EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit 10.1
This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of this
18th day of May, 2009, by and between Bank of Birmingham, a Michigan state bank
(“Bank”), and Xxxxxx Xxxx, an individual resident of the State of Michigan (“Executive”).
WHEREAS, the Bank and the Executive are parties to an employment agreement dated June 28, 2007
(the “Prior Agreement”) providing for the Executive to be employed as President and Chief Executive
Officer of the Bank, and Executive desires to continue such employment, subject to and on the terms
and conditions set forth in this Agreement; and
WHEREAS, the Bank and the Executive wish to amend and restate the Prior Agreement; and
WHEREAS, both the Bank and the Executive have read and understood the terms and provisions set
forth in this Agreement and have been afforded a reasonable opportunity to review this Agreement
with their respective legal counsel.
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth in this
Agreement, the Executive and the Bank agree as follows:
A. DURATION
1. This Agreement shall become effective (the “Effective Date”) upon the date of its execution
indicated above and shall continue in full force and effect, subject to Paragraph 2 below, until
the first anniversary date of the Effective Date, unless earlier terminated as provided herein.
2. The Bank and the Executive acknowledge and agree that the parties may agree to continue the
employment relationship upon such terms as they may mutually agree. Each day during the term of
this Agreement, the term of the Agreement shall automatically be extended for one additional day,
unless either party elects to give the other party written notice of non-renewal. Upon the Bank
giving notice of non-renewal, the Executive shall have the right to remain employed by the Bank for
the one (1) year period following the date the Bank gives notice of non-renewal unless the
termination is for Good Cause (as hereinafter defined).
B. COMPENSATION
3. All payments of salary and other compensation to the Executive shall be payable in
accordance with the Bank’s ordinary payroll and other policies and procedures.
a. During the term of this Agreement, the Bank agrees to pay Executive a base salary
of not less than $145,000 annually, appropriately prorated for partial months at the
commencement and end of the term of this Agreement.
b. The Bank shall have the right to deduct from any payment of compensation to
Executive hereunder any federal, state or local taxes required by law to be withheld with
respect to such payments and any other amounts specifically authorized to be withheld or
deducted by Executive.
c. During the term of this Agreement, it is anticipated that the Board of Directors or
a delegated committee thereof will adopt an executive incentive bonus plan based upon the
asset growth and profitability of the Bank. The Executive will be entitled to participate
in such plan.
Executive shall also be entitled to participate in any benefit programs applicable to
all employees of the Bank or to executive employees of the Bank in accordance with Bank
policy and the provisions of said benefit programs.
4. The Bank shall provide the Executive with an automobile allowance in the amount of $750 per
month. The Bank shall also provide the Executive with a cellular phone and laptop computer for use
in the performance of his duties and obligations under this Agreement. The Bank shall also
reimburse the Executive for all reasonable expenses, including, but not limited to, travel
expenses, lodging expenses, and meals and entertainment expenses, that the Executive may incur in
the performance of his duties and obligations under this Agreement; provided, however, that the
Executive shall be required to submit receipts or other acceptable documentation to the cashier of
the Bank or such other officer designated by the Board to verify such expenses prior to any
reimbursements. In addition to the reimbursement of expenses listed in this Paragraph, the Bank
shall pay, or reimburse Executive, for reasonable initiation fees for trade association memberships
deemed to be acceptable and appropriate by the Board of Directors. The Bank shall also pay, or
reimburse Executive, for all membership fees and monthly membership dues, up to a maximum amount of
$500 per month, on behalf of Executive and his immediate family at a country club, which club must
be acceptable to the Board of Directors. Reimbursement under this Paragraph 4 shall be made in
accordance with the Bank’s expense reimbursement policies, but in no event later than the last day
of the calendar year following the calendar year in which the expenses are incurred. Reimbursement
under this Paragraph 4 shall not affect the expenses eligible for reimbursement in any other
calendar year and cannot be liquidated or exchanged for any other benefit.
