Exhibit 10. Material Contracts - Revised Employee Agreements
FIRST FEDERAL SAVINGS BANK OF IOWA
AMENDED AND RESTATED EMPLOYEE RETENTION AGREEMENT
This Agreement is made effective as of March 20, 1998 by and between First
Federal Savings Bank of Iowa, a federally chartered savings institution, with
its principal administrative office at 000 Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxx
00000 (the "Bank"), and Xxxx X. Xxxx (the "Executive").
WHEREAS, the Bank and the Executive are parties to an Employee Retention
Agreement made and entered into as of the 20th day of March, 1996 ("Prior
Agreement"); and
WHEREAS, the Bank and the Executive desire to amend and restate the Prior
Agreement in its entirety as set forth herein; and
WHEREAS, the Bank wishes to assure itself of the services of Executive for
the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employ of the Bank on a full-
time basis for said period.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
1. POSITION AND RESPONSIBILITIES
During the period of his employment hereunder, Executive agrees to serve as
Senior Vice President of the Bank. During said period, Executive also agrees to
serve, if elected, as an officer and director of any subsidiary or affiliate of
the Bank.
2. TERMS AND DUTIES
(a) The period of Executive's employment under this Agreement shall begin
as of the date first above written and shall continue for a period of thirty-six
(36) full calendar months thereafter. Prior to each anniversary date of this
Agreement, the members of the Board of Directors of the Bank ("Board") will
conduct a comprehensive performance evaluation and review of the Executive for
purposes of determining whether to extend the Agreement, and the results thereof
shall be included in the minutes of the Board's meeting. If the Board determines
to extend the Agreement and the Executive agrees to such extension, the
Executive's period of employment shall be extended for an additional year such
that the remaining term shall be three (3) years from the upcoming anniversary
date. If the Board
does not determine to extend the Agreement or if the Executive does not agree to
a proposed extension, the Agreement shall expire at the end of the term then in
effect.
(b) During the period of his employment hereunder, except for periods of
absence occasioned by illness, reasonable vacation periods, and reasonable
leaves of absence, Executive shall devote substantially all his business time,
attention, skill, and efforts to the faithful performance of his duties
hereunder including activities and services related to the organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board, as evidenced by a resolution of such Board, from time to time,
Executive may serve, or continue to serve, on the boards of directors of, and
hold any other offices or positions in, companies or organizations, which, in
such Board's judgment, will not present any conflict of interest with the Bank,
or materially adversely affect the performance of Executive's duties pursuant to
this Agreement.
3. COMPENSATION AND REIMBURSEMENT
(a) The compensation specified under this Agreement shall constitute the
salary and benefits paid for the duties described in section 2(b). The Bank
shall pay Executive as compensation a salary at an annualized rate of not less
than SIXTY-ONE THOUSAND DOLLARS ($61,000) per year ("Base Salary"). Such Base
Salary shall be payable monthly, on the first day of each month, or in
accordance with the Bank's customary payroll practices in effect from time to
time for other similarly situated employees. During the period of this
Agreement, Executive's Base Salary shall be reviewed at least annually. Such
review shall be conducted by a Committee designated by the Board, and the Board
may increase Executive's Base Salary. In addition to the Base Salary provided in
this Section 3(a), the Bank shall provide Executive with all such other benefits
as are provided uniformly to full-time employees of the Bank, subject to and
upon the same terms and conditions generally applicable to full-time employees.
(b) The Bank will provide Executive with employee benefit plans,
arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit form immediately prior
to the beginning of the term of this Agreement. Without limiting the generality
of the foregoing provisions of this Subsection (b), Executive will be entitled
to participate in or receive benefits under any employee benefit plans including
but not limited to, retirement plans, supplemental retirement plans, pension
plans, profit-sharing plans, health-and-accident plans, medical coverage or any
other employee benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall administration of such
plans and arrangements. Executive will be entitled to incentive compensation and
bonuses as provided in any plan of the Bank in which Executive is eligible to
participate. Nothing paid to the Executive under any such plan or arrangement
will be deemed to be in lieu of other compensation to which the Executive is
entitled under this Agreement.
4. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION
The provisions of this Section shall in all respects be subject to the
terms and conditions stated in Sections 7 and 14.
(a) The provisions of this Section shall apply upon the occurrence of an
Event of Termination (as herein defined) during any portion of the Executive's
term of employment under this Agreement that follows a Change in Control. As
used in this Agreement, an "Event of Termination" shall mean and include any
termination by the Bank of Executive's full-time employment hereunder for any
reason other than a Termination for Cause as defined in Section 6 hereof and any
termination of employment by the Executive within sixty (60) days following any
material reduction in his compensation and benefits from the levels in effect
immediately prior to the Change in Control or any material adverse change in the
Executive's position, duties, authority or terms and conditions of employment
from those in effect immediately prior to the Change in Control. In the event of
a continuing breach of this Agreement by the Bank, the Executive shall not waive
any of his rights under this Agreement by virtue of the fact that the Executive
is engaged in good faith discussions to resolve such breach.
(b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 7, the Bank shall pay Executive, or, in the
event of his subsequent death, his beneficiary or beneficiaries, or his estate,
as the case may be, as severance pay or liquidated damages, or both, a sum equal
to the greater of the payments due for the remaining term of the Agreement or 3
times the average of aggregate of the Executive's Base Salary plus bonus and
other cash compensation paid to, plus the amount of all determinable
contributions made to or under any employee benefit plan on behalf of, the
Executive by the Bank during the period of five (5) years ending on the Date of
Termination; provided, however, that if the Bank is not in compliance with its
minimum capital requirements or if such payments would cause the Bank's capital
to be reduced below its minimum capital requirements, such payments shall be
deferred until such time as the Bank is in capital compliance.
(c) Upon the occurrence of an Event of Termination, the Bank will cause to
be continued life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank for Executive prior to his
termination, provided that such benefits shall not be provided in the event they
should constitute an unsafe or unsound banking practice relating to executive
compensation and employment contracts pursuant to 12 C.F.R. (S)(S) 563.39 and
563.161, as is now or hereafter in effect. Such coverage shall cease upon the
expiration of thirty-six (36) full calendar months following the Date of
Termination.
(d) Upon the occurrence of an Event of Termination, Executive will be
entitled to any benefits granted to him pursuant to any stock option plan of the
Bank or Company.
(e) Upon the occurrence of an Event of Termination, the Executive will be
entitled to any benefits awarded to him under any restricted stock plan of the
Bank or the Company.
(f) Notwithstanding the preceding paragraphs of this Section 4, in the
event that the Executive receives payments in the nature of compensation
(whether or not pursuant to this Agreement) that are subject to the tax imposed
under section 4999 of the Internal Revenue Code of 1986 or the corresponding
provision of any succeeding law ("Parachute Tax"), then:
(i) if, by reducing the payments and benefits provided for in this
Agreement, the aggregate payments in the nature of compensation may be
reduced to a level at which the Parachute Tax is imposed, such payments
shall be reduced to the maximum amount which may be provided without
resulting in the imposition of a Parachute Tax; and
(ii) in all other cases, the payments and benefits provided hereunder
shall not be affected.
The applicability of any reduction under Section 4(f)(i) and the amount and
manner of such reduction shall be determined by a firm of independent certified
public accountants selected by the Bank which shall, in determining the manner
of any reduction, consult with and take into accounts the preferences of the
Executive.
(g) Notwithstanding the foregoing, there will be no reduction in the
compensation otherwise payable to Executive during any period which Executive is
incapable of performing his duties hereunder by reason of temporary disability.
(h) Any payments made to Executive pursuant to this Agreement or
otherwise, are subject to and conditioned upon their compliance with 12.U.S.C.
(S) 1818(k) and any regulations promulgated thereunder.
5. CHANGE IN CONTROL
(a) No benefit shall be payable under Section 4 unless there shall have
been a Change in Control of the Bank or North Central Bancshares, Inc., an Iowa
corporation of which the Bank is a subsidiary (the "Company"), as set forth
below. For purposes of this Agreement, a "Change in Control" of the Bank or
Company shall mean:
(i) approval by the stockholders of the Bank of a transaction that
would result in the reorganization, merger or consolidation of the Bank
with one or more other persons, other than a transaction following which:
(A) at least 51% of the equity ownership interests of the entity
resulting from such transaction are beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) in
substantially the same relative proportions by persons who,
immediately prior to such transaction, beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) at least 51%
of the
outstanding equity ownership interests in the Bank; and
(B) at least 51% of the securities entitled to vote generally in
the election of directors of the entity resulting from such
transaction are beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) in substantially the same relative
proportions by persons who, immediately prior to such transaction,
beneficially owned (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) at least 51% of the securities entitled to vote
generally in the election of directors of the Bank;
(ii) the acquisition of all or substantially all of the assets of the
Bank or beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 20% or more of the outstanding securities of the
Bank entitled to vote generally in the election of directors by any person
or by any persons acting in concert, or approval by the stockholders of the
Bank of any transaction which would result in such an acquisition; or
(iii) a complete liquidation or dissolution of the Bank, or approval
by the stockholders of the Bank of a plan for such liquidation or
dissolution; or
(iv) the occurrence of any event if, immediately following such event,
at least 50% of the members of the board of directors of the Bank do not
belong to any of the following groups:
(A) individuals who were members of the Board of the Bank on the
date of this Agreement; or
(B) individuals who first became members of the Board of the Bank
after the date of this Agreement either:
(I) upon election to serve as a member of the Board of the
Bank by affirmative vote of three-quarters of the members of such
board, or of a nominating committee thereof, in office at the
time of such first election; or
(II) upon election by the stockholders of the Bank to serve
as a member of the Board of the Bank, but only if nominated for
election by affirmative vote of three-quarters of the members of
the Board of the Bank, or of a nominating committee thereof, in
office at the time of such first nomination;
provided, however, that such individual's election or nomination did
not result from an actual or threatened election contest (within the
meaning of Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents (within the meaning of Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) other than by or on behalf of the
Board of the
Bank;
(v) any event which would be described in Section 5(a)(i), (ii),
(iii) or (iv) if the term "Company" were substituted for the term "Bank"
therein.
(b) In no event, however, shall a Change of Control be deemed to have
occurred as a result of any acquisition of securities or assets of the Bank, the
Company, or any affiliate or subsidiary of either of them, by the Bank, the
Company or any affiliate or subsidiary of either of them, or by any employee
benefit plan maintained by any of them. For purposes of this section 5 the term
"person" shall have the meaning assigned to it under sections 13(d)(3) or
14(d)(2) of the Exchange Act.
