Exhibit 10(b)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") made in duplicate originals
and effective this 1st day of April, 1999, is between POTOMAC VALLEY BANK, INC.,
a West Virginia corporation, ("Company") and XXXXXXX X. XXXX, ("Employee").
WHEREAS, the Company offers the terms and conditions of employment
hereinafter set forth and the Employee has indicated his willingness to accept
such terms and conditions in consideration of his employment with the Company.
NOW, THEREFORE, in consideration of the mutual promises and covenants made
in this Agreement, the parties agree as follows:
1. Employment. The Company hereby employs Employee and Employee hereby
accepts employment with the Company as President, Chief Executive Officer and
member of the Board of Directors of the Company upon the terms and conditions
set forth herein.
2. Term. The term of this Agreement shall be for two (2) years and nine
(9) months, unless one of the parties terminates this Agreement as provided
herein. Upon expiration of the original term of this Agreement, the Board of
Directors of the Company shall review the Agreement at least annually, and may,
with the consent of the Employee, extend this term of employment for additional
one (1) year term(s), in which case such term shall end one (1) year from the
date on which it is last renewed.
3. Duties. Employee shall perform and have all of the duties and
responsibilities that may be assigned to him from time to time by the Board of
Directors of the Company. Employee shall devote his best efforts on a full-time
basis to the performance of such duties.
4. Compensation and Benefits. During the term of employment, the Company
agrees to pay Employee a base salary and to provide benefits as set forth in
Exhibit A, which is attached hereto and incorporated herein by reference.
5. Termination by the Company or Employee. The employment of Employee
with the Company may be terminated by any one of the following means, in which
case Employee shall be entitled to such compensation as is described below:
A. Mutual Agreement: The Employee's employment may be termination by
mutual agreement of the parties upon such terms and conditions as they may
agree.
B. For Cause.
(1) The Employee's employment may be terminated by the Company for
cause consisting of one or more of the reasons specified in
Paragraph 5(B)(2)(a)-(e) below; provided, however, that if the
cause of termination is for a reason specified in Paragraph
5(B)(2)(a) below, and if in the reasonable judgment of the Board
of Directors of the Company the damage incurred by the company as
a result of Employee's conduct constituting cause is damage of a
type that is capable of being substantially reversed and
corrected, the Company shall give Employee thirty (30) days
advance notice of the Company's intention to terminate his
employment for cause and a reasonable opportunity to cure the
cause of the possible termination to the satisfaction of the
Company.
(2) For purposes of this Agreement, the term "cause" shall be defined
as follows:
(a) Employee's repeated negligence, malfeasance or misfeasance
in the performance of Employee's duties that can reasonably
be expected to have an adverse impact upon the business and
affairs of the Company;
(b) Employee's commission of any act constituting theft,
intentional wrongdoing or fraud;
(c) The conviction of the Employee of a felony criminal offense
in either state or federal court;
(d) Any single act by Employee constituting gross negligence or
which causes material harm to the reputation, financial
condition or property of the Company; or
(e) The death of Employee during the term of this Agreement, in
which event the Company shall pay to the estate of the
Employee any compensation for services rendered but unpaid
prior to the Employee's date of death.
(3) The Board of Directors of the Company shall determine, in its
sole discretion, whether any acts and/or omissions on the part of
Employee constitute "cause" as defined above. Notwithstanding the
foregoing, Employee shall be entitled to arbitrate a finding of
the Board of Directors of "cause" in accordance with Paragraph 10
hereof.
(4) In the event that Company terminates Employee's employment for
cause as defined above, Employee shall be entitled to be paid his
regular salary and benefits up to the effective date of the
termination, but not any additional compensation.
C. Not for Cause. Employee's employment may be terminated by the Company
for any reason permitted under applicable law so long as Employee is
given thirty (30) days advance written notice (or payment in lieu
thereof). In the event of a termination pursuant to this subparagraph,
Employee shall be entitled to payment from the Company equivalent to
the base salary compensation set forth in this Agreement for the
remaining term of the Agreement or severance pay equal to twelve (12)
months of base salary payments, whichever is greater.
