AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.2
AMENDED
AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is made and
effective as of this _16th_ day of _January_, 2008, by and among United Security
Bank, a California state-chartered bank (“Bank”), and United Security
Bancshares, a California corporation (‘Bancshares”), (collectively “Company”)
and Xxxxxx X. Xxxxx (“Employee”), with respect to the following
facts:
| A. |
The
Company desires to be assured of the continued association and
services of
Employee in order to take advantage of his experience, knowledge
and
abilities in the Company’s business, and further desires to employ
Employee.
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| B. |
The Employee desires to be
so employed, on
the terms and conditions set forth in this
Agreement.
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| C. |
The Company and Employee desire to amend and
restate the
Agreement to conform with Section 409A of the Internal Revenue
Code of
1986, as amended.
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ACCORDINGLY,
on the basis of the representations, warranties and covenants contained herein,
the parties hereto agree as follows:
| 1. |
EMPLOYMENT
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1.1
Employment
and Effective Date.
The
Company hereby employs Employee as the President and Chief Executive Officer
of
Bancshares and Bank, and Employee hereby accepts such employment, on the terms
and conditions set forth below, to perform during the term of the Agreement
such
services as are required hereunder.
The
effective date of this Agreement shall be the date of execution by both parties
hereof; provided, however, that the term shall commence January 1, 2006. (See
paragraph 3.1, below.)
1.2
Duties.
Employee shall render such management services to Company, and shall perform
such duties and acts, in each case consistent with his position as President
and
Chief Executive Officer, as reasonably may be required by the Company’s Boards
of Directors (collectively “Board”) in connection with any aspect of the
Company’s business. Employee will have such authority, power, responsibilities
and duties as are inherent in his positions (and the undertakings applicable
to
his positions) and necessary to carry out his responsibilities and the duties
required of him hereunder.
1.3
Service
to Others.
During
the period in which Employee is employed by Company, Employee shall devote
substantially all of his productive time, ability and attention to, and shall
diligently and conscientiously use his best efforts to further, the Company’s
business, and shall not, without the prior written consent of the Board, perform
such services for any person other than the Company, which would materially
interfere with the performance of his duties hereunder. Notwithstanding the
foregoing provisions of this paragraph 1.3, while Employee is employed by
Company, he may devote reasonable time to activities other than those required
under this Agreement, including the supervision of his personal investments,
and
activities involving professional, charitable, educational, religious and
similar types of organizations, speaking engagements, membership on the boards
of directors of other organizations, and similar types of activities, to the
extent that such other activities do not inhibit or prohibit the performance
of
Employee’s duties under this Agreement, or conflict in any material way with the
business or interests of the Company; provided, however, that Employee shall
report to the Board on an annual basis all positions held with any other
business, civic or charitable organization.
1.4
Place
of Performance.
In
connection with his employment with Company, Employee will be based at the
principal executive offices of the Company, located in Fresno,
California.
| 2. |
COMPENSATION
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2.1
Compensation.
As
consideration for the services which Employee renders hereunder, Employee shall
be entitled to the following:
(a) Effective
January 1, 2006, an annual base salary of $360,000, less federal and state
income tax withholding and other applicable payroll withholdings, payable in
installments consistent with the payment practices generally applicable to
employees of the Company; provided, however, that such annual base salary may
be
increased as determined solely by the Board at an evaluation meeting to be
held
during the first quarter of each year of this Agreement.
(b)
Executive
Incentive Compensation. In general, the Company believes that superior
performance of Executive should be rewarded and encouraged by incentive
compensation. Executive shall be entitled each year of this Agreement to four
percent (4%) of the after tax net income of the Company as reported yearly
on a
consolidated basis for each year of the term of employment. Such incentive
compensation is subject to the Bank receiving satisfactory CAMEL ratings on
both
the Safety and Soundness Examinations and the Compliance Examinations that
are
the most recent as of the payment of such incentive compensation. Subject to
the
foregoing, Executive shall be authorized to receive a draw on the incentive
compensation on a quarterly basis throughout the year. During the term of this
Agreement, Employee may be paid up to 20% of the expected annual incentive
compensation following the filing of the 10-Q for each respective quarter based
on the unaudited quarterly results as contained in the Bancshares’ 10-Q for that
quarter, with a true up and final payment at the time of the finalization of
the
year end financial statements of the Company. However no quarterly payment
as
described above, shall exceed 25% of the expected annual incentive compensation
pursuant to Bancshares budget. The year-end payment shall be conditioned upon
the receipt of the audited financial statement for the Company for the year-end.