6. TERMINATION FOR CAUSE
The term "Termination for Cause" shall mean termination because of the
Executive's personal dishonesty, incompetence, willful misconduct, any breach of
fiduciary duty involving personal profit, intentional failure to perform stated
duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material
breach of any provision of this Agreement. In determining incompetence, the acts
or omissions shall be measured against standards generally prevailing in the
savings institutions industry. For purposes of this paragraph, no act or failure
to act on the part of the Executive shall be considered "willful" unless done,
or omitted to be done, by the Executive not in good faith and without reasonable
belief that the Executive's action or omission was in the best interest of the
Bank. Notwithstanding the foregoing, Executive shall not be deemed to have been
Terminated for Cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the affirmative vote of not less than
three-fourths of the members of the Board at a meeting of the Board called and
held for that purpose (after reasonable notice to Executive and an opportunity
for him, together with counsel, to be heard before the Board), finding that in
the good faith opinion of the board, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in detail. The
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause. Any stock options granted to Executive
under any stock option plan of the Bank, the Company or any subsidiary thereof,
shall become null and void effective upon Executive's receipt of Notice of
Termination for Cause pursuant to Section 7 hereof, and shall not be exercisable
by Executive at any time subsequent to such Termination for Cause.
7. NOTICE
(a) Any purported termination by the Bank or by Executive shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this Agreement, a "Notice of Termination" shall mean a written notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's
employment under the provision so indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination, which shall in no event be later than the date on which the Notice
of Termination is personally delivered by the notifying party to the other party
or five (5) days after the date on which such Notice of Termination is mailed by
certified mail, return receipt requested, to the other party.
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, except upon the occurrence of
Termination for Cause in which case the Date of Termination shall be the date
specified in the Notice, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of an court of competent jurisdiction (the time for appeal having expired and no
appear having been perfected); provided however, that the Date of Termination
shall be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such dispute
with reasonable diligence. Notwithstanding the pendency of any such dispute, the
Bank will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to, Base
Salary) and continue Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice of dispute was
given, until the dispute is finally resolved in accordance with this Agreement,
provided such dispute is resolved within nine months after the Date of
Termination specified in the Notice of Termination; notwithstanding the
foregoing no compensation or benefits shall be paid to Executive in the event
the Executive is Terminated for Cause. In the event that such Termination for
Cause is found to have been wrongful or such dispute is otherwise decided in
Executive's favor, the Executive shall be entitled to receive all compensation
and benefits which accrued for up to a period of nine months after the
Termination for Cause. If such dispute is not resolved within such nine-month
period, the Bank shall not be obligated, upon final resolution of such dispute,
to pay Executive compensation and other payments accruing more than nine months
from the Date of the Termination specified in the Notice of Termination. Amounts
paid under this Section are in addition to all other amounts due under this
Agreement and shall not be offset against or reduce any other amounts due under
this Agreement.
8. POST-TERMINATION OBLIGATIONS
(a) All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with paragraph (b) of this Section 8 during
the term of this Agreement and for 3 full years after the expiration or
termination hereof.
(b) Executive shall, upon reasonable notice, furnish such information and
assistance to the Bank as may reasonably be required by the Bank in connection
with any litigation in which it or any of its subsidiaries or affiliates is, or
may become, a party; provided, however, that the Executive shall be reimbursed
by the Bank for all of the reasonable costs which he incurs in complying with
this Section 8(b).
9. NON-COMPETITION
(a) Executive agrees not to compete with the Bank and/or the Company
during the term of his employment hereunder and for a period of one (1) year
following his Date of Termination in any city, town or county in which the Bank,
the Company, or a subsidiary of the Bank of the Company has an office or other
physical location or has filed an application of regulatory approval to
establish an office, determined as of the effective date of such termination,
except as agreed to pursuant to a resolution duly adopted by the Board.
Executive agrees that during such period and within said cities, towns and
counties, Executive shall not work for or advise, consult or otherwise serve
with, directly or indirectly, any entity whose business materially competes with
the depository, lending or other business activities of the Bank and/or the
Company. The parties hereto, recognizing that irreparable injury will result to
the Bank and/or the Company, its business and property in the event of
Executive's breach of this Subsection 9(a) agree that in the event of any such
breach by Executive, the Bank and/or the Company will be entitled, in addition
to any other remedies and damages available, to an injunction to restrain the
violation hereof by Executive, Executive's partners, agents, servants,
employers, employees and all persons acting for or with Executive. Nothing
herein will be construed as prohibiting the Bank and/or the Company from
pursuing any other remedies available to the Bank and/or the Company for such
breach or threatened breach, including the recovery of damages from Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Bank. Executive will not, during or after the term
of his employment, disclose any knowledge of the past, present, planned or
considered business activities of the Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively derived from the business plans and activities of the Bank, and
Executive may disclose any information regarding the Bank or the Company which
is otherwise publicly available. In the event of a breach or threatened breach
by the Executive of the Provisions of this Section 9, the Bank will be entitled
to an injunction restraining Executive from disclosing, in whole or in part, the
knowledge of the past, present, planned or considered business activities of the
Bank or affiliates thereof, or from rendering any services to any person, firm,
corporation, other entity to whom such knowledge, in whole or in part, has been
disclosed or is threatened to be disclosed. Nothing herein will be construed as
prohibiting the Bank from pursuing any other remedies available to the Bank for
such breach or threatened breach, including the recovery of damages from
Executive.
10. SOURCE OF PAYMENTS
All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank.
11. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior employment agreement between the Bank or any
predecessor of the Bank and Executive, except that this Agreement shall not
affect or operate to reduce any benefit or compensation inuring to the Executive
of a kind elsewhere provided. No provision of this Agreement shall be
interpreted to mean that Executive is subject to receiving fewer benefits that
those available to him without reference to this Agreement.
12. NO ATTACHMENT
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
Executive and the Bank and their respective successors and assigns.
13. MODIFICATION AND WAIVER
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
wavier or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.
14. REQUIRED PROVISIONS
(a) The Bank may terminate the Executive's employment at any time, but any
termination by the Bank, other than Termination for Cause, shall not prejudice
Executive's right (if applicable) to compensation or other benefits under this
Agreement. Executive shall not have the right to receive compensation or other
benefits for any period after Termination for Cause as defined in Section 6
herein above.
(b) If the Executive is suspended from office and/or temporarily
prohibited rom
participating in the conduct of the Bank's affairs by a notice served under
Section 8(e)(3) (12 U.S.C. (S)(S) 1818(e)(3)) or 8(g) (12 U.S.C. (S) 1818(g)) of
the Federal Deposit Insurance Act, as amended by the Financial Institutions
Reform, Recovery and Enforcement Act of 1989, the Bank's obligations under this
contract shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Bank
may in its discretion (i) pay the Executive all or part of the compensation
withheld while their contract obligations were suspended and (ii) reinstate (in
whole or in part) any of the obligations which were suspended.
(c) If the Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e) (12 U.S.C. (S)(S) 1818(e)) or 8(g)(12 U.S.C. (S) 1818(g)) of the
Federal Deposit Insurance Act, as amended by the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, all obligations of the Bank under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.
(d) If the Bank is in default as defined in Section 3(x) (12 U.S.C. (S)
1813(x)(1)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, all obligations of
the Bank under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.
(e) All obligations of the Bank under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the institution, (i) by the Federal Deposit
Insurance Corporation ("FDIC"), at the time FDIC enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) (12 U.S.C. (S) 1823(c)) of the Federal Deposit Insurance Act, as
amended by the Financial Institutions Reform, Recovery and Enforcement Act of
1989; or (ii) by the Office of Thrift Supervision ("OTS") at the time the OTS or
its District Director approves a supervisory merger to resolve problems related
to the operations of the Bank or when the Bank is determined by the OTS or FDIC
to be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
15. SEVERABILITY
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
16. HEADINGS FOR REFERENCE ONLY
The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.
17. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Iowa, but only
to the extent not superseded by federal law.
18. ARBITRATION
Any dispute or controversy arising under or in connection with this
Agreement may be settled by arbitration in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that
Executive shall be entitled to seek specific performance of his right to be paid
until the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
19. INDEMNIFICATION
The Bank shall provide Executive (including his heirs, executors and
administrators) with coverage under a standard directors' and officers'
liability insurance policy at its expense, or in lieu thereof, shall indemnify
Executive (and his heirs, executors and administrator) to the fullest extent
permitted under federal law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which me may be involved by reason of his having been a director
or officer of the Bank (whether or not he continued to be a director or officer
at the time of incurring such expenses or liabilities), such expenses and
liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements (such settlements must be
approved by the Board of Directors of the Bank). If such action, suit or
proceeding is brought against Executive in his capacity as an officer or
director of the Bank, however, such indemnification shall not extend to matters
as to which Executive is finally adjudged to be liable for willful misconduct in
the performance of his duties. No Indemnification shall be paid that would
violate 12 U.S.C. 1828(k) or any regulations promulgated thereunder, or 12
C.F.R. 544.122.
20. SUCCESSOR TO THE BANK
The Bank shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Company, expressly
and unconditionally to assume and agree to perform the Bank's obligations under
this Agreement, in the same manner and the same extent that the Bank would be
required to perform if no such succession or assignment had taken place.
SIGNATURES
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed and
their seals to be affixed hereunto by its duly authorized officer, and the
Executive has signed this Agreement, on the day and date first above written.
ATTEST: FIRST FEDERAL SAVINGS BANK OF IOWA
BY: /s/ Xxxx Xxxx BY: /s/ Xxxxx X. Xxxxxxx
----------------------- --------------------------------
Xxxx Xxxx, Secretary Xxxxx X. Xxxxxxx
President and Chief Executive Officer
[SEAL]
WITNESS EXECUTIVE
BY: /s/ C. Xxxxxx Xxxxxxxxx BY: /s/ Xxxx X Xxxx
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came
Xxxx X. Xxxx, to me known, and known to me to be the individual described in the
foregoing instrument, who, being by me duly sworn, did depose and say that he
resides at 0000 00xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx 00000, and that he signed
his name to the foregoing instrument.
/s/ C. Xxxxxx Xxxxxxxxx
--------------------------
Notary Public
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came Xxxxx X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
resides at 0000 00xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx, 00000, that he is the
President and Chief Executive Officer of First Federal Savings Bank of Iowa, the
savings bank described in and which executed the foregoing instrument; that he
knows the seal of said savings bank; that the seal affixed to said instrument is
such seal; that it was so affixed by order of the Board of Directors of said
savings bank; and that he signed his name thereto by like order.
/s/ C. Xxxxxx Xxxxxxxxx
--------------------------
Notary Public
FIRST FEDERAL SAVINGS BANK OF IOWA
AMENDED AND RESTATED EMPLOYEE RETENTION AGREEMENT
This Agreement is made effective as of March 20, 1998 by and between First
Federal Savings Bank of Iowa, a federally chartered savings institution, with
its principal administrative office at 000 Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxx
00000 (the "Bank"), and C. Xxxxxx Xxxxxxxxx (the "Executive").