D. Employee Resignation. Employee recognizes and understands the vital
role he plays in the Company's operation, growth and development, and
therefore agrees not to resign from employment during the initial term
of this Agreement except in the event of his disability. If the
Employee resigns in violation of this commitment, Employee agrees to
comply with the restrictions set forth in Paragraph 6 below.
E. Change in Control. Exhibit B hereto sets forth the rights and
responsibilities of the parties in the event of a change in control,
as defined therein, and is incorporated herein by reference.
6. Noncompetition and Nonsolicitation. In consideration of the covenants
set forth herein, including but not limited to the severance pay set
forth in Paragraph 5(E) and Exhibit B, Employee agrees as follows:
A. For a period of three (3) years after Employee's employment with the
Company is terminated by Employee for any reason other than Employee's
disability, Employee shall not, directly or indirectly, engage in the
business of banking in the City of Petersburg or the counties of
Pendleton, Grant, Hardy, Mineral or Hampshire, West Virginia. For
purposes
of this Paragraph 6(A), being engaged in the business of banking shall
mean Employee's presence or work in a bank office in the specified
geographic area or Employee's solicitation of business from clients
with a primary or principle office in the specified geographic area.
B. During Employee's employment by the Company and for three (3) years
after Employee's employment with the Company is terminated by Employee
for any reason other than Employee's disability, Employee shall not,
on his own behalf or on behalf of any other person, corporation or
entity, either directly or indirectly, solicit, induce, recruit or
cause another person in the employ of the Company or its affiliates to
terminate his or her employment for the purpose of joining,
associating or becoming an employee with any business which is in
competition with any business or activity engaged in by the Company or
its affiliates.
C. Employee further recognizes and acknowledges that in the event of the
termination of Employee's employment with the Company for any reason
other than Employee's disability, (1) a breach of the obligations and
conditions set forth herein will irreparably harm and damage the
Company; (2) an award of money damages may not be adequate to remedy
such harm; and (3) considering Employee's relevant background,
education and experience, Employee believes that he will be able to
earn a livelihood without violating the foregoing restrictions.
Consequently, Employee agrees that, in the event that Employee
breaches any of the covenants set forth in this Paragraph 6, the
Company and/or its affiliates shall be entitled to both a preliminary
and permanent injunction in order to prevent the continuation of such
harm and to recover money damages insofar as they can be determined,
including, without limitation, all costs and attorneys' fees incurred
by the Company in enforcing the provisions of this Paragraph 6. Such
relief may be sought notwithstanding the arbitration provision set
forth in Paragraph 10 below.
7. Definition of Disability. For the purposes of the Agreement, the term
"disability" shall mean a physical or mental condition rendering Employee
substantially and permanently unable to perform the duties of an officer and
director of a banking organization.
8. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and sent by registered or certified
mail listed herein. In the case of Employee to the following address:
__________________________________________________________________________
__________________________________________. In the case of the Company to the
Chairman addressed to P. O. Xxx 0000, Xxxxxxxxxx, Xxxx Xxxxxxxx 00000. Any
notice sent pursuant to this paragraph shall be effective when deposited in the
mail.
9. Confidential Information. Employee shall not, during the term of this
Agreement or at any time thereafter, directly or indirectly, publish or disclose
to any person or entity any confidential information concerning the assets,
business or affairs of the Company, including but not limited to any trade
secrets, financial data, employee or customer/client information or
organizational structure.
10. Arbitration. Any dispute between the parties arising out of or with
respect to this Agreement or any of its provisions or Employee's employment with
the Company shall be resolved by the sole and exclusive remedy of binding
arbitration. Arbitration shall be conducted in Petersburg, West Virginia, or
such other place as might be mutually agreed between the parties, in accordance
with the rules of the American Arbitration Association ("AAA"). The parties
agree to select one arbitrator from an AAA employment panel. The arbitration
shall be conducted in accordance with the West Virginia Rules of Evidence and
all discovery issues shall be decided by the arbitrator. The arbitrator shall
supply a written opinion and analysis of the matter submitted for arbitration
along with the decision. The arbitration decision shall be final and subject to
enforcement in the local circuit court.
