EXHIBIT 10
EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of the first day of January, 1999, between UNION
NATIONAL FINANCIAL CORPORATION ("Corporation"), a Pennsylvania business
corporation having a place of business at 000 X. Xxxx Xxxxxx, Xxxxx Xxx,
Xxxxxxxxxxxx 00000-0000, UNION NATIONAL COMMUNITY BANK ("Bank") a national
banking association having a place of business at 000 X. Xxxx Xxxxxx, Xxxxx Xxx,
Xxxxxxxxxxxx 00000-0000, and XXXX X. XXXXXX ("Executive"), an individual
residing at 000 Xxxxx Xxxxxx, Xxxxx Xxx, Xxxxxxxxxxxx 00000.
WITNESSETH:
WHEREAS, the Corporation is a registered bank holding company;
WHEREAS, the Bank is a subsidiary of the Corporation;
WHEREAS, Corporation and Bank desire to employ Executive to serve in the
capacity of President and Chief Executive Officer of each of Corporation and
Bank under the terms and conditions set forth herein;
WHEREAS, Executive desires to accept employment with Corporation and Bank
on the terms and conditions set forth herein.
AGREEMENT:
NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
1. Employment. Corporation and Bank hereby employ Executive and Executive
hereby accepts employment with Corporation and Bank, under the terms and
conditions set forth in this Agreement.
2. Duties of Employee. Executive shall perform and discharge well and
faithfully such duties as an executive officer of Corporation and Bank as
may be assigned to Executive from time to time by the Board of Directors of
Corporation and Bank. Executive shall be employed as President and Chief
Executive Officer of Corporation and Bank, and shall hold such other titles
as may be given to him from time to time by the Board of Directors of
Corporation and Bank. Executive shall devote his full time, attention and
energies to the business of Corporation and Bank during the Employment
Period (as defined in Section 3 of this Agreement); provided, however, that
this Section 2 shall not be construed as preventing Executive from (a)
engaging in activities incident or necessary to personal investments so
long as such investment does not exceed 5% of the outstanding shares of any
publicly held company, (b) acting as a member of the Board of Directors of
any other corporation or as a member of the Board of Trustees of any other
organization, with the prior approval of the Board of Directors of
Corporation and Bank, or (c) being involved in any other activity with the
prior approval of the Board of Directors of Corporation and Bank. The
Executive shall not engage in any business or commercial activities, duties
or pursuits which compete with the business or commercial activities of
Corporation or Bank, nor may the Executive serve as a director or officer
or in any other capacity in a company which competes with Corporation or
Bank.
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3. Term of Agreement.
(a) This Agreement shall be for a five (5) year period (the "Employment
Period") beginning on the first day of January, 1999, and if not
previously terminated pursuant to the terms of this Agreement, the
Employment Period shall end five (5) years later. Unless written
notice of nonrenewal is given at least one hundred eighty (180) days
prior to the fifth anniversary date, the Employment Period shall be
automatically extended on the fifth anniversary date of commencement
of the Employment Period (the "Renewal Date") for a period ending five
(5) years thereafter. Unless written notice of nonrenewal is given at
least one hundred eighty (180) days prior to the fifth anniversary
date of each Renewal Date, the Employment Period shall be
automatically extended for an additional five (5) year period.