WHEREAS, the Bank and the Executive are parties to an Employee Retention
Agreement made and entered into as of the 20th day of March, 1996 ("Prior
Agreement"); and
WHEREAS, the Bank and the Executive desire to amend and restate the Prior
Agreement in its entirety as set forth herein; and
WHEREAS, the Bank wishes to assure itself of the services of Executive for
the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employ of the Bank on a full-
time basis for said period.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
21. POSITION AND RESPONSIBILITIES
During the period of his employment hereunder, Executive agrees to serve as
Executive Vice President of the Bank. During said period, Executive also agrees
to serve, if elected, as an officer and director of any subsidiary or affiliate
of the Bank.
22. TERMS AND DUTIES
(a) The period of Executive's employment under this Agreement shall begin
as of the date first above written and shall continue for a period of thirty-six
(36) full calendar months thereafter. Prior to each anniversary date of this
Agreement, the members of the Board of Directors of the Bank ("Board") will
conduct a comprehensive performance evaluation and review of the Executive for
purposes of determining whether to extend the Agreement, and the results thereof
shall be included in the minutes of the Board's meeting. If the Board determines
to extend the Agreement and the Executive agrees to such extension, the
Executive's period of employment shall be extended for an additional year such
that the remaining term shall be three (3) years from the upcoming anniversary
date. If the Board does not determine to extend the Agreement or if the
Executive does not agree to a proposed extension, the Agreement shall expire at
the end of the term then in effect.
(b) During the period of his employment hereunder, except for periods of
absence occasioned by illness, reasonable vacation periods, and reasonable
leaves of absence, Executive shall devote substantially all his business time,
attention, skill, and efforts to the faithful performance of his duties
hereunder including activities and services related to the organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board, as evidenced by a resolution of such Board, from time to time,
Executive may serve, or continue to serve, on the boards of directors of, and
hold any other offices or positions in, companies or organizations, which, in
such Board's judgment, will not present any conflict of interest with the Bank,
or materially adversely affect the performance of Executive's duties pursuant to
this Agreement.
23. COMPENSATION AND REIMBURSEMENT
(a) The compensation specified under this Agreement shall constitute the
salary and benefits paid for the duties described in section 2(b). The Bank
shall pay Executive as compensation a salary at an annualized rate of not less
than SEVENTY THOUSAND DOLLARS ($70,000) per year ("Base Salary"). Such Base
Salary shall be payable monthly, on the first day of each month, or in
accordance with the Bank's customary payroll practices in effect from time to
time for other similarly situated employees. During the period of this
Agreement, Executive's Base Salary shall be reviewed at least annually. Such
review shall be conducted by a Committee designated by the Board, and the Board
may increase Executive's Base Salary. In addition to the Base Salary provided in
this Section 3(a), the Bank shall provide Executive with all such other benefits
as are provided uniformly to full-time employees of the Bank, subject to and
upon the same terms and conditions generally applicable to full-time employees.
(b) The Bank will provide Executive with employee benefit plans,
arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit form immediately prior
to the beginning of the term of this Agreement. Without limiting the generality
of the foregoing provisions of this Subsection (b), Executive will be entitled
to participate in or receive benefits under any employee benefit plans including
but not limited to, retirement plans, supplemental retirement plans, pension
plans, profit-sharing plans, health-and-accident plans, medical coverage or any
other employee benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall administration of such
plans and arrangements. Executive will be entitled to incentive compensation and
bonuses as provided in any plan of the Bank in which Executive is eligible to
participate. Nothing paid to the Executive under any such plan or arrangement
will be deemed to be in lieu of other compensation to which the Executive is
entitled under this Agreement.
24. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION
The provisions of this Section shall in all respects be subject to the
terms and conditions stated in Sections 7 and 14.
(a) The provisions of this Section shall apply upon the occurrence of an
Event of Termination (as herein defined) during any portion of the Executive's
term of employment under this Agreement that follows a Change in Control. As
used in this Agreement, an "Event of Termination" shall mean and include any
termination by the Bank of Executive's full-time employment hereunder for any
reason other than a Termination for Cause as defined in Section 6 hereof and any
termination of employment by the Executive within sixty (60) days following any
material reduction in his compensation and benefits from the levels in effect
immediately prior to the Change in Control or any material adverse change in the
Executive's position, duties, authority or terms and conditions of employment
from those in effect immediately prior to the Change in Control. In the event of
a continuing breach of this Agreement by the Bank, the Executive shall not waive
any of his rights under this Agreement by virtue of the fact that the Executive
is engaged in good faith discussions to resolve such breach.
(b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 7, the Bank shall pay Executive, or, in the
event of his subsequent death, his beneficiary or beneficiaries, or his estate,
as the case may be, as severance pay or liquidated damages, or both, a sum equal
to the greater of the payments due for the remaining term of the Agreement or 3
times the average of aggregate of the Executive's Base Salary plus bonus and
other cash compensation paid to, plus the amount of all determinable
contributions made to or under any employee benefit plan on behalf of, the
Executive by the Bank during the period of five (5) years ending on the Date of
Termination; provided, however, that if the Bank is not in compliance with its
minimum capital requirements or if such payments would cause the Bank's capital
to be reduced below its minimum capital requirements, such payments shall be
deferred until such time as the Bank is in capital compliance.
(c) Upon the occurrence of an Event of Termination, the Bank will cause to
be continued life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank for Executive prior to his
termination, provided that such benefits shall not be provided in the event they
should constitute an unsafe or unsound banking practice relating to executive
compensation and employment contracts pursuant to 12 C.F.R. (S)(S) 563.39 and
563.161, as is now or hereafter in effect. Such coverage shall cease upon the
expiration of thirty-six (36) full calendar months following the Date of
Termination.
(d) Upon the occurrence of an Event of Termination, Executive will be
entitled to any benefits granted to him pursuant to any stock option plan of the
Bank or Company.
(e) Upon the occurrence of an Event of Termination, the Executive will be
entitled to any benefits awarded to him under any restricted stock plan of the
Bank or the Company.
(f) Notwithstanding the preceding paragraphs of this Section 4, in the
event that the Executive receives payments in the nature of compensation
(whether or not pursuant to this Agreement) that are subject to the tax imposed
under section 4999 of the Internal Revenue Code of 1986 or the corresponding
provision of any succeeding law ("Parachute Tax"), then:
(i) if, by reducing the payments and benefits provided for in this
Agreement, the aggregate payments in the nature of compensation may be
reduced to a level at which the Parachute Tax is imposed, such payments
shall be reduced to the maximum amount which may be provided without
resulting in the imposition of a Parachute Tax; and
(ii) in all other cases, the payments and benefits provided hereunder
shall not be affected.
The applicability of any reduction under Section 4(f)(i) and the amount and
manner of such reduction shall be determined by a firm of independent certified
public accountants selected by the Bank which shall, in determining the manner
of any reduction, consult with and take into accounts the preferences of the
Executive.
(g) Notwithstanding the foregoing, there will be no reduction in the
compensation otherwise payable to Executive during any period which Executive is
incapable of performing his duties hereunder by reason of temporary disability.
(h) Any payments made to Executive pursuant to this Agreement or
otherwise, are subject to and conditioned upon their compliance with 12.U.S.C.
(S) 1818(k) and any regulations promulgated thereunder.
25. CHANGE IN CONTROL
(a) No benefit shall be payable under Section 4 unless there shall have
been a Change in Control of the Bank or North Central Bancshares, Inc., an Iowa
corporation of which the Bank is a subsidiary (the "Company"), as set forth
below. For purposes of this Agreement, a "Change in Control" of the Bank or
Company shall mean:
(i) approval by the stockholders of the Bank of a transaction that
would result in the reorganization, merger or consolidation of the Bank
with one or more other persons, other than a transaction following which:
(A) at least 51% of the equity ownership interests of the entity
resulting from such transaction are beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) in
substantially the same relative proportions by persons who,
immediately prior to such transaction, beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) at least 51%
of the outstanding equity ownership interests in the Bank; and
(B) at least 51% of the securities entitled to vote generally in
the election of directors of the entity resulting from such
transaction are beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) in substantially the same relative
proportions by persons who, immediately prior to such transaction,
beneficially
owned (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) at least 51% of the securities entitled
to vote generally in the election of directors of the Bank;
(ii) the acquisition of all or substantially all of the assets of the
Bank or beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 20% or more of the outstanding securities of the
Bank entitled to vote generally in the election of directors by any person
or by any persons acting in concert, or approval by the stockholders of the
Bank of any transaction which would result in such an acquisition; or
(iii) a complete liquidation or dissolution of the Bank, or approval
by the stockholders of the Bank of a plan for such liquidation or
dissolution; or
(iv) the occurrence of any event if, immediately following such
event, at least 50% of the members of the board of directors of the Bank do
not belong to any of the following groups:
(A) individuals who were members of the Board of the Bank on
the date of this Agreement; or
(B) individuals who first became members of the Board of the
Bank after the date of this Agreement either:
(I) upon election to serve as a member of the Board of
the Bank by affirmative vote of three-quarters of the members of
such board, or of a nominating committee thereof, in office at
the time of such first election; or
(II) upon election by the stockholders of the Bank to
serve as a member of the Board of the Bank, but only if nominated
for election by affirmative vote of three-quarters of the members
of the Board of the Bank, or of a nominating committee thereof,
in office at the time of such first nomination;
provided, however, that such individual's election or nomination did
not result from an actual or threatened election contest (within the
meaning of Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents (within the meaning of Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) other than by or on behalf of the
Board of the Bank;
(v) any event which would be described in Section 5(a)(i), (ii),
(iii) or (iv) if the term "Company" were substituted for the term "Bank"
therein.
(b) In no event, however, shall a Change of Control be deemed to have
occurred as a result of any acquisition of securities or assets of the Bank, the
Company, or any affiliate or subsidiary of either of them, by the Bank, the
Company or any affiliate or subsidiary of either of them, or by any employee
benefit plan maintained by any of them. For purposes of this section 5 the term
"person" shall have the meaning assigned to it under sections 13(d)(3) or
14(d)(2) of the Exchange Act.
