EXHIBIT 10.1
Employment Agreement of Xxxxxx X. Xxxxxxxxx
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made this 2nd day of March,
1998, by and between AMERICAN COMMERCIAL BANK ("Employer"), and XXXXX
XXXXXXXXX ("Employee"). This Agreement is made with specific reference to the
following facts:
RECITALS
A. Employee has substantial experience and expertise in the banking
industry, and his qualifications have been reviewed and approved by Employer's
Board of Directors.
B. Employer, acting by and through its Board of Directors, desires to
employ Employee as Employer's President and Chief Executive Officer, and
Employee desires to accept such employment, based upon the following terms and
conditions.
TERMS AND CONDITIONS
NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement and the foregoing Recitals, the parties agree as follows:
1. EMPLOYMENT OF EMPLOYEE. Subject to the remaining provisions hereof,
Employer hereby employs Employee as Employer's President and Chief Executive
Officer, and Employee hereby accepts employment from Employer.
2. EMPLOYEE'S DUTIES AND AUTHORITY.
(a) DUTIES. As Employer's President and Chief Executive Officer,
Employee shall have general executive supervision of the business and affairs of
Employer, subject at all times to the pleasure, direction and control of
Employer's Board of Directors (the "Board"). Employee shall be senior in rank to
all other employees of Employer. Employee shall devote his best efforts to the
business and affairs of Employer and its affiliates on a full-time basis. In the
event Employee shall become a member of the Board, Employee shall be a member of
all committees appointed by the Board, except the audit committee; PROVIDED,
HOWEVER, if Employee's employment by Employer is terminated for any reason, with
or without cause, by resignation or otherwise, Employee shall immediately cease
to be a member of the Board and of any and all committees appointed by the
Board. Employee shall serve on the Board without additional compensation.
Employee shall acquire with his own funds and retain any number of shares of
stock of Employer required of Board members pursuant to the By-laws of Employer
and all applicable governmental regulations.
(b) AUTHORITY. Employee shall have authority to sign contracts,
bills, notes, drafts, and other instruments or obligations of Employer, as
provided in Employer's By-laws, as authorized in advance by the Board and in
accordance with applicable law. Notwithstanding the foregoing, Employee shall at
all times be subject to Employer's By-laws and the direction of Employer's Board
of Directors. Employee shall devote his best efforts and attention to
Employer's business and will not render any personal service of any character to
any other person, firm or corporation, whether for compensation or otherwise,
without the Board's prior written
consent, which consent shall not be unreasonably withheld. Employee shall
perform his duties at all times to the best of his abilities, in accordance with
the highest standards of the banking industry, and in compliance with all
applicable laws, Employer's Articles of Incorporation and Employer's By-laws.
3. TERM OF EMPLOYMENT. Employee's employment shall be for an initial term
of six (6) months, commencing on March 2, 1998; SUBJECT, HOWEVER, to the prior
termination of this Agreement as provided below (the "Initial Term"). The
Initial Term may be extended by the mutual, written agreement of Employer and
Employee.
4. COMPENSATION. As compensation for all services rendered pursuant to
this Agreement, Employee shall receive an annual salary of One Hundred Five
Thousand Dollars ($105,000.00), which salary shall be reviewed by Employer at
the end of the Initial Term. Such salary shall be payable in periodic
installments in accordance with Employer's payroll practices in effect from time
to time and shall be subject to the deductions and withholdings prescribed by
law. Employee's salary shall be prorated for any year in which this Agreement is
in effect for only a portion of the year.
(a) BONUS PROGRAM. In addition to the payment of the annual salary
specified in Section 4 above, Employee shall have the ability to earn an
incentive bonus, pursuant to Employer's bonus program in effect for its senior
executives from time to time. In no event, however, regardless of Employer's
after-tax profit for any year, shall Employee's incentive bonus exceed fifty
percent (50%) of Employee's then existing annual base salary.
5. ADDITIONAL BENEFITS.
(a) VACATION. Employee shall be entitled to twenty (20) days of paid
vacation each year during the term of this Agreement. Employee shall schedule
his vacation after consultation with the Board and shall take no less than ten
(10) days of his vacation without interruption. Sick leave shall be in
accordance with the policies of Employer for its senior executive employees in
effect from time to time. Employee shall accrue vacation and sick leave on an
hourly basis.
(b) AUTOMOBILE ALLOWANCE. Employer agrees to pay Employee Six Hundred
Dollars ($600.00) per month, in addition to his salary, as reimbursement for
his automobile expenses. Employee shall not be entitled to reimbursement of
automobile expenses in excess of the Six Hundred Dollars ($600.00) per month.
