EXHIBIT 10.1
EXECUTIVE EMPLOYMENT AGREEMENT, DATED
AS OF JANUARY 1, 1993, BETWEEN CODORUS VALLEY
BANCORP, INC., PEOPLES BANK OF XXXX ROCK AND
XXXXX X. XXXXXX
EXECUTIVE EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made as of the 1st day of January, 1993,
between Peoples Bank of Xxxx Rock, a Pennsylvania banking
institution (the "Bank"), Codorus Valley Bancorp, Inc., a
Pennsylvania business corporation (the "Corporation") and Xxxxx
X. Xxxxxx, an adult individual (the "Executive").
WHEREAS, the Bank is a subsidiary of the Corporation; and
WHEREAS, the Corporation desires to employ the Executive as
its President and Chief Executive Officer and the Bank desires to
employ the Executive as its President and Chief Executive Officer
both under the terms and conditions set forth herein; and
WHEREAS, the Executive desires to serve the Corporation and
Bank in an executive capacity under the terms and conditions set
forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and intending to be legally bound
hereby, the parties agree as follows:
1. TERMS OF EMPLOYMENT. The Corporation and Bank hereby
shall employ the Executive and the Executive hereby accepts
employment with the Corporation and Bank for a term of three (3)
years beginning on January 1, 1993, and ending on December 31,
1995, subject, however, to prior termination of this Agreement as
set forth below. Furthermore, subject to the subsequent
provisions, upon the expiration of the first twelve (12) full
calendar months after the date first above written, the term
hereof shall be extended for another twelve (12) full calendar
months, and upon expiration of each subsequent twelve (12) full
calendar months thereafter the term of this Agreement shall be
likewise extended
for an additional twelve (12) full calendar months. Such
extension of this Agreement's term shall be automatic unless the
Corporation and Bank provides the Executive written notice of
their intention not to extend this Agreement, which written
notice shall be given by the Corporation and Bank not less than
thirty (30) days before the expiration of the current twelve (12)
months.
2. POSITION AND DUTIES. The Executive shall serve as the
President and Chief Executive Officer of the Corporation and Bank
and a member of the Board of Directors of the Corporation and
Bank, reporting only to the Board of Directors of the Corporation
and Bank and shall have supervision and control over, and
responsibility for, the general management and operation of the
Corporation and Bank, and shall have such other powers and duties
as may from time to time be prescribed by the Board of Directors
of the Corporation and Bank, provided that such powers and duties
are consistent with the Executive's position as the Chief
Executive Officer in charge of the general management of the
Corporation and Bank.
3. ENGAGEMENT IN OTHER EMPLOYMENT. The Executive shall
devote all his working time, ability and attention to the
business of the Corporation and Bank during the term of this
Agreement. The Executive shall notify the Board of Directors of
the Corporation and Bank in writing and receive written approval
from the Corporation and Bank before the Executive engages in any
other business or commercial duties or pursuits, including, but
not limited to, directorships of other companies. Under no
circumstances may the Executive engage in any business or
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commercial activities, duties or pursuits which compete with the
business or commercial activities of the Corporation or Bank, nor
may the Executive serve as a director or officer or in any other
capacity in a company which competes with the Corporation or
Bank. Executive shall not be precluded, however, upon written
notification to the Boards of Directors, from engaging in
voluntary or philanthropic endeavors, from engaging in activities
designed to maintain and improve his professional skills, or from
engaging in activities incident or necessary to personal
investments, so long as they are, in the Boards' reasonable
opinion, not in conflict with or detrimental to the Executive's
rendition of services on behalf of the Bank and Corporation.