26. TERMINATION FOR CAUSE
The term "Termination for Cause" shall mean termination because of the
Executive's personal dishonesty, incompetence, willful misconduct, any breach of
fiduciary duty involving personal profit, intentional failure to perform stated
duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material
breach of any provision of this Agreement. In determining incompetence, the acts
or omissions shall be measured against standards generally prevailing in the
savings institutions industry. For purposes of this paragraph, no act or failure
to act on the part of the Executive shall be considered "willful" unless done,
or omitted to be done, by the Executive not in good faith and without reasonable
belief that the Executive's action or omission was in the best interest of the
Bank. Notwithstanding the foregoing, Executive shall not be deemed to have been
Terminated for Cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the affirmative vote of not less than
three-fourths of the members of the Board at a meeting of the Board called and
held for that purpose (after reasonable notice to Executive and an opportunity
for him, together with counsel, to be heard before the Board), finding that in
the good faith opinion of the board, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in detail. The
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause. Any stock options granted to Executive
under any stock option plan of the Bank, the Company or any subsidiary thereof,
shall become null and void effective upon Executive's receipt of Notice of
Termination for Cause pursuant to Section 7 hereof, and shall not be exercisable
by Executive at any time subsequent to such Termination for Cause.
27. NOTICE
(a) Any purported termination by the Bank or by Executive shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this Agreement, a "Notice of Termination" shall mean a written notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination, which shall in no event be later than the date on which the Notice
of Termination is personally delivered by the notifying party to the other party
or five (5) days after the date on which such Notice of Termination is mailed by
certified mail, return receipt requested, to the other party.
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, except upon the occurrence of
Termination for Cause in which case the Date of Termination shall be the date
specified in the Notice, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of an court of competent jurisdiction (the time for appeal having expired and no
appear having been perfected); provided however, that the Date of Termination
shall be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such dispute
with reasonable diligence. Notwithstanding the pendency of any such dispute, the
Bank will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to, Base
Salary) and continue Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice of dispute was
given, until the dispute is finally resolved in accordance with this Agreement,
provided such dispute is resolved within nine months after the Date of
Termination specified in the Notice of Termination; notwithstanding the
foregoing no compensation or benefits shall be paid to Executive in the event
the Executive is Terminated for Cause. In the event that such Termination for
Cause is found to have been wrongful or such dispute is otherwise decided in
Executive's favor, the Executive shall be entitled to receive all compensation
and benefits which accrued for up to a period of nine months after the
Termination for Cause. If such dispute is not resolved within such nine-month
period, the Bank shall not be obligated, upon final resolution of such dispute,
to pay Executive compensation and other payments accruing more than nine months
from the Date of the Termination specified in the Notice of Termination. Amounts
paid under this Section are in addition to all other amounts due under this
Agreement and shall not be offset against or reduce any other amounts due under
this Agreement.
28. POST-TERMINATION OBLIGATIONS
(a) All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with paragraph (b) of this Section 8 during
the term of this Agreement and for 3 full years after the expiration or
termination hereof.
(b) Executive shall, upon reasonable notice, furnish such information and
assistance to the Bank as may reasonably be required by the Bank in connection
with any litigation in which it or any of its subsidiaries or affiliates is, or
may become, a party; provided, however, that the Executive shall be reimbursed
by the Bank for all of the reasonable costs which he incurs in complying with
this Section 8(b).
29. NON-COMPETITION
(a) Executive agrees not to compete with the Bank and/or the Company
during the term of his employment hereunder and for a period of one (1) year
following his Date of Termination in any city, town or county in which the Bank,
the Company, or a subsidiary of the Bank of the Company has an office or other
physical location or has filed an application
of regulatory approval to establish an office, determined as of the effective
date of such termination, except as agreed to pursuant to a resolution duly
adopted by the Board. Executive agrees that during such period and within said
cities, towns and counties, Executive shall not work for or advise, consult or
otherwise serve with, directly or indirectly, any entity whose business
materially competes with the depository, lending or other business activities of
the Bank and/or the Company. The parties hereto, recognizing that irreparable
injury will result to the Bank and/or the Company, its business and property in
the event of Executive's breach of this Subsection 9(a) agree that in the event
of any such breach by Executive, the Bank and/or the Company will be entitled,
in addition to any other remedies and damages available, to an injunction to
restrain the violation hereof by Executive, Executive's partners, agents,
servants, employers, employees and all persons acting for or with Executive.
Nothing herein will be construed as prohibiting the Bank and/or the Company from
pursuing any other remedies available to the Bank and/or the Company for such
breach or threatened breach, including the recovery of damages from Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Bank. Executive will not, during or after the term
of his employment, disclose any knowledge of the past, present, planned or
considered business activities of the Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively derived from the business plans and activities of the Bank, and
Executive may disclose any information regarding the Bank or the Company which
is otherwise publicly available. In the event of a breach or threatened breach
by the Executive of the Provisions of this Section 9, the Bank will be entitled
to an injunction restraining Executive from disclosing, in whole or in part, the
knowledge of the past, present, planned or considered business activities of the
Bank or affiliates thereof, or from rendering any services to any person, firm,
corporation, other entity to whom such knowledge, in whole or in part, has been
disclosed or is threatened to be disclosed. Nothing herein will be construed as
prohibiting the Bank from pursuing any other remedies available to the Bank for
such breach or threatened breach, including the recovery of damages from
Executive.
30. SOURCE OF PAYMENTS
All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank.
31. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior employment agreement between the Bank or any
predecessor of the
Bank and Executive, except that this Agreement shall not affect or operate to
reduce any benefit or compensation inuring to the Executive of a kind elsewhere
provided. No provision of this Agreement shall be interpreted to mean that
Executive is subject to receiving fewer benefits that those available to him
without reference to this Agreement.
32. NO ATTACHMENT
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
Executive and the Bank and their respective successors and assigns.
33. MODIFICATION AND WAIVER
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
wavier or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.
34. REQUIRED PROVISIONS
(a) The Bank may terminate the Executive's employment at any time, but any
termination by the Bank, other than Termination for Cause, shall not prejudice
Executive's right (if applicable) to compensation or other benefits under this
Agreement. Executive shall not have the right to receive compensation or other
benefits for any period after Termination for Cause as defined in Section 6
herein above.
(b) If the Executive is suspended from office and/or temporarily
prohibited from participating in the conduct of the Bank's affairs by a notice
served under Section 8(e)(3) (12 U.S.C. (S)(S) 1818(e)(3)) or 8(g) (12 U.S.C.
(S) 1818(g)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, the Bank's
obligations under this contract shall be suspended as of the date of service,
unless stayed by appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive all or part of
the compensation withheld while their
contract obligations were suspended and (ii) reinstate (in whole or in part) any
of the obligations which were suspended.
(c) If the Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e) (12 U.S.C. (S)(S) 1818(e)) or 8(g)(12 U.S.C. (S) 1818(g)) of the
Federal Deposit Insurance Act, as amended by the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, all obligations of the Bank under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.
(d) If the Bank is in default as defined in Section 3(x) (12 U.S.C. (S)
1813(x)(1)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, all obligations of
the Bank under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.
(e) All obligations of the Bank under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the institution, (i) by the Federal Deposit
Insurance Corporation ("FDIC"), at the time FDIC enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) (12 U.S.C. (S) 1823(c)) of the Federal Deposit Insurance Act, as
amended by the Financial Institutions Reform, Recovery and Enforcement Act of
1989; or (ii) by the Office of Thrift Supervision ("OTS") at the time the OTS or
its District Director approves a supervisory merger to resolve problems related
to the operations of the Bank or when the Bank is determined by the OTS or FDIC
to be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
35. SEVERABILITY
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
36. HEADINGS FOR REFERENCE ONLY
The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.
37. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Iowa, but only
to the extent not superseded by federal law.
38. ARBITRATION
Any dispute or controversy arising under or in connection with this
Agreement may be settled by arbitration in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that
Executive shall be entitled to seek specific performance of his right to be paid
until the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
39. INDEMNIFICATION
The Bank shall provide Executive (including his heirs, executors and
administrators) with coverage under a standard directors' and officers'
liability insurance policy at its expense, or in lieu thereof, shall indemnify
Executive (and his heirs, executors and administrator) to the fullest extent
permitted under federal law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which me may be involved by reason of his having been a director
or officer of the Bank (whether or not he continued to be a director or officer
at the time of incurring such expenses or liabilities), such expenses and
liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements (such settlements must be
approved by the Board of Directors of the Bank). If such action, suit or
proceeding is brought against Executive in his capacity as an officer or
director of the Bank, however, such indemnification shall not extend to matters
as to which Executive is finally adjudged to be liable for willful misconduct in
the performance of his duties. No Indemnification shall be paid that would
violate 12 U.S.C. 1828(k) or any regulations promulgated thereunder, or 12
C.F.R. 544.122.
40. SUCCESSOR TO THE BANK
The Bank shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Company, expressly
and unconditionally to assume and agree to perform the Bank's obligations under
this Agreement, in the same manner and the same extent that the Bank would be
required to perform if no such succession or assignment had taken place.
SIGNATURES
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed and
their seals to be affixed hereunto by its duly authorized officer, and the
Executive has signed this Agreement, on the day and date first above written.
ATTEST: FIRST FEDERAL SAVINGS BANK OF IOWA
BY: /s/ Xxxx Xxxx BY: /s/ Xxxxx X. Xxxxxxx
---------------------- -----------------------------------
Xxxx Xxxx, Secretary Xxxxx X. Xxxxxxx
President and Chief Executive Officer
[SEAL]
EXECUTIVE
WITNESS
BY: /s/ Xxxx X. Xxxx BY: /s/ C. Xxxxxx Xxxxxxxxx
C. Xxxxxx Xxxxxxxxx
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came C. Xxxxxx
Xxxxxxxxx, to me known, and known to me to be the individual described in the
foregoing instrument, who, being by me duly sworn, did depose and say that he
resides at 0000 0xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx 00000, and that he signed his
name to the foregoing instrument.
/s/ Xxxxx X. Xxxx
------------------
Notary Public
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came Xxxxx X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
resides at 0000 00xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx, 00000, that he is the
President and Chief Executive Officer of First Federal Savings Bank of Iowa, the
savings bank described in and which executed the foregoing instrument; that he
knows the seal of said savings bank; that the seal affixed to said instrument is
such seal; that it was so affixed by order of the Board of Directors of said
savings bank; and that he signed his name thereto by like order.
/s/ Xxxxx X. Xxxx
------------------
Notary Public
FIRST FEDERAL SAVINGS BANK OF IOWA
AMENDED AND RESTATED EMPLOYEE RETENTION AGREEMENT
This Agreement is made effective as of March 20, 1998 by and between First
Federal Savings Bank of Iowa, a federally chartered savings institution, with
its principal administrative office at 000 Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxx
00000 (the "Bank"), and Xxxx X. Xxxxxxxxxxxxx (the "Executive").
WHEREAS, the Bank and the Executive are parties to an Employee Retention
Agreement made and entered into as of the 20th day of March, 1996 ("Prior
Agreement"); and
WHEREAS, the Bank and the Executive desire to amend and restate the Prior
Agreement in its entirety as set forth herein; and
WHEREAS, the Bank wishes to assure itself of the services of Executive for
the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employ of the Bank on a full-
time basis for said period.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
41. POSITION AND RESPONSIBILITIES
During the period of his employment hereunder, Executive agrees to serve as
Treasurer of the Bank. During said period, Executive also agrees to serve, if
elected, as an officer and director of any subsidiary or affiliate of the Bank.
