EXHIBIT 10.2
FORM OF
NONSOLICITATION AGREEMENT
This Nonsolicitation Agreement (the "AGREEMENT") is made and entered into
as of ____________, 2003, by and between Boston Private Financial Holdings,
Inc., a Massachusetts corporation (the "COMPANY") and [_____________] (the
"EXECUTIVE").
WITNESSETH:
WHEREAS, the Company and First State Bancorp ("FIRST STATE") have entered
into an Agreement and Plan of Merger dated as of July__, 2003, as such agreement
may be subsequently amended or modified (the "MERGER AGREEMENT") pursuant to
which a wholly-owned subsidiary of the Company will merge with and into First
State (the "MERGER");
WHEREAS, immediately prior to the Closing of the Merger, the Executive was
the record and beneficial owner of that number of shares of common stock, no par
value, of First State (the "SHARES") as set forth on EXHIBIT A attached hereto;
WHEREAS, as a material inducement to and a condition precedent of the
Company's obligations to consummate the Merger, the Executive is executing and
delivering this Agreement concurrently with such Merger;
NOW, THEREFORE, in consideration of the mutual covenants set forth herein
and other good valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, parties hereto agree as follows:
1. AGREEMENT CONSIDERATION
In consideration for the execution of this Agreement and the Executive's
performance of the covenants contained herein, the Company agrees to pay the
Executive the Merger Consideration (as such term is defined in the Merger
Agreement) for the Shares upon the consummation of the Merger [and to enter into
the covenants set forth herein]. It is understood and agreed that the execution
and delivery of this Agreement by the Executive is a material inducement to and
a condition precedent to the Company's obligations to consummate the Merger
pursuant to the Merger Agreement.
2. NONSOLICITATION
The Executive agrees, for the benefit of the Company, that for a period of
two (2) years following the termination for any reason by either First State or
the Executive of the Executive's employment with First State and its affiliates,
including after the Merger the Company and its subsidiaries, the Executive shall
not, without the express written consent of First State and the Company, take
any of the following actions
(i) solicit or induce, whether directly or indirectly, any person for the
purpose (which need not be the sole or primary purpose) of (A) causing any
customer to terminate their
relationship with First State, or (B) causing any customer not to engage First
State or any of its affiliates to provide services; or
(ii) solicit or induce, or attempt to solicit or induce, directly or
indirectly, any employee or agent of, or consultant to, First State or any of
its affiliates to terminate its, his or her relationship therewith, or hire any
such employee, agent or consultant, or former employee, agent or consultant who
was employed by or acted as an agent or consultant to First State or its
affiliates at any time during the two (2) year period preceding the termination
of the Executive's employment (excluding for all purposes of this sentence,
secretaries and persons holding other similar positions).
The Executive and the Company agree that the periods of time applicable to
the foregoing covenants are reasonable, in view of the consideration to be
received, directly or indirectly, by the Executive under the Merger Agreement,
the Executive's receipt of the payments specified in Section 1 above, the
Executive's knowledge of the business of First State and its affiliates and the
Executive's relationships with the clients of First State and its affiliates.
However, if such period or such area should be adjudged unreasonable in any
judicial proceeding, then the period of time shall be reduced by such number of
months or such area shall be reduced by elimination of such portion of such
area, or both, as are deemed unreasonable, so that this covenant may be enforced
in such maximum area and during such maximum period of time as are adjudged to
be reasonable.
3. CONFIDENTIALITY
Except as required by law or regulation (including without limitation in
connection with any judicial or administrative process or proceeding), the
Executive shall keep secret and confidential and shall not disclose to any third
party (other than the Company or its subsidiaries) in any fashion or for any
purpose whatsoever any information regarding the Company, First State or any of
their respective subsidiaries, which is not available to the general public to
which he or she had access at any time during the course of his or her
employment by First State or its subsidiaries, including without limitation, any
such information relating to: business or operations, plans, strategies,
prospects or objectives; products, technology, processes or specifications;
research and development, operations or plans; customers and customer lists;
distribution, sales, service, support and marketing practices and operations;
financial condition, results of operations and prospects; operational strengths
and weaknesses; and personnel and compensation policies and procedures.
4. [[FOR X. XXXXXX AGREEMENT] SALARY CONTINUATION
In the event that the Executive's employment with First State, or after the
Merger the Company, is terminated without Cause (as defined below) during the
three (3) year period immediately following the Effective Time (as defined in
the Merger Agreement) of the Merger, the Company shall continue the Executive's
salary at the rate then in effect, payable in equal monthly installments in
accordance with the schedule in which salaries are paid to executives, for a
period of one (1) year following the date of such termination.
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The amounts payable to the Executive pursuant to this Section 4 following
the termination of his employment shall be in full and complete satisfaction of
the Executive's rights under this Agreement and any other claims he may have in
respect of his employment by First State, the Company or any of their
affiliates. Such amounts shall constitute liquidated damages with respect to any
and all such rights and claims and, upon the Executive's receipt of such
amounts, First State, the Company and their affiliates shall be released and
discharged from any and all liability to Executive in connection with this
Agreement or otherwise in connection with the Executive's employment with First
State, the Company or any of their affiliates.
This Agreement is not to be construed or interpreted as containing any
guarantee of continued employment by First State, the Company or any of their
affiliates. The employment relationship at First State, the Company or any of
their affiliates is by mutual consent an employment at will. This means that
First State, the Company or any of their affiliates has the right to discontinue
the Executive's employment with or without Cause at any time.