(b) Notwithstanding the provisions of Section 3(a) of this Agreement, this
Agreement shall terminate automatically for Cause (as defined herein)
upon written notice from the Board of Directors of each of Corporation
and Bank to Executive. As used in this Agreement, "Cause" shall mean
any of the following:
(i) Executive's conviction of or plea of guilty or nolo contendere to
a felony, a crime of falsehood or a crime involving moral
turpitude, or the actual incarceration of Executive for a period
of forty five (45) consecutive days or more;
(ii) Executive's failure to follow the good faith lawful instructions
of the Board of Directors of Corporation or Bank with respect to
its operations, after written notice from Corporation or Bank and
a failure to cure such violation within twenty (20) days of said
written notice;
(iii)Executive's willful failure to substantially perform Executive's
duties to Corporation or Bank, other than a failure resulting
from Executive's incapacity because of physical or mental
illness, as provided in subsection (d) of this Section 3, after
written notice from Corporation or Bank and a failure to cure
such violation within twenty (20) days of said written notice;
(iv) Executive's intentional violation of the provisions of this
Agreement, after written notice from Corporation or Bank and a
failure to cure such violation within twenty (20) days of said
written notice;
(v) dishonesty of the Executive in the performance of his duties;
(vi) Executive's removal or prohibition from being an
institutional-affiliated party by a final order of an appropriate
federal banking agency pursuant to Section 8(e) of the Federal
Deposit Insurance Act or by the Office of the Comptroller of the
Currency pursuant to national law;
(vii)conduct on the part of the Executive as determined by an
affirmative vote of seventy-five percent (75%) of the
disinterested members of the Board of Directors which brings
public discredit to Corporation or Bank; or
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(viii) Executive's breach of fiduciary duty involving personal profit.
If this Agreement is terminated for Cause, all of Executive's
rights under this Agreement shall cease as of the effective date
of such termination.
(c) Notwithstanding the provisions of Section 3(a) of this Agreement, this
Agreement shall terminate automatically upon Executive's voluntary
termination of employment (other than in accordance with Section 5 of
this Agreement) for Good Reason. The term "Good Reason" shall mean (i)
the assignment of duties and responsibilities inconsistent with
Executive's status as President and Chief Executive Officer of
Corporation and Bank, (ii) a reassignment which requires Executive to
move his principal residence more than fifty (50) miles from the
Corporation's and Bank's principal executive office immediately prior
to this Agreement, (iii) any removal of the Executive from office or
any adverse change in the terms and conditions of the Executive's
employment, except for any termination of the Executive's employment
under the provisions of Section 3(b) hereof, (iv) any reduction in the
Executive's Annual Base Salary as in effect on the date hereof or as
the same may be increased from time to time, except such reductions
that are the result of a national financial depression or national or
bank emergency when such reduction has been implemented by the Board
of Directors for the Corporation and Bank's senior management, or (v)
any failure of Corporation and Bank to provide the Executive with
benefits at least as favorable as those enjoyed by the Executive
during the Employment Period under any of the pension, life insurance,
medical, health and accident, disability or other employee plans of
Corporation and Bank, or the taking of any action that would
materially reduce any of such benefits unless such reduction is part
of a reduction applicable to all employees. If such termination occurs
for Good Reason, then Corporation or Bank shall pay Executive an
amount equal to the greater of the remaining balance of the Agreed
Compensation otherwise due to the Executive for the remainder of the
then existing Employment Period or 2.99 times the Executive's Agreed
Compensation as defined in subsection (f) of this Section 3, which
amount shall be payable in thirty-six (36) equal monthly installments
and shall be subject to federal, state and local tax withholdings. In
addition, for a period of three (3) years from the date of termination
of employment, or until Executive secures substantially similar
benefits through other employment, whichever shall first occur,
Executive shall receive a continuation of all life, disability,
medical insurance and other normal health and welfare benefits in
effect with respect to Executive during the two (2) years prior to his
termination of employment, or, if Corporation and Bank cannot provide
such benefits because Executive is no longer an employee, a dollar
amount equal to the cost to Executive of obtaining such benefits (or
substantially similar benefits). If permitted under the terms of the
plan, Executive shall receive the additional retirement benefits to
which he would have been entitled had his employment continued through
the then remaining term of the Agreement. However, in the event the
payment described herein, when added to all other amounts or benefits
provided to or on behalf of the Executive in connection with his
termination of employment, would result in the imposition of an excise
tax under Code Section 4999, such payments shall be retroactively (if
necessary) reduced to the extent necessary to avoid such excise tax
imposition. Upon written notice to Executive, together with
calculations of Corporation's independent auditors, Executive shall
remit to Corporation the amount of the reduction plus such interest as
may be necessary to avoid the imposition of such excise tax.
