Exhibit 10.1
AMENDED EMPLOYMENT AGREEMENT
This Agreement supersedes the Employment Agreement dated September 10, 1997.
This amended EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as
of the 26th day of February, 1998, between Redlands Centennial Bank
(hereinafter referred to as "Employer"), and Xxxxxxx X. Xxxxxxx (hereinafter
referred to as "Executive").
WITNESSETH:
WHEREAS, Employer is desirous of employing Executive in the capacity
hereinafter stated and Executive is desirous of continuing in the Employ of
Employer in such capacity, for the period and on the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of the premises and of the mutual covenants
and conditions herein contained, the parties hereto, intending to be legally
bound, do hereby agree as follows:
1. EMPLOYMENT
Employer hereby employs Executive as its President and Chief Executive
Officer, and Executive accepts the duties that are customarily performed by
the President and Chief Executive Officer of a state-chartered banking
institution and accepts all other duties described herein and agrees to
discharge the same faithfully and to the best of his ability and consistent
with past performances and the highest and best standards of the banking
industry, in accordance with the policies of Employer's Board of Directors as
established, and in compliance with all laws and Employer's Articles of
Incorporation, Bylaws, Policies and Procedures. Executive shall devote his
business time and attention to the business and affairs of Employer for which
he is employed and shall perform the duties thereof to the best of his
ability. Except as permitted by the prior written consent of Employee's
Board of Directors, Executive shall not directly or indirectly render any
services of a business, commercial or professional nature to any other
person, firm or corporation, whether for compensation or otherwise, which are
in conflict with Employer's interests. Executive shall perform such other
duties as shall be from time to time prescribed by Employer's Board of
Directors.
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Executive shall have such responsibility and duties and such authority to
transact business on behalf of Employer, as are customarily incident to the
office of President and Chief Executive Officer of a state-chartered banking
institution. In addition, Executive shall be appointed to the Board of
Directors of Employer.
2. TERM
Employer hereby employs Executive, and Executive hereby accept employment
with Employer for the period of four (4) years (the "Term"), commencing
October 1, 1997, with such Term being subject to prior termination as
hereinafter provided. Where used herein, "Term" shall refer to the entire
period of employment of Executive by Employer, whether for the period
provided above, or whether terminated earlier as hereinafter provided, or
extended by mutual agreement in writing by Employer and Executive.
Such Term shall be automatically extended for additional periods of one (1)
year unless Executive or Employer shall give written notice not less than
three months and not more than six months prior to the expiration of the
Term, of intention not to extend the Term.
3. COMPENSATION
In consideration for all services to be rendered by Executive to Employer,
Employer agrees to pay Executive a starting base salary of One Hundred Twenty
Thousand Dollars ($120,000) per year. Employer's Board of Directors shall in
their discretion determine any increases in Executive's base salary after the
first anniversary of the Term. Executive's salary shall be paid semi-monthly.
Employer shall deduct therefrom all taxes which may be required to be
deducted or withheld under any provision of the law (including, but not
limited to, social security payments and income tax withholding) now in
effect or which may become effective anytime during the term of this
Agreement.
Executive shall be entitled to participate in any and all other employee
benefits and plans that may be developed and adopted by Employer and in its
normal course of business, subject to the terms and conditions of such
agreements provided that nothing contained herein shall obligate Employer to
commence, develop or warranty any employee benefits or plans.
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Executive shall not be entitled to fees paid to Employer's Board of Directors
for attendance at regular or special meetings of Employer's Board of
Directors. Executive shall also not be entitled to any committee fees paid to
Employer's Board of Directors.
4. BONUS AND SALARY CONTINUATION PLAN
Executive shall be entitled to participate in Employer's Incentive
Compensation Plan ("Bonus Plan"), which shall be at the discretion of the
Board of Directors.
