EXHIBIT 10.45
AGREEMENT AND MUTUAL GENERAL RELEASE
This Agreement and Mutual General Release ("Agreement") is made and entered
into this 5th day of March, 1997, by and between Pan American Bank, FSB, a
federally chartered savings bank (the "Company"), and Xxxxxx Xxxxxx, an
individual ("Xxxxxx"), with reference to the following:
RECITALS
X. Xxxxxx has served as an executive officer of the Company, pursuant to
that certain Employment Agreement between Xxxxxx and the Company, dated May 1,
1994, including all schedules and exhibits thereto (collectively, the
"Employment Agreement");
X. Xxxxxx and the Company have determined that it is in their respective
mutual best interests: (i) to terminate the Employment Agreement, effective
March 1, 1997 (the "Effective Date"); (ii) for each party to release the other
and their respective directors, officers, employees, agents and assigns, as
applicable (collectively, "agents and assigns"), from and against all claims and
causes of action that either may have against the other or their respective
agents and assigns relating to Xxxxxx'x service to the Company and the Company's
obligations to Xxxxxx under the Employment Agreement; and (iii) to provide that
Xxxxxx will serve as a consultant for the Company for a period of twelve (12)
months from and after the Effective Date on the terms set forth in this
Agreement.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing recitals, which are
incorporated as an integral part of this Agreement, the mutual promises of the
parties and other good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
AGREEMENT
1. TERMINATION OF EMPLOYMENT AGREEMENT. The Employment Agreement shall
be terminated as of the Effective Date, and all obligations of any party
thereunder shall thereby be forever released and discharged. Upon termination
of the Employment Agreement, Xxxxxx shall be entitled to receive from the
Company the sum of $112,500, less any amounts required to be deducted by the
Company for federal and state taxes or other applicable requirements, which
payment shall be made in twenty-four (24) equal bimonthly installments
commencing March 15, 1997.
2. STOCK OPTIONS. The parties hereto expressly acknowledge and agree
that this Agreement constitutes a termination of Xxxxxx'x employment, but does
not terminate the outstanding options to purchase 200 shares of Pan American
Group, Inc. ("PAGI") common stock, at the price of $1,500 per share, which were
previously granted to Xxxxxx (the "Outstanding Options"). On the Effective
Date, pursuant to Section 3.3(cc) of the PAGI 1994 Stock Option Plan, the
Outstanding Options shall immediately vest and be amended to extend
the period thereof so that the Outstanding Options shall be exercisable for
three (3) years from and after the Effective Date. In addition, on the Effective
Date, Xxxxxx shall be granted nonqualified options to purchase 60 shares of
common stock of PAGI, at the price of $2,500 per share (the "Options"). The
Options shall immediately vest and shall be exercisable for three (3) years from
and after the Effective Date.
3. NEW CONSULTING TERMS. Beginning on the Effective Date and for a
period of twelve (12) months thereafter (the "Term"), the Company shall hire the
Xxxxxx as a consultant at a salary of $37,500 per annum, payable in twenty-four
(24) equal bimonthly installments commencing March 15, 1997, consistent with the
Company's general policies relating to the payment of consultants. As a
consultant, Xxxxxx shall make himself reasonably available to advise and assist
the Company regarding, among related matters, the Company's mortgage lending
programs and the Company's activities in the secondary mortgage market.
4. NO OTHER BENEFITS. After the Effective Date except as provided
herein, Xxxxxx shall not be considered as having employee status or be entitled
to participate in any plans, arrangements or distributions by Company pertaining
to or in connection with any pension, stock, bond or profit sharing plan or any
other fringe benefit for Company's regular employees, except that Xxxxxx will
have the rights to stock options set forth in Section 2 of this Agreement.
5. INDEPENDENT CONTRACTOR STATUS. Xxxxxx shall be retained by the
Company as a consultant only for the purposes and to the extent set forth in
this Agreement, and Xxxxxx'x relationship to the Company shall at all times
during the Term shall be that of an independent contractor. Xxxxxx and the
Company acknowledge and agree that, during the Term, Xxxxxx shall be free to
dispose of such portion of Xxxxxx'x time, energy and skill, in such manner as
Xxxxxx sees fit, and to such person, firm or entity as Xxxxxx xxxxx advisable
and that Xxxxxx may seek to organize an independent mortgage company, or
otherwise engage in business activities in addition to the duties to be
performed for the Company hereunder; provided, however, that in connection with
any such independent business activities, without the prior written consent of
the Company (i) Xxxxxx shall not employ or solicit for employment, directly or
indirectly, the services of any employee of the Company or its affiliates, and
(ii) Xxxxxx shall not use or disclose any nonpublic, confidential or proprietary
information of the Company or its affiliates in any manner whatsoever. Xxxxxx
acknowledges that confidential or proprietary information of the Company or its
affiliates is of substantial value to the Company's business and that disclosure
or misuse of same may violate certain laws and could result in serious injury to
the Company for which the remedy of damages would be inadequate, and that the
remedies for any such breach would properly include injunctive relief.
