EXHIBIT 10.4
BANK
EMPLOYMENT AGREEMENT
This agreement made and entered into this 10 day of _March ____ 2004,
between the Mountain Valley Community Bank, Cleveland, White County, Georgia
("the Bank") and Xxxxxx X. Xxxxxxx, ("employee");
WHEREAS, the Bank will be a state bank, regulated by the Georgia
Department of Banking and Finance, insured by the Federal Deposit Insurance
Corporation, and located in Cleveland, Georgia; and
WHEREAS, the Bank wants to employ the employee as Executive Vice
President/ Sr. Credit Officer of the Bank; and
WHEREAS, the parties desire to enter into this agreement setting forth the
terms and conditions of the employment relationship of the Bank and the
employee;
NOW, THEREFORE, it is AGREED as follows:
I. RELATIONSHIP ESTABLISHED AND DUTIES
1. The Bank hereby will employ the employee as Executive Vice
President/ Sr. Credit Officer, and to perform such services
and duties as the Board of Directors & Bank Management may,
from time to time, designate during the term hereof. Subject
to the terms and conditions hereof, employee will perform such
duties and exercise such authority as are customarily
performed and exercised by persons holding such office,
subject to the general direction of the President & CEO and or
the Board of Directors of the Bank, exercised in good faith in
accordance with standards of reasonable business judgment.
2. Employee shall serve on the Board of Directors of the Bank,
and shall be entitled to Directors' Fees just like any other
director, and shall serve as a member of its Executive
Committee, subject to the terms hereof.
3. Employee accepts such employment and shall devote his full
time, attention, and efforts to the diligent performance of
his duties herein specified and as an officer and director of
the Bank and will not accept employment with any other
individual, corporation, partnership, governmental authority,
or any other entity, or engage in any other venture for profit
which the Bank may consider to be in conflict with his or its
best interest or to be in competition with the Bank's
business, or which may interfere in any way with the
Employment Agreement Between Xxxx Xxxxx & MVCB, LLP, Cleveland, GA............ 1
employee's performance of his duties hereunder. Any exception to
this must be made by notification and approval of the Board.
II. TERMS OF EMPLOYMENT
1. The initial term of employment under this Agreement shall continue
for 5 (five) years unless such is terminated pursuant to the terms
hereof or by the first to occur of the conditions to be stated
hereinafter. This Agreement will be automatically extended each year
after the initial term unless either party gives 90 days contrary
written notice to the other. The term previously stated
notwithstanding this contract shall be terminated by the earlier to
occur of any of the following:
a. The death of the employee;
b. The complete disability of employee. "Complete disability" as
used herein shall mean the inability of employee, due to
illness, accident, or other physical or mental incapacity to
perform the services provided for hereunder for an aggregate
of sixty days within any period of 120 consecutive days during
the term hereof; provided, however, disability shall not
constitute a basis for discharge for cause;
c. The discharge of employee by the Bank for cause. "Cause" as
used herein shall mean:
1) Such negligence or misconduct as shall constitute, as a
matter of law, a breach of the covenants and obligations
of employee hereunder;
2) Failure or refusal of employee to comply with the
provisions of this agreement;
3) Employee being convicted by any duly constituted court
with competent jurisdiction of a crime involving moral
turpitude;
4) At the discretion of the Board, this contract may be
terminated if there are acts the Board feels are moral
turpitude;
d. If employee is dismissed or discharged without "cause" as
defined above, the terminated employee shall receive an amount
equal to 1 (one) times his then existing annual base salary.
Employment Agreement Between Xxxx Xxxxx & MVCB, LLP, Cleveland, GA............ 2
Termination of employee's employment shall constitute a tender by employee
of his resignation as an officer and director of the Bank. In the event of
termination the employee is entitled to severance pay equal to one month's pay
for each year employed by the Bank.
III. COMPENSATION
For all services which employee may render to the Bank during the term
hereof, the Bank shall pay to employee, subject to such deductions as may be
required by law:
1. BASE SALARY. An annual salary of $130,000 payable in bi-monthly
installments and subject to such deductions as may be required by
law, for the next 12 months. Thereafter, annual increase reviews
will be done during the month of December for a January 1 effective
increase date during the term of this Agreement so that for the 12
months beginning on each such anniversary date, the employee's
salary increases will take effect.
