EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), entered into and effective
as of August 2, 2002, by and between Blue River Bancshares, Inc. (the "Employer"
or "Blue River" as the context requires), an Indiana corporation and Xxxxxxxx X.
Xxxxxx ("Employee"), a resident of Xxxxxxx County, Indiana.
WITNESSETH
WHEREAS, Employer desires to encourage Employee to make valuable
contributions to Employer's business operations and not to seek or accept
employment elsewhere;
WHEREAS, Employee desires to be assured of a secure minimum
compensation from Employer for his services over a defined term;
WHEREAS, Employer desires to provide fair and reasonable benefits to
Employee on the terms and subject to the conditions set forth in this Agreement;
and
WHEREAS, Employer desires reasonable protection of its confidential
business and customer information which it will develop over the years at
substantial expense and assurance that Employee will not compete with Employer
for a reasonable period of time after termination of his employment with
Employer, except as otherwise provided herein.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual
covenants and undertakings herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Employer and Employee, each intending to be legally bound, covenant and agree as
follows:
1. Upon the terms and subject to the conditions set forth in this
Agreement, Employer employs Employee as President of Blue River, and Employee
accepts such employment.
2. Employee agrees to serve as the President of Blue River and to
perform such duties in that office as may reasonably be assigned to him by
Employer's Board of Directors, provided, however, that such duties shall be
performed in or from the principal executive offices of Employer, currently
located in Shelbyville, Indiana, and shall be of the character as those
generally associated with the office of President and or Chief Executive Office,
as the case may be. Employee shall not be required to be absent from the
location of the principal executive offices of employer on travel status or
otherwise more than 45 days in any calendar year. While employed by Employer,
Employee shall devote that amount of his business time and efforts as are
reasonably determined by the Employer to be necessary and appropriate to
Employer's business and shall not engage in any other related business. Employee
may, however, use his discretion in fixing his hours and schedule of work
consistent with the proper discharge of his duties.
3. The term of this Agreement shall begin on August 2, 2002 (the
"Effective Date") and shall end on the date which is three years following such
date.
4. Employee shall receive a minimum annual salary in an amount equal to
$32,500.00 ("Base Compensation") payable at regular intervals in accordance with
Employer's normal payroll practices in effect from time to time.
In connection with its annual review of the performance of the Employee, the
Board of Directors of the Employer shall ascertain if any adjustment to the
minimum annual salary of the Employee is necessary. Any and all adjustments to
the Employee's salary pursuant to this section shall cause the level of Base
Compensation to be adjusted by an equal amount for purposes of this Agreement.
The adjusted level of Base Compensation as provided in this section shall become
the level of Base Compensation for the remainder of the Term of this Agreement
until there is a further adjustment to Base Compensation as provided herein. If
applicable, Employee shall not receive director's fees for his services as a
director of Employer or any of the Employer's subsidiaries, and any committees
of the Boards of Directors.
5. During the term of this Agreement, Employee shall be entitled to
participate in or receive benefits under (i) any life, health, hospitalization,
medical, dental, disability or other insurance policy or plan, (ii) pension,
retirement or employee stock ownership plan, (iii) bonus or profit-sharing plan
or program, (iv) deferred compensation plan or arrangement, and (v) any other
employee benefit plan, program or arrangement, made available by Employer on the
date of this Agreement and from time to time in the future to Employer's
directors, officers and employees on a basis consistent with the terms,
conditions and overall administration of the foregoing plans, programs or
arrangements and with respect to which Employee is otherwise eligible to
participate or receive benefits.
6.(A) So long as Employee is employed by Employer pursuant to this
Agreement, Employee shall receive reimbursement from Employer for all reasonable
business expenses incurred in the course of his employment by Employer, upon
submission to Employer of written vouchers and statements for reimbursement.
Employee shall attend, at the Board of Directors' discretion, those professional
meetings, conventions, and/or similar functions that the Board of Directors
deems appropriate and useful for purposes of keeping abreast of current
developments in the industry and/or promoting the interests of Employer.
(B) So long as Employee is employed by Employer pursuant to this
Agreement, Employee shall be entitled to office space and working conditions
consistent with his position as President and/or Chief Executive Officer, as the
case may be. During the term of this Agreement and the Shelby County Employment
Agreement (as defined herein), Employee shall be entitled to an aggregate of
five (5) weeks per calendar year of paid vacation, which shall be utilized at
such times when his absence will not materially impair Employer's normal
business functions. Any unused vacation time in any calendar year may be carried
over and must be used prior to March 31 of the succeeding calendar year. If any
unused vacation time is not used by March 31 of the succeeding calendar year,
such unused vacation time shall lapse, and Employee shall not be entitled to any
additional compensation for any such unused and lapsed vacation time. In
addition to the vacation described above, Employee also shall be entitled to all
paid holidays customarily given by Employer to its officers.