If the Company does not realize net income in a quarter then Executive shall
not
be authorized to receive incentive compensation for that quarter. In the event
that Company has over advanced on the incentive compensation to Executive in
any
year, then Executive’s incentive compensation for the following year shall be
reduced by the amount of the over advanced and Executive shall not be entitled
to any quarterly advances on the incentive compensation until the over advance
is repaid in its entirety through the net income of the Company. The payment
of
this incentive compensation for any calendar year during the term shall be
paid
no later than the 15th
day of
the third month following the end of the calendar year for which it was earned,
except as may be delayed because of certain unforeseeable events as set forth
in
the final regulations promulgated under Section 409A of the Code.
(c)
Bancshares
has granted Employee stock options to acquire 25,000 shares of Bancshares common
stock effective February 6, 2006 at closing price of February 6, 2006. The
Board
may grant Employee additional stock options as determined solely by the Board
at
an evaluation meeting to be held during the first quarter of each year of this
Agreement.
(d)
In
addition to any other benefits agreements specific to Employee, participation
in
all benefit plans or programs sponsored by Company, including, without
limitation, participation in any group health, medical reimbursement, dental,
disability, accidental death or dismemberment or life insurance plan (the costs,
including premiums, of which shall by paid exclusively by Company), vacation
and
sick leave; provided that the plan and programs shall be maintained by Company
on terms no less favorable to Employee than those plans and programs in effect
on the date hereof.
(e)
Reimbursement
of reasonable and documented expenses incurred by Employee from time to time
in
the performance of his duties hereunder including but not limited to
entertainment, meals, travel, cellular phone, and expenses associated with
participation on Company’s Board of Directors.
(f) Six
(6)
weeks paid vacation per year, and all paid holidays observed by Company during
the first year of this Agreement. During the second year, six (6) weeks and
two
(2) days paid vacation per year, and all paid holidays observed by Company
during the second year of this Agreement. During the third year and successive
years, seven (7) weeks paid vacation per year, and all paid holidays observed
by
Company during the third year of this Agreement. In scheduling vacations,
Employee shall take into consideration the needs and activities of the
Company.
(g)
Use
of a
Bank owned automobile for business and personal use, together with all
reasonable expenses for insurance, fuel, maintenance, repair and registration.
Employee shall keep a log detailing personal use of such automobile and shall
have included in his Form 1099, the value of such personal use.
(h)
All
initiation fees and membership dues associated with the Employee’s membership in
the San Xxxxxxx Country Club.
(i)
The
Company will, to the maximum extent permitted by law, defend, indemnify and
hold
harmless Employee and his heirs, estate, executors and administrators against
any costs, losses, claims, suites proceedings, damages or liabilities to which
Employee may become subject which arise out of, are based upon or relate to
Employee’s employment by Company (and any predecessor to Company), or the
Employee’s service as an officer or member of the Board of Directors of Company
(or any predecessor to Company), including without limitation the advance of
legal or other expenses reasonably incurred by Employee in connection with
investigation and defending against any such costs, losses, claims, suits,
proceedings, damages or liabilities, provided that any reimbursement provided
by
this Section 2.1(i) to Employee for costs or legal fees arising out of claims
made against Employee shall be subject to Section 5.12 herein. The Company
shall
maintain directors and officers liability insurance in commercially reasonable
amounts (as reasonably determined by the Board), and Employee shall be covered
under such insurance to the same extent as other senior management employees
of
the Company.
Not withstanding anything to the contrary contained herein, Employee shall
not
be entitled to the payment of any severance benefit to the extent that such
payment shall be deemed a “golden parachute payment” as defined in Section 359.
l(f) of the Federal Deposit Insurance Corporation Rules and
Regulations.
2.2
Illness.
Subject
to the limitations contained in paragraph 3.2, if Employee shall be unable
to
render the services required hereunder on account of personal injuries or
physical or mental illness that do not result in total disability, he shall
continue to receive all payments provided in this Agreement; provided, however,
that any such payments may, at the sole option of the Company, be reduced
by any
amount that the Employee receives for the period covered by such payments
as
disability compensation under insurance policies, if any, maintained by the
Company or under government programs.
2.3
Key
Man and Disability Insurance.
The
Company shall have the right to obtain and hold a “keyman” life insurance policy
on the life of Employee and/or a disability insurance policy with the Company
as
the beneficiary of the policy. Employee agrees to provide any information
required for the issuance of such policy and submit himself to any physical
examination required for such policy.
| 3. |
TERM
OF EMPLOYMENT AND TERMINATION
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3.1
Term.