Employee shall maintain automobile insurance with a liability limit of no less
than $500,000.00 per occurrence, with an insurer reasonably acceptable to
Employer. Employee shall provide Employer with proof of his required automobile
insurance throughout the term of this Agreement.
(c) INSURANCE. Employer shall cover Employee and his dependents,
without cost to Employee, with the group medical, hospitalization and dental
insurance that is otherwise provided by Employer from time to time for its
senior executive employees. Employee shall also receive Employer-paid life
insurance equal to 1 1/2 times Employee's annual salary throughout the term of
this Agreement.
(d) RETIREMENT BENEFITS. Employer agrees to cover Employee under all
pension, profit sharing, or other retirement plans or benefits that may be
provided by Employer for its senior executive employees from time to time, to
the extent Employee otherwise qualifies for participation in the subject benefit
plans.
(e) EXPENSE REIMBURSEMENTS. Employer shall reimburse Employee for
all reasonable, ordinary and necessary expenses incurred by Employee in the
performance of his duties under this Agreement, including, but not limited
'to,.- reimbursement for educational programs and banking seminars; SUBJECT
HOWEVER, to the submission of written reports by Employee outlining the need
for the program and the prior written approval thereof by the Board. Employee
shall submit expense accounting forms in detail reasonably satisfactory to
Employer to substantiate all expense reimbursement requests. In all events,
however, absent the Board's prior written approval, Employee's reimbursable
expenses shall not exceed Five Hundred Dollars ($500.00) per month. If any
reimbursements paid by Employer are subsequently disallowed by Employer's
audit committee or independent accountants, Employee agrees to repay Employer
the FULL amounts that are disallowed, immediately upon demand. The Board
shall previously approve any and all service or social clubs Employee wishes
to participate in for business purposes on behalf of Employer and, once
approved, Employee's dues for membership in any service or social clubs shall
be paid directly by Employer.
6. TERMINATION.
(a) TERMINATION BY EMPLOYER FOR CAUSE. Employer, acting by and
through the Board, may terminate Employee's employment, without further
obligation or liability to Employee, at any time the Board determines that there
is cause for such termination. The occurrence of any of the following events
shall constitute cause for purposes of this Agreement:
(i) Employee's neglect of his duties, negligence, WILLFUL
wrongdoing, or violation of applicable banking laws or regulations;
(ii) , Employee's engaging in an activity which adversely
affects Employer's reputation in the community, or which evidences
Employee's lack of fitness or ability to perform his duties as determined
by the Board, in good faith;
(iii) Employee's commission of any act that causes termination
of coverage under Employer's Banker's Blanket Bond as to Employee, as
distinguished from termination of coverage as to Employer's employees
generally;
(iv) The physical or mental inability of Employee to perform
his duties for a period of ninety (90) days or more during any twelve (12)
month period;
(v) Action taken by the California Department of Banking or
other regulatory authority, including the Federal Deposit Insurance
Corporation, to close or take over Employer;
(vi) Mutual agreement of the parties;
(vii) Employee's death; or
(viii) The exercise of the power of any duly constituted
regulatory authority to remove Employee from office.
Any determination of termination of Employee for cause made by the Board in
good faith shall terminate Employee's employment immediately, without further
liability or obligation to Employee under this
Agreement. Employee, however, will thereafter be entitled to any accrued but
unpaid salary, reimbursable expenses, and accrued vacation to the date of his
termination, but all other remuneration and benefits will cease as of the date
of termination.
(b) TERMINATION BY EMPLOYER WITHOUT CAUSE. Employer, acting by and
through the Board, may terminate Employee at any time, without cause;
PROVIDED, HOWEVER, that in the event of any such termination Employee shall
be entitled to any then accrued but unpaid salary, reimbursable expenses, and
accrued vacation. In addition, if Employee is terminated without cause during
this Agreement's term, Employer shall continue Employee's base salary for
three (3) months from the date of termination, or for the remainder of the
term of this Agreement, whichever sum shall be less. Further, for a period of
three (3) months from the date of termination, Employer shall provide
Employee with a sum equal to Employee's monthly cost for group medical and
hospitalization insurance benefits for Employee and Employee's dependents
under Employer's then existing health insurance plan, should Employee elect
to continue such health insurance coverage at his own expense after
termination. All such severance pay shall be at the rate in effect
immediately prior to such termination. Payment to Employee of those sums
required pursuant to this Section 6(b) shall discharge Employer and the Board
from any further liability to Employee hereunder.
(c) TERMINATION BY EMPLOYEE. Employee may terminate this Agreement
upon ninety (90) days prior written notice to Employer. In such an event,
Employee will be entitled to accrued but unpaid salary, reimbursable expenses,
and accrued vacation, but all other remuneration and benefits will cease as of
the effective date of termination.