4. COMPENSATION.
(a) ANNUAL DIRECT SALARY: As compensation for services
rendered the Corporation and Bank under this Agreement, the
Executive shall be entitled to receive from the Bank an annual
direct salary of One Hundred Twenty-Five Thousand ($125,000.00)
Dollars per year, (the "Annual Direct Salary") payable in
substantially equal bi-monthly installments (or such other
intervals of the Bank's payroll policy) prorated for any partial
employment period. The Annual Direct Salary shall be reviewed
annually, no later than November 30 of the then calendar year and
shall be subject to such annual change (but not reduced below
$125,000.00 without the Executive's written consent, except in
cases of national financial depression or emergency when
compensation reduction has been implemented by the Board of
Directors for the Bank's senior management) as may be set by the
Board of
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Directors of the Corporation and Bank taking into account the
position and duties of the Executive and the performance of the
Corporation and Bank under the Executive's leadership.
(b) ANNUAL BUSINESS PLAN. The Executive shall prepare a
business plan establishing the financial and business goals of
the Corporation and Bank prior to the start of each fiscal year.
The business plan prepared by the Executive shall be reviewed
promptly by the Board of Directors of the Corporation and Bank,
which may in its sole discretion alter or modify such plan prior
to its adoption.
(c) BONUS. The Board of Directors of the Corporation
and Bank in its sole discretion may provide for payment of a
periodic bonus to the Executive in such an amount or nature as it
may deem appropriate to provide incentive to the Executive and to
reward the Executive for his performance.
(d) DIRECTOR FEES. The Executive shall not be entitled
to any director's fee or other compensation as paid to other
members of the Board of Directors of the Bank and/or Corporation
or subsidiaries of either. The Executive also agrees to serve on
any committee of the Board of Directors of the Bank and/or
Corporation or subsidiary of either without any additional
compensation or fees.
5. FRINGE BENEFITS, VACATION, EXPENSES, AND PERQUISITES.
(a) EMPLOYEE BENEFIT PLANS. The Executive shall be
entitled to participate in or receive benefits under all Bank
employment benefit plans including, but not limited to, any
pension
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plan, profit-sharing plan, savings plan, life insurance plan or
disability insurance plan as made available by the Bank to its
employees, subject to and on a basis consistent with terms,
conditions and overall administration of such plans and
arrangements.
(b) VACATION, HOLIDAYS, SICK DAYS AND PERSONAL DAYS.
The Executive shall be entitled to the number of paid vacation
days in each calendar year determined by the Bank from time to
time for its senior executive officers, but not less than four
(4) weeks (two weeks of which shall be in sequence unless excused
from such requirement by the Board of Directors) in any calendar
year (prorated in any calendar year during which the Executive is
employed hereunder for less than the entire such year in
accordance with the number of days in such calendar year during
which he is so employed). The Executive shall also be entitled
to all paid holidays, sick days and personal days given by the
Bank to its employees.
(c) BUSINESS EXPENSES. During the term of his
employment hereunder, the Executive shall be entitled to receive
prompt reimbursement for all reasonable expenses incurred by him
(in accordance with the policies and procedures established by
the Board of Directors of the Bank for its senior executive
officers) in performing services hereunder, provided that the
Executive properly accounts therefor in accordance with Bank
policy.
(d) AUTOMOBILE. The Executive shall be entitled to the
use of a Bank purchased or leased automobile of the following
make and model, or such comparable model as may be agreed upon by
the
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Board of Directors and the Executive: Chrysler New Yorker. The
Executive shall also be entitled to reimbursement for all
operating expenses of the automobile, including, but not limited
to, oil, gasoline, maintenance, repairs and insurance. The use
of said automobile shall be limited to the Executive, his spouse,
authorized Bank personnel, or designated driver in the event of
an emergency.
(e) MEMBERSHIP DUES. While serving as President and
Chief Executive Officer of the Corporation and Bank, Executive
shall be reimbursed for membership dues to the Lafayette Club of
York along with reasonable club expenses incurred during the
conduct of Bank or Corporation business.
6. POSITIONS. The Executive agrees to serve without
additional compensation as a director on the Board of Directors
of the Corporation or Bank and, if elected or appointed thereto,
in one or more offices of the Corporation or Bank, and/or in one
or more offices or as a director of any of the Corporation's
and/or Bank's subsidiaries.
