEMENT








THIS AGREEMENT, dated as of January 1, 2008, by and between WELLINGTON D. JONES III, hereinafter referred to as "Executive," and lst SOURCE CORPORATION, an Indiana corporation, hereinafter referred to as "Employer,"







WHEREAS, Executive is currently employed as the Executive Vice President of Employer and the President and Chief Operating Officer of Employer's subsidiary, 1st Source Bank, hereinafter referred to as "Bank," pursuant to the terms of that certain Employment Agreement dated as of April 16, 1998; and







WHEREAS, Employer desires to assure the continued service of Executive, and Executive is willing to provide such service on the terms and conditions specified herein.







NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements contained in this Agreement, Employer and Executive hereby agree as follows:




1. Employment Position . The parties agree that the employment of Executive by Employer shall continue for the term referred to in Section 2. Employer agrees to continue the employment of Executive in a senior officer position for both Employer and Bank with the same titles referenced above. Executive shall devote his full time during business hours to the performance of his duties hereunder and shall at all times use his best efforts to promote the best interests of Employer. Executive shall report to the Chief Executive Officer, or such other senior executive officer of Employer or Bank, as the Chief Executive Officer of Employer, the Chairman of the Board, or the Board of Directors ("Board") shall direct.




2. Term . The term of this Agreement shall be from the date hereof until December 31, 2008, unless terminated sooner in accordance with Section 5 or Section 6 hereof, provided, however, that the term shall be automatically extended for an additional year on January 1, 2009 and on January 1 of each year thereafter, unless either party hereto gives written notice of an intention not to extend this Agreement (a "Non-Renewal Notice") on or before September 30 of the then current year, in which case no further automatic extension shall occur and the term of this Agreement shall end on December 31 of such year.



3. Compensation and Benefits .


(a) Base Salary . Executive shall be paid a base salary of Three Hundred Fifty-Nine Thousand Dollars ($359,000) per annum, with such increases thereafter as may be determined by Employer (the "Base Salary").



(b) Incentive Compensation . In addition to amounts paid to Executive as salary and for other benefits, Executive will participate in Employer's Executive Incentive Plan at a "partnership" rate of 25% of Base Salary for purposes of determining awards under the Plan. All amounts awarded are subject to the terms and conditions of the Plan.







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(c) Benefit Plans . During the term of this Agreement, Executive shall be entitled to participate, at a level commensurate with his position, in all benefit plans Employer presently has or hereafter adopts for its officers or employees, including (without limitation) directors and officers liability insurance, pension, profit sharing, stock option or any group life or health insurance, hospitalization or other similar plans, any eligibility or waiting periods to be waived to the extent feasible.



(d) Life Insurance . Executive will be entitled to term life insurance coverage for the benefit of Executive, his family or estate as he may direct provided under the terms of the group policy offered to all employees, except that Employer will pay Executive's portion of the cost thereof.



(e) Club Membership . A club membership will be provided by Employer for Executive to at least one country club and to one club in downtown South Bend, Indiana, with the initiation fees, monthly fee and appropriate business related expenses paid by Employer.




4. Disability . In the event that this Agreement is terminated by reason of Executive's Disability, Executive will participate in the Employer's disability compensation programs, including any salary continuance plan in effect at that time for officers or executives of Employer. In addition, Executive will receive the following separation payments: (a) a lump-sum payment, payable within thirty (30) days following his termination, equal to six times his then monthly Base Salary amount; and (b) six (6) monthly installment payments, each installment payment equal to his then monthly Base Salary amount, commencing on the first day of the seventh month following the month in which Executive's last day of employment occurs and continuing on the first day of the immediately succeeding five (5) months. For purposes of this Agreement, "Disability" means Executive ?s inability by reason of illness or other physical or mental impairment to perform the duties required by his employment for any consecutive one hundred eighty (180) day period, provided that written notice of any termination for Disability shall have been given by Employer to Executive prior to the full resumption by him of the performance of such duties.



5. Termination by Employer; Death or Disability.



(a) With Cause . In the event the Board determines that Executive is guilty of gross dereliction of duty or of fraud or dishonesty in connection with the performance of his duties under this Agreement, the Board may terminate the Executive's Employment, such termination to be effective thirty (30) days after the Board gives written notice to Executive setting forth with specificity the reason or cause for terminating the Executive's employment. In such event, the compensation and other benefits provided for in this Agreement shall terminate on the date specified by the Board in the written notice of termination delivered to Executive.











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(b) Without Cause . If Employer shall discharge Executive from his employment hereunder for any reason other than one set forth in Section 5(a), or if it shall be determined by a court of competent jurisdiction that the discharge under Section 5(a) was not justified, the Executive's employment shall end as of the date of such discharge by Employer, provided however, that Executive shall receive the following separation payments: (i) a lump sum payment, payable within thirty (30) days following the date of such discharge, equal to six (6) times his then monthly Base Salary amount; and (ii) six (6) monthly installment payments, each installment payment equal to such monthly Base Salary amount, commencing on the first day of the seventh month following the month in which Executive's last day of employment occurs, and continuing on the first day of each immediately succeeding month for the next five (5) months.



(c) Death. This Agreement shall terminate in the event of the death of Executive. In such event, Executive's estate or his designee shall be entitled to the death benefits provided in Section 3(d) of this Agreement.



6. Termination By Executive . Executive may, at any time upon written notice to Employer, immediately terminate his employment for Good Reason. For purposes of this Agreement, "Good Reason" shall mean (i) breach of this Agreement by Employer in any material respect, (ii) any material adverse change in Executive's status ...