Exhibit 10.4
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of the 9th day of April, 1997, between First
Citizens Corporation (the "Employer"), and Xxxxxxx X. Xxxxxx, a resident of the
State of Georgia (the "Employee"), First Citizens Bank of Fayette and Xxxx State
Bank, wholly owned subsidiaries of the Employer (collectively the "Banks") are
made parties to this Agreement for the sole purpose of defining the position and
responsibility of the Employee to the Banks.
RECITALS:
The Employer desires to employ the Employee as the Vice President of the
Employer and President and Chief Executive Officer of the Banks and the Employee
desires to accept such employment.
In consideration of the above premises and the mutual agreements
hereinafter set forth, the parties hereby agree as follows:
1. Definitions. Whenever used in this Agreement, the following terms and
their variant forms shall have the meaning set forth below:
1.1 "Agreement" shall mean this Agreement and any exhibits incorporated
herein together with any amendments hereto made in the manner described in this
Agreement.
1.2 "Affiliate" shall mean any business entity which controls the Employer,
is controlled by or is under common control with the Employer.
1.3 "Area" shall mean the geographic area within the boundaries of Fayette,
Xxxxxxx, Xxxxx, Coweta, and Xxxxx Counties. It is the express intent of the
parties that these counties are the Area where the Employee performs or
performed services on behalf of the Employer under this Agreement as of, or
within a reasonable time prior to, the termination of the Employee's employment
hereunder.
1.4 "Business of the Employer" shall mean the business conducted by the
Employer, which is commercial banking.
1.5 "Cause" shall mean:
1.5.1 With respect to termination by the Employer:
(a) A material breach of the terms of this Agreement by the
Employee, including, without limitation, a breach of any
representation or warranty of the Employee set forth herein, or a
violation of the Employer or the Banks' written policies, or the
specific directions of the Board which directions are consistent
with normally accepted business practices.
(b) Conduct by the Employee that amounts to fraud, dishonesty or
willful misconduct in the performance of his duties and
responsibilities hereunder;
(c) The conviction of the Employee of a felony;
(d) Conduct of the Employee that amounts to gross and willful
insubordination or inattention to his duties and responsibilities
hereunder; or
(e) Conduct by the Employee that results in removal from his
position as an officer or employee of the Employer pursuant to a
written order by any regulatory agency with authority or jurisdiction
over the Employer.
1.5.2 With respect to termination by the Employee, a material
diminution in the powers, responsibilities, duties, or compensation of
Employee hereunder, or the failure of the Board of Directors of either Bank
and the Employer to elect him as President and Chief Executive Officer of
each Bank and Vice President of the Employer, or a material breach of the
terms of this Agreement by the Employer which remains uncured after the
expiration of thirty (30) days following the delivery of written notice of
such breach to the Employer by the Employee.
1.6 "Employer Information" means Confidential Information or Trade Secrets.
1.7 "Confidential Information" means data and information relating to the
business of the Employer (which does not rise to the status of a Trade Secret)
which is or has been disclosed to Employee or of which Employee became aware as
a consequence of or through Employee's relationship to the Employer and which
has value to the Employer and is not generally known to its competitors.
Confidential Information shall not include any data or information that has been
voluntarily disclosed to the public by the Employer (except where such public
disclosure has been made by Employee without authorization) or that has been
independently developed and disclosed by others, or that otherwise enters the
public domain through lawful means.
1.8 "Change in Control" of the Employer shall mean any transaction wherein
fifty percent (50%) of the shares of the Bank or the Employer, plus one share,
are directly or indirectly transferred by sale, gift, merger, exchange or any
other means to new owners other than an Affiliate of such person or entity
transferring such shares of or if a majority of the members of the Board of
Directors of the Employer are replaced.
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1.9 "Initial Term" shall mean that period of time commencing on the date of
execution of this Agreement by the Employer and the Employee and running until
the earlier of three (3) years thereafter or any termination of employment of
the Employee under this Agreement as provided for in Section 3.
1.10 "Permanent Disability" shall mean the total inability of the Employee
to perform his duties under this Agreement for a period of ninety (90)
consecutive days as certified by a physician chosen by the Employer and
reasonably acceptable to the Employee.
1.11 "Term" shall mean the Initial Term and all subsequent renewal periods.
1.12 "Trade Secrets" means information including, but not limited to,
technical or nontechnical data, formulas, patterns, compilations, programs,
devices, methods, techniques, drawings, processes, financial data, financial
plans, product plans or lists of actual or potential customers or suppliers
which (i) derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other persons
who an obtain economic value from its disclosure or use; and (ii) is the subject
of efforts that are reasonable under the circumstances to maintain its secrecy.