7. LIABILITY INSURANCE. The Bank shall use its best
efforts to obtain insurance coverage for the Executive under an
insurance policy covering officers and directors of the Bank
against lawsuits, arbitrations or other legal or regulatory
proceedings; however, nothing herein shall be construed to
require the Bank to obtain such insurance, if the Board of
Directors of the Bank determine that such coverage cannot be
obtained at a reasonable price.
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8. UNAUTHORIZED DISCLOSURE. During the term of his
employment hereunder, or at any later time, the Executive shall
not, without the written consent of the Board of Directors of the
Corporation or Bank or a person authorized thereby, knowingly
disclose to any person, other than an employee of the 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 the Corporation or Bank, any
material confidential information obtained by him while in the
employ of the Corporation or Bank with respect to any of the
Corporation or 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 materially damaging to the Corporation or 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 or a business similar to
that conducted by the Corporation or Bank or any information that
must be disclosed as required by law.
9. RESTRICTIVE COVENANT. The Executive covenants and
agrees that the Executive shall not directly or indirectly,
within the marketing area of the Bank (defined as an area within
fifty (50) miles of the registered office of the Bank), enter
into or engage generally in direct or indirect competition with
the Corporation or
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Bank or any subsidiary of the Corporation, either as an
individual on his own or as a partner or joint venturer, or as a
director, officer, shareholder, employee, agent, independent
contractor, lessor or creditor of or for any person, for a period
of one year after the date of termination of his employment if
the Executive's employment is terminated for any reason
whatsoever except upon resignation by the Executive for "Good
Reason" under paragraph 10(d) hereof (except that change of
control shall not constitute Good Reason for this paragraph).
The foregoing restriction shall not be construed to prohibit the
ownership by Executive of not more than five percent (5%) of any
class of securities of any corporation which is in competition
with the Bank or Corporation, provided that such ownership
represents a passive investment and that neither Executive nor
any group of persons including Executive in any way, either
directly or indirectly, manages or exercises control of any such
corporation, guarantees any of its financial obligations,
otherwise takes any part in its business, other than exercising
his rights as a shareholder, or seek to do any of the foregoing.
The existence of any claim or cause of action of the Executive
against the Corporation or Bank, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the
enforcement by the Corporation or Bank of this covenant. The
Executive agrees that any breach of the restrictions set forth in
paragraphs 8 and 9 will result in irreparable injury to the
Corporation or Bank for which it shall have no adequate remedy at
law and the Corporation or Bank shall be entitled to injunctive
relief in order to enforce the provisions hereof. In the event
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that this paragraph shall be determined by any court of competent
jurisdiction to be unenforceable in part by reason of it being
too great a period of time or covering too great a geographical
area, it shall be in full force and effect as to that period of
time or geographical area determined to be reasonable by the
court.
10. TERMINATION.
(a) The Executive's employment hereunder shall terminate
upon his death.
(b) If the Executive becomes disabled because of
sickness, physical or mental disability, or any other reason, the
Corporation or Bank shall have the option to terminate this
Agreement by giving written notice of termination to the
Executive. Executive shall be deemed to have become "disabled"
only in the event and at such time as he qualifies (after
expiration of any applicable waiting period) to receive benefits
for total disability under the employee disability insurance
benefit plan referred to in paragraph 5(a) above.
(c) The Corporation or Bank may terminate the
Executive's employment hereunder for Cause. For the purposes of
this Agreement, the Corporation or Bank shall have "Cause" to
terminate the Executive's employment hereunder upon (1) the
willful failure by the Executive to substantially perform his
duties hereunder, or (2) the willful engaging by the Executive in
misconduct injurious to the Corporation or Bank, or (3) the
willful violation by the Executive of the provisions of
paragraphs 3 or 8 hereof after notice from the Bank and a failure
to cure such
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violation within thirty (30) days of said notice, or if said
violation cannot be cured within thirty (30) days, within a
reasonable time thereafter if the Executive is diligently
attempting to cure the violation, or (4) the dishonesty or gross
negligence of the Executive in the performance of his duties or
(5) the breach of Executive's fiduciary duty involving personal
profit, or (6) the violation of any law, rule or regulation
governing banks or bank officers or any final cease and desist
order issued by a bank regulatory authority any of which
materially jeopardizes the business of the Corporation or Bank,
or (7) moral turpitude or other conduct on the part of Executive
which brings public discredit to the Corporation or Bank or (8)
the Executive's failure to be elected and serve as a member of
the Board of Directors of the Corporation.