Unless
sooner terminated pursuant to paragraph 3.2 of this Agreement, the term of
employment hereunder shall be for a three year period commencing January 1,
2006. The term shall be automatically extended at the end of each year for
an
additional year so that at all times this Agreement shall be for a term of
three
years unless either party provides written notice of nonrenewal of this
Agreement to the other party prior to January 1 of the next year.
3.2
Duties
Upon Termination.
(a) In
the
event that employment under this Agreement is terminated, neither Company nor
Employee shall have any remaining duties or obligations hereunder, except that
(i) Employee shall continue to be bound by paragraph 4 of this Agreement and
(ii) in the event that such employment is terminated (A) by Company for any
reason other than “for cause” (as defined below) or (B) by Employee with “just
reason” (as defined below), the Company shall pay or provide to Employee, or his
estate, (I) a lump sum payment, not later than 5 days after such termination
of
employment except as required to be delayed pursuant to Section 5.12 herein,
equal to 24 months of Employee’s then base salary at the time of termination and
(II) participation in all benefit plans and programs sponsored by the Company
for executive officers in general, all as set forth in paragraph 2.1(d) for
24
months following termination.
(b) The
Company shall be deemed to have terminated the employment of Employee “for
cause” if, but only if, such termination (i) shall result solely from Employee’s
continued and willful failure or refusal to substantially perform his duties
in
accordance with the terms of this Agreement and shall have been approved by
the
Board; provided, however, that the Employee first shall have received written
notice specifying the acts or omissions alleged to constitute such failure
or
refusal and such failure or refusal continues after the Employee shall have
had
reasonable opportunity (but in no event less than thirty (30) days) to correct
the same; (ii) Employee is subject to removal proceedings brought by a bank
regulatory authority; or (iii) Employee is formally charged with a felony
involving dishonesty or moral turpitude; provided, however, that in the case
of
clause (ii) next above, if the removal proceeding is unsuccessful, or in the
case of clause (iii) next above, if the Employee is not convicted of the felony,
Employee shall not be treated as having been terminated “for cause” and shall be
entitled to prompt payment of all amounts described in paragraph 3.2(a)(ii).
For
purposes of this subparagraph (b), no act, or failure to act, on the Employee’s
part shall be deemed “willful” unless done, or omitted to be done, by the
Employee not in good faith and without reasonable belief that Employee’s action
or omission was in the best interest of the Company.
(c) Employee
shall be deemed to have terminated his employment with “just reason” if such
termination shall result, in whole or in part, from any of the following
events:
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(i)
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the
breach by the Company of any material provision of this Agreement;
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(ii)
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receipt
by the Employee of a notice from the Company that the Company intends
to
terminate employment under this Agreement;
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(iii)
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the
failure of a successor or assign of the Company’s rights under this
Agreement to assume the Company’s duties hereunder;
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(iv)
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the
Company directs Employee to perform any unlawful act;
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(v)
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the
Employee ceases to be a member of the Board;
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(vi)
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the
Employee’s duties are materially reduced;
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(vii)
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a
relocation of Employee’s principal place of employment by more than 20
miles from downtown Fresno, California;
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(viii)
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liquidation
or dissolution of Bank; or
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(ix)
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the
death or total disability of the
Employee.
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(d) The
Employee shall not be required to mitigate the amount of any payment provided
for in this Agreement by seeking other employment or otherwise. The Company
shall not be entitled to set off against the amounts payable to Employee under
this Agreement any amounts owed to the Company by Employee, any amounts earned
by Employee in other employment after termination of his employment with
Company, or any amounts which might have been earned by Employee in other
employment had he sought such other employment.
(e) Without
limiting any other remedies available to the Company, the payments to be made
under this paragraph 3.2 after termination of Employee shall be subject to
the
Employee’s execution of a release agreement satisfactory to the Company and the
Employee’s continued compliance with such agreement. Such release agreement
shall contain, but not be limited to, provisions that (i) Employee shall not
disparage Company; (ii) Employee shall not, for a period of one (1) year
following termination, solicit or attempt to solicit, directly or indirectly
any
employee or customer of the Company; and (iii) Employee shall not, directly
or
indirectly, be employed by, be connected with, or have an interest of any kind
in, any person or entity owning managing, controlling, operating, or otherwise
participating or assisting in any business that is similar to or in competition
with Company or any of its affiliates, within a 20 mile radius of any location
where the Company or any subsidiary or parent thereof has a place of
business.