2. Duties.
2.1 The Employee is employed initially as the President and Chief Executive
Officer of the Bank and Vice President of the Employer. Employee, subject to the
direction of the Board or its designee, shall perform and discharge well and
faithfully the duties which may be assigned to him from time to time by the
Employer in connection with the conduct of its business. The initial duties and
responsibilities of the Employee are set forth on Exhibit A attached hereto.
2.2 In addition to the duties and responsibilities specifically assigned to
the Employee pursuant to Section 2.1 hereof, the Employee shall: (1) devote
substantially all of his time, energy and skill during regular business hours to
the performance of the duties of his employment (reasonable vacations and
reasonable absences due to illness excepted) and faithfully and industriously
perform such duties; (2) diligently follow and implement all management policies
and decisions communicated to him by the Board; and (3) timely prepare and
forward to the Board all reports and accounting as may be requested of the
Employee.
2.3 The Employee shall devote his entire business time, attention and
energies to the Business of the Employer and shall not during the term of this
Agreement be engaged (whether or not during normal business hours) in any other
business or professional activity, whether or not such activity is pursued for
gain, profit
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or other pecuniary advantage; without limitation, the Employee shall not be
engaged in, shall not participate in, shall not invest in, and shall have no
relationship whatsoever with any business or entity which shall conduct business
relations with the Bank or the Employer. Notwithstanding the above, the
limitations of this paragraph shall not be construed as preventing the Employee
from (1) investing his personal assets in businesses which will not require any
services on the part of the Employee in their operation or affairs and in which
his participation is solely that of an investor, (2) purchasing securities in
any corporation whose securities are regularly traded provided that such
purchase shall not result in his collectively owning beneficially at any time
one percent (1%) or more of the equity securities of any business in competition
with the Business of the Employer and (3) participating in civic and
professional affairs and organizations. Prior to commencing any activity
described in clause (3) above, the Employee shall inform the Board, in writing,
of any such activity.
3. Term and Termination.
3.1 Term. This Agreement shall remain in effect for the Initial Term. At
the end of the first twelve-month period hereunder and at the end of each
successive twelve-month period, this Agreement shall automatically be extended
for a successive twelve-month period following the then two-year remaining term
unless either party gives written notice to the other of its intent not to
extend this Agreement with such written notice to be given not less than ninety
(90 days prior to the end of such twelve-month period. In the event such notice
of non-extension is properly given, this Agreement shall terminate at the end of
the remaining term then in effect. However, notwithstanding the provisions of
this Section 3.1, no extension shall be granted that would extend the term of
this Agreement beyond the last day of the month during which the Employee
attains age 61.
3.2 Termination. During the Term, the employment of the Employee under this
Agreement may be terminated only as follows:
3.2.1 By the Employer:
(a) For Cause [provided that if Cause is as defined in Section
1.5.1(a) the Employer shall first have given Employee written notice
of the act or failure which Employer asserts constitutes such Cause
and fifteen (15) days to cure such] in which event the Employer shall
have no further obligation to the Employee except for the payment of
any amounts which have vested and are due and owing under Section 4 as
of the effect date of termination; (but not any amount accruing
thereafter); or
(b) Without Cause or upon the Disability of Employee at any time,
provided that the Employer shall
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give the Employee thirty (30) days' prior written notice of its intent
to terminate, in which event the Employer shall be required to
continue to meet its obligations to the Employee under Section 4 for a
period of twenty-four (24) months following termination.
3.2.2 By the Employee:
(a) For Cause, with no prior notice except as provided in Section
1.5.2, in which event the Employer shall be required to continue to
meet its obligations to the Employee under Section 4 for a period of
twelve (12) months following termination; or
(b) Without Cause or upon the Permanent Disability of Employee,
provided that the Employee shall give the Employer sixty (60) days'
prior written notice of his intent to terminate, in which event the
employer shall have no further obligation to the Employee except
future payment of any amounts due and owing under Section 4 on the
effective date of the termination.
3.2.3 By the Employee within six (6) months following a Change in
Control of the Employer, provided that the Employee shall give written
notice to the Employer of his intention to terminate this Agreement,
in which event the Employer shall be required to pay to continue to
meet its obligations to Employee under Section 4 for a period of
twelve (12) months after termination.
3.2.4 At any time upon mutual, written agreement of the parties,
in which event the Employer shall have no further obligation to the
Employee except for the payment of any amounts due and owing under
Section 4 on the effective date of termination unless otherwise set
forth in the written agreement.
