In February 2022, the Company entered into an amended and restated employment agreement with Ms. Lee (“Lee Amended Agreement”). The Lee Amended Agreement replaced Ms. Lee’s then-existing employment agreement with the Company and the Bank and provided for (i) a three-year term commencing on February 28, 2022, and ending on February 28, 2025, which would renew automatically for one-year periods unless either Ms. Lee or the Company provided written notice of non-renewal, (ii) annual salary of $715,000, reviewed at least annually, (iii) annual target cash bonus of 75% of salary, and (iv) twenty-five days of paid vacation annually. In March 2025, the Company entered into a First Amendment to the Lee Amended Agreement, extending the term of the agreement to April 28, 2028, or if earlier, the close of business on the effective date of termination of employment pursuant to Section 5 of the Lee Amended Agreement. On April 28, 2028, and on each subsequent anniversary, the term of the Lee Amended Agreement will automatically renew for an additional year, unless either party provides written notice of non-renewal. All other terms of the Lee Amended Agreement remain in effect.
In July 2022, the Company entered into a first amendment to the amended and restated employment agreement with Mr. Santarosa (“Santarosa Amended Agreement”), which extended the employment term through February 2025. In March 2025, the Company entered into a second amendment to the Santarosa Amended Agreement, extending the term of the agreement to December 31, 2027, or if earlier, the close of business on the effective date of termination of employment pursuant to Section 5 of the Santarosa Amended Agreement. On December 31, 2027, and on each subsequent anniversary, the term of the Santarosa Amended Agreement will automatically renew for an additional year, unless either party provides written notice of non-renewal. All other terms of the Santarosa Amended Agreement remain in effect.
Post-Employment Compensation
Our post-employment compensation arrangements are designed to provide reasonable compensation to Ms. Lee and Mr. Santarosa if they are terminated by us without cause or in connection with a change in control. Further, we seek to mitigate any potential employer liability and avoid future disputes or litigation by requiring a departing executive officer to sign a separation and release agreement acceptable to us as a condition to receiving post-employment compensation payments or benefits.
Our CHR Committee and the Board of Directors do not consider specific amounts payable under these post-employment compensation arrangements when establishing annual compensation. The CHR Committee and the Board believe, however, that these arrangements are necessary to offer compensation packages that are competitive.
The treatment of outstanding equity awards held by NEOs upon termination of employment or in connection with a change in control is described below in the “Employment Agreements” and “Potential Payments Upon Termination of Employment or Change in Control” sections.
All other executives are employed “at-will,” and Hanmi does not provide any right to additional payments or benefits in the event of a termination of employment or a change in control of Hanmi.
Executive Perquisites
Our NEOs receive the following benefits in addition to their other compensation: technology allowance, automobile allowance, gas allowance, wellness benefit and gift cards for the holidays. Mr. Santarosa receives a membership to a social club. Ms. Lee also receives memberships to a country club and social club, company-provided welfare benefits and additional term life insurance. These benefits are detailed in the “Summary Compensation Table.”
Broad-Based Benefits Programs
Our NEOs participate in the benefit programs that are available to all full-time employees. These benefits include health, dental, vision, life insurance, short-term and long-term disability insurance, healthcare reimbursement accounts, paid vacation, paid sick leave, 401(k) plan matching contributions, and a year of service award upon achieving certain years of service milestones with the Company.
Other Compensation Considerations
Insider Trading Policy
Our Board has adopted an Insider Trading Policy, that governs the purchase, sale and/or other disposition of the Company’s securities and is applicable to all of our directors, officers, and employees. We believe our Insider Trading Policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, as well as listing standards