5. Subject to the provisions of Paragraph 8 of this Agreement, the Executive shall be entitled
to receive employee and dependent health insurance, dental insurance, paid sick leave and four (4)
weeks of paid vacation per year, and any additional benefits provided to all Bank employees all in
accordance with the Bank’s employment policies.
6. The Bank shall also provide the Executive with term life insurance coverage in an initial
amount not to exceed 200% of Executive’s base salary, and having a term not less than ten years.
If, during the term of this Agreement, the Bank adopts a plan providing life insurance benefits to
other Bank employees and the maximum coverage under such plan exceeds the maximum coverage
permitted under this Paragraph, then notwithstanding the limitations of this Paragraph, Executive
shall be entitled to participate in the Bank’s life insurance benefit plan to the full extent that
it is available to other Bank employees.
7. The Board of Directors or a delegated committee shall review the amount of Executive’s
compensation, including his base salary, not less than annually and shall increase such base salary
as a result of such review and to provide reasonable cost of living adjustments, all in the
discretion of the Board of Directors or such committee and consistent with safe and sound banking
practices; provided however that Executive’s base salary, bonuses, vacation and car allowance shall
not be less than the amounts set forth in Paragraphs 3, 4, and 5 at any time during the term of
this Agreement.
8. All employee benefits provided to the Executive by the Bank incident to the Executive’s
employment shall be governed by the applicable plan documents, summary plan descriptions or
employment policies, and may be modified, suspended or revoked at any time, in accordance with the
terms and provisions of the applicable documents.
9. The parties hereto acknowledge that the compensation set forth herein and the other
covenants and agreements of the Bank contained herein are fair and adequate compensation for
Executive’s services and for the covenants of Executive as set forth herein.
C. RESPONSIBILITIES
10. The Executive shall be employed as President and Chief Executive Officer of the Bank and
shall faithfully devote his best efforts and his primary focus to his positions with the Bank.
11. The Executive acknowledges and agrees that the duties and responsibilities of the
Executive required by his position as President and Chief Executive Officer of the Bank are wholly
within the discretion of its Board of Directors, and may be modified, or new duties and
responsibilities imposed by the Board of Directors, at any time, without the approval or consent of
the Executive. However, these new duties and responsibilities may not constitute immoral or
unlawful acts. In addition, the new duties and responsibilities must be consistent with the
Executive’s role as President or Chief Executive Officer of a financial institution.
12. The Executive acknowledges and agrees that, during the term of this Agreement, he has a
fiduciary duty of loyalty to the Bank, and that he will not engage in any activity during the term
of this Agreement, which will or could, in any significant way, harm the business, business
interests, or reputation of the Bank or the reputation of the Board of Directors.
13. The Executive shall not directly or indirectly engage in competition with the Bank at any
time during the existence of the employment relationship between the Bank and the Executive, and
the Executive will not on his own behalf, or as another’s agent or employee, engage in any of the
same or similar duties and/or Bank-related responsibilities required by the Executive’s position
with the Bank, other than as an employee of the Bank pursuant to this Agreement or as specifically
approved by the Board of Directors. In addition, without the prior written consent of the Board of
Directors, Executive shall not usurp for himself any corporate opportunity available to the Bank.
D. NONINTERFERENCE
14. Executive acknowledges that, as part of his employment with the Bank, he will become
familiar with the salary, pay scale, capabilities, experiences, skill and desires of the Bank’s
employees. Executive agrees to maintain the confidentiality of such information. Executive
further covenants and agrees that, for a period of one year subsequent to the termination of this
Agreement, whether such termination occurs at the insistence of the Bank or the Executive, the
Executive shall not recruit, hire, or attempt to recruit or hire, directly or by assisting others,
any other employees of the Bank, nor shall the Executive contact or communicate with any other
employees of the Bank for the purpose of inducing other employees to terminate their employment
with the Bank. For purposes of this covenant, “other employees” shall refer to employees who are
still actively employed by or were employed by the Bank within the prior year, or doing business
with, the Bank at the time of the attempted recruiting or hiring.