Notwithstanding the foregoing or any other provision of this contract
to the contrary, if any portion of the amount herein payable to the
Executive is determined to be non-deductible
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pursuant to the regulations promulgated under Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), the
Corporation shall be required only to pay to Executive the amount
determined to be deductible under Section 280G.
At the option of the Executive, exercisable by the Executive within
ninety (90) days after the occurrence of the event constituting "Good
Reason," the Executive may resign from employment under this Agreement
by a notice in writing (the "Notice of Termination") delivered to
Corporation and Bank and the provisions of this Section 3(c) hereof
shall thereupon apply.
(d) Notwithstanding the provisions of Section 3(a) of this Agreement, this
Agreement shall terminate automatically upon Executive's Disability
and Executive's rights under this Agreement shall cease as of the date
of such termination; provided, however, that Executive shall
nevertheless be entitled to receive an amount equal to and no greater
than 70% of the Executive's Agreed Compensation as defined in
subsection (f) of this Section 3, less amounts payable under any
disability plan of Corporation and Bank, until the earliest of (i)
Executive's return to employment, (ii) his attainment of age 65, (iii)
his death, or (iv) the end of the then existing Employment Period. In
addition, Executive shall receive for such period a continuation of
all life, disability, medical insurance and other normal health and
welfare benefits in effect with respect to Executive during the two
(2) years prior to his disability, or, if Corporation and Bank cannot
provide such benefits because Executive is no longer an employee, a
dollar amount equal to the cost to Executive of obtaining such
benefits (or substantially similar benefits). For purposes of this
Agreement, the Executive shall have a Disability if, as a result of
physical or mental injury or impairment, Executive is unable to
perform all of the essential job functions of his position on a full
time basis with or without a reasonable accommodation and without
posting a direct threat to himself and others, for a period of one
hundred eighty (180) days. The Executive shall have no duty to
mitigate any payment provided for in this Section 3(d) by seeking
other employment.
(e) Executive agrees that in the event his employment under this Agreement
is terminated, Executive shall resign as a director of Corporation and
Bank, or any affiliate or subsidiary thereof, if he is then serving as
a director of any of such entities.
(f) The term "Agreed Compensation" shall equal the sum of (A) the
Executive's highest Annual Base Salary under the Agreement, and (B)
the average of the Executive's annual bonuses with respect to the
three (3) calendar years immediately preceding the Executive's
termination.
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4. Employment Period Compensation.
(a) Annual Base Salary. For services performed by Executive under this
Agreement, Corporation or Bank shall pay Executive an Annual Base
Salary during the Employment Period at the rate of $132,017.60 per
year, minus applicable withholdings and deductions, payable at the
same times as salaries are payable to other executive employees of
Corporation or Bank. Corporation or Bank may, from time to time,
increase Executive's Annual Base Salary, and any and all such
increases shall be deemed to constitute amendments to this Section
4(a) to reflect the increased amounts, effective as of the date
established for such increases by the Board of Directors of
Corporation or Bank or any committee of such Board in the resolutions
authorizing such increases.
(b) Bonus. For services performed by Executive under this Agreement,
Corporation or Bank may, from time to time, pay a bonus or bonuses to
Executive as Corporation or Bank, in its sole discretion, deems
appropriate. The payment of any such bonuses shall not reduce or
otherwise affect any other obligation of Corporation or Bank to
Executive provided for in this Agreement.
(c) Vacations. During the term of this Agreement, Executive shall be
entitled to paid annual vacation in accordance with the policies as
established from time to time by the Boards of Directors of
Corporation and Bank. However, Executive shall not be entitled to
receive any additional compensation from Corporation and Bank for
failure to take a vacation, nor shall Executive be able to accumulate
unused vacation time from one year to the next, except to the extent
authorized by the Boards of Directors of Corporation and Bank.