6. TAXES. Xxxxxx acknowledges that no federal or California withholding
taxes, FICA, SDI or other employee payroll taxes or deductions are made with
respect to compensation paid to Xxxxxx under the portion of this Agreement
relating to Xxxxxx'x service as a consultant. Xxxxxx is responsible for all such
taxes, and agrees to report for federal and California income and Franchise tax
purposes all such compensation, and to pay all taxes due thereon and to
indemnify, defend and hold the Company harmless in the event that any claim is
made against
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the Company, including but not limited to claims made by any taxing authority,
by reason of Xxxxxx'x failure to properly pay any and all taxes which are due in
relation to the services provided pursuant to this Agreement.
7. MUTUAL GENERAL RELEASE. In further consideration of the promises and
agreements made hereunder, Xxxxxx agrees unconditionally and forever to release
and discharge the Company and its respective agents and assigns, and the Company
agrees unconditionally and forever to release and discharge Xxxxxx and his
respective agents and assigns, from any and all claims, actions, causes of
action, demands, liabilities, rights or damages of any kind or nature which any
of them may now have, or ever have, whether known or unknown, against the other,
including any claims, causes of action or demands of any nature arising out of
or in any way relating to Xxxxxx'x service to the Company and the Company's
obligations to Xxxxxx under the Employment Agreement.
This release specifically includes, but is not limited to, any claims for
discrimination and/or violation of any statutes, rules, regulations or
ordinances, whether federal, state or local, including, but not limited to,
Title VII of the Civil Rights Act of 1964, as amended, age claims under the Age
Discrimination in Employment Act of 1967, as amended by the Older Workers
Benefits Protection Act of 1990, Section 1981 of Title 42 of the United States
Code, and the California Fair Employment and Housing Act.
The parties further agree knowingly to waive the provisions and protections
of Section 1542 of the California Civil Code, which reads:
A general release does not extend to claims which the creditor does
not know or suspect to exist in his favor at the time of executing the
release, which, if known by him, must have materially affected his
settlement with the debtor.
Xxxxxx represents and agrees that, prior to the execution of this
Agreement, Xxxxxx has had the opportunity to discuss the terms of this Agreement
with legal counsel of his choosing. Xxxxxx affirms that no promise or inducement
was made to cause him to enter into this Agreement, other than the severance and
other benefits described herein. Xxxxxx further confirms that he has not relied
upon any other statement or representation by anyone other than what is in this
Agreement as a basis for his agreement.
8. COOPERATION IN LITIGATION. Upon reasonable notice from the Company,
during the Term and thereafter (but only so long as any matter based upon
circumstances arising during the period of Xxxxxx'x employ by the Company or the
Term is pending), Xxxxxx shall make himself reasonably available to assist and
otherwise cooperate with the Company in connection with any litigation matters
involving the Company.
9. ARBITRATION. Any and all disputes or claims arising out of or in any
way related to this Agreement, including without limitation, fraud in the
inducement of this Agreement, or
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relating to the general validity or enforceability of this Agreement, shall be
submitted to final and binding arbitration before an arbitrator of the American
Arbitration Association in San Mateo, California in accordance with the rules of
that body governing commercial disputes, and the prevailing party shall be
entitled to reasonable costs and attorneys' fees. Judgment on the award rendered
by the arbitrator may be entered in any court having jurisdiction thereof.
10. GOVERNING LAW. This Agreement shall be construed under the laws of
the State of California, both procedural and substantive, except as may be
required under federal laws and regulations applicable to federally chartered
savings associations or their subsidiaries or affiliates.
11. REVOCATION RIGHT. Xxxxxx acknowledges that he has been advised that
he has twenty-one (21) days to consider this Agreement and that he has been
informed that he has the right to consult with counsel regarding this Agreement.
To the extent that Xxxxxx has taken less than twenty-one (21) days to consider
this Agreement, Xxxxxx acknowledges that he has had sufficient time to consider
the Agreement and to consult with counsel and that he does not desire additional
time. This Agreement is revocable by Xxxxxx for a period of seven (7) days
following Xxxxxx'x execution of this Agreement. The revocation by Xxxxxx of
this Agreement must be in writing, must specifically revoke this Agreement, and
must be received by the Company prior to the eighth (8th) day following the
execution of this Agreement by Xxxxxx. This Agreement becomes effective,
enforceable and irrevocable on the eighth (8th) day following Xxxxxx'x execution
of the Agreement.
12. MISCELLANEOUS. This Agreement sets forth the entire agreement between
Xxxxxx and the Company relating to the subject matter hereof and, except as
expressly set forth herein, supersedes all prior oral or written agreements
relating thereto, including, without limitation, the Employment Agreement. This
Agreement shall be binding upon all parties' respective heirs, representatives,
successors and assigns. Xxxxxx may not assign or delegate his rights or
responsibilities under this Agreement without the prior written consent of the
Company. If any portion of this Agreement is found to be illegal or
unenforceable, such action shall not affect the validity or enforceability of
the remaining paragraphs or subparagraphs of this Agreement. No amendments to
this Agreement will be valid unless written and signed by Xxxxxx and an
authorized representative of the Company. This Agreement may be executed in one
or more counterparts, all of which, taken together, shall
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constitute one original document. The undersigned agree to the terms of this
Agreement and voluntarily enter into it with the intent to be bound thereby.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first written above.
XXXXXX: PAN AMERICAN BANK, FSB
/s/ XXXXXX XXXXXX By: /s/ XXXXXXXX X. GRILL
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Xxxxxx Xxxxxx Xxxxxxxx X. Grill
President and Chief Executive Officer
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