42. TERMS AND DUTIES
(a) The period of Executive's employment under this Agreement shall begin
as of the date first above written and shall continue for a period of thirty-six
(36) full calendar months thereafter. Prior to each anniversary date of this
Agreement, the members of the Board of Directors of the Bank ("Board") will
conduct a comprehensive performance evaluation and review of the Executive for
purposes of determining whether to extend the Agreement, and the results thereof
shall be included in the minutes of the Board's meeting. If the Board determines
to extend the Agreement and the Executive agrees to such extension, the
Executive's period of employment shall be extended for an additional year such
that the remaining term shall be three (3) years from the upcoming anniversary
date. If the Board does not determine to extend the Agreement or if the
Executive does not agree to a proposed extension, the Agreement shall expire at
the end of the term then in effect.
(b) During the period of his employment hereunder, except for periods of
absence occasioned by illness, reasonable vacation periods, and reasonable
leaves of absence, Executive shall devote substantially all his business time,
attention, skill, and efforts to the faithful performance of his duties
hereunder including activities and services related to the organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board, as evidenced by a resolution of such Board, from time to time,
Executive may serve, or continue to serve, on the boards of directors of, and
hold any other offices or positions in, companies or organizations, which, in
such Board's judgment, will not present any conflict of interest with the Bank,
or materially adversely affect the performance of Executive's duties pursuant to
this Agreement.
43. COMPENSATION AND REIMBURSEMENT
(a) The compensation specified under this Agreement shall constitute the
salary and benefits paid for the duties described in section 2(b). The Bank
shall pay Executive as compensation a salary at an annualized rate of not less
than SEVENTY-SEVEN THOUSAND FIVE HUNDRED DOLLARS ($77,500) per year ("Base
Salary"). Such Base Salary shall be payable monthly, on the first day of each
month, or in accordance with the Bank's customary payroll practices in effect
from time to time for other similarly situated employees. During the period of
this Agreement, Executive's Base Salary shall be reviewed at least annually.
Such review shall be conducted by a Committee designated by the Board, and the
Board may increase Executive's Base Salary. In addition to the Base Salary
provided in this Section 3(a), the Bank shall provide Executive with all such
other benefits as are provided uniformly to full-time employees of the Bank,
subject to and upon the same terms and conditions generally applicable to full-
time employees.
(b) The Bank will provide Executive with employee benefit plans,
arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit form immediately prior
to the beginning of the term of this Agreement. Without limiting the generality
of the foregoing provisions of this Subsection (b), Executive will be entitled
to participate in or receive benefits under any employee benefit plans including
but not limited to, retirement plans, supplemental retirement plans, pension
plans, profit-sharing plans, health-and-accident plans, medical coverage or any
other employee benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall administration of such
plans and arrangements. Executive will be entitled to incentive compensation and
bonuses as provided in any plan of the Bank in which Executive is eligible to
participate. Nothing paid to the Executive under any such plan or arrangement
will be deemed to be in lieu of other compensation to which the Executive is
entitled under this Agreement.
44. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION
The provisions of this Section shall in all respects be subject to the
terms and conditions stated in Sections 7 and 14.
(a) The provisions of this Section shall apply upon the occurrence of an
Event of Termination (as herein defined) during any portion of the Executive's
term of employment under this Agreement that follows a Change in Control. As
used in this Agreement, an "Event of Termination" shall mean and include any
termination by the Bank of Executive's full-time employment hereunder for any
reason other than a Termination for Cause as defined in Section 6 hereof and any
termination of employment by the Executive within sixty (60) days following any
material reduction in his compensation and benefits from the levels in effect
immediately prior to the Change in Control or any material adverse change in the
Executive's position, duties, authority or terms and conditions of employment
from those in effect immediately prior to the Change in Control. In the event of
a continuing breach of this Agreement by the Bank, the Executive shall not waive
any of his rights under this Agreement by virtue of the fact that the Executive
is engaged in good faith discussions to resolve such breach.
(b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 7, the Bank shall pay Executive, or, in the
event of his subsequent death, his beneficiary or beneficiaries, or his estate,
as the case may be, as severance pay or liquidated damages, or both, a sum equal
to the greater of the payments due for the remaining term of the Agreement or 3
times the average of aggregate of the Executive's Base Salary plus bonus and
other cash compensation paid to, plus the amount of all determinable
contributions made to or under any employee benefit plan on behalf of, the
Executive by the Bank during the period of five (5) years ending on the Date of
Termination; provided, however, that if the Bank is not in compliance with its
minimum capital requirements or if such payments would cause the Bank's capital
to be reduced below its minimum capital requirements, such payments shall be
deferred until such time as the Bank is in capital compliance.
(c) Upon the occurrence of an Event of Termination, the Bank will cause to
be continued life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank for Executive prior to his
termination, provided that such benefits shall not be provided in the event they
should constitute an unsafe or unsound banking practice relating to executive
compensation and employment contracts pursuant to 12 C.F.R. (S)(S) 563.39 and
563.161, as is now or hereafter in effect. Such coverage shall cease upon the
expiration of thirty-six (36) full calendar months following the Date of
Termination.
(d) Upon the occurrence of an Event of Termination, Executive will be
entitled to any benefits granted to him pursuant to any stock option plan of the
Bank or Company.
(e) Upon the occurrence of an Event of Termination, the Executive will be
entitled to any benefits awarded to him under any restricted stock plan of the
Bank or the Company.
(f) Notwithstanding the preceding paragraphs of this Section 4, in the
event that the Executive receives payments in the nature of compensation
(whether or not pursuant to this Agreement) that are subject to the tax imposed
under section 4999 of the Internal Revenue Code of 1986 or the corresponding
provision of any succeeding law ("Parachute Tax"), then:
(i) if, by reducing the payments and benefits provided for in this
Agreement, the aggregate payments in the nature of compensation may be
reduced to a level at which the Parachute Tax is imposed, such payments
shall be reduced to the maximum amount which may be provided without
resulting in the imposition of a Parachute Tax; and
(ii) in all other cases, the payments and benefits provided hereunder
shall not be affected.
The applicability of any reduction under Section 4(f)(i) and the amount and
manner of such reduction shall be determined by a firm of independent certified
public accountants selected by the Bank which shall, in determining the manner
of any reduction, consult with and take into accounts the preferences of the
Executive.
(g) Notwithstanding the foregoing, there will be no reduction in the
compensation otherwise payable to Executive during any period which Executive is
incapable of performing his duties hereunder by reason of temporary disability.
(h) Any payments made to Executive pursuant to this Agreement or otherwise,
are subject to and conditioned upon their compliance with 12.U.S.C. (S) 1818(k)
and any regulations promulgated thereunder.
45. CHANGE IN CONTROL
(a) No benefit shall be payable under Section 4 unless there shall have
been a Change in Control of the Bank or North Central Bancshares, Inc., an Iowa
corporation of which the Bank is a subsidiary (the "Company"), as set forth
below. For purposes of this Agreement, a "Change in Control" of the Bank or
Company shall mean:
(i) approval by the stockholders of the Bank of a transaction that
would result in the reorganization, merger or consolidation of the Bank
with one or more other persons, other than a transaction following which:
(A) at least 51% of the equity ownership interests of the entity
resulting from such transaction are beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) in
substantially the same relative proportions by persons who,
immediately prior to such transaction, beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) at least 51%
of the outstanding equity ownership interests in the Bank; and
(B) at least 51% of the securities entitled to vote generally in
the election of directors of the entity resulting from such
transaction are beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) in substantially the same relative
proportions
by persons who, immediately prior to such transaction, beneficially
owned (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) at least 51% of the securities entitled to vote generally in the
election of directors of the Bank;
(ii) the acquisition of all or substantially all of the assets of the
Bank or beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 20% or more of the outstanding securities of the
Bank entitled to vote generally in the election of directors by any person
or by any persons acting in concert, or approval by the stockholders of the
Bank of any transaction which would result in such an acquisition; or
(iii) a complete liquidation or dissolution of the Bank, or approval
by the stockholders of the Bank of a plan for such liquidation or
dissolution; or
(iv) the occurrence of any event if, immediately following such event,
at least 50% of the members of the board of directors of the Bank do not
belong to any of the following groups:
(A) individuals who were members of the Board of the Bank on the
date of this Agreement; or
(B) individuals who first became members of the Board of the Bank
after the date of this Agreement either:
(I) upon election to serve as a member of the Board of the
Bank by affirmative vote of three-quarters of the members of such
board, or of a nominating committee thereof, in office at the
time of such first election; or
(II) upon election by the stockholders of the Bank to serve
as a member of the Board of the Bank, but only if nominated for
election by affirmative vote of three-quarters of the members of
the Board of the Bank, or of a nominating committee thereof, in
office at the time of such first nomination;
provided, however, that such individual's election or nomination did
not result from an actual or threatened election contest (within the
meaning of Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents (within the meaning of Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) other than by or on behalf of the
Board of the Bank;
(v) any event which would be described in Section 5(a)(i), (ii),
(iii) or (iv) if the term "Company" were substituted for the term "Bank"
therein.
(b) In no event, however, shall a Change of Control be deemed to have
occurred as a result of any acquisition of securities or assets of the Bank, the
Company, or any affiliate or subsidiary of either of them, by the Bank, the
Company or any affiliate or subsidiary of either of them, or by any employee
benefit plan maintained by any of them. For purposes of this section 5 the term
"person" shall have the meaning assigned to it under sections 13(d)(3) or
14(d)(2) of the Exchange Act.
46. TERMINATION FOR CAUSE
The term "Termination for Cause" shall mean termination because of the
Executive's personal dishonesty, incompetence, willful misconduct, any breach of
fiduciary duty involving personal profit, intentional failure to perform stated
duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material
breach of any provision of this Agreement. In determining incompetence, the acts
or omissions shall be measured against standards generally prevailing in the
savings institutions industry. For purposes of this paragraph, no act or failure
to act on the part of the Executive shall be considered "willful" unless done,
or omitted to be done, by the Executive not in good faith and without reasonable
belief that the Executive's action or omission was in the best interest of the
Bank. Notwithstanding the foregoing, Executive shall not be deemed to have been
Terminated for Cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the affirmative vote of not less than
three-fourths of the members of the Board at a meeting of the Board called and
held for that purpose (after reasonable notice to Executive and an opportunity
for him, together with counsel, to be heard before the Board), finding that in
the good faith opinion of the board, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in detail. The
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause. Any stock options granted to Executive
under any stock option plan of the Bank, the Company or any subsidiary thereof,
shall become null and void effective upon Executive's receipt of Notice of
Termination for Cause pursuant to Section 7 hereof, and shall not be exercisable
by Executive at any time subsequent to such Termination for Cause.