2. PERFORMANCE BONUSES.
a. Until the Stock Appreciation Rights Incentive (SAR) program
is implemented, the Board, in consultation with the CEO, will
determine the amount of performance bonus to be awarded to the
executive officers.
b. When the Board, in consultation with the CEO, determines
that it is time for the SAR program to be implemented it will
operate in the following way:
Each year, a performance bonus, will be awarded,
based upon mutually agreed upon goals such as
achievement of the goals in the Strategic Plan
achieved before the application of taxes based
upon the following formula: 50% of the Impact
Pool allocation as identified in the Bank's
Stock Appreciation Rights Incentive Program
("SAR").
3. STOCK OPTIONS. Based on his satisfactory performance the Employee,
as determined by the Board using mutually agreed upon safety and
soundness criteria as well as capital adequacy, asset quality,
profitability, and liquidity, shall have the right and option to
purchase an additional number of shares of
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common stock of the Bank:
4% of the total capital of the bank over the term of this
Agreement not to exceed 10 years.
The option granted to the Employee pursuant to this paragraph 3 may
be exercised by the Employee, in whole or in part, at any time or
from time to time during the period this Agreement is in effect.
Notwithstanding anything contained herein to the contrary, if the
shareholders of the Bank approve of a capital reorganization of the
common stock of the Bank or a merger or consolidation of the Bank
with or into another corporation, or the sale of all or
substantially all of the assets of the Bank; then Employee shall
have the right and option to purchase stock options up to 4% of
total capital of the Bank at book value immediately upon
consummation of any merger or sale as stated above. The purchase
price for each share of common stock of the Bank that the Employee
purchases pursuant to the exercise of the options granted herein
shall be $10.00 per share and shall be paid in cash upon exercise.
IV. OTHER BENEFITS
1. The employee shall be entitled to participate in any plan of the
Bank relating to stock options, stock purchases, profit sharing,
group life insurance, medical coverage, education, or other
retirement or employee benefits that the Bank may adopt for the
benefit of its employees. The employee shall be entitled to a
comprehensive annual physical paid by the bank.
2. The employee shall be eligible to participate in any other benefits
which may be or become applicable to the Bank's executive employees,
shall be furnished a car with all expenses of maintenance to cover
all automobile use, a reasonable expense account, the payment of
reasonable expenses for attending annual and periodic meetings of
trade associations, and any other benefits which are commensurate
with the responsibilities and functions to be performed by the
employee under this Agreement.
3. At such reasonable times as the President & CEO or the Board of
Directors shall in its discretion permit, the employee shall be
entitled, without loss of pay, to absent himself voluntarily from
the performance of his employment under this Agreement, all such
voluntary absences to count as vacation time,
Employment Agreement Between Xxxx Xxxxx & MVCB, LLP, Cleveland, GA............ 4
provided that:
a. The employee shall be entitled to an annual vacation of 4
(four) weeks per year.
b. The timing of vacations shall be scheduled in a reasonable
manner by the employee. The employee shall not be entitled to
receive any additional compensation from the Bank on account
of his failure to take a vacation; nor shall he be entitled to
accumulate unused vacation time from one calendar year to the
next.
c. In addition to the aforesaid paid vacations, the employee
shall be entitled, without loss of pay to absent himself
voluntarily from the performance of his employment with the
Bank for such additional periods of time and for such valid
and legitimate reasons as the Board of Directors in its
discretion may determine. Further, the Board of Directors
shall be entitled to grant to the employee a leave or leaves
of absence with or without pay at such time or times and upon
such terms and conditions as the Board, in its discretion, may
determine.