11. Entire Agreement. This Agreement constitutes the entire Agreement
between the parties and shall supersede all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof, and may not be changed or amended except by an instrument in writing to
be executed by each of the parties hereto.
12. Severability. If any provision hereof, or any portion of any provision
hereof, is held to be invalid, illegal or unenforceable, all other provisions
shall remain in force and effect as if such invalid, illegal or unenforceable
provision or portion thereof has not been included herein. If any provision or
portion of any provision of this Agreement is so broad as to be unenforceable,
such provision or a portion thereof shall be interpreted to be only so broad as
is enforceable.
13. Headings. The headings contained in this Agreement are included for
convenience or reference only and shall have no effect on the construction,
meaning or interpretation of this Agreement.
14. Governing Law. The laws of the State of West Virginia shall govern the
interpretation and enforcement of this Agreement.
15. Amendments. Any amendments to this Agreement must be in writing and
signed by all parties hereto except that extensions of the term of this
Agreement under Paragraph 2 above, may be evidenced by minutes of a meeting of
the Board of Directors.
16. Waiver of Breach. No requirement of this Agreement may be waived
except by a written document signed by the party adversely affected. A waiver of
a breach of any provision of the Agreement by any party shall not be construed
as a waiver of subsequent breaches of that provision.
17. Counterparts. This Agreement may be executed in counterparts, all of
which shall be considered one and the same Agreement and each of which shall be
deemed an original.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
its corporate name by its corporate officer thereunto duly authorized, and
Employee has hereunto set his hand and seal, as of the day and year first above
written:
POTOMAC VALLEY BANK, INC.
By: /s/ G. R. Ours
---------------------------
Its: Chairman
---------------------------
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
EXHIBIT A
COMPENSATION AND BENEFITS
A. Base Salary. Employees starting base salary shall be $100,000 per
calendar year. Commencing April 1, 1999, and through the remaining months of
1999, Employee shall receive $8,333.33 per month as a base salary. Employee
shall then be considered for salary increases on the basis of merit beginning
January 1, 2000, the second full year of his employment.
B. Bonus. In addition to the base salary provided for herein, Employee
shall be eligible for an incentive bonus subject to the goals and criteria
information and data attached hereto and made a part of this Exhibit A.
C. Vacation. Employee shall be entitled to all paid vacation and holidays
and other paid leave as provided by the Company to other employees; providing,
however, commencing the year 1999, Employee shall be entitled to paid vacation
of three weeks.
D. Fringe Benefits. The Company shall afford to Employee the benefit of
all fringe benefits afforded to all other Company officers, including but not
limited to retirement plans, life insurance, disability, health and accident
insurance benefits and any other fringe benefit plan now existing or hereinafter
adopted by the Company.
E. Business Expenses. The Company shall reimburse Employee for all
reasonable expenses incurred by Employee in carrying out his duties and
responsibilities, including, but not limited to, reimbursing civic club
organization dues, Valley View Golf Club membership dues and reasonable expenses
for customer entertainment.
F. Automobile. The Company shall provide Employee with the use of an
automobile for the Employee's business and personal use. The Company shall be
responsible for expenses associated with the vehicle including but not limited
to taxes, gasoline, licenses, maintenance, repair, insurance and reasonable
cellular phone charges. Employee shall be subject to tax for his personal use of
vehicle in accordance with the Internal Revenue Code and any applicable state
law. Upon approval of the Company, appropriate replacement vehicles may be
provided in the future.
G. Director's Fees. The Company shall pay Employee the same Director's
fees for attendance of Board meetings as are provided to other members of the
Board of Directors.