3.3
Change
of Control.
The
following Section 3.3 will not be effective until January 22, 2007, at which
time Employee’s Change in Control Agreement with the Bank expires. From the date
of this Agreement through January 22, 2007, Employee’s Change in Control
Agreement with the Bank shall remain in place and shall not be superceded by
this Agreement. A “Change in Control” shall mean the earliest occurrence of one
of the following events:
A.
A
Change In Ownership of Bancshares or the Bank.
A
change in ownership of Bancshares or the Bank occurs on the date that any person
(or group of persons) acquires ownership of stock of Bancshares or the Bank
that, together with stock held by such person or group, constitutes more than
fifty percent (50%) of the total fair market value or total voting power of
the
stock of Bancshares or the Bank, respectively.
B.
A
Change in Effective Control of Bancshares or the Bank.
A
change in effective control of Bancshares or the Bank occurs on the date
that:
1.
Any
person (or group of persons) acquires (or has acquired during the twelve (12)
month period ending on the date of the most recent acquisition by such person
or
persons) ownership of stock of Bancshares or the Bank possessing thirty-five
percent (35%) or more of the total voting power of the stock of Bancshares
or
the Bank, respectively; or
2.
A
majority of members of Bancshares’ or Bank’s Board is replaced during any twelve
(12) month period by directors whose appointment or election is not endorsed
by
a majority of the members of Bancshares’ or the Bank’s Board, respectively prior
to the date of the appointment or election.
C.
A
Change in Ownership of a Substantial Portion of Bancshares’ or the Bank’s
Assets.
A
change in the ownership of a substantial portion of Bancshares’ or the Bank’s
assets occurs on the date that any person (or group of persons) acquires (or
has
acquired during the twelve (12) month period ending on the date of the most
recent acquisition by such person or persons) assets from Bancshares or the
Bank, respectively that have a total gross fair market value equal to, or more
than, forty percent (40%) of the total gross fair market value of all of the
assets of Bancshares or the Bank, respectively immediately prior to such
acquisition or acquisitions.
For the purpose of this Agreement, transfers of the outstanding voting
securities of Bancshares or the Bank made on account of deaths or gifts,
transfers between family members, former spouses or transfers to a qualified
retirement plan maintained by the Bancshares or the Bank shall not be considered
in determining whether there has been a Change in Control.
In the event of a Change of Control and subject to Section 5.12 herein, Employee
shall be paid a lump sum amount in cash equal to three times the average of
the
last three (3) years of Employee’s total compensation, inclusive of Employee’s
base annual salary and all incentive compensation immediately following the
date
of consummation of the Change of Control. The Company and Employee acknowledge
that limitations on deductibility of the Change of Control payment herein for
federal income tax purposes may be imposed under, but not limited to Section
280G of the Internal Revenue Code of 1986, as amended (“Code”), and any
successor to Section 280G of the Code. The Change of Control payment pursuant
to
the application of this Section 3.3 shall be limited to such amount that results
in the greatest amount of the Change in Control payment that is deductible
by
the Company for federal income tax purposes after taking into account all other
compensation payments to or for the benefit of the Employee that are included
in
determining the deductibility of such payments under Section 280G of the Code
or
any successor to Section 280G of the Code. In the event that prior to the
application of this Section 3.3, all other compensation payments to or for
the
benefit of Employee results in the limitation of the deductibility by the
Company of such payments under Section 280G or any successor to Section 280G
of
the Code, then no payment shall be made pursuant this Section 3.3.
3.4
Resignation.
Employee shall provide at least ninety days notice of resignation from
employment. Company shall have the authority to waive such notice.
| 4. |
TRADE
SECRETS
|
4.1
Trade
Secrets.
Employee shall not, without the prior written consent of the Board in each
instance, disclose or use in any way, during the term of his employment by
the
Company and for one (1) year thereafter, except as required in the course of
such employment, any confidential business or technical information or trade
secret of the Company acquired in the course of such employment, whether or
not
patentable, copyrightable or otherwise protected by law, and whether or not
conceived of or prepared by him (collectively, the “Trade Secrets”) including,
without limitation, any information concerning customer lists, products,
procedures, operations, investments, financing, costs, employees, accounting,
marketing, salaries, pricing, profits and plans for future development, the
identity, requirements, preferences, practices and methods of doing business
of
specific parties with whom the Company transacts business, and all other
information which is related to any product, service or business of the Company,
other than information which is generally known in the industry in which the
Company transacts business or is acquired from public sources; all of which
Trade Secrets are the exclusive and valuable property of the Company; provided,
however, that, following termination of employment, Employee shall be entitled
to retain a copy of any rolodex or other compilation maintained by him of the
names of business contacts with their addresses, telephone numbers and similar
information.