(d) The Executive may terminate his employment hereunder
if (1) his health should become impaired to an extent that it
makes continued performance of his duties hereunder hazardous to
his physical or mental health or his life, or (2) for Good
Reason. The term "Good Reason: shall mean (i) any assignment to
the Executive, without his consent, of any duties other than
those contemplated by, or any limitation of the powers of the
Executive not contemplated by, paragraphs 2 and 6 hereof, or (ii)
any removal of the Executive from (other than as a result of his
regulatory removal or failure to be re-elected on the Corporation
and Bank's Boards of Directors) any of the positions indicated in
paragraph 2 hereof, except in connection with termination of the
Executive's
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employment for Cause, or (iii) failure of the Bank to comply with
paragraph 5 hereof, or (iv) any Change of Control (as defined
herein); all after notice from the Executive to the Corporation
and Bank that such action or limitation of the Bank or
Corporation constitutes Good Reason and the failure to cure such
situation within thirty (30) days of said notice, or if said
situation cannot be cured within thirty (30) days, within a
reasonable time thereafter if a diligent effort is being made to
cure such situation.
11. PAYMENTS UPON TERMINATION.
(a) If the Executive's employment shall be terminated
because of death, disability or for Cause, the Bank shall pay the
Executive or his fiduciary his full Annual Direct Salary through
the date of termination at the rate in effect at the time of
termination and the Corporation and Bank shall have no further
obligation to the Executive under this Agreement.
(b) If the Executive's employment is terminated by the
Corporation or Bank (other than pursuant to paragraphs 10(a) or
10(b) or 10(c) hereof), then the Bank shall pay the Executive his
full Annual Direct Salary from the date of termination through
the last day of the term of this Agreement or an amount equal to
his
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current Annual Direct Salary, whichever is greater. If the
Executive shall terminate his employment for Good Reason, other
than a Change of Control as defined herein, then the Bank shall
pay the Executive an amount equal to his Annual Direct Salary.
If the Executive shall terminate his employment for Good Reason,
as defined in paragraph 10(d)(iv), constituting a Change of
Control, then the Bank shall pay the Executive his full Annual
Direct Salary from the Date of Change of Control as defined in
paragraph 14 through the last day of the term of this Agreement
or an amount equal to his current Annual Direct Salary, whichever
is greater. The Bank shall also maintain in full force and
effect, for the continued benefit of the Executive for an
equivalent period, all employee benefit plans and programs to
which the Executive was entitled prior to the date of
termination, except those under paragraphs 5(b) (but not
including accrued vacation days), (c), (d), and (e), if the
Executive's continued participation is possible under the general
terms and provisions of such plans and programs except that if
the Executive's participation in any health, medical, life
insurance, or disability plan or program is barred, the Bank
shall obtain and pay for, on the Executive's behalf, individual
insurance plans, policies or programs which provide to the
Executive health, medical, life and disability insurance coverage
which is substantially equivalent to the insurance coverage to
which the Executive was entitled prior to the date of termination
and the Corporation and Bank shall have no further obligations to
the Executive under this Agreement.
(c) In the event the Executive serves the full term of
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this Agreement, and the Bank or Corporation do not offer to renew
this Agreement, the Executive shall not be entitled to any
severance allowance whatsoever and the Corporation and Bank shall
have no further obligations to the Executive under this
Agreement.
12. DAMAGES FOR BREACH OF CONTRACT. In the event of a
breach of this Agreement by either the Corporation, Bank or the
Executive resulting in damages to another party to this
Agreement, that party may recover from the party breaching the
Agreement only those damages as set forth herein. In no event
shall any party be entitled to the recovery of attorney's fees or
costs.