(d) Automobile. During the term of this Agreement, Corporation and Bank
shall provide Executive with exclusive use of an automobile mutually
agreed upon by Corporation and Bank. Corporation and Bank shall be
responsible and shall pay for all costs of insurance coverage,
repairs, maintenance and other operating and incidental expenses,
including license, fuel and oil. Corporation and Bank shall provide
Executive with a replacement automobile at approximately the time
Executive's automobile reaches three (3) years of age or 50,000 miles,
whichever is first, and approximately every three (3) years or 50,000
miles thereafter, upon the same terms and conditions.
(e) Employee Benefit Plans. During the term of this Agreement, Executive
shall be entitled to participate in or receive the benefits of any
employee benefit plan currently in effect at Corporation and Bank,
subject to the terms of said plan, until such time that the Boards of
Directors of Corporation and Bank authorize a change in such benefits.
Corporation and Bank shall not make any changes in such plans or
benefits which would adversely affect Executive's rights or benefits
thereunder, unless such change occurs pursuant to a program applicable
to all executive officers of Corporation and Bank and does not result
in a proportionately greater adverse change in the rights of or
benefits to Executive as compared with any other executive officer of
Corporation and Bank. Nothing paid to Executive under any plan or
arrangement presently in effect or made available in the future shall
be deemed to be in lieu of the salary payable to Executive pursuant to
Section 4(a) hereof.
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(f) Business Expenses. During the term of this Agreement, Executive shall
be entitled to receive prompt reimbursement for all reasonable
expenses incurred by him, which are properly accounted for, in
accordance with the policies and procedures established by the Boards
of Directors of Corporation and Bank for their executive officers.
5. Termination of Employment Following Change in Control.
(a) If a Change in Control (as defined in Section 5(b) of this Agreement)
shall occur or if thereafter at any time during the term of this
Agreement there shall be:
(i) any involuntary termination of Executive's employment (other than
for the reasons set forth in Section 3(b) or 3(d) of this
Agreement);
(ii) any reduction in Executive's title, responsibilities, including
reporting responsibilities, or authority, including such title,
responsibilities or authority as such may be increased from time
to time during the term of this Agreement;
(iii)the assignment to Executive of duties inconsistent with
Executive's office on the date of the Change in Control or as the
same may be increased from time to time after the Change in
Control;
(iv) any reassignment of Executive to a location greater than fifty
(50) miles from the location of Executive's office on the date of
the Change in Control;
(v) any reduction in Executive's Annual Base Salary in effect on the
date of the Change in Control or as the same may be increased
from time to time after the Change in Control;
(vi) any failure to provide Executive with benefits at least as
favorable as those enjoyed by Executive under any of Corporation
or Bank's retirement or pension, life insurance, medical, health
and accident, disability or other employee plans in which
Executive participated at the time of the Change in Control, or
the taking of any action that would materially reduce any of such
benefits in effect at the time of the Change in Control;
(vii)any requirement that Executive travel in performance of his
duties on behalf of Corporation or Bank for a significantly
greater period of time during any year than was required of
Executive during the year preceding the year in which the Change
in Control occurred; or
(viii) any sustained pattern of interruption or disruption of
Executive for matters substantially unrelated to Executive's
discharge of Executive's duties on behalf of Corporation and
Bank;
then, at the option of Executive, exercisable by Executive within
one hundred twenty (120) days of the Change in Control or
occurrence of any of the foregoing events, Executive may resign
from employment with Corporation and Bank (or, if involuntarily
terminated, give notice of
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intention to collect benefits under this Agreement) by delivering
a notice in writing (the "Notice of Termination") to Corporation
and Bank and the provisions of Section 6 of this Agreement shall
apply.