Within one (1) year of the execution of this Agreement, Employer shall
establish a Salary Continuation Plan that shall pay Executive a minimum of
One Hundred Twenty Thousand Dollars ($120,000) per year for ten (10) years
commencing on the earlier to occur on Executive's death or Executive reaching
the age of fifty-five such Salary Continuation Plan shall be covered by a
separate agreement. The Salary Continuation Plan Agreement shall be attached
as an exhibit to this Agreement. Notwithstanding the foregoing, nothing
contained herein shall be deemed to grant Executive any rights or benefits
under a Salary Continuation Plan until such plan is duly adopted by Employer.
5. STOCK OPTION
Employer shall grant Executive stock options to purchase twenty thousand
(20,000) shares of Employer's common stock at the price per share set at the
market value at the time of the grant. Options shall have a term of ten (10)
years and are subject to a Stock Option Agreement to be executed by the
parties. One-fifth (1/5) of the stock provided in said option shall vest and
become exercisable each year at the anniversary dates of the granting of the
stock option, provided Executive is an employee of Employer, commencing on
the first year anniversary of employment.
Vested options may be exercised at any time during the remaining term of the
stock option, provided Executive remains an employee of Employer.
Notwithstanding the preceding sentence, if Executive is terminated and such
termination if not for cause, then Executive shall have ninety (90) days to
exercise all options vested with Executive as of the termination date.
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The Stock Option Plan shall be attached as an exhibit and incorporated herein
by reference. Notwithstanding anything contained herein to the contrary,
nothing contained in this Agreement shall grant to Executive any rights as a
stockholder or optionholder of employer unless and until a stock option
agreement is adopted by Employer.
6. AUTOMOBILE AND REIMBURSEMENT
Employer agrees to provide Executive with an automobile allowance of $700.00
per month.
Employer agrees to reimburse Executive for all ordinary and necessary
expenses incurred by Executive on behalf of Employer, including
entertainment, meals and travel expenses. Any costs incurred by Executive for
conventions, meetings and seminars will be reimbursed as well as special
social entertainment expenses, provided Employer's Board of Directors
approves such.
Employer shall pay money for personal relocation expenses of Executive
incurred in a relocation of Executive to Redlands up to a maximum of $10,000.
7. INSURANCE
Employer agrees to provide Executive with health and life insurance benefits
which are now or may hereinafter be in effect for all other full-time
employees. Employer shall also provide life insurance for executive with a
beneficiary defined by Executive. Provision of the insurance will commence on
the Effective Date and is subject to Executive's passing the necessary
physical examinations for qualification, if any. Employer may also apply for
"key man" life insurance with Employer as beneficiary of the policy.
8. VACATION
Executive shall be entitled to accrue up to four (4) weeks vacation during
each year of the Term with at least two (2) weeks to be taken in a
consecutive period. Vacation benefits shall not accrue above four weeks at
any time. Employer's Board of Directors, in its discretion, may waive the
provision with respect to unused vacation time.
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9. TERMINATION
Employer shall have the right to terminate this Agreement for any of the
following reasons by service written notice upon Executive:
(a) willful breach of, habitual neglect of, willful failure to perform,
or inability to perform, Executive's duties and obligations as
President and Chief Executive Officer;
(b) illegal conduct, constituting a crime involving moral turpitude,
conviction of a felony, or any conduct detrimental to the interests
of Employer;
(c) physical or mental disability rendering Executive incapable of
performing his duties for a consecutive period of 180 days, or by
death. In the event of such disability, Employer will provide salary
continuation for 180 days, less accrued sick leave. Accrued sick
leave is to be utilized until exhausted PRIOR to salary continuation
provided herein; or
(d) determination by Employer's Board of Directors that the continued
employment of Executive is not desired for any reason or no reason
at all, solely within the discretion of the Employer's Board of
Directors.
In the event this Agreement is terminated for any of the reasons specified in
the paragraphs (a), (b), or (c) above, Executive will be paid four weeks'
salary calculated as of the date of Executive's termination, plus any pay in
lieu of vacation accrued to, but not taken as of termination. Such
termination pay shall be considered to be in full and complete satisfaction
of any and all rights which Executive may enjoy under the terms of this
Agreement other than rights, if any, to exercise any of the stock options
vested prior to such termination. The insurance benefits provided herein
shall be extended at Employer's sole cost until the end of the month in which
Executive is terminated.