(C) So long as Employee is employed by Employer pursuant to this
Agreement, Employee shall be provided with a membership at the Columbia Club,
and all membership fees, dues and assessments shall be paid by Employer so long
as Employee utilizes such membership primarily in furtherance of his duties
under this Agreement.
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7. Subject to the respective continuing obligations of the parties,
including but not limited to those set forth in subsections 9(A), 9(B), 9(C),
and (D) hereof, Employee's employment by Employer may be terminated prior to the
expiration of the Term of this Agreement as follows:
(A) Employer, by action of its Board of Directors and upon written
notice to Employee, may terminate Employee's employment with Employer
immediately for cause. For purposes of this subsection 7(A), "cause" shall be
defined as (i) personal dishonesty, (ii) incompetence, (iii) willful misconduct,
(iv) breach of fiduciary duty involving personal profit, (v) intentional failure
to perform stated duties, (vi) willful violation of any law, rule, or regulation
(other than traffic violations or similar offenses) or final cease-and-desist
order, (vii) any material breach of any term, condition or covenant of this
Agreement, or (viii) termination of the employment of the Employee with Shelby
County Bank for cause, as that term is defined in that certain employment
agreement entered into by and between the Employee and Shelby County Bank (the
"Shelby County Employment Agreement").
(B) Employer, by action of its Board of Directors, may terminate
Employee's employment with Employer without cause at any time; provided,
however, that the "date of termination" for purposes of determining benefits
payable to Employee under subsection 8(B) hereof shall be the date which is 30
days after Employee receives written notice of such termination.
(C) Employee, by written notice to Employer, may terminate his
employment with Employer immediately for cause provided, however, that Employer
shall have thirty (30) days, after the giving of written notice to Employer by
Employee of Employee's intention to terminate this Agreement for cause which
notice shall indicate the specific provision of this Agreement which will be
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for such termination, to cure the facts and
circumstances relied upon for establishing cause. For purposes of this
subsection 7(C), "cause" shall be defined as (i) any action by Employer to
remove the Employee as President of Blue River, except where the Employer's
Board of Directors properly acts to remove Employee from such office for "cause"
as defined in subsection 7(A) hereof, (ii) any action by Employer's Board of
Directors to materially limit, increase, or modify Employee's duties and/or
authority as President of Blue River (including his authority, subject to
corporate controls no more restrictive than those in effect on the date hereof),
(iii) Employer, without the written consent of Employee, relocating or
transferring Employee to a location more than 30 miles from the Employer's
current place of business, (iv) any failure of Employer to obtain the assumption
of the obligation to perform this Agreement by any successor, as contemplated in
section 18 hereof; or (v) any intentional breach by Employer of a term,
condition or covenant of this Agreement.
(D) Employee, upon sixty (60) days written notice to Employer, may
terminate his employment with Employer without cause.
(E) Employee's employment with Employer shall terminate in the event of
Employee's death or disability. For purposes hereof, "disability" shall be
defined as Employee's inability by reason of illness or other physical or mental
incapacity to perform the duties required by his employment for any consecutive
One Hundred Eighty (180) day period, provided that notice of any termination by
Employer because of Employee's "disability" shall have been given to Employee
prior to the full resumption by him of the performance of such duties.
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8. In the event of termination of Employee's employment with Employer
pursuant to section 7 hereof, compensation shall continue to be paid by Employer
to Employee as follows:
(A) In the event of termination pursuant to subsection 7(A) or 7(D),
compensation provided for herein (including Base Compensation) shall continue to
be paid, and Employee shall continue to participate in the employee benefit,
retirement, and compensation plans and other perquisites as provided in sections
5 and 6 hereof, through the date of termination specified in the notice of
termination. Any benefits payable under insurance, health, retirement and bonus
plans as a result of Employee's participation in such plans through such date
shall be paid when due under those plans. The date of termination specified in
any notice of termination pursuant to subsection 7(A), termination for cause,
shall be no later than the date of delivery of such notice of termination.
(B) In the event of termination pursuant to subsection 7(B) or 7(C),
compensation provided for herein (including Base Compensation) shall continue to
be paid, and Employee shall continue to participate in the employee benefit,
retirement, and compensation plans and other perquisites as provided in sections
5 and 6 hereof, through the date of termination specified in the notice of
termination. Any benefits payable under insurance, health, retirement and bonus
plans as a result of Employee's participation in such plans through such date
shall be paid when due under those plans. In addition, Employee shall be
entitled to continue to receive from Employer at his Base Compensation at the
rates in effect at the time of termination for the remaining Term of the
Agreement. In addition, during such periods, Employer will maintain in full
force and effect for the continued benefit of Employee each employee welfare
benefit plan (as such term is defined in the Employee Retirement Income Security
Act of 1974, as amended) in which Employee was entitled to participate
immediately prior to the date of his termination, unless an essentially
equivalent and no less favorable benefit is provided by a subsequent employer of
Employee. If the terms of any employee welfare benefit plan of Employer do not
permit continued participation by Employee, Employer will arrange to provide to
Employee a benefit substantially similar to, and no less favorable than, the
benefit he was entitled to receive under such plan at the end of the period of
coverage.