47. NOTICE
(a) Any purported termination by the Bank or by Executive shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this Agreement, a "Notice of Termination" shall mean a written notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination, which shall in no event be later than the date on which the Notice
of Termination is personally delivered by the notifying party to the other party
or five (5) days after the date on which such Notice of Termination is mailed by
certified mail, return receipt requested, to the other party.
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, except upon the occurrence of
Termination for Cause in which case the Date of Termination shall be the date
specified in the Notice, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of an court of competent jurisdiction (the time for appeal having expired and no
appear having been perfected); provided however, that the Date of Termination
shall be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such dispute
with reasonable diligence. Notwithstanding the pendency of any such dispute, the
Bank will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to, Base
Salary) and continue Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice of dispute was
given, until the dispute is finally resolved in accordance with this Agreement,
provided such dispute is resolved within nine months after the Date of
Termination specified in the Notice of Termination; notwithstanding the
foregoing no compensation or benefits shall be paid to Executive in the event
the Executive is Terminated for Cause. In the event that such Termination for
Cause is found to have been wrongful or such dispute is otherwise decided in
Executive's favor, the Executive shall be entitled to receive all compensation
and benefits which accrued for up to a period of nine months after the
Termination for Cause. If such dispute is not resolved within such nine-month
period, the Bank shall not be obligated, upon final resolution of such dispute,
to pay Executive compensation and other payments accruing more than nine months
from the Date of the Termination specified in the Notice of Termination. Amounts
paid under this Section are in addition to all other amounts due under this
Agreement and shall not be offset against or reduce any other amounts due under
this Agreement.
48. POST-TERMINATION OBLIGATIONS
(a) All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with paragraph (b) of this Section 8 during
the term of this Agreement and for 3 full years after the expiration or
termination hereof.
(b) Executive shall, upon reasonable notice, furnish such information and
assistance to the Bank as may reasonably be required by the Bank in connection
with any litigation in which it or any of its subsidiaries or affiliates is, or
may become, a party; provided, however, that the Executive shall be reimbursed
by the Bank for all of the reasonable costs which he incurs in complying with
this Section 8(b).
49. NON-COMPETITION
(a) Executive agrees not to compete with the Bank and/or the Company
during the term of his employment hereunder and for a period of one (1) year
following his Date of Termination in any city, town or county in which the Bank,
the Company, or a subsidiary of the Bank of the Company has an office or other
physical location or has filed an application of regulatory approval to
establish an office, determined as of the effective date of such
termination, except as agreed to pursuant to a resolution duly adopted by the
Board. Executive agrees that during such period and within said cities, towns
and counties, Executive shall not work for or advise, consult or otherwise serve
with, directly or indirectly, any entity whose business materially competes with
the depository, lending or other business activities of the Bank and/or the
Company. The parties hereto, recognizing that irreparable injury will result to
the Bank and/or the Company, its business and property in the event of
Executive's breach of this Subsection 9(a) agree that in the event of any such
breach by Executive, the Bank and/or the Company will be entitled, in addition
to any other remedies and damages available, to an injunction to restrain the
violation hereof by Executive, Executive's partners, agents, servants,
employers, employees and all persons acting for or with Executive. Nothing
herein will be construed as prohibiting the Bank and/or the Company from
pursuing any other remedies available to the Bank and/or the Company for such
breach or threatened breach, including the recovery of damages from Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Bank. Executive will not, during or after the term
of his employment, disclose any knowledge of the past, present, planned or
considered business activities of the Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively derived from the business plans and activities of the Bank, and
Executive may disclose any information regarding the Bank or the Company which
is otherwise publicly available. In the event of a breach or threatened breach
by the Executive of the Provisions of this Section 9, the Bank will be entitled
to an injunction restraining Executive from disclosing, in whole or in part, the
knowledge of the past, present, planned or considered business activities of the
Bank or affiliates thereof, or from rendering any services to any person, firm,
corporation, other entity to whom such knowledge, in whole or in part, has been
disclosed or is threatened to be disclosed. Nothing herein will be construed as
prohibiting the Bank from pursuing any other remedies available to the Bank for
such breach or threatened breach, including the recovery of damages from
Executive.
50. SOURCE OF PAYMENTS
All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank.
51. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior employment agreement between the Bank or any
predecessor of the Bank and Executive, except that this Agreement shall not
affect or operate to reduce any benefit or compensation inuring to the Executive
of a kind elsewhere provided. No provision
of this Agreement shall be interpreted to mean that Executive is subject to
receiving fewer benefits that those available to him without reference to this
Agreement.
52. NO ATTACHMENT
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
Executive and the Bank and their respective successors and assigns.
53. MODIFICATION AND WAIVER
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
wavier or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.
54. REQUIRED PROVISIONS
(a) The Bank may terminate the Executive's employment at any time, but any
termination by the Bank, other than Termination for Cause, shall not prejudice
Executive's right (if applicable) to compensation or other benefits under this
Agreement. Executive shall not have the right to receive compensation or other
benefits for any period after Termination for Cause as defined in Section 6
herein above.
(b) If the Executive is suspended from office and/or temporarily
prohibited rom participating in the conduct of the Bank's affairs by a notice
served under Section 8(e)(3) (12 U.S.C. (S)(S) 1818(e)(3)) or 8(g) (12 U.S.C.
(S) 1818(g)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, the Bank's
obligations under this contract shall be suspended as of the date of service,
unless stayed by appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive all or part of
the compensation withheld while their contract obligations were suspended and
(ii) reinstate (in whole or in part) any of the obligations which were
suspended.
(c) If the Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e) (12 U.S.C. (S)(S) 1818(e)) or 8(g)(12 U.S.C. (S) 1818(g)) of the
Federal Deposit Insurance Act, as amended by the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, all obligations of the Bank under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.
(d) If the Bank is in default as defined in Section 3(x) (12 U.S.C. (S)
1813(x)(1)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, all obligations of
the Bank under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.
(e) All obligations of the Bank under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the institution, (i) by the Federal Deposit
Insurance Corporation ("FDIC"), at the time FDIC enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) (12 U.S.C. (S) 1823(c)) of the Federal Deposit Insurance Act, as
amended by the Financial Institutions Reform, Recovery and Enforcement Act of
1989; or (ii) by the Office of Thrift Supervision ("OTS") at the time the OTS or
its District Director approves a supervisory merger to resolve problems related
to the operations of the Bank or when the Bank is determined by the OTS or FDIC
to be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
55. SEVERABILITY
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
56. HEADINGS FOR REFERENCE ONLY
The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.
57. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Iowa, but only
to the extent not superseded by federal law.
58. ARBITRATION
Any dispute or controversy arising under or in connection with this
Agreement may be settled by arbitration in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that
Executive shall be entitled to seek specific performance of his right to be paid
until the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
59. INDEMNIFICATION
The Bank shall provide Executive (including his heirs, executors and
administrators) with coverage under a standard directors' and officers'
liability insurance policy at its expense, or in lieu thereof, shall indemnify
Executive (and his heirs, executors and administrator) to the fullest extent
permitted under federal law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which me may be involved by reason of his having been a director
or officer of the Bank (whether or not he continued to be a director or officer
at the time of incurring such expenses or liabilities), such expenses and
liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements (such settlements must be
approved by the Board of Directors of the Bank). If such action, suit or
proceeding is brought against Executive in his capacity as an officer or
director of the Bank, however, such indemnification shall not extend to matters
as to which Executive is finally adjudged to be liable for willful misconduct in
the performance of his duties. No Indemnification shall be paid that would
violate 12 U.S.C. 1828(k) or any regulations promulgated thereunder, or 12
C.F.R. 544.122.
60. SUCCESSOR TO THE BANK
The Bank shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Company, expressly
and unconditionally to assume and agree to perform the Bank's obligations under
this Agreement, in the same manner and the same extent that the Bank would be
required to perform if no such succession or assignment had taken place.
SIGNATURES
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed and
their seals to be affixed hereunto by its duly authorized officer, and the
Executive has signed this Agreement, on the day and date first above written.
ATTEST: FIRST FEDERAL SAVINGS BANK OF IOWA
BY: /s/ Xxxx Xxxx BY: /s/ Xxxxx X. Xxxxxxx
Xxxx Xxxx, Secretary Xxxxx X. Xxxxxxx
President and Chief
Executive Officer
[SEAL]
EXECUTIVE
WITNESS
/s/ Xxxx X. Xxxx BY: /s/ Xxxx X. Xxxxxxxxxxxxx
Xxxx X. Xxxxxxxxxxxxx
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 7th day of July, 1998, before me personally came Xxxx X.
Xxxxxxxxxxxxx, to me known, and known to me to be the individual described in
the foregoing instrument, who, being by me duly sworn, did depose and say that
he resides at 0000 Xxxxxx Xxxxxx, Xxxx Xxxxx, Xxxx 00000, and that he signed his
name to the foregoing instrument.
/s/ C. Xxxxxx Xxxxxxxxx
--------------------------
Notary Public
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 7th day of July, 1998, before me personally came Xxxxx X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
resides at 0000 00xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx, 00000, that he is the
President and Chief Executive Officer of First Federal Savings Bank of Iowa, the
savings bank described in and which executed the foregoing instrument; that he
knows the seal of said savings bank; that the seal affixed to said instrument is
such seal; that it was so affixed by order of the Board of Directors of said
savings bank; and that he signed his name thereto by like order.
/s/ C. Xxxxxx Xxxxxxxxx
--------------------------
Notary Public
FIRST FEDERAL SAVINGS BANK OF IOWA
AMENDED AND RESTATED EMPLOYEE RETENTION AGREEMENT
This Agreement is made effective as of March 20, 1998 by and between First
Federal Savings Bank of Iowa, a federally chartered savings institution, with
its principal administrative office at 000 Xxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxx
00000 (the "Bank"), and Xxxx X. Lake (the "Executive").
WHEREAS, the Bank and the Executive are parties to an Employee Retention
Agreement made and entered into as of the 20th day of March, 1996 ("Prior
Agreement"); and
WHEREAS, the Bank and the Executive desire to amend and restate the Prior
Agreement in its entirety as set forth herein; and
WHEREAS, the Bank wishes to assure itself of the services of Executive for
the period provided in this Agreement; and
WHEREAS, Executive is willing to serve in the employ of the Bank on a full-
time basis for said period.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:
61. POSITION AND RESPONSIBILITIES
During the period of his employment hereunder, Executive agrees to serve as
Secretary of the Bank. During said period, Executive also agrees to serve, if
elected, as an officer and director of any subsidiary or affiliate of the Bank.
