EXHIBIT 10.21
EXECUTION COPY
NON-COMPETITION AGREEMENT
This Non-Competition Agreement ("NON-COMPETITION AGREEMENT"), dated as of
July 23, 2004, is made by and among Intermountain Community Bancorp, an Idaho
corporation ("INTERMOUNTAIN"); Panhandle State Bank, an Idaho state-chartered
bank ("PANHANDLE"); Snake River Bancorp, Inc., an Idaho corporation ("SNAKE
RIVER"); Magic Valley Bank, an Idaho state-chartered bank ("MAGIC VALLEY"); and
the undersigned, each of whom is a director of Snake River and Magic Valley.
RECITALS
A. Intermountain, Panhandle, Snake River and Magic Valley have entered into a
Plan and Agreement of Merger (the "MERGER AGREEMENT") dated as of the date
hereof, pursuant to which Snake River will merge with and into
Intermountain, and Magic Valley will merge with and into Panhandle (the
"TRANSACTION").
B. The parties to this Non-Competition Agreement believe that the future
success and profitability of Intermountain and Panhandle following the
Transaction (collectively, the "COMBINED ENTITY") require that existing
directors of Snake River and Magic Valley (other than officer directors
who will be party to employment agreements with Panhandle) (the
"DIRECTORS") not be affiliated in any substantial way with a Competing
Business (as defined herein) for a reasonable period of time after closing
of the Transaction and/or termination of the Director's status as a
director of the Combined Entity.
AGREEMENT
In consideration of the parties' performance under the Merger Agreement,
the Directors agree as follows:
1. DEFINITIONS. Capitalized terms not defined in this Non-Competition
Agreement have the meaning assigned to those terms in the Merger
Agreement. The following definitions also apply to this Non-Competition
Agreement:
a. Competing Business. "COMPETING BUSINESS" means any financial
institution or trust company (including without limitation, any
start-up or other financial institution or trust company in
formation) or holding company thereof that competes or will compete
within the Covered Area with the Combined Entity or any of its
subsidiaries or affiliates.
b. Covered Area. "COVERED AREA" means the geographical area within a
ninety mile radius of Twin Falls, Idaho.
c. Term. "TERM" means the period of time beginning on the Effective
Date and ending on the later of (i) three (3) years after the
Effective Date or (ii) one year
following termination of a Director's service on the Board of
Directors of the Combined Entity. For purposes of this Section 1(c),
service solely on an advisory board to Panhandle will not constitute
service on the Board of Directors of the Combined Entity.
2. PARTICIPATION IN COMPETING BUSINESS. Except as provided in Section 5 or 6,
during the Term no Director may become involved with a Competing Business
or serve, directly or indirectly, a Competing Business in any manner,
including without limitation, (a) as a shareholder, member, partner,
director, officer, manager, investor, organizer, founder, employee,
consultant, agent, or representative, or (b) during the organization and
pre-opening phases in the formation of a Competing Business.
3. NO SOLICITATION. During the Term, no Director may, directly or indirectly,
solicit or attempt to solicit (a) any employees of the Combined Entity or
any of its subsidiaries or affiliates to participate, as an employee or
otherwise, in any manner in a Competing Business, or (b) any customers of
the Combined Entity or its subsidiaries or affiliates to transfer their
business to a Competing Business. Solicitation prohibited under this
section includes solicitation by any means, including, without limitation,
meetings, letters or other mailings, electronic communications of any
kind, and internet communications.
4. CONFIDENTIAL INFORMATION. During and after the Term, the Directors will
not disclose any confidential information of the Combined Entity or its
subsidiaries or affiliates obtained by such person while serving as a
director of the Combined Entity except in accordance with a judicial or
other governmental order.
5. OUTSIDE COVERED AREA. Nothing in this Non-Competition Agreement prevents a
Director from becoming involved with, as a shareholder, member, partner,
director, officer, manager, investor, organizer, founder, employee,
consultant, agent, representative, or otherwise, with a Competing Business
that has no operations in the Covered Area.
6. PASSIVE INTEREST. Nothing in this Non-Competition Agreement prevents the
Directors from owning 5% or less of any class of security of a Competing
Business.
7. REMEDIES. Any breach of this Non-Competition Agreement by a Director will
entitle the Combined Entity, together with its successors and assigns, to
injunctive relief and/or specific performance, as well as to any other
legal or equitable remedies they may be entitled to.
8. GOVERNING LAW AND ENFORCEABILITY. This Non-Competition Agreement is
governed by, and will be interpreted in accordance with, the laws of the
State of Idaho. If any court determines that the restrictions set forth in
this Non-Competition Agreement are unenforceable, then the parties request
such court to reform these provisions to the maximum restrictions, term,
scope or geographical area that such court finds enforceable.
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9. INDIVIDUAL OBLIGATIONS. The obligations of each of the Directors under
this Non-Competition Agreement are intended to be several and not joint.
10. COUNTERPARTS. The parties may execute this Non-Competition Agreement in
one or more counterparts, including facsimile counterparts. All the
counterparts will be construed together and will constitute one Agreement.
SIGNED as of July 23, 2004:
INTERMOUNTAIN COMMUNITY SNAKE RIVER BANCORP, INC.
BANCORP
By /s/ Xxxx Xxxxxx By /s/ Xxxxxxx Xxxxxxx
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Xxxx Xxxxxx Xxxxxxx Xxxxxxx
President & Chief Executive Officer President & Chief Executive Officer
PANHANDLE STATE BANK MAGIC VALLEY BANK
By /s/ Xxxx Xxxxxx By /s/ Xxxxxxx Xxxxxxx
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Xxxx Xxxxxx Xxxxxxx Xxxxxxx
Chief Executive Officer President & Chief Executive Officer
DIRECTORS:
/s/ Xxxxxxx Xxxxxx /s/ Xxxx Xxxxxxx
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Xxxxxxx Xxxxxx Xxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxx
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Xxxxxxx Xxxxxxx Xxxxxx Xxxxxx
/s/ Xxx Xxxxx /s/ Xxxxxxx Xxxxx
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Xxx Xxxxx Xxxxxxx Xxxxx
/s/ Xxxxxxx Xxxxxx /s/ Xxxxx Xxxxxxx
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Xxxxxxx Xxxxxx Xxxxx Xxxxxxx
/s/ Xxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxxx
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