In the event this Agreement is terminated for any reason specified in
paragraph (d) above, Executive shall be entitled to termination pay in an
amount equal to one (1) year of Executive's then base annual salary. Such
termination pay shall be paid in one lump sum and shall be considered to be
in full and complete satisfaction of any and all rights which Executive may
enjoy under the terms of this Agreement including any pay in lieu of vacation
accrued to, but not taken as of the date of termination, other than rights,
if any, to exercise any of the stock options vested prior to such termination.
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Where termination is pursuant to paragraph (d) above, the insurance benefits
provided here shall be extended at Employer's sole cost for the remainder of
the month and twelve (12) full months following the date of termination.
Executive shall give one hundred twenty (120) days prior notice, in writing,
to Employer in the event Executive resigns or voluntarily terminates
employment. In the event Executive resigns or voluntarily terminates
employment to work for another financial institution, such financial
institution shall reimburse Employer for any continuing expense incurred by
Employer concerning Executive's employment.
10. ACQUISITION OR DISSOLUTION OF EMPLOYER
This Employment Agreement shall not be terminated by the voluntary or
involuntary dissolution of the Employer. Notwithstanding the foregoing, in
the event proceedings for liquidation of Employer commenced by regulatory
authorities, this Agreement and all rights and benefits hereunder shall
terminate. In the event of a Change of Ownership or Control occurs during
the employment of the Executive and if the Executive's position is either
eliminated or materially changed, the Executive shall receive an amount equal
to two (2) years of the then current annual salary in full and complete
satisfaction of any and all rights which Executive may enjoy hereunder other
than the right, if any, to exercise any of the stock options vested prior to
such termination and Executive's right pursuant to the attached Salary
Continuation Agreement. The Executive may choose to receive said amount in a
lump sum or in quarterly payments. Change of Ownership shall have occurred on
the date of (i) a merger, where the Bank is not the surviving corporation;
(ii) a consolidation, where the Bank is not the surviving corporation; (iii)
a transfer to another entity of all or substantially all of the assets of the
Bank; (iv) an acquisition by a financial institution, company, individual or
individuals acting as a group, of more than fifty percent (50%) of the then
outstanding shares of the Bank are held by a person or group of persons
(whether or not acting in concert) not the holder of more than fifty percent
(50%) of the shares on the Commencement Date of this Agreement; or (v) during
any period of twenty-four consecutive months, individuals who at the
beginning of such period where members of the Board of Directors of the Bank
(the "Incumbent Board") shall cease to constitute a majority of the Board of
Directors of the Bank or any successor to the Bank, provided that any person
becoming a director subsequent to the beginning of such period whose election
or nomination for
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election was approved by a vote of at least seventy-five percent (75%) of all
the directors compromising the Incumbent Board shall, for the purposes
hereof, considered as though such a person were a member of the Incumbent
Board.
11. INDEMNIFICATION
To the extent permitted by law, Employer shall indemnify Executive if he was
or is a party or is threatened to be made a party in any action brought by a
third party against Executive (whether or not Employer is joined as a party
defendant) against expenses, judgments, fines, settlements and other amounts
actual and reasonably incurred in connection with said action if Executive
acted in good faith and in a manner Executive reasonably believed to be in
the best interest of Employer (and with respect to a criminal proceeding if
Executive had no reasonable cause to believe his conduct was unlawful),
provided that the alleged conduct of Executive arose out of and was within
the course and scope of his employment as an officer or employee of Employer.
12. TRADE SECRETS
During the Term, Executive will have access to and become acquainted with
what Executive and Employer acknowledge as trade secrets, i.e., knowledge or
data concerning Employer, including its operations and business, and the
identity of customers and clients of Employer. Executive will not any time
disclose any trade secrets or propriety information, directly or indirectly,
or use them in any way, except as required by his duties and
responsibilities. Executive's obligation not to disclose the Employer's trade
secrets or propriety information to third parties continues after his
employment with the Employer ceases.