(d) MERGER OR OTHER REORGANIZATION. In the event of the merger of
Employer into another corporation (where Employer is not the surviving entity),
an exchange of all of the outstanding shares of Employer for the shares of
another corporation, a transfer or other consideration of all or substantially
all of the assets of Employer for the shares of another corporation, or other
corporate reorganization resulting in a successor to Employer, this Agreement
shall remain in full force and effect, and shall be assigned or be deemed to be
assigned to any such successor of Employer, unless otherwise mutually agreed
between Employer and Employee. Upon any such assignment, Employer shall be
unconditionally released from any and all continuing duties and obligations
under this Agreement. In the event of Employee's termination without cause in
connection with the acquisition, merger or reorganization of Employer, Employee
shall be entitled hereunder to the lesser of six (6) month's base salary or the
base salary due Employee for the balance of the term of this Agreement, or any
extension thereof, whichever may be less.
(e) SOLE REMEDY. Employee agrees that his sole remedy for an alleged
breach of this Agreement shall be against Employer. For and in consideration of
this Agreement, Employee expressly waives any right he may have for a lawsuit
for damages against any shareholder, director, officer or employee of Employer
for any claim, cause of action, damage, cost or expense, arising from, in
connection with, or relating to, the terms and provisions of this Agreement or
any breach hereof.
7. NONDISCLOSURE OF CONFIDENTIAL INFORMATION.
(a) TRADE SECRETS. During the term or any extended term of this
Agreement, Employee will have access to and become acquainted with what Employee
and Employer both acknowledge are trade secrets. Specifically, Employee will
acquire by virtue of his employment knowledge or data concerning Employer,
including its operations and business, and the identity of customers of
Employer, including knowledge of their financial needs and methods of doing
business. Employee shall not disclose any of the above-described trade
secrets or any other trade secrets of Employer, directly or indirectly, or use
them in any way, either during the term of this Agreement or for a period of one
(1) year after the TERMINATION of this Agreement for whatever reason, except as
required in the course of Employee's employment with Employer.
(b) RETURN OF PERSONAL PROPERTY. Employee expressly agrees that
all manuals, documents, files, reports, studies, computer programs or models,
budgets, instruments or other materials used, supplied to and/or developed by
Employee during the term of this Agreement are solely the property of
Employer, and that Employee shall have no right, title or interest therein.
Upon termination of this Agreement, for whatever reason, Employee or
Employee's representative shall promptly deliver possession of all of
Employer's personal property to Employer in good condition. Further, Employee
shall also immediately tender to Employer or its representative(s) any and
all keys, credit cards, combinations, and/or computer access codes then
maintained by Employee.
(c) The foregoing covenants of Employee are given to Employer as a
material inducement to Employer to enter into this Agreement and to pay
Employee the compensation stated in Section 4 above. Further, in the event of
a breach or threatened breach by Employee of any of the covenants contained
in this Section 7, Employer shall have the right to seek monetary damages for
any past breach and equitable relief, including specific performance by means
of an injunction, against Employee or against Employee's partners, agents,
representatives, servants, employers, employees, family members, and/or any
and all persons acting directly or indirectly by or with him, to prevent or
restrain and threatened or further breach of these covenants.
8. REPRESENTATIONS OF EMPLOYEE. Employee hereby represents and
warrants to Employer that:
(a) The execution, delivery and performance of this Agreement by
Employee will not violate, be in conflict with, or constitute a default under
any contract or agreement to which Employee is a party or is bound.
(b) Employee does not and will not have any material agreements or
commitments including, but without limiting the generality of the foregoing,
any agreement restricting competition or any material commitments or
obligations, contingent or otherwise, under any contract or agreement which
would conflict in any way with Employee's ability to fully perform his
obligations hereunder, or which would impede Employer's ability to market
Employee's services.
(c) Employee is not a party to any pending or threatened
litigation, proceedings, claims or governmental investigation which may
either (i) adversely affect Employee's practice of banking or impair
Employee's ability to perform his duties under this Agreement, or (ii) seek
to prevent, restrain or interfere with the performance by Employee of his
duties under this Agreement.
Employee's representations and warranties contained in this Agreement
shall be deemed to have been made as of the date of this Agreement and shall
continue to be made throughout the term of this Agreement. Employee shall
immediately notify Employer of any and all subsequent misstatements or
inaccuracies in any of the representations and warranties set forth herein.