For purposes of this Section 4, the term "Cause" shall have the following
meaning:
(i) the Executive has been indicted or otherwise formerly charged with
engaging in (A) any criminal offense which is classified as a felony (or its
equivalent under the laws or regulations of any country or political subdivision
thereof), or (B) any other criminal offense which involves a violation of
federal or state banking laws or regulations (or equivalent laws or regulations
of any country or political subdivision thereof), embezzlement, fraud, wrongful
taking or misappropriation of property, theft or any other crime involving
dishonesty;
(ii) persistent and willful failure to perform to the reasonable
satisfaction of First State, or after the Merger the Company, or in a manner
consistent with the Executive's past performance a substantial portion of the
Executive's duties and responsibilities assigned or delegated to him by the
board of directors of First State, or after the Merger the Company, which
failure continues, in the reasonable judgment of First State or the Company,
after written notice is given to the Executive by First State or the Company; or
(iii) gross negligence, willful misconduct or insubordination of the
Executive to the material detriment of First State, the Company or any affiliate
of First State or the Company.]
5. INJUNCTIVE RELIEF; REMEDIES
The Executive agrees that damages at law will be an insufficient remedy to
the Company in the event that the Executive violates any of the provisions of
Sections 2 or 3, and that the Company may apply for and, upon the requisite
showing, have injunctive relief in any court of competent jurisdiction to
restrain the breach of threatened or attempted breach of or otherwise to
specifically enforce any of the covenants contained in Section 2 or 3. The
Executive also agrees that such remedies shall be in addition to any and all
remedies, including damages, available to the Company against the Executive for
such breaches or threatened or attempted breaches.
6. NO DISPARAGEMENT.
The Executive agrees that he or she shall not, directly or indirectly, make
any statement (whether orally, in writing or through any other media), or take
any other action, if such
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statement, or action is intended or could reasonably be expected to disparage
the Company, First State or any of their affiliates or to adversely affect the
reputation or business or credit standing of the Company, First State or any of
their affiliates.
7. REPRESENTATIONS AND WARRANTIES
The Company and the Executive represent and warrant to each other that they
have carefully read this Agreement and consulted with respect thereto with their
respective counsel and that each of them fully understands the content of this
Agreement and its legal effect. Each party hereto also represents and warrants
that this Agreement is a legal, valid and binding obligation of such party which
is enforceable against it in accordance with its terms.
8. SUCCESSORS AND ASSIGNS
This Agreement will inure to the benefit of and be binding upon the
Executive and his or her heirs, successors and assigns, and upon the Company,
including any successor to the Company by merger or consolidation or any other
change in form or any other person or firm or corporation to which all or
substantially all of the assets and business of the Company may be sold or
otherwise transferred. This Agreement may not be assigned by any party hereto
without the consent of the other party.
9. NOTICES
All notices and other communications hereunder shall be in writing and
shall be deemed given if delivered personally, telecopied (with confirmation),
or delivered by an express courier (with confirmation) to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
if to the Company, to:
Boston Private Financial Holdings, Inc.
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, President
and Chief Financial Officer
with copies to:
Xxxxxxx Procter LLP
Exchange Place
Boston, MA 02109-2881
Attn: Xxxxxxx X. Xxxxx, Esq.
Xxxxxx X. Xxxxx, P.C.
Facsimile: (000) 000-0000
and
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if to the Executive, to
_______________________________________
_______________________________________
_______________________________________
with a copy to:
_______________________________________
_______________________________________
_______________________________________
Any notice given hereunder may be given on behalf of any party by his or her
counsel or other authorized representatives.
10. WITHHOLDING
The Company may withhold from any amounts payable under this Agreement such
Federal, state, local or foreign taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
11. ENTIRE AGREEMENT; SEVERABILITY
(a) This Agreement incorporates the entire understanding between the
parties relating to the subject matter hereof, recites the sole consideration
for the promises exchanged and supersedes any and all prior agreements, both
written and oral, between the Company and the Executive or the First State and
the Executive, in either case with respect to the subject hereof. In reaching
this Agreement, no party has relied upon any representation or promise except
those set forth herein.
(b) Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms and provisions of
this Agreement in any other jurisdiction. If any provision of this Agreement is
so broad as to be unenforceable, the provision shall be interpreted to be only
so broad as is enforceable. In all such cases, the parties shall use their
reasonable best efforts to substitute a valid, legal and enforceable provision
which, insofar as practicable, implements the original purposes and intents of
this Agreement.
12. WAIVER
Failure to insist upon strict compliance with any of the terms, covenants
or conditions hereof shall not be deemed a waiver of such term, covenant or
condition. A waiver of any provision of this Agreement must be made in writing,
designated as a waiver and signed by the party against whom its enforcement is
sought. Any waiver or relinquishment of any right or power hereunder at any one
or more times shall not be deemed a waiver or relinquishment of such right or
power at any other time or times.
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13. COUNTERPARTS
This Agreement may be executed in counterparts, all of which shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each of the parties and delivered to the other
parties, it being understood that all parties need not sign the same
counterpart.
14. GOVERNING LAW
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of California applicable to agreements
made and entirely to be performed within the jurisdiction.
15. HEADINGS
The headings of sections in this Agreement are for convenience of reference
only and are not intended to qualify the meaning of any section. Any reference
to a section number shall refer to a section of this Agreement, unless otherwise
stated.
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IN WITNESS WHEREOF, the Company and the Executive have caused this
Agreement to be executed as of the date first above written.
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
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By:
Title:
EXECUTIVE:
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EXHIBIT A