3.2.5 Notwithstanding anything in this Agreement to the contrary,
the term of employment shall end automatically upon the Employee's
death, in which event the Employer shall have no further obligation to
the Employee except for the payment of any amounts due and owing under
Section 4 on the effective date of termination.
3.3 Effect of Termination. Termination of the employment of the Employee
pursuant to Section 3.2 shall be without prejudice to any right or claim which
may have previously accrued to either the Employer or the Employee hereunder and
shall not terminate, alter, supersede or otherwise affect the terms and
covenants and the rights and duties prescribed in this Agreement.
4. Compensation. The Employee shall receive the following salary
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and benefits:
4.1 Base Salary. During the Initial Term, the Employee shall be compensated
at a base rate of $135,000.00 per annum (the "Base Salary"). The Employee's
salary shall be reviewed by the Board at least annually, not less than ninety
(90) days prior to the anniversary of this Agreement, and the Employee shall be
entitled to receive such amount as may be determined by the Board. Such salary
shall be payable in accordance with the Employer's normal payroll practices.
4.2 Specific Individual Benefits. The Employee shall receive the following
specific individual benefits:
(a) The executive salary continuation plan originally entered
into by Employee and Xxxx State Bank as of August 7, 1995.
(b) An automobile allowance in the amount of $500.00 per month.
4.3 Incentive Compensation. The Employee shall be entitled to participate
in such bonus, incentive and other executive compensation programs as are made
available to senior management of the Employer from time to time (the "Incentive
Compensation").
4.4 Benefits.
(a) In addition to the Base Salary, Specific Individual Benefits,
and Incentive Compensation, the Employee shall be entitled to such
benefits as may be available from time to time for executives of the
Employer similarly situated to the Employee. All such benefits shall
be awarded and administered in accordance with the Employer's standard
policies and practices. Such benefits may include, by way of example
only, profit-sharing plans, retirement or investment funds, dental,
health, life and disability insurance benefits and such other benefits
as the Employer deems appropriate.
(b) The Employer specifically agrees to reimburse the Employee
for reasonable business expenses incurred by him in performance of his
duties hereunder, as approved from time to time by the Board; provided
that the Employee shall, as a condition of reimbursement, submit
verification of the nature and amount of such expenses in accordance
with reimbursement policies from time to time adopted by the Employer
and in sufficient detail to comply with rules and regulations
promulgated by the Internal Revenue Service.
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(c) On a non-cumulative basis the Employee shall be entitled to
Four (4) weeks of vacation in each year of this Agreement, during
which his compensation shall be paid in full. At least two consecutive
weeks each year must be taken by the Employee for vacation, with other
vacation to be taken at the time the Employer determines appropriate,
taking into account the requirements of the Employer.
4.4 Withholding. The Employer may deduct from each payment of compensation
hereunder all amounts required to be deducted and withheld in accordance with
applicable federal and state income, FICA and other withholding requirements.
4.5 Moving Expenses. It is agreed that Employee shall move his residence to
Xxxxxxx or Fayette or Xxxxx Counties or an agreed upon nearby community. The
bank shall pay relocation expenses up to $30,000.00. Said expenses shall include
moving by a professional moving company, sales commission on the sale of his
present home, and closing cost on the purchase of his new home.
To facilitate the agreements set forth herein, Employee shall list his
present home (the "Home") for sale within fifteen (15) days after the date on
which Xxxx State Bank shall become a wholly owned subsidiary of Employer, such
listing to be at Two Hundred Sixty-Five Thousand and 00/100 ($265,000.00)
Dollars. Between the date of such listing and August 1, 1997, (i) Employee shall
accept any offer to purchase the Home which is equal to or greater than said
listing price, and shall thereafter promptly relocate, and (ii) Employee shall
notify Employer of any offer to purchase the Home less than the listing price
and, if Employer agrees to pay to Employee the amount of such deficiency, shall
accept said offer and promptly relocate. After August 1, 1997, Employer shall be
entitled to make all decisions with respect to the listing broker, agent, price,
and the acceptance or rejection of any offer, and all other issues involved in
the sale of the House, provided that regardless of such decision, Employer shall
in every case pay to Employer the deficiency, if any, between the sales price
and the Employee's original purchase price of the Home, and, at Employer's
request, Employee shall promptly relocate at such time as a purchase contract
for the Home shall be determined to be accepted by Employer.
5. Employer Information.
5.1 Ownership of Information. All Employer Information received or
developed by the Employee while employed by the Employer will remain the sole
and exclusive property of the Employer.