13. DEFINITION OF CHANGE OF CONTROL. For purposes of this
Agreement, the term "Change of Control" shall mean: A change in
control of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A and any
successor rule or regulation promulgated under the Securities
Exchange Act of 0000 (xxx "Xxxxxxxx Xxx"); provided that, without
limitation, such a change in control shall be deemed to have
occurred if (a) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act), other than the Corporation
or any "person" who on the date hereof is a director or officer
of the Corporation is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing
twenty-five percent (25%) or more of the combined voting power of
the Corporation's then outstanding securities, or (b) during any
period of two consecutive years during the term of this
Agreement, individuals who at the beginning of such period
constitute the Board of
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Directors of the Bank or Corporation 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 (c) the sale or
transfer of all or substantially all of the Bank or Corporation's
assets.
14. DEFINITION OF DATE OF CHANGE OF CONTROL. For purposes
of this Agreement, the date of Change of Control shall mean:
(a) the first date on which a single person and/or
entity, or group of affiliated persons and/or entities, acquire
the beneficial ownership of twenty-five percent (25%) or more of
the Corporation's voting securities, or
(b) the date of the transfer of all or substantially all
of the Bank or Corporation's assets, or
(c) the date on which a merger, consolidation or
combination is consummated, as applicable, or
(d) the date on which individuals who formerly
constituted a majority of the Board of Directors of the Bank or
Corporation under paragraph 13(b) above, ceased to be a majority.
15. NOTICE. For the purposes of this Agreement, notices
and all other communications provided for in the Agreement shall
be in writing and shall be deemed to have been duly given when
hand-delivered or mailed by United States certified mail, return
receipt requested, postage prepaid, addressed as follows:
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If to the Executive: Xxxxx X. Xxxxxx
000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
If to the Bank: Chairman of the Board
Peoples Bank of Xxxx Rock
Xxx Xxxxxxxxxx Xxxxxx
Xxx 00
Xxxx Xxxx, Xxxxxxxxxxxx 00000
If to the Corporation: Chairman of the Board
Codorus Valley Bancorp, Inc.
Xxx Xxxxxxxxxx Xxxxxx
Xxx 00
Xxxx Xxxx, Xxxxxxxxxxxx 00000
or to such other address as any party may have furnished to the
other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
16. SUCCESSORS. This Agreement shall inure to the benefit
of and be binding upon the Executive, the Corporation and the
Bank and any of their successors or assigns, provided however,
that the Executive may not commute, anticipate, encumber, dispose
or assign any payment except as set forth in paragraph 19.
17. SEVERABILITY. If any provision of this Agreement is
declared unenforceable for any reason, the remaining provisions
of this Agreement shall be unaffected thereby and shall remain in
full force and effect.
18. AMENDMENT. This Agreement may be amended or cancelled
only by mutual agreement of the parties in writing.
19. PAYMENT OF MONEY DUE DECEASED EXECUTIVE. In the event
of Executive's death, any moneys that may be due him from the
Bank under this Agreement as of the date of death shall be paid
to the person designated by him in writing for this purpose, or
in the absence of any such designation to his estate.
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20. LAW GOVERNING. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of
Pennsylvania.
21. 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
Corporation and Bank, and this Agreement contains all the
covenants and agreements between the parties with respect to the
employment.
IN WITNESS WHEREOF, the parties hereto, intending to be
legally bound hereby, have caused this Agreement to be duly
executed in their respective names and, in the case of the
Corporation and Bank, by its authorized representatives the day
and year above mentioned.
ATTEST: PEOPLES BANK OF XXXX ROCK
/s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxxx
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Secretary Xxxxxxx X. Xxxxxxx
Chairman of the Board
ATTEST: CODORUS VALLEY BANCORP, INC.
/s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
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Secretary Xxxxxxx X. Xxxxxxx
Chairman of the Board
WITNESS:
/s/ Xxxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