15. In his position of employment, the Executive will be exposed to confidential information
and trade secrets (hereafter “Proprietary Information”) pertaining to, or arising from, the
business of the Bank and its affiliates (if any). The Executive hereby agrees and acknowledges
that such Proprietary Information is unique and valuable to the Bank’s business and that the Bank
would suffer irreparable injury if this information were publicly disclosed. Therefore, the
Executive agrees to keep in strict secrecy and confidence, both during and after the period of his
employment, any and all Proprietary Information which the Executive acquires, or to which the
Executive has access, during employment by the Bank, that has not been publicly disclosed by the
Bank. The Proprietary Information covered by this Agreement shall include, but shall not be
limited to: (i) the identities of the Bank’s existing and prospective customers or clients,
including names, addresses, credit status, and pricing levels; (ii) the buying and selling habits
and customs of the Bank’s existing and prospective customers or clients; (iii) financial
information about the Bank; (iv) product and systems specifications, concepts for new or
improved products and other product or systems data; (v) the identities of, and special skills
possessed by, the Bank’s employees; (vi) the identities of and pricing information about the Bank’s
suppliers and vendors; (vii) training programs developed by the Bank; (viii) pricing studies,
information and analyses; (ix) current and prospective products and inventories; (x) financial
models, business projections and market studies; (xi) the Bank’s financial results and business
conditions; (xii) business plans and strategies; (xiii) special processes, procedures, and services
of the Bank and its suppliers and vendors; and (xiv) computer programs and software developed by
the Bank or its consultants. The provisions and agreements entered into herein shall survive the
term of the Employee’s employment to the extent reasonably necessary to accomplish their purpose in
protecting the interests of the Bank in any Proprietary Information disclosed to, or learned by,
the Executive while employed.
16. The Executive expressly represents that he has no agreements with, or obligations to, any
party which conflict, or may conflict, with the interests of the Bank or with the Executive’s
duties as an employee of the Bank.
17. Executive acknowledges that the special relationship of trust and confidence between him,
the Bank, and its clients and customers creates a high risk and opportunity for Executive to
misappropriate the relationship and goodwill existing between the Bank and its clients and
customers. Executive further acknowledges and agrees that it is fair and reasonable for the Bank
to take steps to protect itself from the risk of such misappropriation. Executive further
acknowledges that, at the outset of his employment with the Bank and throughout his employment with
the Bank, Executive will be provided with access to and informed of Proprietary Information, which
will enable him to benefit from the Bank’s goodwill and know-how.
18. Executive acknowledges that it would be inevitable in the performance of his duties as a
director, officer, employee, investor, agent or consultant of any person, association, entity, or
company which competes with the Bank, or which intends to or may compete with the Bank, to disclose
and/or use Proprietary Information, as well as to misappropriate the Bank’s goodwill and know-how,
to or for the benefit of such other person, association, entity, or company. Executive also
acknowledges that, in exchange for the execution of the non-solicitation restriction set forth in
these NONINTERFERENCE provisions, he has received substantial, valuable consideration, including:
(i) confidential trade secret and proprietary information relating to the identity and special
needs of the Bank’s current and prospective customers, the Bank’s current and prospective services,
the Bank’s business projections and market studies, the Bank’s business plans and strategies, the
Bank’s studies and information concerning special services unique to the Bank; (ii) employment; and
(iii) compensation and benefits as described in this Agreement. Executive further acknowledges and
agrees that this consideration constitutes fair and adequate consideration for the execution of the
non-solicitation restriction set forth herein.
