Exhibit 10.8
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of the
1st day of March, 1995, by and between Equitable Bankshares of Colorado, Inc., a
Colorado corporation ("Company"), and Xxxxxxxx X. Xxxxxx ("Employee").
WITNESSETH:
WHEREAS, Company desires Employee to become employed by Company and
Employee desires to become employed by Company upon the terms and conditions
hereinafter set forth.
NOW, THEREFORE, the parties agree as follows:
1. EMPLOYMENT. Company hereby agrees to employ Employee, and Employee
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hereby agrees to be employed by Company, as (a) an Executive Vice President of
Company, (b) Chairman of the Board of Directors of Company's wholly-owned
subsidiary Equitable Bank of Littleton ("Littleton Bank"), (c) such executive
capacity as Employee and Company may agree for. Company's majority-owned
subsidiary The Women's Bank ("Women's Bank"), and (d) such other or different
executive capacities as may be determined from time to time by the Boards of
Directors of Company and Littleton Bank.
2. RESPONSIBILITIES OF EMPLOYMENT. During the term of his employment,
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Employee:
(a) shall diligently and faithfully serve Company and Littleton Bank
in such executive capacities as may be determined from time to time by the
Boards of Directors of Company and Littleton Bank, and he shall devote his
best efforts and entire business time, services and attention to the
advancement of Company's interests;
(b) shall not, without the prior written consent of the Board of
Directors of Company, engage in any other employment or business, directly
or indirectly, as a sole proprietor, a member of a partnership or limited
liability company, as a director, officer, employee or shareholder of a
corporation not affiliated with Company, or as a consultant or otherwise,
whether for compensation or otherwise, which could reasonably be expected
to or does interfere with Employee's performance of his duties hereunder or
which business is in competition in any way with the business then being
conducted by Company, Littleton Bank or Women's Bank; provided, however,
that the provisions of this subparagraph (b) shall not be deemed to
prohibit Employee's ownership of stock in any publicly owned corporation so
long as Employee's ownership, directly and indirectly, when aggregated with
the direct and indirect ownership of all members of Employee's family, does
not exceed
one percent (1%) of the total outstanding stock of such publicly owned
corporation, measured by reference to either market value or voting power;
(c) shall diligently and faithfully carry out the policies, programs
and directions of the Boards of Directors of Company and Littleton Bank;
(d) shall fully cooperate with such other officers of Company and
Littleton Bank as may be elected or appointed by the Boards of Directors of
Company and Littleton Bank; and
(e) shall report to the Chief Executive Officer of Company.
3. COMPENSATION. Company will compensate Employee for his services
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during the term of this Agreement and his employment hereunder as follows:
(a) Basic Compensation. Company shall pay to Employee as basic
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compensation the sum of One Hundred Twenty-Five Thousand Dollars
($125,000.00) per year, payable in equal monthly installments. Employee's
basic compensation may be increased from time to time in the sole
discretion of Company's Board of Directors.
(b) Benefits. Employee shall be entitled to use a Company automobile
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(model and year to be agreed upon from time to time by Employee and
Company's Chief Executive Officer) in the course of performing his duties
hereunder and shall be entitled to participate in any and all other
benefits from time to time afforded executive employees of Company,
including, without limitation, health, accident, hospitalization and life
insurance programs. Company shall additionally pay the monthly (not
initial or initiation) dues for Employee at a country, health or social
club to be agreed upon by Employee and Company's Chief Executive Officer.
(c) Reimbursement of Expenses. Employee shall be entitled to
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reimbursement of ordinary and necessary out-of-pocket expenses reasonably
incurred by him on behalf of Company in the course of performing his duties
hereunder, subject to his furnishing appropriate documentation relative to
such expenses in form and substance satisfactory to Company.
(d) Vacations. Employee shall be entitled to four (4) weeks paid
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vacation each year, subject to Company's general vacation policy.