5.2 Obligations of Employee. Employee agrees (a) to hold Employer
Information in strictest confidence, and (b) not to use,
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duplicate, reproduce, distribute, disclose or otherwise disseminate Employer
Information or any physical embodiments thereof and may in no event take any
action causing or fail to take any action necessary in order to prevent any
Employer Information from losing its character or ceasing to qualify as
Confidential Information or a Trade Secret. In the event that Employee is
required by law to disclose any Employer Information, Employee will not make
such disclosure unless (and then only to the extent that) Employee has been
advised by independent legal counsel that such disclosure is required by law and
then only after prior written notice is given to the Employer when Employee
becomes aware that such disclosure has been requested and is required by law.
This Section 5 shall survive for a period of two (2) years following termination
of this Agreement with respect to Confidential Information, and shall survive
termination of this Agreement for so long as is permitted by the then-current
Georgia Trade Secrets Act of 1990, O.C.G.A. xx.xx. 10-1-760-10-1-767, with
respect to Trade Secrets.
5.3 Delivery upon Request or Termination. Upon request by the Employer, and
in any event upon termination of his employment with the Employer, the Employee
will promptly deliver to the Employer all property belonging to the Employer,
including without limitation all Employer Information then in his possession or
control.
6. Non-Competition. The Employee agrees that during his employment by the
Employer hereunder and, in the event of his termination other than by the
Employee for Cause pursuant to Section 3.2.2(a), for a period of two (2) years
thereafter, he will not (except on behalf of or with the prior written consent
of the Employer), within the Area on his own behalf or in the service or on
behalf of others, in the capacity which involves the duties and responsibilities
undertaken by the Employee for the Employer, engage in any business which is the
same as or essentially the same as the Business of the Employer.
7. Non-Solicitation of Customers. The Employee agrees that during his employment
by the Employer hereunder and, in the event of his termination other than by the
Employee for Cause pursuant to Section 3.2.2(a), 3.2.3, or 3.2.4 for a period of
two (2) years thereafter, he will not (except on behalf of or with the prior
written consent of the Employer), within the Area, on his own behalf or in the
service or on behalf of others, solicit, divert or appropriate or attempt to
solicit, divert or appropriate, directly or by assisting others, any business
from any of the Employer's customers, including actively sought prospective
customers, with whom the Employee has or had material contact during the last
one (1) year of his employment, for purposes of providing products or services
that are competitive with those provided by the Employer.
8. Non-Solicitation of Employees. The Employee agrees that during his employment
by the Employer hereunder and, in the event
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of his termination other than by the Employee for Cause pursuant to Section
3.2.2(a), for a period of two (2) years thereafter, he will not, within the
Area, on his own behalf or in the service or on behalf of others, solicit,
recruit or hire away or attempt to solicit, recruit or hire away, directly or by
assisting others, any person then an employee of the Employer or its Affiliates
with whom Employee has had interaction, whether or not such employee is a
full-time employee or a temporary employee of the Employer or its Affiliates and
whether or not such employment is pursuant to written agreement and whether or
not such employment is for a determined period or is at will.
9. Remedies. The Employee agrees that the covenants contained in Sections 5
through 8 of this Agreement are of the essence of this Agreement; that each of
the covenants is reasonable and necessary to protect the business, interests and
properties of the Employer; and that irreparable loss and damage will be
suffered by the Employer should he breach any of the covenants. Therefore, the
Employee agrees and consents that, in addition to all the remedies provided by
law or in equity, the Employer shall be entitled to a temporary restraining
order and temporary and permanent injunctions to prevent a breach or
contemplated breach of any of the covenants. The Employer and the Employee agree
that all remedies available to the Employer or the Employee, as applicable,
shall be cumulative.
10. Severability. The parties agree that each of the provisions included in this
Agreement is separate, distinct and severable from the other provisions of this
Agreement and that the invalidity or unenforceability of any agreement provision
shall not affect the validity or enforceability of any other provision of this
Agreement. Further, if any provision of this Agreement is ruled invalid or
unenforceable by a Court of competent jurisdiction because of a conflict between
the provision and any applicable law or public policy, the provisions shall be
redrawn to make the provision consistent with and valid and enforceable under
the law or public policy.
11. No Set-Off by Employee. The existence of any claim, demand, action or cause
of action by the Employee against the Employer, or any Affiliate of the
Employer, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Employer of any of its rights
hereunder.