19. In consideration for the above-recited valuable consideration, as well as to protect the
vital interests described in these NONINTERFERENCE provisions, the Executive understands and agrees
that during the continuation of this Agreement and for a period of one year following the
termination of this Agreement by either party, for any reason (other than for termination of
Executive for circumstances described in Paragraph 24(e), below), the Executive will not be or
become engaged in any way (directly or indirectly), as an individual proprietor, beneficiary,
trustee, owner, partner, stockholder, officer, director, executive, investor, lender, sales
representative, or in any other capacity, whatsoever, in any activity or endeavor which competes or
conflicts with the Bank’s business or the business of the Bank or the business of any of their
respective affiliates (if any), as such business has been conducted during the years of the
Executive’s employment with the Bank, within the following Michigan cities/towns: Bloomfield,
Bloomfield Hills, Xxxxxxx Hills, Birmingham, Franklin, and Xxxxxxx Farms. It is the parties’
desire that these restrictions be enforced to the fullest extent allowed by law.
20. Executive agrees that the restriction set forth above is ancillary to an otherwise
enforceable agreement, is supported by independent valuable consideration, and that the limitations
as to time, geographical area, and scope of activity to be restrained by Paragraph 19 are
reasonable and acceptable, and do not impose any greater restraint than is reasonably necessary to
protect the goodwill and other business interests of the Bank. This Section creates a narrowly
tailored advance approval requirement in order to avoid unfair competition and irreparable harm to
the Bank and is not intended or to be construed as a general restraint from engaging in a lawful
profession or a general covenant against competition. Nothing herein will prohibit (i) beneficial
ownership of less than 5% of the publicly traded capital stock of a corporation listed on a
national securities exchange so long as this is not a controlling interest, or (ii) ownership of
mutual fund investments. Executive may not avoid the purpose and intent of this Paragraph by
engaging in conduct within the geographically limited area from a remote location through means
such as telecommunications, written correspondence, computer generated or assisted communications,
or other similar methods. Executive agrees that if, at some later date, a court of competent
jurisdiction determines that the non-solicitation agreement set forth in this Section does not meet
the criteria set forth by applicable law, this Section may be reformed by the court and enforced to
the maximum extent permitted under applicable law. Executive understands that his obligations
under this Section shall not be assignable by him.
21. Executive acknowledges that the covenants set forth in these NONINTERFERENCE provisions
are material conditions to the Bank’s willingness to execute and deliver this Agreement and to
provide Executive the compensation and benefits and other consideration provided hereunder. The
parties agree that the existence of any claim or cause of action of Executive against the Bank,
whether predicated on this Agreement or otherwise, will not constitute a defense to the enforcement
by the Bank of such covenants. It is specifically acknowledged that the periods following the
termination of employment stated in Paragraphs 14 and 19, during which the agreements and covenants
of Executive made in such Paragraphs are effective, are to be computed by excluding from such
computation any time during which Executive is in violation of any provision of Paragraph 14 or 19.
The covenants contained in these NONINTERFERENCE provisions will not be affected by any breach of
any other provision hereof by any party hereto. In addition, Executive’s obligations under these
NONINTERFERENCE provisions shall survive the termination of this Agreement and Executive’s
employment with the Bank. Executive’s obligations under these NONINTERFERENCE provisions are in
addition to, and not in limitation or preemption of, all other obligations of confidentiality which
he may have to Bank under general legal or equitable principles, or other the Bank policies.
E. REMEDIES
22. In the event that the Executive violates any of the provisions set forth in this Agreement
relating to NONINTERFERENCE, Executive acknowledges that the Bank would suffer immediate and
irreparable harm and would not have an adequate remedy at law for money damages. Accordingly,
Executive agrees that, without the necessity of proving actual damages or posting bond or other
security, the Bank shall be entitled to temporary or permanent injunction or injunctions to prevent
breaches of such performance and to specific enforcement of such covenants in addition to any other
remedy to which the Bank may be entitled, at law or in equity. In such a situation, the parties
agree that the Bank may pursue any remedy available, including declaratory relief, concurrently or
consecutively in any order as to any breach, violation, or threatened breach or violation of any of
the provisions set forth in this Agreement relating to NONINTERFERENCE, and the pursuit of any
particular remedy or remedies shall not be deemed an election of remedies or waiver of the right to
pursue any other remedy.
