EXHIBIT 10.3
1ST BANK
EMPLOYMENT AGREEMENT
XXXXXXX XXXXXX
THIS EMPLOYMENT AGREEMENT (this "Agreement"), signed as of January 22,
2007, between 1st BANK and Xxxxxxx Xxxxxx ("Executive") and ratified by GLACIER
BANCORP, INC. ("GBCI"), takes effect on the effective date of the pending Merger
(the "Effective Date") referenced below.
RECITALS
A. 1st Bank has entered into a Plan and Agreement Merger (the "Merger
Agreement") with North Side State Bank of Rock Springs ("North Side") and
GBCI. Pursuant to the terms of the Merger Agreement, North Side will merge
with and into 1st Bank, with 1st Bank as the surviving entity (the
"Merger").
B. Executive presently serves as Chief Operating Officer of North Side and
will continue to do so until the Effective Date.
C. GBCI and 1st Bank desire Executive to be employed by 1st Bank from and
after the Effective Date, under the terms and conditions of this Agreement.
D. Executive desires to be employed by 1st Bank from and after the Effective
Date, under the terms and conditions of this Agreement.
E. This Agreement supercedes any and all other employment or similar
agreements that may currently be in effect for Executive.
AGREEMENT
In consideration of the promises set forth in this Agreement, the parties
agree as follows.
1. Employment. 1st Bank agrees to employ Executive, and Executive accepts
employment by 1st Bank on the terms and conditions set forth in this
Agreement.
2. Effective Date and Term.
a. Term. The term of this Agreement ("Term") begins on the Effective
Date and will expire on January 1, 2008.
b. Abandonment or Termination of the Merger. This Agreement is void
if the Merger Agreement is terminated for any reason.
3. Duties. 1st Bank will employ Executive and Executive will faithfully
and diligently perform the duties assigned to him. Executive will be
responsible for
the operations of the former North Side office and will assist with
data conversion and other transition matters. The board of directors
of 1st Bank or GBCI may, from time to time and in good faith, modify
Executive's performance responsibilities to accommodate management
objectives of 1st Bank or of GBCI. Executive will assume any
additional positions, duties, and responsibilities as may reasonably
be requested of him with or without additional compensation, as
appropriate and consistent with his position.
4. Extent of Services. Executive will devote all of his working time,
attention and skill to the duties and responsibilities referenced in
Section 3. To the extent that such activities do not interfere with
his duties under Section 3, Executive may participate in other
businesses as a passive investor, but (i) Executive may not actively
participate in the operation or management of those businesses, and
(ii) Executive may not, without 1st Bank's prior written consent, make
or maintain any investment in a business with which 1st Bank and/or
GBCI has an existing competitive or commercial relationship.
5. Payment at End of Term. Provided that Executive has fulfilled his
obligations under Section 3, within fifteen (15) days following the
expiration of the Term, 1st Bank shall pay Executive a lump sum
payment equal to $165,000.
6. Salary. Executive's annualized salary during the term of this
Agreement will be $116,750. Executive's salary will be paid in
accordance with 1st Bank's regular payroll schedule.
7. Vacation and Benefits.
a. Vacation and Holidays. Executive will receive the same number of
days of vacation during the term of this Agreement as Executive
received prior to the Effective Date. Executive's ability to
carry over or accumulate vacation will be governed by 1st Bank's
and/or GBCI's applicable policies.
b. Benefits. Executive will be entitled to participate in any group
life insurance, disability, health and accident insurance plans,
profit sharing plan and in other employee fringe benefit programs
1st Bank or GBCI may have in effect from time to time for its
similarly situated employees, in accordance with and subject to
any policies adopted by 1st Bank's or GBCI's board of directors
with respect to the plans or programs, including without
limitation, any incentive or employee stock option plan, deferred
compensation plan and 401(k) plan. Neither 1st Bank nor GBCI
through this Agreement obligates itself to make any particular
benefits available to its employees.
c. Business Expenses. 1st Bank will reimburse Executive for ordinary
and reasonable expenses which are consistent with past practice
at 1st Bank (including, without limitation, travel,
entertainment, and similar expenses)
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and which are incurred in performing and promoting 1st Bank's
business. Executive will present from time to time itemized
accounts of these expenses, subject to any limits of Bank policy
or the rules and regulations of the Internal Revenue Service.
8. Termination of Employment.
a. Termination By Bank for Cause. If 1st Bank terminates Executive's
employment for Cause (defined in Section 8(e)) or Executive
terminates his employment without Good Reason (defined in Section
8(f)) before this Agreement terminates, 1st Bank will pay
Executive the salary earned and expenses reimbursable under this
Agreement incurred through the date of his termination. Executive
will have no right to receive compensation or other benefits for
any period after termination under this Section 8(a).
b. Other Termination By Bank. If 1st Bank terminates Executive's
employment without Cause before this Agreement terminates or
expires, or Executive terminates his employment for Good Reason,
1st Bank will pay Executive a lump sum payment equal to the sum
of: (i) the amount of salary that Executive would have otherwise
received for the remainder of 2007, plus (ii) $165,000.