62. TERMS AND DUTIES
(a) The period of Executive's employment under this Agreement shall begin
as of the date first above written and shall continue for a period of thirty-six
(36) full calendar months thereafter. Prior to each anniversary date of this
Agreement, the members of the Board of Directors of the Bank ("Board") will
conduct a comprehensive performance evaluation and review of the Executive for
purposes of determining whether to extend the Agreement, and the results thereof
shall be included in the minutes of the Board's meeting. If the Board determines
to extend the Agreement and the Executive agrees to such extension, the
Executive's period of employment shall be extended for an additional year such
that the remaining term shall be three (3) years from the upcoming anniversary
date. If the Board does not determine to extend the Agreement or if the
Executive does not agree to a proposed extension, the Agreement shall expire at
the end of the term then in effect.
(b) During the period of his employment hereunder, except for periods of
absence occasioned by illness, reasonable vacation periods, and reasonable
leaves of absence, Executive shall devote substantially all his business time,
attention, skill, and efforts to the faithful performance of his duties
hereunder including activities and services related to the organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board, as evidenced by a resolution of such Board, from time to time,
Executive may serve, or continue to serve, on the boards of directors of, and
hold any other offices or positions in, companies or organizations, which, in
such Board's judgment, will not present any conflict of interest with the Bank,
or materially adversely affect the performance of Executive's duties pursuant to
this Agreement.
63. COMPENSATION AND REIMBURSEMENT
(a) The compensation specified under this Agreement shall constitute the
salary and benefits paid for the duties described in section 2(b). The Bank
shall pay Executive as compensation a salary at an annualized rate of not less
than FORTY THOUSAND DOLLARS ($40,000) per year ("Base Salary"). Such Base Salary
shall be payable monthly, on the first day of each month, or in accordance with
the Bank's customary payroll practices in effect from time to time for other
similarly situated employees. During the period of this Agreement, Executive's
Base Salary shall be reviewed at least annually. Such review shall be conducted
by a Committee designated by the Board, and the Board may increase Executive's
Base Salary. In addition to the Base Salary provided in this Section 3(a), the
Bank shall provide Executive with all such other benefits as are provided
uniformly to full-time employees of the Bank, subject to and upon the same terms
and conditions generally applicable to full-time employees.
(b) The Bank will provide Executive with employee benefit plans,
arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit form immediately prior
to the beginning of the term of this Agreement. Without limiting the generality
of the foregoing provisions of this Subsection (b), Executive will be entitled
to participate in or receive benefits under any employee benefit plans including
but not limited to, retirement plans, supplemental retirement plans, pension
plans, profit-sharing plans, health-and-accident plans, medical coverage or any
other employee benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall administration of such
plans and arrangements. Executive will be entitled to incentive compensation and
bonuses as provided in any plan of the Bank in which Executive is eligible to
participate. Nothing paid to the Executive under any such plan or arrangement
will be deemed to be in lieu of other compensation to which the Executive is
entitled under this Agreement.
64. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION
The provisions of this Section shall in all respects be subject to the
terms and conditions stated in Sections 7 and 14.
(a) The provisions of this Section shall apply upon the occurrence of an
Event of Termination (as herein defined) during any portion of the Executive's
term of employment under this Agreement that follows a Change in Control. As
used in this Agreement, an "Event of Termination" shall mean and include any
termination by the Bank of Executive's full-time employment hereunder for any
reason other than a Termination for Cause as defined in Section 6 hereof and any
termination of employment by the Executive within sixty (60) days following any
material reduction in his compensation and benefits from the levels in effect
immediately prior to the Change in Control or any material adverse change in the
Executive's position, duties, authority or terms and conditions of employment
from those in effect immediately prior to the Change in Control. In the event of
a continuing breach of this Agreement by the Bank, the Executive shall not waive
any of his rights under this Agreement by virtue of the fact that the Executive
is engaged in good faith discussions to resolve such breach.
(b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 7, the Bank shall pay Executive, or, in the
event of his subsequent death, his beneficiary or beneficiaries, or his estate,
as the case may be, as severance pay or liquidated damages, or both, a sum equal
to the greater of the payments due for the remaining term of the Agreement or 3
times the average of aggregate of the Executive's Base Salary plus bonus and
other cash compensation paid to, plus the amount of all determinable
contributions made to or under any employee benefit plan on behalf of, the
Executive by the Bank during the period of five (5) years ending on the Date of
Termination; provided, however, that if the Bank is not in compliance with its
minimum capital requirements or if such payments would cause the Bank's capital
to be reduced below its minimum capital requirements, such payments shall be
deferred until such time as the Bank is in capital compliance.
(c) Upon the occurrence of an Event of Termination, the Bank will cause to
be continued life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank for Executive prior to his
termination, provided that such benefits shall not be provided in the event they
should constitute an unsafe or unsound banking practice relating to executive
compensation and employment contracts pursuant to 12 C.F.R. (S)(S) 563.39 and
563.161, as is now or hereafter in effect. Such coverage shall cease upon the
expiration of thirty-six (36) full calendar months following the Date of
Termination.
(d) Upon the occurrence of an Event of Termination, Executive will be
entitled to any benefits granted to him pursuant to any stock option plan of the
Bank or Company.
(e) Upon the occurrence of an Event of Termination, the Executive will be
entitled to any benefits awarded to him under any restricted stock plan of the
Bank or the Company.
(f) Notwithstanding the preceding paragraphs of this Section 4, in the
event that the Executive receives payments in the nature of compensation
(whether or not pursuant to this Agreement) that are subject to the tax imposed
under section 4999 of the Internal Revenue Code of 1986 or the corresponding
provision of any succeeding law ("Parachute Tax"), then:
(i) if, by reducing the payments and benefits provided for in this
Agreement, the aggregate payments in the nature of compensation may be
reduced to a level at which the Parachute Tax is imposed, such payments
shall be reduced to the maximum amount which may be provided without
resulting in the imposition of a Parachute Tax; and
(ii) in all other cases, the payments and benefits provided hereunder
shall not be affected.
The applicability of any reduction under Section 4(f)(i) and the amount and
manner of such reduction shall be determined by a firm of independent certified
public accountants selected by the Bank which shall, in determining the manner
of any reduction, consult with and take into accounts the preferences of the
Executive.
(g) Notwithstanding the foregoing, there will be no reduction in the
compensation otherwise payable to Executive during any period which Executive is
incapable of performing his duties hereunder by reason of temporary disability.
(h) Any payments made to Executive pursuant to this Agreement or
otherwise, are subject to and conditioned upon their compliance with 12.U.S.C.
(S) 1818(k) and any regulations promulgated thereunder.
65. CHANGE IN CONTROL
(a) No benefit shall be payable under Section 4 unless there shall have
been a Change in Control of the Bank or North Central Bancshares, Inc., an Iowa
corporation of which the Bank is a subsidiary (the "Company"), as set forth
below. For purposes of this Agreement, a "Change in Control" of the Bank or
Company shall mean:
(i) approval by the stockholders of the Bank of a transaction that
would result in the reorganization, merger or consolidation of the Bank
with one or more other persons, other than a transaction following which:
(A) at least 51% of the equity ownership interests of the entity
resulting from such transaction are beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) in
substantially the same relative proportions by persons who,
immediately prior to such transaction, beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) at least 51%
of the outstanding equity ownership interests in the Bank; and
(B) at least 51% of the securities entitled to vote generally in
the election of directors of the entity resulting from such
transaction are beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) in substantially the same relative
proportions by persons who, immediately prior to such transaction,
beneficially
owned (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) at least 51% of the securities entitled to vote generally in the
election of directors of the Bank;
(ii) the acquisition of all or substantially all of the assets of the
Bank or beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 20% or more of the outstanding securities of the
Bank entitled to vote generally in the election of directors by any person
or by any persons acting in concert, or approval by the stockholders of the
Bank of any transaction which would result in such an acquisition; or
(iii) a complete liquidation or dissolution of the Bank, or approval
by the stockholders of the Bank of a plan for such liquidation or
dissolution; or
(iv) the occurrence of any event if, immediately following such
event, at least 50% of the members of the board of directors of the Bank do
not belong to any of the following groups:
(A) individuals who were members of the Board of the Bank on the
date of this Agreement; or
(B) individuals who first became members of the Board of the
Bank after the date of this Agreement either:
(I) upon election to serve as a member of the Board of the
Bank by affirmative vote of three-quarters of the members of such
board, or of a nominating committee thereof, in office at the
time of such first election; or
(II) upon election by the stockholders of the Bank to serve
as a member of the Board of the Bank, but only if nominated for
election by affirmative vote of three-quarters of the members of
the Board of the Bank, or of a nominating committee thereof, in
office at the time of such first nomination;
provided, however, that such individual's election or nomination did
not result from an actual or threatened election contest (within the
meaning of Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or
consents (within the meaning of Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) other than by or on behalf of the
Board of the Bank;
(v) any event which would be described in Section 5(a)(i), (ii),
(iii) or (iv) if the term "Company" were substituted for the term "Bank"
therein.
(b) In no event, however, shall a Change of Control be deemed to have
occurred as a result of any acquisition of securities or assets of the Bank, the
Company, or any affiliate or subsidiary of either of them, by the Bank, the
Company or any affiliate or subsidiary of either of them, or by any employee
benefit plan maintained by any of them. For purposes of this section 5 the term
"person" shall have the meaning assigned to it under sections 13(d)(3) or
14(d)(2) of the Exchange Act.
66. TERMINATION FOR CAUSE
The term "Termination for Cause" shall mean termination because of the
Executive's personal dishonesty, incompetence, willful misconduct, any breach of
fiduciary duty involving personal profit, intentional failure to perform stated
duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material
breach of any provision of this Agreement. In determining incompetence, the acts
or omissions shall be measured against standards generally prevailing in the
savings institutions industry. For purposes of this paragraph, no act or failure
to act on the part of the Executive shall be considered "willful" unless done,
or omitted to be done, by the Executive not in good faith and without reasonable
belief that the Executive's action or omission was in the best interest of the
Bank. Notwithstanding the foregoing, Executive shall not be deemed to have been
Terminated for Cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the affirmative vote of not less than
three-fourths of the members of the Board at a meeting of the Board called and
held for that purpose (after reasonable notice to Executive and an opportunity
for him, together with counsel, to be heard before the Board), finding that in
the good faith opinion of the board, Executive was guilty of conduct justifying
Termination for Cause and specifying the particulars thereof in detail. The
Executive shall not have the right to receive compensation or other benefits for
any period after Termination for Cause. Any stock options granted to Executive
under any stock option plan of the Bank, the Company or any subsidiary thereof,
shall become null and void effective upon Executive's receipt of Notice of
Termination for Cause pursuant to Section 7 hereof, and shall not be exercisable
by Executive at any time subsequent to such Termination for Cause.