V. CHANGE OF CONTROL
1. If during the term of this Agreement there is a change of control
(COC) of the Bank, the Employee shall be entitled to termination or
severance pay in the event the employee's employment is terminated,
except for just cause as defined in Section II., paragraph 1, c,
after the change in control. In the event the employee is terminated
as a result of COC, the employee shall be entitled to receive his
salary through the last day of the calendar month of the
termination, or payment in lieu of the notice period. In addition,
the terminated employee shall receive an amount equal to 3 (three)
times his then existing annual base salary. This payment shall also
be made in connection with, a change in control of the Bank if such
change in control was opposed by the employee or the Bank's Board of
Directors. This payment shall be in addition to any amount otherwise
owed to the employee pursuant to this Agreement.
2. The following items are automatically considered due and payable in
the event that change of control occurs:
a. Non-forfeitable deferred compensation shall be paid out in
full.
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b. Long-term performance plan objective payments as described in
Section III, 2, shall be declared accomplished and earned
based upon performance up to date of the COC.
c. In the event that the employee is a participant in a
restricted stock plan, or share option plan, and such plan is
terminated involuntarily as a result of the COC, all stock and
options shall be declared 100% vested, and distributed. The
term "control" shall refer to the acquisition of 25 percent or
more of the voting securities of the Bank by any person, or
persons acting as a group within the meaning of Section 13(d)
of the Securities Exchange Act of 1934, or to such acquisition
of a percentage between 10 percent and 25 percent if the Board
of Directors of the Bank or the Comptroller of the Currency,
the FDIC, or the Federal Reserve Bank have made a
determination that such acquisition constitutes or will
constitute control of the Bank. The term "person" refers to an
individual, corporation, Bank, bank holding company, or other
entity.
VI. POST TERMINATION COVENANTS
1. If during the term hereof employee shall cease employment hereunder
for any reason, then employee agrees that for six months if
dismissed for cause and one year without cause following such
termination he will not be employed in the banking business or any
related field thereto in Cleveland, Georgia or White County,
Georgia. In consideration for this non-compete clause the Board
agrees to pay the employee at a rate of the current annual salary
annually. This compensation will be for the length of the
non-compete and will not exceed one year. Furthermore, following
such termination employee agrees that he will not, without the prior
written consent of the Bank:
1) Furnish anyone with the name of, or any list or lists of
customers of the Bank or utilize such list or information
himself for banking purposes; or
2) Furnish, use, or divulge to anyone any information acquired by
him from the Bank relating to the Bank's methods of doing
business; or
3) Contact directly or indirectly any customer of the Bank for
banking solicitation purposes; or
4) Hire for any other Bank or employer (including himself) any
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employee of the Bank or directly or indirectly cause such
employee to leave his or her employment to work for another.
2. It is understood and agreed by the parties hereto that the
provisions of this section are independent of each other, and the
invalidity of any such provision or portion thereof shall not affect
the validity or enforceability of any other provisions of this
agreement.
VII. WAIVER OF PROVISIONS
Failure of any of the parties to insist, in one or more instances, on
performance by the others in strict accordance with the terms and conditions of
this agreement shall not be deemed a waiver or relinquishment of any right
granted hereunder of the future performance of any such term or condition or of
any other term or condition of this agreement, unless such waiver is contained
in a writing signed by or on behalf of all the parties.
VIII. GOVERNING LAW
This agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Georgia. If for any reason any
provision of this agreement shall be held by a court of competent jurisdiction
to void or unenforceable, the same shall not affect the remaining provisions
thereof.
IX. MODIFICATION AND AMENDMENT
This agreement contains the sole and entire agreement among the parties
hereto and supersedes all prior discussions and agreements among the parties,
and any such prior agreements shall, from and after the date hereof, be null and
void. This agreement shall not be modified or amended except by an instrument in
writing signed by or on behalf of the parties hereto.
X. COUNTERPARTS AND HEADINGS
This agreement may be executed simultaneously in any number of
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument. The headings set out herein are for
convenience of reference and shall not be deemed a part of this agreement.
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XI. CONTRACT NONASSIGNABLE
This agreement may not be assigned or transferred by any party hereto, in
whole or in part, without the prior written consent of the other.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the year and date first above written.
Employee:
/s/ Xxxxxx X. Xxxxxxx
_____________________ _____________________________________ ________
Witness EMPLOYEE Date
BANK
/s/
_____________________ By:_________________________________ ________
Witness Chairman of the Board Date
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