(b) As used in this Agreement, "Change in Control" shall mean the
occurrence of any of the following:
(i) (A) a merger, consolidation or division involving Corporation or
Bank, (B) a sale, exchange, transfer or other disposition of
substantially all of the assets of Corporation or Bank, or (C) a
purchase by Corporation or Bank of substantially all of the
assets of another entity, unless (y) such merger, consolidation,
division, sale, exchange, transfer, purchase or disposition is
approved in advance by seventy percent (70%) or more of the
members of the Board of Directors of Corporation or Bank who are
not interested in the transaction and (z) a majority of the
members of the Board of Directors of the legal entity resulting
from or existing after any such transaction and of the Board of
Directors of such entity's parent corporation, if any, are former
members of the Board of Directors of Corporation or Bank; or
(ii) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934 (the "Exchange Act")), other
than Corporation or Bank or any "person" who on the date hereof
is a director or officer of Corporation or Bank is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of Corporation or
Bank representing twenty-five (25%) percent or more of the
combined voting power of Corporation or Bank's then outstanding
securities, or
(iii)during any period of two (2) consecutive years during the term of
Executive's employment under this Agreement, individuals who at
the beginning of such period constitute the Board of Directors of
Corporation or Bank cease for any reason to constitute at least a
majority thereof, unless the election of each director who was
not a director at the beginning of such period has been approved
in advance by directors representing at least two-thirds of the
directors then in office who were directors at the beginning of
the period; or
(iv) any other change in control of Corporation and Bank similar in
effect to any of the foregoing.
6. Rights in Event of Termination of Employment Following Change in Control.
(a) In the event that Executive delivers a Notice of Termination (as
defined in Section 5(a) of this Agreement) to Corporation and Bank,
Executive shall be entitled to receive the compensation and benefits
set forth below:
If, at the time of termination of Executive's employment, a "Change in
Control" (as defined in Section 5(b) of this Agreement) has also
occurred, Corporation and Bank shall pay Executive a lump sum amount
equal to and no greater than 2.99 times the Executive's Agreed
Compensation
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as defined in subsection (f) of Section 3, minus applicable taxes and
withholdings. In addition, for a period of three (3) years from the
date of termination of employment, or until Executive secures
substantially similar benefits through other employment, whichever
shall first occur, Executive shall receive a continuation of all life,
disability, medical insurance and other normal health and welfare
benefits in effect with respect to Executive during the two (2) years
prior to his termination of employment, or, if Corporation and Bank
cannot provide such benefits because Executive is no longer an
employee, a dollar amount equal to the cost to Executive of obtaining
such benefits (or substantially similar benefits). If permitted under
the terms of the plan, Executive shall receive additional retirement
benefits to which he would have been entitled had his employment
continued through the then remaining term of the Agreement. However,
in the event the payment described herein, when added to all other
amounts or benefits provided to or on behalf of the Executive in
connection with his termination of employment, would result in the
imposition of an excise tax under Code Section 4999, such payments
shall be retroactively (if necessary) reduced to the extent necessary
to avoid such excise tax imposition. Upon written notice to Executive,
together with calculations of Corporation's independent auditors,
Executive shall remit to Corporation the amount of the reduction plus
such interest as may be necessary to avoid the imposition of such
excise tax. Notwithstanding the foregoing or any other provision of
this contract to the contrary, if any portion of the amount herein
payable to the Executive is determined to be non-deductible pursuant
to the regulations promulgated under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), the Corporation shall
be required only to pay to Executive the amount determined to be
deductible under Section 280G.
(b) Executive shall not be required to mitigate the amount of any payment
provided for in this Section 6 by seeking other employment or
otherwise. Unless otherwise agreed to in writing, the amount of
payment or the benefit provided for in this Section 6 shall not be
reduced by any compensation earned by Executive as the result of
employment by another employer or by reason of Executive's receipt of
or right to receive any retirement or other benefits after the date of
termination of employment or otherwise.