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(e) Discretionary Bonus Plan. Company is in the process of developing
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a discretionary bonus plan for key executives. Employee shall be entitled
to participate in such discretionary bonus plan.
(f) Stock Option. Company is in the process of developing an Incentive
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Stock Option Plan (the "Plan") for key employees. If the Plan is approved
by Company's Board of Directors, subject to further approval of the Plan by
Company's shareholders, Company will grant Employee the option to purchase
up to 8,100 shares of Company's common stock pursuant to the Plan. It is
contemplated that the option price per share will approximate $10.00 and
that the options will vest annually over a four (4) year vesting schedule.
If Company's Board of Directors or shareholders do not approve the Plan,
Company agrees to find an alternative, commercially equivalent means of
compensating Employee in lieu of granting options under the Plan.
(g) Allocations. As Company and Employee intend that Employee will be
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a dual employee of Company and Littleton Bank, and that Employee will be
devoting substantial time and attention to the affairs of Littleton Bank
(and Women's Bank, if applicable), Company may allocate to Littleton Bank
(and Women's Bank, if applicable) any portion of Employee's basic and other
compensation that Company and Littleton Bank (and Women's Bank, if
applicable) deem to be a lawful and appropriate allocation, but no such
allocation will relieve Company of any of its obligations to Employee under
this Agreement.
4. TERM AND TERMINATION.
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(a) Term. The term of Employee's employment shall be a one (1) year
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term beginning on the date hereof. Upon expiration of the stated term of
this Agreement, Employee's employment with Company shall revert to the
status of employment at will and shall thereafter be subject to termination
by either party and at any time subject to the rights and obligation of
employee as defined in 4(b).
(b) Termination. Upon termination of this Agreement by Company, by
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Employee or upon the death or disability of Employee, the rights and
obligations of Employee shall be as follows:
(i) Termination by Employee. In the event Employee elects to
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terminate his employment hereunder, this Agreement shall immediately
terminate without any further obligation on the part of Company,
except that Company shall pay to Employee such compensation pursuant
to
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Paragraph 3 hereof as may be accrued and unpaid on the date of
termination of employment.
(ii) Termination by Company for Cause. If Employee's employment
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hereunder is terminated by Company for cause, this Agreement shall
immediately terminate without any further obligation on the part of
Company, except that Company shall pay to Employee such compensation
pursuant to Paragraph 3 hereof as may be accrued and unpaid on the
date of such termination of employment. For purposes of this
Agreement, "cause" shall mean willful failure or neglect of Employee
to perform his duties as prescribed herein, the conviction of a
felony, theft, embezzlement or improper use of corporate funds by
Employee, self dealing detrimental to Company, any attempt to obtain
any personal profit from any transaction in which Company has an
interest or any breach of the terms of Paragraphs 6 or 7 of this
Agreement by Employee.
(iii) Termination by Company for Other Reasons. Company shall
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have the right at any time to terminate Employee's employment
hereunder for any reason by giving him written notice (which notice
shall fix the date as of which Employee's employment is to terminate)
of its intention to do so. If Employee's employment hereunder is
terminated by Company other than for cause, Company shall be obligated
to pay Employee the severance benefits set forth in Paragraph 4(c)
hereof.
(iv) Constructive Discharge. If Employee is ever constructively
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discharged, he may terminate this Agreement and his employment
hereunder by delivering written notice to Company no later than thirty
(30) days before the effective date of termination. If Employee is
constructively discharged, Company shall be obligated to pay Employee
the severance benefits set forth in Paragraph 4(c) hereof. For
purposes of the foregoing, "constructive discharge" means the
occurrence of any one or more of the following: (i) Employee is
removed from all of the offices described in Paragraph 1 hereof; (ii)
Company fails to vest with or removes from Employee the duties,
responsibilities, authority or resources that he reasonably needs to
competently perform the duties of his office; (iii) Company decreases
Employee's basic compensation or arbitrarily and capriciously
decreases Employee's bonus; or (iv) Company transfers Employee to a
location outside the Denver metropolitan area; and in any of such
events, Company fails to cure any of the above within thirty (30) days
after Employee gives Company written notice of such breach.