(C) In the event of termination pursuant to subsection 7(E),
compensation provided for herein (including Base Compensation) shall continue to
be paid, and Employee shall continue to participate in the employee benefit,
retirement, and compensation plans and other perquisites as provided in sections
5 and 6 hereof, (i) in the event of Employee's death, through the date of death,
or (ii) in the event of Employee's disability, through the date of proper notice
of disability as required by subsection 7(E). Any benefits payable under
insurance, health, retirement and bonus plans as a result of Employer's
participation in such plans through such date shall be paid when due under those
plans.
9. In order to induce Employer (for purposes of this Section includes
Employer's affiliates) to enter into this Agreement, Employee hereby agrees as
follows:
(A) While Employee is employed by Employer and for a period of three
years after termination of such employment or the expiration of the Term,
Employee shall not divulge or furnish any trade secrets (as defined in IND. CODE
Section 24-2-3-2) of Employer or any confidential information acquired by him
while employed by Employer concerning the policies, plans, procedures or
customers of employer to any person, firm or corporation, other than Employer or
upon its written request, or use any such trade secret or confidential
information directly or indirectly for Employee's own benefit or for the benefit
of any person, firm or corporation other than Employer, since such trade secrets
and confidential information are confidential and shall at
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all times remain the property of Employer.
(B) For a period of three years after termination of Employee's
employment by Employer for reasons other than those set forth in subsections
7(B) or (C) of this Agreement or expiration of the Term, Employee shall not
directly or indirectly provide banking or bank-related services to or solicit
the banking or bank-related business of any customer of Employer at the time of
such provision of services or solicitation which Employee served either alone or
with others while employed by Employer in any city, town, borough, township,
village or other place in which Employee performed services for Employer while
employed by it, or assist any actual or potential competitor of Employer to
provide banking or bank-related services to or solicit any such customer's
banking or bank-related business in any such place.
(C) While Employee is employed by Employer and for a period of one year
after termination of Employee's employment by Employer for reasons other than
those set forth in subsections 7(B) or (C) of this Agreement, Employee shall
not, directly or indirectly, as principal, agent, or trustee, or through the
agency of any corporation, partnership, trade association, agent or agency,
engage in any banking or bank-related business or venture which competes with
the business of Employer as conducted during Employee's employment by Employer
within a radius of fifty (50) miles of Employer's main office or any of
Employer's subsidiaries' branch offices.
(D) Upon Employee's termination of employment or the expiration of the
Term, Employee will turn over immediately thereafter to Employer all business
correspondence, letters, papers, reports, customers' lists, financial
statements, credit reports or other confidential information or documents of
Employer or its affiliates in the possession or control of Employee, all of
which writings are and will continue to be the sole and exclusive property of
Employer or its affiliates.
If Employee's employment by Employer is terminated during the Term of this
Agreement for reasons set forth in subsections 7(B) or (C) or this Agreement,
Employee shall have no obligations to Employer with respect to or noncompetition
under this section 9.
10. Any termination of Employee's employment with Employer as
contemplated by section 7 hereof, except in the circumstances of Employee's
death, shall be communicated by written "Notice of Termination" by the
terminating party to the other party hereto. Any "Notice of Termination"
pursuant to subsections 7(A), 7(C) or 7(E) shall indicate the specific
provisions of this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for such
termination.
11. If Employee is suspended and/or temporarily prohibited from
participating in the conduct of Employer's or any affiliates' affairs by a
notice served under section 8(e)(3) or (g)(1) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1818(e)(3) and (g)(1)), Employer's obligations under this
Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, Employer
shall (i) pay Employee all of the compensation withheld while its obligations
under this Agreement were suspended and (ii) reinstate (in whole or in part) any
of its obligations which were suspended.
12. If Employee is removed and/or permanently prohibited from
participating in the conduct of Employer's or any affiliates' affairs by an
order issued under section 8(e)(4) or (g)(1) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1818(e)(4) or (g)(1)), all obligations of Employer under
this Agreement shall terminate as of the effective date of the order, but vested
rights of the parties to the Agreement shall not be affected.
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13. If Employer is in default (as defined in section 3(x)(1) of the
Federal Deposit Insurance Act), all obligations under this Agreement shall
terminate as of the date of default, but this provision shall not affect any
vested rights of Employer or Employee.