c. Death or Disability. This Agreement terminates (i) if Executive
dies or (ii) if Executive is unable to perform his duties and
obligations under this Agreement for a period of 90 consecutive
days as a result of a physical or mental disability arising at
any time during the term of this Agreement, unless with
reasonable accommodation Executive could continue to perform his
duties under this Agreement and making these accommodations would
not pose an undue hardship on 1st Bank. If termination occurs
under this Section 8(c), Executive or his estate will be entitled
to receive all compensation and benefits earned and expenses
reimbursable through the date Executive's employment terminated.
d. Return of Bank Property. If and when Executive ceases, for any
reason, to be employed by 1st Bank, Executive must return to 1st
Bank all keys, pass cards, identification cards and any other
property of 1st Bank or GBCI. At the same time, Executive also
must return to 1st Bank all originals and copies (whether in hard
copy, electronic or other form) of any documents, drawings,
notes, memoranda, designs, devices, diskettes, tapes, manuals,
and specifications which constitute proprietary information or
material of 1st Bank or GBCI. The obligations in this paragraph
include the return of documents and other materials that may be
in his desk at work, in his car, in place of residence, or in any
other location under his control.
e. Cause. "Cause" means any one or more of the following:
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(1) Willful misfeasance or gross negligence in the performance
of Executive's duties;
(2) Conviction of a crime in connection with his duties; or
(3) Conduct demonstrably and significantly harmful to 1st Bank,
as reasonably determined on the written advice of legal
counsel by 1st Bank's board of directors.
f. Good Reason. "Good Reason" means only any one or more of the
following:
(1) Reduction of Executive's salary or reduction or elimination
of any compensation or benefit plan benefiting Executive,
unless the reduction or elimination is generally applicable
to substantially all Bank employees (or employees of a
successor or controlling entity of 1st Bank) formerly
benefited;
(2) The assignment to Executive without his consent of any
authority or duties materially inconsistent with Executive's
position as of the date of this Agreement;
(3) A relocation or transfer of Executive's principal place of
employment that would require Executive to commute on a
regular basis more than thirty (30) miles each way from
North Side's present main office location.
9. Confidentiality. Executive will not, after the date this Agreement was
signed, including during and after its Term, use for his own purposes
or disclose to any other person or entity any confidential business
information concerning 1st Bank or GBCI or their business operations,
unless (i) 1st Bank or GBCI consents to the use or disclosure of their
respective confidential information; (ii) the use or disclosure is
consistent with Executive's duties under this Agreement; (iii)
disclosure is required by law or court order; or (iv) the information
is made or otherwise becomes public. For purposes of this Agreement,
confidential business information includes, without limitation, trade
secrets (as defined under the Wyoming Trade Secrets Act, Section
00-00-000 of the Wyoming Statutes), various confidential information
concerning all aspects of current and future operations, nonpublic
information on investment management practices, marketing plans,
pricing structure and technology of either 1st Bank or GBCI. Executive
will also treat the terms of this Agreement as confidential business
information.
10. Restrictive Covenants.
a. Competitive Activities. During the period of his employment and,
if Executive's employment with 1st Bank terminates pursuant to
Section 8(a) or 8(b) of this Agreement, then for two (2) years
after Executive's employment with 1st Bank has ended, Executive
will not, directly or
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indirectly, as a shareholder, director, officer, employee,
partner, agent, consultant, lessor, creditor or otherwise,
provide management, supervisory or other similar services to any
person or entity engaged in any business in Sweetwater County,
Wyoming, which is competitive with the business of 1st Bank or
GBCI as conducted during the Term of this Agreement or as
conducted as of the date of termination of employment, including
any preliminary steps associated with the formation of a new
bank.
b. Non-Interference. During the period of his employment and, if
Executive's employment with 1st Bank terminates pursuant to
Section 8(a) or 8(b) of this Agreement, then for two (2) years
after Executive's employment with 1st Bank has ended, Executive
will not, directly or indirectly, persuade or entice, or attempt
to persuade or entice, (i) any employee of 1st Bank or GBCI to
terminate his/her employment with 1st Bank or GBCI, or (ii) any
person or entity to terminate, cancel, rescind or revoke its
business or contractual relationships with 1st Bank or GBCI.
11. Enforcement.
a. 1st Bank and Executive stipulate that, in light of all of the
facts and circumstances of the relationship between Executive and
1st Bank, the agreements referred to in Sections 9 and 10
(including without limitation their scope, duration and
geographic extent) are fair and reasonably necessary for the
protection of 1st Bank's and GBCI's confidential information,
goodwill and other protectable interests. If a court of competent
jurisdiction should decline to enforce any of those covenants and
agreements, Executive and 1st Bank request the court to reform
these provisions to restrict Executive's use of confidential
information and Executive's ability to compete with 1st Bank and
GBCI to the maximum extent, in time, scope of activities, and
geography, the court finds enforceable.
b. Executive acknowledges 1st Bank and GBCI will suffer immediate
and irreparable harm that will not be compensable by damages
alone if Executive repudiates or breaches any of the provisions
of Sections 9 or 10 or threatens or attempts to do so. For this
reason, under these circumstances, 1st Bank, in addition to and
without limitation of any other rights, remedies or damages
available to it at law or in equity, will be entitled to obtain
temporary, preliminary and permanent injunctions in order to
prevent or restrain the breach, and 1st Bank will not be required
to post a bond as a condition for the granting of this relief.