4.2
Tangible
Items.
All
files, accounts, records, documents, books, forms, notes, reports, memoranda,
studies, compilations of information, correspondence and all copies, abstracts
and summaries of the foregoing, and all other physical items related to the
Company, other than a merely personal item, whether of a public nature or not,
and whether prepared by the Employee or not, are and shall remain the exclusive
property of the Company and shall not be removed from the premises of the
Company, except as required in the course of employment by the Company, without
the prior written consent of the Board in each instance, and the same shall
be
promptly returned to the Company by Employee on the expiration or termination
of
this employment by the Company or at any time prior thereto upon the request
of
the Company.
4.3
Injunctive
Relief.
Employee hereby acknowledges and agrees that it would be difficult to fully
compensate the Company for damages resulting from the breach or threatened
breach of this paragraph 4 and, accordingly, that the Company shall be entitled
to seek temporary and injunctive relief, including temporary restraining orders,
preliminary injunctions and permanent injunctions, to enforce such provisions
without the necessity of proving actual damages and without the necessity of
posting any bond or other undertaking in connection therewith. This provision
with respect to injunctive relief shall not, however, diminish the Company’s
right to claim and recover damages.
4.4
“Company”.
For the
purposes of this paragraph 4 of the Agreement only, the term “Company” shall
include United Security Bank, United Security Bancshares, their successors,
assigns and nominees, and all individuals, corporations and other entities
that
directly, or indirectly through one or more intermediaries, control or are
controlled by or are under common control with any of the
foregoing.
| 5. |
MISCELLANEOUS
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5.1
Severable
Provisions.
The
provisions of this Agreement are severable, and if any one or more provision
may
be determined to be illegal or otherwise unenforceable, in whole or in part,
the
remaining provisions, and any partially unenforceable provisions to the extent
enforceable, shall nevertheless be binding and enforceable.
5.2
Successors
and Assigns.
All of
the terms, provisions and obligations of this Agreement shall inure to the
benefit of and shall be binding upon the parties hereto and their respective
heirs, representatives, successors and assigns. Notwithstanding the foregoing,
neither the Agreement nor any rights hereunder shall be assigned, pledged,
hypothecated or otherwise transferred by Employee without the prior written
consent of the Board in each instance.
5.3
Governing
Law.
The
validity, construction and interpretation of this Agreement shall be governed
in
all respects by the laws of the State of California applicable to contracts
made
and to be performed within that State.
5.4
Headings.
Paragraph and subparagraph headings are not to be considered part of the
Agreement and are included solely for convenience and reference and in no way
define, limit or describe the scope of the Agreement or the intent of any
provisions hereof.
5.5
Entire
Agreement.
The
Agreement constitutes the entire agreement between the parties hereto pertaining
to the subject matter hereof, and supersedes all prior agreements,
understanding, negotiations and discussions, whether oral or written, relating
to the subject matter of the Agreement, except as expressly stated in Section
3.3. No supplement, modification, waiver or termination of the Agreement shall
be valid unless executed by the party to be bound thereby. No waiver of any
of
the provisions of the Agreement shall be deemed to or shall constitute a waiver
of any other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
5.6
Notice.
Any
notice or other communication required or permitted hereunder shall be in
writing and shall be deemed to have been given (i) if personally delivered,
when
so delivered, (ii) if mailed, one (1) week after having been placed in the
United States mail, registered or certified, postage prepaid, addressed to
the
party to whom it is directed at the address set forth below or (iii) if given
by
telecopier, when such notice or other communication is transmitted to the
telecopier number specified below and the appropriate answerback confirmation
is
received. Either party may change the address to which such notices are to
be
addressed by giving the other party notice in the manner herein set
forth.
5.7
Attorneys’
Fees.
In the
event either party takes legal action to enforce any of the terms of the
Agreement, the unsuccessful party to such action shall pay the successful party
to such action shall pay the successful party’s expenses, including attorneys’
fees, incurred in such action.
5.8
Third
Parties.
Nothing
in the Agreement, expressed or implied, is intended to confer upon any person
other than the Company or the Employee any rights or remedies under or by reason
of the Agreement.
5.9
Arbitration.