14. All obligations under the contract shall be terminated, except to
the extent determined that the continuation of the contract is necessary for the
continued operation of the Employer:
(A) By the Director or his designee, at the time the Federal Deposit
Insurance Corporation for the Resolution Trust Corporation enters into an
agreement to provide assistance to or on behalf of the Employer under the
authority contained in 13(c) of the Federal Deposit Insurance Act; or
(B) By the Director or his designee, at the time the Director or his
designee approves a supervisory merger to resolve problems related to the
operation of the Employer or when the Employer is determined by the Director to
be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
15. If a dispute arises regarding the termination of Employee pursuant
to section 7 hereof or as to the interpretation or enforcement of this Agreement
and Employee obtains a final judgment in his favor in a court of competent
jurisdiction or his claim is settled by Employer prior to the rendering of a
judgment by such a court, all reasonable legal fees and expenses incurred by
Employee is contesting or disputing any such termination or seeking to obtain or
enforce any right or benefit provided for in this Agreement or otherwise
pursuing his claim shall be paid by Employer, to the extent permitted by law.
16. Should Employee die after termination of his employment with
Employer while any amounts are payable to him hereunder, this Agreement shall
inure to the benefit of and be enforceable by Employee's executors,
administrators, heirs, distributees, devisees and legatees and all amounts
payable hereunder shall be paid in accordance with the terms of this Agreement
to Employee's devisee, legatee or other designee or, if there is no such
designee, to his estate.
17. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been given when delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to Employee: Xx. Xxxxxxxx X. Xxxxxx
0000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx 00000
If to Employer: Blue River Bancshares, Inc.
00 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxx 00000
or to such other address as either party hereto may have furnished to the other
party in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
18. The validity, interpretation, and performance of this Agreement
shall be governed by the laws of the State of Indiana to the extent that federal
banking law and the regulations of the Office of Thrift Supervision are
inapplicable.
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19. Employer shall require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business or assets of Employer, by agreement in form and in substance
satisfactory to Employee to expressly assume and agree to perform this Agreement
in the same manner and same extent that Employer would be required to perform it
if no such succession had taken place. Failure of Employer to obtain such
agreement prior to the effectiveness of any such succession shall be a material
intentional breach of this Agreement and shall entitle Employee to terminate his
employment with Employer pursuant to subsection 7(C) hereof. As used in this
Agreement, "Employer" shall mean Employer as hereinbefore defined and any
successor to its business or assets as aforesaid.
20. No provision of this agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
signed by Employee and Employer. No waiver by either party hereto at any time of
any breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a wavier of dissimilar provisions or conditions at the same or any prior
subsequent time. No agreements or representation, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. The Change of Control
Agreement, dated October 2000, by and between Blue River and Employee is hereby
terminated and of no further force or effect.
21. The invalidity or unenforceability of any provisions of this
Agreement shall not affect the validity or enforceability of any other
provisions of this Agreement which shall remain in full force and effect.
22. Any payments made to the Employee pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with 12 USC
Section 1828(k) and FDIC regulation 12 CRF 359, "Golden Parachute and
Indemnification Payments".
23. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same agreement.
24. This Agreement is personal in nature and neither party hereto
shall, without consent of the other, assign or transfer this Agreement or any
rights or obligations hereunder except as provided in section 15 and section 18
above. Without limiting the foregoing, Employee's right to receive compensation
hereunder shall not be assignable or transferable, whether by pledge, creation
of a security interest or otherwise, other than a transfer by his will or by the
laws of descent or distribution as set forth in section 14 hereof, and in the
event of any attempted assignment or transfer contrary to this paragraph,
Employer shall have no liability to pay any amounts so attempted to be assigned
or transferred.
25. Anything in this Agreement to the contrary notwithstanding in the
event Employer's independent public accountants determine that any payment by
Employer to or for the benefit of Employee, whether paid or payable pursuant to
the terms of this Agreement, would be non-deductible by employer for federal
income tax purposes because of Section 280G of the Code, then the amount payable
to or for the benefit of Employee pursuant to the Agreement shall be reduced
(but not below zero) to the Reduced Amount. For purposes of this section 23, the
"Reduced Amount" shall be the amount which maximizes the amount payable without
causing the payment to be non-deductible by Employer because of Section 280G of
the Code.
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IN WITNESS WHEREOF, the parties have caused the Agreement to be executed and
delivered as of the 2nd day of August, 2002.
BLUE RIVER BANCSHARES, INC.
/s/ Xxxxx X. Xxxx, Chairman
"Employer"
/s/ Xxxxxxxx X. Xxxxxx
"Employee"
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), entered into and effective
as of August 2, 2002, by and between Shelby County Bank (the "Employer" or the
"Bank" as the context requires), a federal savings bank, and Xxxxxxxx X. Xxxxxx
("Employee"), a resident of Xxxxxxx County, Indiana.