F. TERMINATION
23. The Board of Directors shall be entitled to terminate this Agreement, for any reason, by
providing the Executive with thirty (30) days written notice of the termination. However, if this
Agreement is terminated by the Bank without Good Cause, as defined in this Agreement, the Executive
shall be entitled to continue in the employment of the Bank under the terms and conditions that
were in effect as of the date the Bank gives notice of termination for the one (1) year period
following the date the Bank gives notice of termination..
24. For purposes of this Agreement, “Good Cause” shall be defined as the occurrence of one of
the following events:
a. The determination of the Board of Directors, in the exercise of its reasonable
judgment, that Executive has violated any provision of this Agreement or is grossly
negligent in the performance of his duties hereunder, and has failed to cure such violation
or the effects of such gross negligence within a reasonable period after written notice to
the Executive by the Bank specifying in reasonable detail the alleged violation;
b. The determination of the Board of Directors, in the exercise of its reasonable
judgment, that (i) Executive has failed to follow the policies adopted by the Board of
Directors and has failed to cure such failure within a reasonable period after written
notice to the Executive by the Bank specifying in reasonable detail the alleged failure; or
(ii) Executive has engaged in such actions or omissions that would constitute unsafe or
unsound banking practices;
c. The Executive is convicted of a misdemeanor involving moral turpitude or a felony;
d. The determination of the Board of Directors, in the exercise of its reasonable
judgment, that the Executive has engaged in gross misconduct in the course and scope of his
employment with the Bank including indecency, immorality, gross insubordination,
dishonesty, unlawful harassment, use of illegal drugs, or fighting;
e. The determination of the Board of Directors, in the exercise of its reasonable
judgment and in good faith, that the Executive’s job performance is substantially
unsatisfactory and that Executive has failed to cure such performance within a reasonable
period after written notice to the Executive by the Bank specifying in reasonable detail
the nature of the unsatisfactory performance; or
f. The Executive is prohibited from engaging in the business of banking by any
governmental regulatory agency having jurisdiction over the Bank.
Notwithstanding anything in this Agreement to the contrary, Executive will not be in breach of this
Agreement and his action or failure to act shall not be a basis for termination for Good Cause if
Executive’s action or failure to act would constitute an unsafe or unsound banking practice or be
reasonably expected to have a material adverse effect on the financial or regulatory condition of
the Bank.
25. Executive shall be entitled to terminate this Agreement at any time, for any reason, with
or without cause, by providing thirty (30) days written notice to the Bank. The effective date of
such resignation shall be the 30th calendar day following the date the notice is given
or such other later date as may be set forth in the notice. Upon Executive’s resignation,
Executive shall be entitled to receive any base salary which has been earned by him through the
effective date of such resignation.
26. If Executive dies during the term of this Agreement and while in the employ of the Bank,
this Agreement will terminate automatically, without notice, on the date of the Executive’s death
and the Bank shall have any further obligation to Executive or his estate under this Agreement
(other than death benefits payable under any benefit plans to which Executive is a party), except
that the Bank shall pay Executive’s estate that portion of Executive’s base salary accrued through
the date on which Executive’s death occurred. To the maximum extent, and for the term, permitted
by the health benefit provisions of the Consolidated Omnibus Budget Reconciliation Act (COBRA) of
1986, if Executive dies during the term of this Agreement and while in the employ of the Bank, the
Bank shall provide or maintain health insurance benefits, at the Bank’s expense, for Executive’s
spouse.
27. The Executive acknowledges and agrees that this Agreement will terminate immediately,
without notice, in the event the Executive becomes physically or mentally disabled, as defined by
29 C.F.R. § 1630.2(g)(1), and cannot perform the essential functions of his position, with or
without reasonable accommodation for the period designated by the Executive’s disability insurance
after which disability payments will begin. In the event of a termination pursuant to this
Section, the Bank shall be relieved of all its obligations under this Agreement, except that the
Bank shall pay to Executive, or his estate in the event of his subsequent death, Executive’s base
salary through the date on which such termination shall have occurred, reduced during such period
by the amount of any benefits received by Executive under any disability policy maintained by the
Bank.