7. Rights in Event of Termination of Employment Absent Change in Control.
(a) In the event that Executive's employment is involuntarily terminated
by Corporation and/or Bank without Cause and no Change in Control
shall have occurred at the date of such termination, Corporation and
Bank shall pay Executive an amount equal to and no greater than 2.99
times the Executive's Agreed Compensation as defined in subsection (f)
of Section 3, and shall be payable in thirty-six (36) equal monthly
installments and shall be subject to federal, state and local tax
withholdings. In addition, for a period of three (3) years from the
date of termination of employment, or until Executive secures
substantially similar benefits through other employment, whichever
shall first occur, Executive shall receive a continuation of all life,
disability, medical insurance and other normal health and welfare
benefits in effect with respect to Executive during the two (2) years
prior to his termination of employment, or, if Corporation and Bank
cannot provide such benefits because Executive is no longer an
employee, a dollar amount equal to the cost to Executive of obtaining
such benefits (or substantially similar benefits). In addition, if
permitted pursuant to the terms of the plan, Executive shall receive
additional retirement benefits to which he would have been entitled
had his employment
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continued through the then remaining term of the Agreement. However,
in the event the payment described herein, when added to all other
amounts or benefits provided to or on behalf of the Executive in
connection with his termination of employment, would result in the
imposition of an excise tax under Code Section 4999, such payments
shall be retroactively (if necessary) reduced to the extent necessary
to avoid such excise tax imposition. Upon written notice to Executive,
together with calculations of Corporation's independent auditors,
Executive shall remit to Corporation the amount of the reduction plus
such interest as may be necessary to avoid the imposition of such
excise tax. Notwithstanding the foregoing or any other provision of
this contract to the contrary, if any portion of the amount herein
payable to the Executive is determined to be non-deductible pursuant
to the regulations promulgated under Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), the Corporation shall
be required only to pay to Executive the amount determined to be
deductible under Section 280G.
(b) Executive shall not be required to mitigate the amount of any payment
provided for in this Section 7 by seeking other employment or
otherwise. Unless otherwise agreed to in writing, the amount of
payment or the benefit provided for in this Section 7 shall not be
reduced by any compensation earned by Executive as the result of
employment by another employer or by reason of Executive's receipt of
or right to receive any retirement or other benefits after the date of
termination of employment or otherwise.
8. Covenant Not to Compete.
(a) Executive hereby acknowledges and recognizes the highly competitive
nature of the business of Corporation and Bank and accordingly agrees
that, during and for the applicable period set forth in Section 8(c)
hereof, Executive shall not, except as otherwise permitted in writing
by the Corporation and the Bank:
(i) be engaged, directly or indirectly, either for his own account or
as agent, consultant, employee, partner, officer, director,
proprietor, investor (except as an investor owning less than 5%
of the stock of a publicly owned company) or otherwise of any
person, firm, corporation or enterprise engaged in (1) the
banking (including bank holding company) or financial services
industry, or (2) any other activity in which Corporation or Bank
or any of their subsidiaries are engaged during the Employment
Period, and remain so engaged at the end of the Employment
Period, in any area in which, at any time during the Employment
Period or at the date of termination of the Executive's
employment, is within twenty (20) miles of any branch location,
office or other facility of Corporation or Bank or any of their
subsidiaries, unless Executive exclusively performs all such
activity outside of said twenty (20) mile area (the
"Non-Competition Area"); or
(ii) provide financial or other assistance to any person, firm,
corporation, or enterprise engaged in (1) the banking (including
bank holding company) or financial services industry, or (2) any
other activity in which Corporation or Bank or any of their
subsidiaries are engaged during the Employment Period, in the
Non-Competition Area; or
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(iii)if employed in a capacity provided in (i) and (ii), solicit
current customers, during the term of this Agreement, of
Corporation, Bank or any Corporation subsidiary in the
NonCompetition Area; or
(iv) solicit employees of Corporation, Bank or any Corporation
subsidiary who are employed during the term of this Agreement.