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(v) Termination Upon Change of Control. Employee may terminate
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this Agreement and his employment hereunder for any reason within two
(2) years after a Change of Control occurs by delivering written
notice of termination to Company or its successor no less than thirty
(30) days before the effective date of termination. After two (2)
years following the Change of Control, Employee may terminate this
Agreement and his employment hereunder only in accordance with
Paragraph 4 (b) (i) hereof. If Employee so terminates, Company shall
be obligated to pay Employee two and ninety-nine hundredths (2.99)
times the severance benefits set forth in Paragraph 4 (c) hereof, with
the exception that the Paragraph 4(c) (ii) bonus component shall be
based upon a full year and not prorated to the date of Employee's
termination.
(A) A "Change of Control" will be deemed to have occurred
if: a) any person (as such term is defined in Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended (the
"1934 Act") other than a person who is a shareholder of Company
as of the date of this Agreement acquires beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the 0000 Xxx)
of fifty percent (50%) or more of the combined voting power of
the then outstanding voting securities of Company; or b) the
individuals who were members of Company's Board of Directors as
of the date of this Agreement (the "Current Board Members") cease
for any reason to constitute a majority of the Board of Directors
of Company or its successor; however, if the election or the
nomination for election of any new director of Company or its
successor is approved by a vote of a majority of the individuals
who are Current Board Members, such new director shall, for the
purposes of this paragraph, be considered a Current Board Member;
or c) Company's stockholders approve (l) a merger or
consolidation of Company or Women's Bank and the stockholders of
Company immediately before such merger or consolidation do not,
as a result of such merger or consolidation, own, directly or
indirectly, more than fifty percent (50%) of the combined voting
power of the then outstanding voting securities of the entity
resulting from such merger or consolidation in substantially the
same proportion as their ownership of the combined voting power
of the outstanding securities of Company immediately before such
merger or consolidation; or (2) a complete liquidation or
dissolution or an agreement
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for the sale or other disposition of all or substantially all of
the assets of Company or Women's Bank.
(B) Notwithstanding and in lieu of Paragraph 4 (b) (v) (A),
a Change of Control will not be deemed to have occurred: a)
solely because fifty percent (50%) or more of the combined voting
power of the then outstanding voting securities of Company are
acquired by (1) a trustee or other fiduciary holding securities
under one or more employee benefit plans maintained for employees
of Company, Littleton Bank or Women's Bank, or (2) any person
pursuant to the will or trust of any existing stockholder of
Company, or who is a member of the immediate family of such
stockholder, or (3) any corporation which, immediately prior to
such acquisition, is owned directly or indirectly by the
stockholders in the same proportion as their ownership of stock
immediately prior to such acquisition; or b) if Employee agrees
in writing to waive a particular Change of Control for the
purposes of this Agreement.
(vi) Termination Upon Employee's Disability. In the event
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Employee's employment is terminated by Company due to Employee's
disability, Company shall be obligated to pay Employee the severance
benefits set forth in Paragraph 4(c) hereof. For purposes of the
foregoing, "disability" shall mean Employee's inability due to illness
or other physical or mental disability to substantially perform his
duties as prescribed herein for a period of forty-five (45) days
within any consecutive six (6) month period, and any action to be
taken hereunder based on disability shall not be effective until the
expiration of such forty-five (45) day period:
(vii) Termination Upon Employee's Death. In the event that
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Employee dies while employed by Company, then Company shall be
obligated to pay Employee's estate the severance benefits set forth in
Paragraph 4(c) hereof.
(viii) Continuing Obligations of Employee. Notwithstanding
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anything to the contrary contained herein, termination of this
Agreement or Employee's employment hereunder, for whatsoever reason or
for no reason at all, by Employee or otherwise, shall not be deemed in
any way to affect Employee's obligations under Paragraphs 6 and 7 of
this Agreement, with respect to which he shall remain bound.