13. NONCOMPETITION
During the term of this Agreement, Executive will not, directly or
indirectly, either as an employee, employer, consultant, agent, principal,
partner, stockholder, corporate officer, director or in any other individual
or representative capacity, engage or participate in any business that is in
competition in any manner whatsoever with the business of Employer.
14. RETURN OF DOCUMENTS
Executive expressly agrees that all manuals, documents, files, reports,
studies, instruments or other materials used or developed by Executive during
the Term are solely the property of Employer, and Executive has no right,
title or interest therein. Upon termination of this
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Agreement, Executive or Executive's representatives shall promptly deliver
possession of all said property to Employer in good condition.
15. NOTICES
Any notice, request, demand, or other communication required or permitted
hereunder shall be deemed to be properly given when personally served in
writing, when deposited in the U.S. mail, postage prepaid, or when
communicated to a public telegraph company for transmittal, addressed as
follows:
TO BANK: Redlands Centennial Bank
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx Xxxxxxxxxx 00000
Attention: Board of Directors
TO EXECUTIVE: Xxxxxxx X. Xxxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxxxxx 00000
Any party hereto may change its or his address for purposes of this Section
by giving notice in accordance herewith.
16. BENEFIT OF AGREEMENT
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective executors, administrators, successors and assigns.
17. APPLICABLE LAW.
This Agreement is made and entered into in the State of California, and the
laws of said State shall govern the validity and interpretation hereof, and
the performance of the parties hereto and their respective duties and
obligations hereunder.
18. CAPTIONS AND PARAGRAPH HEADINGS
Captions and paragraph headings used herein are for convenience only and are
not a part of this Agreement and shall not be used in construing it.
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19. INVALID PROVISIONS
Should any provision of this Agreement for any reason be declared invalid,
void, or unenforceable by a court of competent jurisdiction, the validity and
binding effect of any remaining portions shall not be affected and the
remaining portions of this Agreement shall remain in full force and effect as
if this Agreement had been executed with said provision eliminated.
20. ENTIRE AGREEMENT
This Agreement contains the entire agreement of the parties and it supersedes
any and all other agreements, either oral or in writing, between the parties
hereto with respect to the employment of Executive by Employer, except to the
extent that it is contemplated that Executive and Employer may enter into a
stock option agreement and/or salary continuation agreement. Each party to
this Agreement acknowledges that no representations, inducements, promises or
agreements, oral or otherwise, have been made by any party, or anyone acting
on behalf of any party, which are not embodied herein, and that no other
agreement, statement, or promise not contained in this Agreement shall be
valid or binding. This Agreement may not be modified or amended by oral
agreement, but only by an agreement in writing signed by Employer and
Executive.
21. CONFIDENTIALITY
This Agreement is to be held confidential. Willful breach of such
confidentiality by Executive will be subject to termination under the
provisions of 9(a) of this Agreement.
22. ARBITRATION
Any controversy or claim arising out of or relating to this Agreement, or the
breach thereof, shall be settled pursuant to an arbitration agreement to be
entered into by the parties, and in the event there is no arbitration
agreement, then in accordance with the rules of the American Arbitration
Association, and judgment upon the award rendered by the arbitrator(s) may
be entered into any court having jurisdiction thereof.
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23. LEGAL COSTS
If either Executive or Employer commences an action against the other arising
out of or in connection with this Agreement, the prevailing party shall be
entitled to have and recover from the losing party reasonable attorney's fees
and costs of suit.
IN WITNESS WHEREOF, the parties hereto have executed this amended Agreement
as of the day and year first written above.
REDLANDS CENTENNIAL BANK
By: /s/ XXXXXXX X. XXXXX
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XXXXXXX X. XXXXXXX
/s/ XXXXXXX X. XXXXXXX
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