WITNESSETH
WHEREAS, Employer desires to encourage Employee to make valuable
contributions to Employer's business operations and not to seek or accept
employment elsewhere;
WHEREAS, Employee desires to be assured of a secure minimum
compensation from Employer for his services over a defined term;
WHEREAS, Employer desires to provide fair and reasonable benefits to
Employee on the terms and subject to the conditions set forth in this Agreement;
and
WHEREAS, Employer desires reasonable protection of its confidential
business and customer information which it will develop over the years at
substantial expense and assurance that Employee will not compete with Employer
for a reasonable period of time after termination of his employment with
Employer, except as otherwise provided herein.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual
covenants and undertakings herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Employer and Employee, each intending to be legally bound, covenant and agree as
follows:
1. Upon the terms and subject to the conditions set forth in this
Agreement, Employer employs Employee as President and Chief Executive Officer of
the Bank, and Employee accepts such employment.
2. Employee agrees to serve as the President and Chief Executive
Officer of the Bank and to perform such duties in that office as may reasonably
be assigned to him by Employer's Board of Directors, provided, however, that
such duties shall be performed in or from the principal executive offices of
Employer, currently located in Shelbyville, Indiana, and shall be of the
character as those generally associated with the office of President and or
Chief Executive Office, as the case may be. Employee shall not be required to be
absent from the location of the principal executive offices of employer on
travel status or otherwise more than 45
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days in any calendar year. While employed by Employer, Employee shall devote
that amount of his business time and efforts as are reasonably determined by the
Employer to be necessary and appropriate to Employer's business and shall not
engage in any other related business. Employee may, however, use his discretion
in fixing his hours and schedule of work consistent with the proper discharge of
his duties.
3. The term of this Agreement shall begin on August 2, 2002 (the
"Effective Date") and shall end on the date which is three years following such
date.
4. Employee shall receive a minimum annual salary in an amount equal to
$97,500.00 ("Base Compensation") payable at regular intervals in accordance with
Employer's normal payroll practices in effect from time to time.
In connection with its annual review of the performance of the Employee, the
Board of Directors of the Employer shall ascertain if any adjustment to the
minimum annual salary of the Employee is necessary. Any and all adjustments to
the Employee's salary pursuant to this section shall cause the level of Base
Compensation to be adjusted by an equal amount for purposes of this Agreement.
The adjustment to the level of Base Compensation as provided in this section
shall become the level of Base Compensation for the remainder of the Term of
this Agreement until there is a further adjustment to Base Compensation as
provided herein. If applicable, Employee shall not receive director's fees for
his services as a director of Employer or any of the Employer's subsidiaries,
and any committees of the Boards of Directors.
5. During the term of this Agreement, Employee shall be entitled to
participate in or receive benefits under (i) any life, health, hospitalization,
medical, dental, disability or other insurance policy or plan, (ii) pension,
retirement or employee stock ownership plan, (iii) bonus or profit-sharing plan
or program, (iv) deferred compensation plan or arrangement, and (v) any other
employee benefit plan, program or arrangement, made available by Employer on the
date of this Agreement and from time to time in the future to Employer's
directors, officers and employees on a basis consistent with the terms,
conditions and overall administration of the foregoing plans, programs or
arrangements and with respect to which Employee is otherwise eligible to
participate or receive benefits.
6.(A) So long as Employee is employed by Employer pursuant to
this Agreement, Employee shall receive reimbursement from
Employer for all reasonable business expenses incurred in the
course of his employment by Employer, upon submission to
Employer of written vouchers and statements for reimbursement.
Employee shall attend, at the Board of Directors' discretion,
those professional meetings, conventions, and/or similar
functions that the Board of Directors deems appropriate and
useful for purposes of keeping abreast of current developments
in the industry and/or promoting the interests of Employer.
(B) So long as Employee is employed by Employer pursuant to this
Agreement, Employee shall be entitled to office space and
working conditions consistent with his position as President
and/or Chief Executive Officer, as the case may be. During the
term of this Agreement and the Blue River Employment Agreement
(as defined herein), Employee shall be entitled to an
aggregate of five (5) weeks per calendar year of paid
vacation, which shall be utilized at such times when his
absence will not materially impair Employer's normal business
functions. Any unused vacation time in any calendar year may
be carried over and must be used prior to March 31 of the
succeeding calendar year. If any unused vacation time is
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not used by March 31 of the succeeding calendar year, such
unused vacation time shall lapse, and Employee shall not be
entitled to any additional compensation for any such unused
and lapsed vacation time. In addition to the vacation
described above, Employee also shall be entitled to all paid
holidays customarily given by Employer to its officers.