67. NOTICE
(a) Any purported termination by the Bank or by Executive shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this Agreement, a "Notice of Termination" shall mean a written notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated.
(b) "Date of Termination" shall mean the date specified in the Notice of
Termination, which shall in no event be later than the date on which the Notice
of Termination is personally delivered by the notifying party to the other party
or five (5) days
after the date on which such Notice of Termination is mailed by certified mail,
return receipt requested, to the other party.
(c) If, within thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, except upon the occurrence of
Termination for Cause in which case the Date of Termination shall be the date
specified in the Notice, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of an court of competent jurisdiction (the time for appeal having expired and no
appear having been perfected); provided however, that the Date of Termination
shall be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such dispute
with reasonable diligence. Notwithstanding the pendency of any such dispute,
the Bank will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to, Base
Salary) and continue Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice of dispute was
given, until the dispute is finally resolved in accordance with this Agreement,
provided such dispute is resolved within nine months after the Date of
Termination specified in the Notice of Termination; notwithstanding the
foregoing no compensation or benefits shall be paid to Executive in the event
the Executive is Terminated for Cause. In the event that such Termination for
Cause is found to have been wrongful or such dispute is otherwise decided in
Executive's favor, the Executive shall be entitled to receive all compensation
and benefits which accrued for up to a period of nine months after the
Termination for Cause. If such dispute is not resolved within such nine-month
period, the Bank shall not be obligated, upon final resolution of such dispute,
to pay Executive compensation and other payments accruing more than nine months
from the Date of the Termination specified in the Notice of Termination.
Amounts paid under this Section are in addition to all other amounts due under
this Agreement and shall not be offset against or reduce any other amounts due
under this Agreement.
68. POST-TERMINATION OBLIGATIONS
(a) All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with paragraph (b) of this Section 8 during
the term of this Agreement and for 3 full years after the expiration or
termination hereof.
(b) Executive shall, upon reasonable notice, furnish such information and
assistance to the Bank as may reasonably be required by the Bank in connection
with any litigation in which it or any of its subsidiaries or affiliates is, or
may become, a party; provided, however, that the Executive shall be reimbursed
by the Bank for all of the reasonable costs which he incurs in complying with
this Section 8(b).
69. NON-COMPETITION
(a) Executive agrees not to compete with the Bank and/or the Company
during the term of his employment hereunder and for a period of one (1) year
following his Date of Termination in any city, town or county in which the Bank,
the Company, or a subsidiary of the Bank of the Company has an office or other
physical location or has filed an application of regulatory approval to
establish an office, determined as of the effective date of such termination,
except as agreed to pursuant to a resolution duly adopted by the Board.
Executive agrees that during such period and within said cities, towns and
counties, Executive shall not work for or advise, consult or otherwise serve
with, directly or indirectly, any entity whose business materially competes with
the depository, lending or other business activities of the Bank and/or the
Company. The parties hereto, recognizing that irreparable injury will result to
the Bank and/or the Company, its business and property in the event of
Executive's breach of this Subsection 9(a) agree that in the event of any such
breach by Executive, the Bank and/or the Company will be entitled, in addition
to any other remedies and damages available, to an injunction to restrain the
violation hereof by Executive, Executive's partners, agents, servants,
employers, employees and all persons acting for or with Executive. Nothing
herein will be construed as prohibiting the Bank and/or the Company from
pursuing any other remedies available to the Bank and/or the Company for such
breach or threatened breach, including the recovery of damages from Executive.
(b) Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Bank. Executive will not, during or after the term
of his employment, disclose any knowledge of the past, present, planned or
considered business activities of the Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively derived from the business plans and activities of the Bank, and
Executive may disclose any information regarding the Bank or the Company which
is otherwise publicly available. In the event of a breach or threatened breach
by the Executive of the Provisions of this Section 9, the Bank will be entitled
to an injunction restraining Executive from disclosing, in whole or in part, the
knowledge of the past, present, planned or considered business activities of the
Bank or affiliates thereof, or from rendering any services to any person, firm,
corporation, other entity to whom such knowledge, in whole or in part, has been
disclosed or is threatened to be disclosed. Nothing herein will be construed as
prohibiting the Bank from pursuing any other remedies available to the Bank for
such breach or threatened breach, including the recovery of damages from
Executive.
70. SOURCE OF PAYMENTS
All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank.
71. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS
This Agreement contains the entire understanding between the parties hereto
and supersedes any prior employment agreement between the Bank or any
predecessor of the Bank and Executive, except that this Agreement shall not
affect or operate to reduce any benefit or compensation inuring to the Executive
of a kind elsewhere provided. No provision of this Agreement shall be
interpreted to mean that Executive is subject to receiving fewer benefits that
those available to him without reference to this Agreement.
72. NO ATTACHMENT
(a) Except as required by law, no right to receive payments under this
Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.
(b) This Agreement shall be binding upon, and inure to the benefit of,
Executive and the Bank and their respective successors and assigns.
73. MODIFICATION AND WAIVER
(a) This Agreement may not be modified or amended except by an instrument
in writing signed by the parties hereto.
(b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel against the enforcement of any provision
of this Agreement, except by written instrument of the party charged with such
wavier or estoppel. No such written waiver shall be deemed a continuing waiver
unless specifically stated therein, and each such waiver shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.
74. REQUIRED PROVISIONS
(a) The Bank may terminate the Executive's employment at any time, but any
termination by the Bank, other than Termination for Cause, shall not prejudice
Executive's right (if applicable) to compensation or other benefits under this
Agreement. Executive shall not have the right to receive compensation or other
benefits for any period after Termination for Cause as defined in Section 6
herein above.
(b) If the Executive is suspended from office and/or temporarily prohibited
from
participating in the conduct of the Bank's affairs by a notice served under
Section 8(e)(3) (12 U.S.C. (S)(S) 1818(e)(3)) or 8(g) (12 U.S.C. (S) 1818(g)) of
the Federal Deposit Insurance Act, as amended by the Financial Institutions
Reform, Recovery and Enforcement Act of 1989, the Bank's obligations under this
contract shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Bank
may in its discretion (i) pay the Executive all or part of the compensation
withheld while their contract obligations were suspended and (ii) reinstate (in
whole or in part) any of the obligations which were suspended.
(c) If the Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e) (12 U.S.C. (S)(S) 1818(e)) or 8(g)(12 U.S.C. (S) 1818(g)) of the
Federal Deposit Insurance Act, as amended by the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, all obligations of the Bank under this
contract shall terminate as of the effective date of the order, but vested
rights of the contracting parties shall not be affected.
(d) If the Bank is in default as defined in Section 3(x) (12 U.S.C. (S)
1813(x)(1)) of the Federal Deposit Insurance Act, as amended by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989, all obligations of
the Bank under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.
(e) All obligations of the Bank under this contract shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of the institution, (i) by the Federal Deposit
Insurance Corporation ("FDIC"), at the time FDIC enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) (12 U.S.C. (S) 1823(c)) of the Federal Deposit Insurance Act, as
amended by the Financial Institutions Reform, Recovery and Enforcement Act of
1989; or (ii) by the Office of Thrift Supervision ("OTS") at the time the OTS or
its District Director approves a supervisory merger to resolve problems related
to the operations of the Bank or when the Bank is determined by the OTS or FDIC
to be in an unsafe or unsound condition. Any rights of the parties that have
already vested, however, shall not be affected by such action.
75. SEVERABILITY
If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.
76. HEADINGS FOR REFERENCE ONLY
The headings of sections and paragraphs herein are included solely for
convenience
of reference and shall not control the meaning or interpretation of any of the
provisions of this Agreement.
77. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Iowa, but only
to the extent not superseded by federal law.
78. ARBITRATION
Any dispute or controversy arising under or in connection with this
Agreement may be settled by arbitration in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that
Executive shall be entitled to seek specific performance of his right to be paid
until the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
79. INDEMNIFICATION
The Bank shall provide Executive (including his heirs, executors and
administrators) with coverage under a standard directors' and officers'
liability insurance policy at its expense, or in lieu thereof, shall indemnify
Executive (and his heirs, executors and administrator) to the fullest extent
permitted under federal law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which me may be involved by reason of his having been a director
or officer of the Bank (whether or not he continued to be a director or officer
at the time of incurring such expenses or liabilities), such expenses and
liabilities to include, but not be limited to, judgments, court costs and
attorneys' fees and the cost of reasonable settlements (such settlements must be
approved by the Board of Directors of the Bank). If such action, suit or
proceeding is brought against Executive in his capacity as an officer or
director of the Bank, however, such indemnification shall not extend to matters
as to which Executive is finally adjudged to be liable for willful misconduct in
the performance of his duties. No Indemnification shall be paid that would
violate 12 U.S.C. 1828(k) or any regulations promulgated thereunder, or 12
C.F.R. 544.122.
80. SUCCESSOR TO THE BANK
The Bank shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Company, expressly
and unconditionally to assume and agree to perform the Bank's obligations under
this Agreement, in the same manner and the same extent that the Bank would be
required to perform if no such succession or assignment had taken place.
SIGNATURES
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed and
their seals to be affixed hereunto by its duly authorized officer, and the
Executive has signed this Agreement, on the day and date first above written.
ATTEST: FIRST FEDERAL SAVINGS BANK OF IOWA
BY: /s/ Xxxx Xxxx BY: /s/ Xxxxx X. Xxxxxxx
-------------------------- -------------------------------
Xxxx Xxxx, Secretary Xxxxx X. Xxxxxxx
President and Chief Executive Officer
[SEAL]
EXECUTIVE
WITNESS
BY: /s/ Xxxx X. Xxxx BY: /s/ Xxxx X. Lake
---------------- ----------------
Xxxx X. Xxxx Xxxx X. Lake
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came Xxxx X.
Lake, to me known, and known to me to be the individual described in the
foregoing instrument, who, being by me duly sworn, did depose and say that he
resides at 0000 Xxxxx 00xx Xxxxx, Xxxx Xxxxx, Xxxx 00000, and that he signed his
name to the foregoing instrument.
/s/ C. Xxxxxx Xxxxxxxxx
------------------------
Notary Public
STATE OF IOWA )
: ss.:
COUNTY OF XXXXXXX )
On this 29th day of June, 1998, before me personally came Xxxxx X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
resides at 0000 00xx Xxxxxx Xxxxx, Xxxx Xxxxx, Xxxx, 00000, that he is the
President and Chief Executive Officer of First Federal Savings Bank of Iowa, the
savings bank described in and which executed the foregoing instrument; that he
knows the seal of said savings bank; that the seal affixed to said instrument is
such seal; that it was so affixed by order of the Board of Directors of said
savings bank; and that he signed his name thereto by like order.
/s/ C. Xxxxxx Xxxxxxxxx
-----------------------
Notary Public