12. Covenants. Executive specifically acknowledges the receipt of adequate
consideration for the covenants contained in Sections 9 and 10 and
that 1st Bank is entitled to require him to comply with these
Sections. Sections 9 and 10 will survive termination and/or expiration
of this Agreement. Executive represents that if his employment is
terminated, whether voluntarily or involuntarily,
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Executive has experience and capabilities sufficient to enable
Executive to obtain employment in areas which do not violate this
Agreement and that 1st Bank's enforcement of a remedy by way of
injunction will not prevent Executive from earning a livelihood.
13. Arbitration.
a. Arbitration. At either party's request, the parties must submit
any dispute, controversy or claim arising out of or in connection
with, or relating to, this Agreement or any breach or alleged
breach of this Agreement, to arbitration under the American
Arbitration Association's rules then in effect (or under any
other form of arbitration mutually acceptable to the parties). A
single arbitrator agreed on by the parties will conduct the
arbitration. If the parties cannot agree on a single arbitrator,
each party must select one arbitrator and those two arbitrators
will select a third arbitrator. This third arbitrator will hear
the dispute. The arbitrator's decision is final (except as
otherwise specifically provided by law) and binds the parties,
and either party may request any court having jurisdiction to
enter a judgment and to enforce the arbitrator's decision. The
arbitrator will provide the parties with a written decision
naming the substantially prevailing party in the action. This
prevailing party is entitled to reimbursement from the other
party for its costs and expenses, including reasonable attorneys'
fees.
b. Governing Law. All proceedings will be held at a place designated
by the arbitrator in Uinta County, Wyoming. The arbitrator, in
rendering a decision as to any state law claims, will apply
Wyoming law.
c. Exception to Arbitration. Notwithstanding the above, if Executive
violates Section 9 or 10, 1st Bank will have the right to
initiate the court proceedings described in Section 11(b), in
lieu of an arbitration proceeding under this Section 13.
14. Miscellaneous Provisions.
a. Entire Agreement. This Agreement constitutes the entire
understanding and agreement between the parties concerning its
subject matter and supersedes all prior agreements,
correspondence, representations, or understandings between the
parties relating to its subject matter.
b. Binding Effect. This Agreement will bind and inure to the benefit
of 1st Bank's, GBCI's and Executive's heirs, legal
representatives, successors and assigns.
c. Litigation Expenses. If either party successfully seeks to
enforce any provision of this Agreement or to collect any amount
claimed to be due under it, this party will be entitled to
reimbursement from the other party for any and all of its
reasonable out-of-pocket expenses and costs
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including, without limitation, reasonable attorneys' fees and
costs incurred in connection with the enforcement or collection.
d. Waiver. Any waiver by a party of its rights under this Agreement
must be written and signed by the party waiving its rights. A
party's waiver of the other party's breach of any provision of
this Agreement will not operate as a waiver of any other breach
by the breaching party.
e. Assignment. The services to be rendered by Executive under this
Agreement are unique and personal. Accordingly, Executive may not
assign any of his rights or duties under this Agreement.
f. Amendment. This Agreement may be modified only through a written
instrument signed by both parties.
g. Severability. The provisions of this Agreement are severable. The
invalidity of any provision will not affect the validity of other
provisions of this Agreement.
h. Governing Law and Venue. This Agreement will be governed by and
construed in accordance with Wyoming law, except to the extent
that certain regulatory matters may be governed by federal law.
The parties must bring any legal proceeding arising out of this
Agreement in Uinta County, Wyoming.
i. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original, but all
of which taken together will constitute one and the same
document.
j. Counsel Review. Executive acknowledges that he has had the
opportunity to consult with independent counsel with respect to
the negotiation, preparation, and execution of this Agreement.
k. IRC Section 409A. The provisions of this Agreement are intended
to comply with Section 409A of the U.S. Internal Code of 1986, as
amended, U.S. Treasury regulations issued thereunder, and related
U.S. Internal Revenue Service guidance ("409A Rules"). Such
provisions will be interpreted and applied in a manner consistent
with the 409A Rules so that payments and benefits provided to
Executive hereunder will not, to the greatest extent possible, be
subject to taxation under such Section 409A. Notwithstanding any
contrary provisions hereof and provided there is no reduction in
payments due Executive, this Agreement may be amended if and to
the extent GBCI and/or 1st Bank determines that such amendment is
necessary to comply with the 409A Rules.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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This Employment Agreement is executed as of January 22, 2007.
1ST BANK:
By /s/ Xxxxxxx Xxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxx
Its: President
EXECUTIVE:
/s/ Xxxxxxx Xxxxxx
----------------------------------------
Xxxxxxx Xxxxxx
Ratified as of January 22, 2007:
GLACIER BANCORP, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxxxx
Its: President & Chief Executive Officer
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