28. Executive acknowledges that all memoranda, notes, records, reports, manuals, books,
papers, letters, client and customer lists, contracts, software programs, information and records,
drafts of instructions, guides and manuals, and other documentation (whether in draft or final
form), and other sales or financial information and aids relating to the Bank’s business, and any
and all other documents containing confidential information furnished to Executive by any
representative of the Bank or otherwise acquired or developed by Executive in connection with his
duties under this Agreement (collectively, “Recipient Materials”) shall at all times be the
property of the Bank. Within three calendar days of the termination of this Agreement, Executive
shall return to the Bank, any Recipient Materials which are in his possession, custody or control.
29. The provisions of provisions of Paragraphs 14, 15, 19-22, 28-34, 39, 42, 43 and 45 shall
survive the termination of this Agreement.
G. SEVERABILITY
30. If any term or other provision of this Agreement is held to be illegal, invalid or
unenforceable by any rule of law or public policy, (A) such term or provision shall be fully
severable and this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision were not a part hereof; (B) the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by such illegal, invalid or
unenforceable provision or by its severance from this Agreement; and (C) there shall be added
automatically as a part of this Agreement a provision as similar in terms to such illegal, invalid
or unenforceable provision as may be possible and still be legal, valid and enforceable. If any
provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only as broad as is enforceable.
H. WAIVER
31. The parties acknowledge and agree that the failure of either to enforce any provision of
this Agreement shall not constitute a waiver of that particular provision, or of any other
provisions of this Agreement.
I. SUCCESSORS AND ASSIGNS
32. The Executive acknowledges and agrees that this Agreement may be assigned by the Bank to
any successor-in-interest and shall inure to the benefit of, and be fully enforceable by, any
successor and/or assignee; and this Agreement will be fully binding upon, and may be enforced by
the Executive against, any successor and/or assignee of the Bank.
33. The Executive acknowledges and agrees that his obligations, duties and responsibilities
under this Agreement are personal and shall not be assignable, and that this Agreement shall be
enforceable by the Executive only. In the event of the Executive’s death, this Agreement shall be
enforceable by the Executive’s estate, executors and/or legal representatives, only to the extent
provided herein.
J. CHOICE OF LAW
34. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND ALL QUESTIONS
CONCERNING THE CONSTRUCTION, VALIDITY, INTERPRETATION AND PERFORMANCE OF THIS AGREEMENT SHALL BE
GOVERNED BY, THE LAWS OF THE STATE OF MICHIGAN, WITHOUT GIVING EFFECT TO PROVISION THEREOF
REGARDING CONFLICT OF LAWS. IT IS STIPULATED THAT MICHIGAN HAS A COMPELLING STATE INTEREST IN THE
SUBJECT MATTER OF THIS AGREEMENT, AND THAT EXECUTIVE HAS OR WILL HAVE REGULAR CONTACT WITH THE
STATE OF MICHIGAN IN THE PERFORMANCE OF THIS AGREEMENT.
K. MODIFICATION
35. The parties acknowledge and agree that this Agreement and the other agreements and plans
referenced herein constitute the complete and entire agreement between the parties; that each
executed this Agreement based upon the express terms and provisions set forth herein; that, in
accepting employment with the Bank, Executive has not relied on any representations, oral or
written, which are not set forth in this Agreement; that no previous agreement, either oral or
written, shall have any effect on the terms or provisions of this Agreement; and that all previous
agreements, either oral or written, are expressly superseded and revoked by this Agreement. Except
as otherwise expressly provided in this Agreement, no conditions, usage of trade, course of dealing
or performance, understanding or agreement purporting to modify, vary, explain or supplement the
terms or conditions of this Agreement unless hereafter made in writing and signed by the party to
be bound. No waiver shall be deemed a continuing waiver or a waiver of any subsequent breach or
default, either of a similar or different nature, unless expressly so stated in writing.