9. MISCELLANEOUS PROVISIONS.
(a) NOTICES. Any notice, request, demand, or other communication
required or permitted to be given hereunder shall be in writing and may be
delivered by hand, deposited in the United States mail, certified or registered
and postage prepaid, or by facsimile transmission addressed as follows:
If to Employer: American Commercial Bank
000 Xxxxx Xxxxx Xxxx
Xxxxxxx, XX 00000
Attention: CHAIRMAN of the Board
Fax: (805)
If to Employee: Xxxxx Xxxxxxxxx
0000 Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
All such notices, requests, demands, or other communications so delivered
shall be deemed to have been received by the addressee (i) if delivered by
hand, on the date of delivery; (ii) if sent by facsimile transmission, on the
date of transmission; and (iii) if sent by United States mail, two (2)
calendar days after the date of posting. If either party hereto changes his
or its address, then such party shall immediately notify other party in
writing of the return address in accordance with the foregoing procedures.
(b) GOVERNING LAW. To the extent not otherwise in conflict with
all applicable Federal laws and regulations, this Agreement shall be governed
by, interpreted under, and construed and enforced in accordance with the laws
of the State of California applicable to agreements made and to be performed
wholly within the State of California.
(c) ENTIRE AGREEMENT. There have been no representations or
warranties made by the parties except as expressly set forth herein. The
terms and conditions hereof are intended by the parties as a complete and
final expression of their agreement with respect to the subject matter of
this Agreement and may not be contradicted by evidence of any prior or
contemporaneous agreement, all of which are merged herein.
(d) MODIFICATIONS AND AMENDMENTS. This Agreement may not be
modified, changed, or supplemented, nor may any obligations hereunder be
waived, except by a written instrument, signed by each of the parties.
Employee further acknowledges and agrees that the terms and conditions of
this Agreement may only be amended by a written resolution of the Board, as
approved by the then required majority of Employer's directors.
(e) TITLES AND HEADINGS. Titles and headings of sections of this
Agreement are for convenience of reference only and shall not affect the
construction of any provision of this Agreement.
(f) ASSIGNMENTS. Except as provided in paragraph 6(d), this
Agreement, and the rights, duties, and obligations hereunder may not be assigned
by any party without the prior written consent of the other parties.
(g) SUCCESSORS AND ASSIGNS. This Agreement and the provisions hereof
shall be binding upon and inure to the benefit of each of the parties and their
respective heirs, executors, administrators, successors, and permitted assigns.
(h) PARTIAL INVALIDITY. If any provision of this Agreement is found
to be invalid by any court, the invalidity of such provision shall not affect
the validity of the remaining provisions hereof.
(i) SURVIVAL. Notwithstanding any other provisions hereof, the
provisions of paragraphs 6 and 7 and their subparagraphs shall survive the
termination of this Agreement.
(j) ADDITIONAL INSTRUMENTS. The parties agree that they will execute
such other instruments and documents as are or may become necessary or
convenient to carry out the intent and purposes of this Agreement.
(k) WAIVER. Pursuit of any one remedy shall not preclude pursuit of
any other remedies provided for herein or by law. No waiver of one violation of
this Agreement shall be deemed or construed to constitute a waiver of any
similar violations subsequently occurring, or any other violation whatsoever.
(l) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
shall constitute one and the same Agreement.
(m) AMENDMENTS. This Agreement may not be amended, altered or
modified except by a written instrument signed by all of the parties.
(n) ARBITRATION. Any and all disputes, controversies or questions
arising under this Agreement shall be referred for decision by arbitration in
Ventura, California, by a single arbitrator selected by the parties. The
proceeding shall be governed by the Rules of the American Arbitration
Association then in effect or SUCH rules last in effect (in the event that
SUCH Association is no longer in existence). If the parties are unable to
agree upon an arbitrator within thirty (30) days after either party has given
the other party written notice of its desire to submit the dispute,
controversy or question for decision, then either party may apply to the
American Arbitration Association for the appointment of an arbitrator or, if
such Association is not then in existence or does not desire to act in the
matter, either party may apply to the Presiding Judge of the Superior Court
of the County of Ventura, California, for the appointment of an arbitrator to
hear the parties and settle the dispute, controversy or question, and such
judge is authorized to make such appointment. The compensation and expenses
of an arbitrator shall be borne equally by the parties to this Agreement.
Arbitration shall be the exclusive remedy for the settlement of disputes
arising under this Agreement or for the breach of this Agreement. The
decision of the arbitrator shall be final, conclusive and binding on all
interested persons and no action at law or in equity shall be instituted by
either party other than to enforce the award of the arbitrator.
IN WITNESS WHEREOF, the parties hereto have executed the foregoing
Agreement on the date first written above.
"EMPLOYER": "EMPLOYEE":
AMERICAN COMMERCIAL BANK XXXXX XXXXXXXXX
By:
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Title:
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