(C) So long as Employee is employed by Employer pursuant to this
Agreement, Employee shall be provided with a membership at the
Columbia Club, and all membership fees, dues and assessments
shall be paid by Employer so long as Employee utilizes such
membership primarily in furtherance of his duties under this
Agreement.
7. Subject to the respective continuing obligations of the parties,
including but not limited to those set forth in subsections 9(A), 9(B), 9(C),
and (D) hereof, Employee's employment by Employer may be terminated prior to the
expiration of the Term of this Agreement as follows:
(A) Employer, by action of its Board of Directors and upon written
notice to Employee, may terminate Employee's employment with
Employer immediately for cause. For purposes of this
subsection 7(A), "cause" shall be defined as (i) personal
dishonesty, (ii) incompetence, (iii) willful misconduct, (iv)
breach of fiduciary duty involving personal profit, (v)
intentional failure to perform stated duties, (vi) willful
violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist
order, (vii) any material breach of any term, condition or
covenant of this Agreement, or (viii) termination of the
employment of the Employee with Blue River Bancshares for
cause, as that term is defined in that certain employment
agreement entered into by and between the Employee and Blue
River Bancshares (the "Blue River Employment Agreement").
(B) Employer, by action of its Board of Directors, may terminate
Employee's employment with Employer without cause at any time;
provided, however, that the "date of termination" for purposes
of determining benefits payable to Employee under subsection
8(B) hereof shall be the date which is 30 days after Employee
receives written notice of such termination.
(C) Employee, by written notice to Employer, may terminate his
employment with Employer immediately for cause provided,
however, that Employer shall have thirty (30) days, after the
giving of written notice to Employer by Employee of Employee's
intention to terminate this Agreement for cause which notice
shall indicate the specific provision of this Agreement which
will be relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for
such termination, to cure the facts and circumstances relied
upon for establishing cause. For purposes of this subsection
7(C), "cause" shall be defined as (i) any action by Employer
to remove the Employee as President and Chief Executive
Officer of the Bank except where the Employer's Board of
Directors
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properly acts to remove Employee from such office for "cause"
as defined in subsection 7(A) hereof, (ii) any action by
Employer's Board of Directors to materially limit, increase,
or modify Employee's duties and/or authority as President and
Chief Executive Officer of the Bank (including his authority,
subject to corporate controls no more restrictive than those
in effect on the date hereof), (iii) Employer, without the
written consent of Employee, relocating or transferring
Employee to a location more than 30 miles from the Employer's
current place of business, (iv) any failure of Employer to
obtain the assumption of the obligation to perform this
Agreement by any successor, as contemplated in section 18
hereof; or (v) any intentional breach by Employer of a term,
condition or covenant of this Agreement.
(D) Employee, upon sixty (60) days written notice to Employer, may
terminate his employment with Employer without cause.
(E) Employee's employment with Employer shall terminate in the
event of Employee's death or disability. For purposes hereof,
"disability" shall be defined as Employee's inability by
reason of illness or other physical or mental incapacity to
perform the duties required by his employment for any
consecutive One Hundred Eighty (180) day period, provided that
notice of any termination by Employer because of Employee's
"disability" shall have been given to Employee prior to the
full resumption by him of the performance of such duties.
8. In the event of termination of Employee's employment with Employer
pursuant to section 7 hereof, compensation shall continue to be paid by Employer
to Employee as follows:
(A) In the event of termination pursuant to subsection 7(A) or
7(D), compensation provided for herein (including Base
Compensation) shall continue to be paid, and Employee shall
continue to participate in the employee benefit, retirement,
and compensation plans and other perquisites as provided in
sections 5 and 6 hereof, through the date of termination
specified in the notice of termination. Any benefits payable
under insurance, health, retirement and bonus plans as a
result of Employee's participation in such plans through such
date shall be paid when due under those plans. The date of
termination specified in any notice of termination pursuant to
subsection 7(A), termination for cause, shall be no later than
the date of delivery of such notice of termination.
(B) In the event of termination pursuant to subsection 7(B) or
7(C), compensation provided for herein (including Base
Compensation) shall continue to be paid, and Employee shall
continue to participate in the employee benefit, retirement,
and compensation plans and other perquisites as provided in
sections 5 and 6 hereof, through the date of termination
specified in the notice of termination. Any benefits payable
under insurance, health, retirement and bonus plans as a
result of
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Employee's participation in such plans through such date shall
be paid when due under those plans. In addition, Employee
shall be entitled to continue to receive from Employer at his
Base Compensation at the rates in effect at the time of
termination for the remaining Term of the Agreement. In
addition, during such periods, Employer will maintain in full
force and effect for the continued benefit of Employee each
employee welfare benefit plan (as such term is defined in the
Employee Retirement Income Security Act of 1974, as amended)
in which Employee was entitled to participate immediately
prior to the date of his termination, unless an essentially
equivalent and no less favorable benefit is provided by a
subsequent employer of Employee. If the terms of any employee
welfare benefit plan of Employer do not permit continued
participation by Employee, Employer will arrange to provide to
Employee a benefit substantially similar to, and no less
favorable than, the benefit he was entitled to receive under
such plan at the end of the period of coverage.