12. Notice. All notices and other communications required or permitted under
this Agreement shall be in writing and, if mailed by prepaid first-class mail or
certified mail, return receipt requested, shall be deemed to have been received
on the earlier of the date shown on the receipt or three (3) business days after
the postmarked date thereof. In addition, notices hereunder may be delivered by
hand, facsimile transmission or overnight courier, in which event the notice
shall be deemed effective when delivered or transmitted. All notices and other
communications under this
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Agreement shall be given to the parties hereto at the following address:
(i) If to the Employer, to it at:
First Citizens Corporation
P. O. Xxxxxx 000
Xxxxxx, Xxxxxxx 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
(i) If to the Employee, to him at:
Xxxxxxx X. Xxxxxx
000 Xxxxxxxx Xx
Xxxxxxxxx, Xxxxxxx 00000
13. Assignment. Neither party hereto may assign or delegate this Agreement or
any of its rights and obligations hereunder without the written consent of the
other party hereto.
14. Waiver. A waiver by the Employer of any breach of this Agreement by the
Employee shall not be effective unless in writing, and no waiver shall operate
or be construed as a waiver of the same or another breach on a subsequent
occasion.
15. Attorneys' Fees. In the event of litigation between the parties concerning
this Agreement, the party prevailing in such litigation shall be entitled to
receive from the other party all reasonable costs and expenses, including
without limitation attorneys' fees, incurred by the prevailing party in
connection with such litigation, and the other party shall pay such costs and
expenses to the prevailing party promptly upon demand by the prevailing party.
16. Applicable Law. This Agreement shall be construed and enforced under and in
accordance with the laws of the State of Georgia. The parties agree that any
appropriate state court located in Xxxxxxx or Coweta County, Georgia, shall have
jurisdiction of any case or controversy arising under or in connection with this
Agreement and shall be a proper forum in which to adjudicate such case or
controversy. The parties consent to the jurisdiction of such courts.
17. Interpretation. Words importing any gender include all genders. Words
importing the singular form shall include the plural and vice versa. The terms
"herein", "hereunder", hereby", "hereto", "hereof" and any similar terms refer
to this Agreement.
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Any captions, titles or headings preceding the text of any article, section or
subsection herein are solely for convenience of reference and shall not
constitute part of this Agreement or affect its meaning, construction or effect.
18. Entire Agreement. This Agreement embodies the entire and final agreement of
the parties on the subject matter stated in the Agreement. No amendment or
modification of this Agreement shall be valid or binding upon the Employer or
the Employee unless made in writing and signed by both parties. All prior
understandings and agreements relating to the subject matter of this Agreement
are hereby expressly terminated.
19. Rights of Third Parties. Nothing herein expressed is intended to or shall be
construed to confer upon or give to any person, firm or other entity, other than
the parties hereto and their permitted assigns, any rights or remedies under or
by reason of this Agreement.
20. Survival. The obligations of the Employee pursuant to Sections, 5, 6, 7, 8
and 9 shall survive the termination of the employment of the Employee hereunder
for the period designated under each of those respective sections.
21. Joint and Several. The obligation of the Bank and the Employer to Employee
hereunder shall be joint and several.
IN WITNESS WHEREOF, the Employer and the Employee have executed and
delivered this Agreement as of the date first shown above.
THE EMPLOYER:
FIRST CITIZENS CORPORATION
By: /s/ Xxx Xxxx
--------------------------
Name: Xxx Xxxx
Title: President
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FIRST CITIZENS BANK, XXXXXXX
By: /s/ Xxxxxx Xxxxx
--------------------------
Name: Xxxxxx Xxxxx
Title: Chairman
THE EMPLOYEE:
/s/ Xxxxxxx X. Xxxxxx
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Exhibit A
Initial Duties of the Employee
The initial duties of the Employee shall include, in addition to any other
duties assigned the Employee by the Board of Directors of the Bank or the
Employer or their respective designees, the following:
x Xxxxxx a corporate culture of the Bank that promotes ethical
practices, encourages individual integrity, fulfills social
responsibility, and is conducive to attracting, retaining and
motivating a diverse group to top-quality employees at all levels.
o Work with the Employer's Chief Executive and Board of Directors to
develop a long-term strategy for the Employer and the Banks that
creates shareholder value.
o Develop and recommend to the Employer's Chief Executive and Board
annual business plans and budgets that support the Employer's
long-term strategy.
o Manage the day-to-day business affairs of the Bank appropriately.
o Use best efforts to achieve the Bank's and the Employer's financial
and operating goals and objectives.
o Improve the quality and value of the products and services provided by
the Bank and the Employer.
o Ensure that the Bank maintains a satisfactory competitive position
within its industry.
o Develop an effective Bank management team and an active plan for its
development and succession, and make recommendations to the Employer's
Chief Executive and Board regarding hiring, firing and compensation.
o Implement major corporate policies.
o Develop and manage the commercial lending program for all banks
included within the Employer, including the development of commercial
lending policies and procedures and the development and supervision of
an effective commercial lending team.
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