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(c) Severance Benefits. Provided Employee is in compliance with
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Paragraph 4 (b) (viii) hereof, Company will pay or provide the following
severance benefits to Employee in lieu of any separation payments otherwise
provided upon termination of employment under any other severance pay or
similar plan or policy of Company:
(i) Twelve (12) consecutive monthly payments each equal to one-
twelfth (l/l2th) of Employee's annual basic compensation in effect
immediately prior to Employee's termination;
(ii) Twelve (12) consecutive monthly payments each equal to one-
twelfth (1/12th) of the higher of (A) Employee's discretionary bonus
for the previous calendar year, or (B) the average of Employee's
discretionary bonus for the previous three (3) calendar years (or such
fewer calendar years as Employee has been employed), in each case
prorated to the date of Employee's termination
(iii) For the twelve (12) month period following the date of
termination of Employee's employment, Company will maintain in full
force and effect for the continued benefit of Employee each employee
benefit plan in which Employee was a participant immediately prior to
the date of Employee's termination, unless an essentially equivalent
and no less favorable benefit is provided bet a subsequent employer at
no additional cost to Employees If the terms of any employee benefit
plan of Company do not permit continued participation by Employee,
then Company will arrange to provide to Employee (at Company's cost) a
benefit substantially similar to and no less favorable than the
benefit Employee was entitled to receive under such plan at the end of
the period Of coverage.(This provision specifically is not applicable
to Employee's automobile and club dues, which benefits end upon
Employee's date of termination of employment.)
(iv) For the twelve (12) month period following the date of
termination of Employee's employment, Company will treat Employee for
all purposes as an Employee under all of Company's retirement plans in
which Employee was a participant on the date of termination of
Employee's employment or under which Employee would become eligible
during such twelve (12) month period (hereinafter referred to
collectively as the "Plan"). Benefits due to Employee under the Plan
shall be computed as if Employee had continued to be an Employee of
Company for the twelve (12) month period following termination of
employment. If under the terms of the Plan such continued coverage is
not permitted, Company will pay to Employee or Employee's
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estate a supplemental benefit in an amount which, when added to the
benefits that Employee is entitled to receive under the Plan, shall
equal the amount that Employee would have received under the Plan had
Employee remained an employee of Company during such twelve (12) month
period.
(v) If any excise tax imposed under Internal Revenue Code Section
4999 or any successor provision, as amended after the date hereof, is
due and owing by Employee as a result of any amount paid or payable
pursuant to this Paragraph 4(c), Company shall indemnify and hold
Employee harmless against all such excise taxes and any interest,
penalties or costs with respect thereto.
(vi) Company will be obligated to make all payments that become
due to Employee under this Paragraph 4(c) whether or not he obtains
other employment following termination. The payments and other
benefits provided for in this Paragraph 4(c) are intended to
supplement any compensation or other benefits that have accrued or
vested with respect to Employee or his account as of the effective
date of termination.
(vii) Company may elect to defer any payments that may become due
to Employee under this Paragraph 4(c) if, at the time the payments
become due, Company or Women's Bank is not in compliance with any
regulatory-mandated minimum capital requirements or if making the
payments would cause Company's or Women's Bank's capital to fall below
such minimum capital requirements. In this event, Company will resume
making the payments as soon as it can do so without violating such
minimum capital requirements.
5. SALE OR REORGANIZATION OF COMPANY. This Agreement shall not restrict
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the sale, transfer, consolidation, liquidation, reorganization or disposition of
the assets of Company and to the extent that the business of Company is
conducted in another form or through another entity or entities, such entity or
entities shall be obligated to fulfill Company's obligations hereunder.