(C) In the event of termination pursuant to subsection 7(E),
compensation provided for herein (including Base Compensation)
shall continue to be paid, and Employee shall continue to
participate in the employee benefit, retirement, and
compensation plans and other perquisites as provided in
sections 5 and 6 hereof, (i) in the event of Employee's death,
through the date of death, or (ii) in the event of Employee's
disability, through the date of proper notice of disability as
required by subsection 7(E). Any benefits payable under
insurance, health, retirement and bonus plans as a result of
Employer's participation in such plans through such date shall
be paid when due under those plans.
9. In order to induce Employer (for purposes of this Section includes
Employer's affiliates) to enter into this Agreement, Employee hereby agrees as
follows:
(A) While Employee is employed by Employer and for a period of
three years after termination of such employment or the
expiration of the Term, Employee shall not divulge or furnish
any trade secrets (as defined in IND. CODE Section 24-2-3-2)
of Employer or any confidential information acquired by him
while employed by Employer concerning the policies, plans,
procedures or customers of employer to any person, firm or
corporation, other than Employer or upon its written request,
or use any such trade secret or confidential information
directly or indirectly for Employee's own benefit or for the
benefit of any person, firm or corporation other than
Employer, since such trade secrets and confidential
information are confidential and shall at all times remain the
property of Employer.
(B) For a period of three years after termination of Employee's
employment by Employer for reasons other than those set forth
in subsections 7(B) or (C) of this Agreement or expiration of
the Term, Employee shall not directly or indirectly provide
banking or bank-related services to or solicit
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the banking or bank-related business of any customer of
Employer at the time of such provision of services or
solicitation which Employee served either alone or with others
while employed by Employer in any city, town, borough,
township, village or other place in which Employee performed
services for Employer while employed by it, or assist any
actual or potential competitor of Employer to provide banking
or bank-related services to or solicit any such customer's
banking or bank-related business in any such place.
(C) While Employee is employed by Employer and for a period of one
year after termination of Employee's employment by Employer
for reasons other than those set forth in subsections 7(B) or
(C) of this Agreement, Employee shall not, directly or
indirectly, as principal, agent, or trustee, or through the
agency of any corporation, partnership, trade association,
agent or agency, engage in any banking or bank-related
business or venture which competes with the business of
Employer as conducted during Employee's employment by Employer
within a radius of fifty (50) miles of Employer's main office
or any of Employer's subsidiaries' branch offices.
(D) Upon Employee's termination of employment or the expiration of
the Term, Employee will turn over immediately thereafter to
Employer all business correspondence, letters, papers,
reports, customers' lists, financial statements, credit
reports or other confidential information or documents of
Employer or its affiliates in the possession or control of
Employee, all of which writings are and will continue to be
the sole and exclusive property of Employer or its affiliates.
If Employee's employment by Employer is terminated during the Term of this
Agreement for reasons set forth in subsections 7(B) or (C) or this Agreement,
Employee shall have no obligations to Employer with respect to or noncompetition
under this section 9.
10. Any termination of Employee's employment with Employer as
contemplated by section 7 hereof, except in the circumstances of Employee's
death, shall be communicated by written "Notice of Termination" by the
terminating party to the other party hereto. Any "Notice of Termination"
pursuant to subsections 7(A), 7(C) or 7(E) shall indicate the specific
provisions of this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for such
termination.
11. If Employee is suspended and/or temporarily prohibited from
participating in the conduct of Employer's or any affiliates' affairs by a
notice served under section 8(e)(3) or (g)(1) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1818(e)(3) and (g)(1)), Employer's obligations under this
Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, Employer
shall (i) pay Employee all of the compensation withheld while its obligations
under this Agreement were suspended and (ii) reinstate (in whole or in part) any
of its obligations which were suspended.
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12. If Employee is removed and/or permanently prohibited from
participating in the conduct of Employer's or any affiliates' affairs by an
order issued under section 8(e)(4) or (g)(1) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1818(e)(4) or (g)(1)), all obligations of Employer under
this Agreement shall terminate as of the effective date of the order, but vested
rights of the parties to the Agreement shall not be affected.
13. If Employer is in default (as defined in section 3(x)(1) of the
Federal Deposit Insurance Act), all obligations under this Agreement shall
terminate as of the date of default, but this provision shall not affect any
vested rights of Employer or Employee.