(b) It is expressly understood and agreed that, although Executive and
Corporation and Bank consider the restrictions contained in Section
8(a) hereof reasonable for the purpose of preserving for Corporation
and Bank and their subsidiaries their good will and other proprietary
rights, if a final judicial determination is made by a court having
jurisdiction that the time or territory or any other restriction
contained in Section 8(a) hereof is an unreasonable or otherwise
unenforceable restriction against Executive, the provisions of Section
8(a) hereof shall not be rendered void but shall be deemed amended to
apply as to such maximum time and territory and to such other extent
as such court may judicially determine or indicate to be reasonable.
(c) The provisions of this Section 8 shall be applicable commencing on the
date of this Agreement and ending on one of the following dates, as
applicable:
(i) if Executive's employment terminates in accordance with the
provisions of Section 3 (other than Section 3(b) relating to
termination for Cause), the effective date of termination of
employment; or
(ii) if Executive's employment terminates in accordance with the
provisions of Section 3(b) of this Agreement (relating to
termination for Cause), the second anniversary date of the
effective date of termination of employment; or
(iii)if the Executive voluntarily terminates his employment in
accordance with the provisions of Section 5 hereof, the second
anniversary date of the effective date of termination of
employment; or
(iv) if the Executive's employment is involuntarily terminated in
accordance with the provisions of Section 7 hereof, the second
anniversary date of the effective date of termination of
employment.
9. Unauthorized Disclosure. During the term of his employment hereunder, or at
any later time, the Executive shall not, without the written consent of the
Boards of Directors of Corporation and Bank or a person authorized thereby,
knowingly disclose to any person, other than an employee of Corporation or
Bank or a person to whom disclosure is reasonably necessary or appropriate
in connection with the performance by the Executive of his duties as an
executive of Corporation and Bank, any material confidential information
obtained by him while in the employ of Corporation and Bank with respect to
any of Corporation and Bank's services, products, improvements, formulas,
designs or styles, processes, customers, methods of business or any
business practices the disclosure of which could be or will be damaging to
Corporation or
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Bank; provided, however, that confidential information shall not include
any information known generally to the public (other than as a result of
unauthorized disclosure by the Executive or any person with the assistance,
consent or direction of the Executive) or any information of a type not
otherwise considered confidential by persons engaged in the same business
of a business similar to that conducted by Corporation and Bank or any
information that must be disclosed as required by law.
10. Liability Insurance. Corporation and Bank shall use their best efforts to
obtain insurance coverage for the Executive under an insurance policy
covering officers and directors of Corporation and Bank against lawsuits,
arbitrations or other legal or regulatory proceedings; however, nothing
herein shall be construed to require Corporation and/or Bank to obtain such
insurance, if the Board of Directors of the Corporation and/or Bank
determine that such coverage cannot be obtained at a reasonable price.
11. Notices. Except as otherwise provided in this Agreement, any notice
required or permitted to be given under this Agreement shall be deemed
properly given if in writing and if mailed by registered or certified mail,
postage prepaid with return receipt requested, to Executive's residence, in
the case of notices to Executive, and to the principal executive offices of
Corporation and Bank, in the case of notices to Corporation and Bank.
12. Waiver. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing and signed by Executive and an executive officer specifically
designated by the Boards of Directors of Corporation and Bank. 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 waiver of similar or
dissimilar provisions or conditions at the same or at any prior or
subsequent time.
13. Assignment. This Agreement shall not be assignable by any party, except by
Corporation and Bank to any successor in interest to their respective
businesses.
14. Entire Agreement. This Agreement supersedes any and all agreements, either
oral or in writing, between the parties with respect to the employment of
the Executive by the Bank and/or Corporation and this Agreement contains
all the covenants and agreements between the parties with respect to
employment. This Agreement specifically releases all parties of any rights
and obligations under the Executive Employment Agreement of Xxxx X. Xxxxxx
dated January 27, 1994, between Union National Financial Corporation and
Xxxx X. Xxxxxx and said agreement is hereafter null and void.