6. RESTRICTIVE COVENANT. It is mutually recognized and agreed that the
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services to be rendered pursuant to this Agreement by Employee are special,
unique and of extraordinary character. Therefore, as a condition to Company's
obligations hereunder Employee agrees that without Company's prior written
consents during the term of this Agreement and for a period ending on first
anniversary of the date of termination of his employment hereunder, regardless
of cause, he will not engage in any manner directly or indirectly, to solicit or
induce any employee or agent of Company,
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Littleton Bank or Women's Bank to terminate employment with Company, Littleton
Bank or Women's Bank, as the case may be, or solicit or induce any customer of
Company, Littleton Bank or Women's Bank to become a customer of any person,
firm, partnership, corporation, trust or other entity that owns, controls or is
a bank, savings and loan association, credit union or similar financial
institution. Furthermore, Employee will at no time during or subsequent to the
term of his employment by Company make any statements or take any actions which
could reasonably be expected to damage the reputation or business of Company. It
is further recognized and agreed that irreparable injury will result to Company,
its businesses and property in the event of a breach of this covenant by
Employee, that such injury would be difficult if not impossible to ascertain,
and therefore, any remedy at law for any breach by Employee of this covenant
will be inadequate and Company shall be entitled to temporary and permanent
injunctive relief without the necessity of proving actual damage to Company by
reason of any such breach. In addition, in the event of a breach of this
covenant by Employee, Company shall also be entitled to recover reasonable costs
and attorneys' fees incurred in connection with the enforcement of its rights
hereunder. Whenever used herein, Company shall be deemed to include any
successors or any other person or entity which may hereafter acquire the
business of Company, Littleton Bank or Women's Bank. The foregoing
notwithstanding, should the assets of Company be disposed of in such a manner
that no purchaser thereof has acquired a going business, then Employee shall not
be bound by the covenants expressed in this paragraph.
7. TRADE SECRETS AND CONFIDENTIAL INFORMATION. Employee hereby covenants
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and agrees that he will not, except as may be required in connection with his
employment under this Agreement, directly or indirectly, use or disclose to any
other person, firm or corporation, whether during or subsequent to the term of
his employment by Company, irrespective of the time, manner or cause of the
termination of his employment, any information of a proprietary nature belonging
to Company, or which could be reasonably expected to have an adverse effect on
Company, its businesses, property or financial condition, including but not
limited to records, data, documents, processes, specifications, methods of
operation, techniques and know-how, plans, policies, customer lists, the names
and addresses of suppliers or representatives, investigations or other matters
of any kind or description relating to the products, services, suppliers,
customers, sales or businesses of Company. All records, files, documents,
equipment and the like relating to Company's businesses which Employee shall
prepare, use or observe shall be and remain the sole property of Company, and
upon termination of this Agreement or his employment hereunder for any reason,
Employee shall return to the possession of Company any items of that nature and
any copies thereof which he may have in his possession.
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8. INDEMNITY.
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(a) Indemnification. Company will indemnify Employee (and, upon his
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death, his heirs, executors and administrators) to the fullest extent
permitted by law against all expenses, including reasonable attorneys'
fees, court and investigative costs, judgments, fines and amounts paid in
settlement (collectively, "Expenses") reasonably incurred by him in
connection with or arising out of any pending, threatened or completed
action, suit or proceeding in which he may become involved by reason of his
having been an officer or director of Company or Littleton Bank (or Women's
Bank, if applicable). The indemnification rights provided for herein are
not exclusive and will supplement any rights to indemnification that
Employee may have under any applicable bylaw or charter provision of
Company or Littleton Bank (or Women's Bank, if applicable), or any
resolution of Company or Littleton Bank (or Women's Bank, if applicable),
or any applicable statute.