Any
controversy arising out of or relating to this Agreement or the transactions
contemplated hereby shall be referred to arbitration before the American
Arbitration Association strictly in accordance with the terms of this Agreement
and the substantive law of the State of California. The board of arbitrators
shall convene at a place mutually acceptable to the parties in the State of
California and, if the place of arbitration cannot be agreed upon, arbitration
shall be conducted in Anaheim. The parties hereto agree to accept the decision
of the board of arbitrators, and judgment upon any award rendered hereunder
may
be entered in any court having jurisdiction thereof. Neither party shall
institute a proceeding hereunder until that party has furnished to the other
party, by registered mail, at least thirty (30) days’ prior written notice of
its intent to do so.
5.10
Construction.
If any
part of this Agreement is deemed to be unclear or ambiguous, it shall be
construed as if it were drafted jointly by the parties. Each party hereto
acknowledges that no party was in a superior bargaining position regarding
the
substantive terms of this Agreement.
5.11
Consent
to Jurisdiction.
Subject
to paragraph 5.9, each party hereto, to the fullest extent it may effectively
do
so under applicable law, irrevocably (i) submits to the exclusive jurisdiction
of any court of the State of California or the United States of America sitting
in the City of Fresno over any suit, action or proceeding arising out of or
relating to this Agreement, (ii) waives and agrees not to assert, by way of
motion, as a defense or otherwise, any claim that it is not subjection to the
jurisdiction of any such court, any objection that it may now or hereafter
have
to the establishment of the venue of any such suit, action or proceeding brought
in any such court and any claim that any such suit, action or proceeding brought
in any such court has been brought in an inconvenient forum, (iii) agrees that
a
judgment in any such suit, action or proceeding brought in any such court shall
be conclusive and binding upon such party and may be enforced in the courts
of
the United States of America or the State of California (or any other courts
to
the jurisdiction of which such party is or may be subject) by a suit upon such
judgment and (iv) consents to process being served in any such suit, action
or
proceeding by mailing a copy thereof by registered or certified air mail,
postage prepaid, return receipt requested, to the address of such party
specified in or designated pursuant to paragraph 5.6. Each party agrees that
such service (i) shall be deemed in every respect effective service of process
upon such party in any such suit, action or proceeding and (ii) shall, to the
fullest extent permitted by law, be taken and held to be valid personal service
upon and personal delivery to such party.
5.12
Compliance
with Section 409A of the Code.
If the
Employee is a key employee of the Company as defined in Section 416(i) (without
regard to paragraph 5 thereof) of the Code and if any stock of the Company
is
publicly traded on an established securities market or otherwise, then the
benefit payments to Employee pursuant to Section 3.2 and Section 3.3 of this
Agreement following Employee’s Separation of Service for any reason other than
death shall be deferred for a period of at least six months after the date
of
Separation of Service at which time the first payment of such benefit payment
shall on the first day of the seventh month following the date of Employee’s
Separation of Service and be equal to the amount of payments that would have
otherwise been paid to Employee if Employee were not a key
employee.
The term “Separation from Service” means the termination of the Employee’s
employment with the Company for reasons other than death or Disability. Whether
a Separation from Service takes place is determined based on the facts and
circumstances surrounding the termination of the Employee’s employment and
whether the Company and the Employee intended for the Employee to provide
significant services for the Employer following such termination. A termination
of employment will be considered a Separation from Service if the Employee’s
services provided to the Company are reasonably expected to permanently decrease
to an annual rate that is twenty percent (20%) or less of the services rendered,
on average, during the immediately preceding three full calendar years.
Furthermore, a termination of employment will not be considered a Separation
from Service, if the
Employee continues to provide services to the Company in a capacity other than
as an employee of the Employer at an annual rate that is fifty percent (50%)
or
more of the services rendered, on average, during the immediately preceding
three years.
This
Agreement shall at all times be administered in compliance with the requirements
of §409A of the Code and any and all regulations thereunder, including such
regulations as may be promulgated after the date and year first set forth
above.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as
of the date and year first set forth above.
| United Security Bank | ||
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| By: | /s/ Xxxxxxx X. Xxxxxxx | |
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Its
|
SVP / CFO |
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| United Security Bancshares | ||
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| By: | /s/ Xxxxxx X. Xxxxxx | |
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Its
|
Vice Chairman |
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| EMPLOYEE | ||
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| By: | /s/ Xxxxxx X. Xxxxx | |
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Its
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Xxxxxx X. Xxxxx |
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