36. Except as otherwise expressly provided in this Agreement, no conditions, usage of trade,
course of dealing or performance, understanding or agreement purporting to modify, vary, explain or
supplement the terms or conditions of this Agreement unless hereafter made (i) in writing,
(ii) referencing an express provision in this Agreement, (iii) signed by the Executive, and
(iv) approved by a disinterested majority of the Board of Directors.
L. INDEMNIFICATION
37. During the term of this Agreement, the Bank shall indemnify the Executive against all
judgments, penalties, fines, amounts paid in settlement and reasonable expenses (including, but not
limited to, attorneys’ fees) relating to his employment by the Bank to the fullest extent
permissible under the law, including, without limitation, federal and/or state banking laws and
regulations, the Michigan
Banking Code of 1999, as amended, the Michigan Business Corporation Act, as amended, and the
Bank’s Articles of Incorporation. To the extent permitted by law, the Bank may purchase such
indemnification insurance as the Board may from time to time determine.
M. ARBITRATION
38. Any dispute, controversy, or claim arising out of or relating to this Agreement or breach
thereof, or arising out of or relating in any way to the employment of the Executive or the
termination thereof, shall be submitted to arbitration in accordance with the Employment Dispute
Arbitration Rules of the American Arbitration Association. Judgment upon the award rendered by the
arbitrator may be entered in any court of competent jurisdiction. In reaching his or her decision,
the arbitrator shall have no authority to ignore, change, modify, add to or delete from any
provision of this Agreement, but instead is limited to interpreting this Agreement.
Notwithstanding the arbitration provisions set forth in this Agreement, the Executive and the Bank
acknowledge and agree that nothing in this Agreement shall be construed to require the arbitration
of any claim or controversy arising under the NONINTERFERENCE provisions of this Agreement. These
provisions shall be enforceable by any court of competent jurisdiction and shall not be subject to
this Paragraph of the Agreement. The Executive and the Bank further acknowledge and agree that
nothing in this Agreement shall be construed to require arbitration of any claim for workers’
compensation or unemployment compensation.
N. LEGAL CONSULTATION
39. Each party acknowledges that it has carefully read this agreement, that it has had an
opportunity to consult with his or its attorney concerning the meaning, import and legal
significance of this Agreement, that it understands the terms of the Agreement, that all
understandings and agreements between Executive and the Bank relating to the subjects covered in
this Agreement are contained in it, and that it has entered into the Agreement voluntarily and not
in reliance on any promises or representations by the other than those contained in this Agreement.
O. MISCELLANEOUS
40. The Executive shall make himself available, upon the request of the Bank, to testify or
otherwise assist in litigation, arbitration, or other disputes involving the Bank, or any of the
directors, officers, employees, subsidiaries, or parent corporations of either, at no additional
cost during the term of this Agreement and at any time following the termination of this Agreement.
41. The Executive shall not be required to mitigate the amount of any payment provided for in
this Agreement by seeking other employment or otherwise, nor shall the amount of any payment
provided for in this Agreement be reduced by any compensation earned by the Executive as the result
of employment by another employer after the date of termination, or otherwise.
42. In the event either party institutes arbitration or litigation to enforce or protect its
rights under this Agreement, the prevailing party in such arbitration or litigation shall be
entitled, in addition to all other relief, to reasonable attorneys fees, out-of-pocket costs,
disbursements, and arbitrator’s fees relating to such arbitration or litigation.
43. This Agreement may be executed simultaneously in two or more counterparts, each of which
shall be deemed an original, but all of which shall together constitute one and the same Agreement.