(b) Advancement of Expenses. In the event that Employee becomes a
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party, or is threatened to be made a party, to any pending, threatened or
completed action, suit or proceeding for which Company or Littleton Bank
(or Women's Bank, if applicable) is permitted or required to indemnify him
under this Agreement, any applicable bylaw or charter provision of Company
or Littleton Bank (or Women's Bank, if applicable), any resolution of
Company or Littleton Bank (or Women's Bank, if applicable), or any
applicable statute, Company will, to the fullest extent permitted by law,
advance all Expenses incurred by Employee in connection with the
investigation, defense, settlement or appeal of any threatened, pending or
completed action, suit or proceeding, subject to receipt by Company of a
written undertaking from Employee to reimburse Company for all Expenses
actually paid by Company to or on behalf of Employee in the event it shall
be ultimately determined that Company or Littleton Bank (or Women's Bank,
if applicable) cannot lawfully indemnify Employee for such Expenses, and to
assign to Company all rights of Employee to indemnification under any
policy of directors' and officers' liability insurance to the extent of the
amount of Expenses actually paid by Company to or on behalf of Employee.
(c) Litigation. Unless precluded by an actual or potential conflict of
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interest, Company will have the right to recommend counsel to Employee to
represent him in connection with any claim covered by this Section 8.
Further, Employee's choice of counsel, his decision to contest or settle
any such claim, and the terms and amount of the settlement of any such
claim will be subject to Company's prior reasonable approval
in writing.
9. ARBITRATION. Any disputes arising out of this Agreement or connected
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with Employee's employment shall be submitted by
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Employee and Company to arbitration by the American Arbitration Association or
its successor, and the determination of the American Arbitration Association or
its successor shall be final and absolute. The arbitrator shall be governed by
the duly promulgated rules and regulations of the American Arbitration
Association or its successor, and the pertinent provisions of the laws of the
State of Colorado relating to arbitration. The decision of the arbitrator may be
entered as a judgment in any court in the State of Colorado or elsewhere. The
prevailing party shall be entitled to receive reasonable attorneys' fees
incurred in connection with such arbitration in addition to such other costs and
expenses as the arbitrators may award.
10. INTERPRETATION. This Agreement shall be construed in accordance with
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the internal laws of the State of Colorado. The titles of the paragraphs have
been inserted as a matter of convenience of reference only and shall not be
construed to control or affect the meaning or construction of this Agreement.
11. SEVERABILITY. In the event that any portion of this Agreement is found
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to be in violation of or conflict with any federal or state law, the parties
agree that said portion shall be modified only to the extent necessary to enable
it to comply with such law.
12. ASSIGNMENT. This Agreement shall not be assignable by Employee, but
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shall be binding upon and inure to the benefit of the successors and assigns of
Company.
13. NOTICES. All notices or other communications in connection with this
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Agreement shall be in writing and shall be deemed to have been duly given when
delivered, sent by professional courier or mailed first class, postage prepaid
and addressed as follows:
(i) If to Company, addressed to:
Equitable Bankshares of Colorado, Inc.
000 - 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx Xxxxxxx
with a copy to:
Xxxxxx & Coff
Suite 4100
55 X. Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxx
If to Employee, addressed to:
Xxxxxxxx X. Xxxxxx
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0000 X. Xxxxxxx Xxx
Xxxxxx, Xxxxxxxx 00000
with a copy to:
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or such other address or addressed to the attention of such other person or
persons as either of the parties may notify the other in accordance with the
provisions of this paragraph.
14. ENTIRE AGREEMENT. This Agreement is the entire agreement and
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understanding of the parties hereto with respect to the subject matter hereof
and supersedes any and all prior and contemporaneous negotiations,
understandings and agreements with regard to the subject matter hereof, whether
oral or written. No representation, inducement, agreement, promise or
understanding altering, modifying, taking from or adding to the terms and
conditions hereof shall have any force or effect unless the same is in writing
and validly executed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
EQUITABLE BANKSHARES OF
COLORADO, INC.
/S/ Xxxxxxxx X. Xxxxxx By: /S/ Xxxxxx Xxxxxxx
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XXXXXXXX X. XXXXXX Xxxxxx Xxxxxxx
Chief Executive Officer
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