15. Successors; Binding Agreement.
(a) Corporation and Bank will require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all of the businesses and/or assets of Corporation and
Bank to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that Corporation and Bank would be
required to perform it if no such succession had taken place. Failure
by Corporation and Bank to obtain such assumption and agreement prior
to the effectiveness of any such succession shall constitute a breach
of this
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Agreement and the provisions of Section 3 of this Agreement shall
apply. As used in this Agreement, "Corporation" and "Bank" shall mean
Corporation and Bank, as defined previously and any successor to their
respective businesses and/or assets as aforesaid which assumes and
agrees to perform this Agreement by operation of law or otherwise.
(b) This Agreement shall inure to the benefit of and be enforceable by
Executive's personal or legal representatives, executors,
administrators, heirs, distributees, devisees and legatees. If
Executive should die after a Notice of Termination is delivered by
Executive, or following termination of Executive's employment without
Cause, and any amounts would be payable to Executive under this
Agreement if Executive had continued to live, all such amounts shall
be paid in accordance with the terms of this Agreement to Executive's
devisee, legatee, or other designee, or, if there is no such designee,
to Executive's estate.
16. Arbitration. Corporation, Bank and Executive recognize that in the event a
dispute should arise between them concerning the interpretation or
implementation of this Agreement, lengthy and expensive litigation will not
afford a practical resolution of the issues within a reasonable period of
time. Consequently, each party agrees that all disputes, disagreements and
questions of interpretation concerning this Agreement are to be submitted
for resolution, in Philadelphia, Pennsylvania, to the American Arbitration
Association (the "Association") in accordance with the Association's
National Rules for the Resolution of Employment Disputes or other
applicable rules then in effect ("Rules"). Corporation, Bank or Executive
may initiate an arbitration proceeding at any time by giving notice to the
other in accordance with the Rules. Corporation and Bank and Executive may,
as a matter of right, mutually agree on the appointment of a particular
arbitrator from the Association's pool. The arbitrator shall not be bound
by the rules of evidence and procedure of the courts of the Commonwealth of
Pennsylvania but shall be bound by the substantive law applicable to this
Agreement. The decision of the arbitrator, absent fraud, duress,
incompetence or gross and obvious error of fact, shall be final and binding
upon the parties and shall be enforceable in courts of proper jurisdiction.
Following written notice of a request for arbitration, Corporation, Bank
and Executive shall be entitled to an injunction restraining all further
proceedings in any pending or subsequently filed litigation concerning this
Agreement, except as otherwise provided herein.
17. Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
18. Applicable Law. This Agreement shall be governed by and construed in
accordance with the domestic, internal laws of the Commonwealth of
Pennsylvania, without regard to its conflicts of laws principles.
19. Headings. The section headings of this Agreement are for convenience only
and shall not control or affect the meaning or construction or limit the
scope or intent of any of the provisions of this Agreement.
Execution Copy
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
ATTEST: UNION NATIONAL FINANCIAL
CORPORATION
/s/ Xxxx X. Xxxxxxxx By /s/ Xxxxxx X. Xxxxxxxxx
------------------------------ -------------------------------
Xxxx X. Xxxxxxxx Xxxxxx X. Xxxxxxxxx
"Corporation"
UNION NATIONAL COMMUNITY BANK
/s/ Xxxxxxx X. Xxxxxx By /s/ Xxxxxx X. Xxxxxxxxx
----------------------------- --------------------------------
Xxxxxxx X. Xxxxxx Xxxxxx X. Xxxxxxxxx
"Bank"
WITNESS:
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxx X. Xxxxxx
----------------------------- --------------------------------
Xxxxxxx X. Xxxxxx Xxxx X. Xxxxxx
"Executive"