44. The Bank shall have no obligation to set aside, earmark or entrust any fund or money with
which to pay its obligations under this Agreement. The Executive or any successor-in-interest to
Executive shall be and remain simply a general creditor of the Bank in the same manner as any
other creditor having a general unsecured claim. For purposes of the Code, the Bank intends this
Agreement to be an unfunded, unsecured promise to pay on the part of the Bank. For purposes of
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Bank intends that this
Agreement not be subject to ERISA. If it is deemed subject to ERISA, it is intended to be an
unfunded arrangement for the benefit of a select member of management, who is a highly compensated
employee of the Bank for the purpose of qualifying this Agreement for the “top hat” plan exception
under sections 201(2), 301(a)(3) and 401(a)(1) of ERISA. At no time shall the Executive have or be
deemed to have any lien nor right, title or interest in or to any specific investment or to any
assets of the Bank. If the Bank elects to invest in a life insurance, disability or annuity policy
upon the life of Executive, the Executive shall assist the Bank by freely submitting to a physical
examination and supplying such additional information necessary to obtain such insurance or
annuities.
45. When a reference is made in this Agreement to a Paragraph, such reference shall be to a
Paragraph of this Agreement unless otherwise indicated. The headings contained in this Agreement
are for convenience of reference only and shall not affect in any way the meaning or interpretation
of this Agreement. Whenever the words “include”, “includes” or “including” are used in this
Agreement, they shall be deemed to be followed by the words “without limitation.” The words
“hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision in this Agreement. Each use
herein of the masculine, neuter or feminine gender shall be deemed to include the other genders.
Each use herein of the plural shall include the singular and vice versa, in each case as the
context requires or as is otherwise appropriate. The word “or” is used in the inclusive sense.
Any agreement or instrument defined or referred to herein or in any agreement or instrument that is
referred to herein means such agreement or instrument as from time to time amended, modified or
supplemented, including by waiver or consent. References to a person are also to its permitted
successors or assigns.
46. Executive represents that his service as an employee of the Bank will not violate any
agreement: (i) he has made that prohibits him from disclosing any information he acquired prior to
his becoming employed by the Bank; or (ii) he has made that prohibits him from accepting employment
with the Bank or that will interfere with his compliance with the terms of this Agreement.
Executive further represents that he has not previously, and will not in the future, disclose to
Bank any proprietary information or trade secrets belonging to any previous employer. Executive
acknowledges that the Bank has instructed him not to disclose to it any proprietary information or
trade secrets belonging to any previous employer.
P. NOTICES
47. All notices and other communications required or permitted to be given or delivered
hereunder or by reason of the provisions of this Agreement shall be in writing and shall be deemed
to have been properly given if (a) delivered personally, (b) delivered by a recognized overnight
courier service, (c) sent by United States mail, or (d) sent by facsimile transmission followed by
a confirmation copy delivered by recognized overnight courier service the next day. Such notices,
requests, consents and other communications shall be sent to the respective parties as follows (or
at such other address for a party as shall be specified by like notice to the other party):
If to the Bank:
Bank of Birmingham
00000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
00000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Chairman
If to Executive:
Xxxxxx Xxxx
48. Any notice or other communication given pursuant to this Agreement shall be effective (i)
in the case of personal delivery, telex or facsimile transmission, when received; (ii) in the case
of mail, upon the earlier of actual receipt or five (5) business days after deposit with the United
States Postal Service, first class certified or registered mail, postage prepaid, return receipt
requested; and (iii) in the case of a recognized overnight courier service, one (1) business day
after delivery to the courier service together with all appropriate fees or charges and
instructions for overnight delivery.
49. This Agreement shall at all times be administered, and the provisions of this Agreement
shall be interpreted, consistent with the requirements of Section 409A and the final regulations
thereunder.
[signature page follows]
[signature page to Employment Agreement]
EXECUTED ON THIS DATE FIRST WRITTEN ABOVE IN BIRMINGHAM, MICHIGAN.
| EXECUTIVE | ||||||
| /s/ Xxxxxxx Xxxxxxxx | /s/ Xxxxxx Xxxx | |||||
| WITNESS | Xxxxxx Xxxx | |||||
| BANK OF BIRMINGHAM | ||||||
/s/ Xxxxxxx Xxxxxxxx
|
By: | /s/ Xxxxx X. Xxxxxxxx
Chairman-Compensation Committee |
||||