14. All obligations under the contract shall be terminated, except to
the extent determined that the continuation of the contract is necessary for the
continued operation of the Employer:
(A) By the Director or his designee, at the time the Federal Deposit
Insurance Corporation or the Resolution Trust Corporation enters into an
agreement to provide assistance to or on behalf of the Employer under the
authority contained in 13(c) of the Federal Deposit Insurance Act; or
(B) By the Director or his designee, at the time the Director or his
designee approves a supervisory merger to resolve problems related to the
operation of the Employer or when the Employer is determined by the Director to
be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
15. If a dispute arises regarding the termination of Employee pursuant
to section 7 hereof or as to the interpretation or enforcement of this Agreement
and Employee obtains a final judgment in his favor in a court of competent
jurisdiction or his claim is settled by Employer prior to the rendering of a
judgment by such a court, all reasonable legal fees and expenses incurred by
Employee is contesting or disputing any such termination or seeking to obtain or
enforce any right or benefit provided for in this Agreement or otherwise
pursuing his claim shall be paid by Employer, to the extent permitted by law.
16. Should Employee die after termination of his employment with
Employer while any amounts are payable to him hereunder, this Agreement shall
inure to the benefit of and be enforceable by Employee's executors,
administrators, heirs, distributees, devisees and legatees and all amounts
payable hereunder shall be paid in accordance with the terms of this Agreement
to Employee's devisee, legatee or other designee or, if there is no such
designee, to his estate.
17. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been given when delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to Employee: Xx. Xxxxxxxx X. Xxxxxx
0000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx 00000
If to Employer: Shelby County Bank
00 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxx 00000
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or to such other address as either party hereto may have furnished to the other
party in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
18. The validity, interpretation, and performance of this Agreement
shall be governed by the laws of the State of Indiana to the extent that federal
banking law and the regulations of the Office of Thrift Supervision are
inapplicable.
19. Employer shall require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business or assets of Employer, by agreement in form and in substance
satisfactory to Employee to expressly assume and agree to perform this Agreement
in the same manner and same extent that Employer would be required to perform it
if no such succession had taken place. Failure of Employer to obtain such
agreement prior to the effectiveness of any such succession shall be a material
intentional breach of this Agreement and shall entitle Employee to terminate his
employment with Employer pursuant to subsection 7(C) hereof. As used in this
Agreement, "Employer" shall mean Employer as hereinbefore defined and any
successor to its business or assets as aforesaid.
20. No provision of this agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
signed by Employee and Employer. No waiver by either party hereto at any time of
any breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a wavier of dissimilar provisions or conditions at the same or any prior
subsequent time. No agreements or representation, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. The Change of Control
Agreement, dated October 2002 by and between Blue River and Employee is hereby
terminated and of no further force or effect.
21. The invalidity or unenforceability of any provisions of this
Agreement shall not affect the validity or enforceability of any other
provisions of this Agreement which shall remain in full force and effect.
22. Any payments made to the Employee pursuant to this Agreement, or
otherwise, are subject to an conditioned upon their compliance with 12 USC
Section 1828(k) and FDIC regulation 00 XXX 000, "Golden Parachute and
Indemnification Payments".
23. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same agreement.
24. This Agreement is personal in nature and neither party hereto
shall, without consent of the other, assign or transfer this Agreement or any
rights or obligations hereunder except as provided in section 15 and section 18
above. Without limiting the foregoing, Employee's right to receive compensation
hereunder shall not be assignable or transferable, whether by pledge, creation
of a security interest or otherwise, other than a transfer by his will or by the
laws of descent or distribution as set forth in section 14 hereof, and in the
event of any attempted assignment or transfer contrary to this paragraph,
Employer shall have no liability to pay any amounts so attempted to be assigned
or transferred.
25. Anything in this Agreement to the contrary notwithstanding in the
event Employer's independent public accountants determine that any payment by
Employer to or for the benefit of Employee, whether paid or payable pursuant to
the terms of this Agreement, would be non-deductible by employer for federal
income tax purposes because of Section 280G of the
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Code, then the amount payable to or for the benefit of Employee pursuant to the
Agreement shall be reduced (but not below zero) to the Reduced Amount. For
purposes of this section 23, the "Reduced Amount" shall be the amount which
maximizes the amount payable without causing the payment to be non-deductible by
Employer because of Section 280G of the Code.
IN WITNESS WHEREOF, the parties have caused the Agreement to be
executed and delivered as of the 2nd day of August, 2002.
SHELBY COUNTY BANK
/s/ Xxxxx X. Xxxx, Chairman
---------------------------
"Employer"
/s/ Xxxxxxxx X. Xxxxxx
---------------------------
"Employee"
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