EMPLOYMENT AGREEMENT
EMPLOYMENT
AGREEMENT
This
Agreement (“Agreement”) is made by and between American
Savings, FSB,
a
federal savings bank (the “Bank”), with its principal office in Munster,
Indiana, and Xxxxxx Xxxxx
(“Executive”) and shall be effective as of February
13, 2008.
WHEREAS,
in order
to induce Executive to remain in the employ of the Bank and to provide further
incentive to achieve the financial and performance objectives of the Bank,
the
parties desire to enter into this Agreement upon the terms and conditions
hereof; and
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.
The
Executive agrees to serve as the Vice President of the Bank and as such,
the
Executive shall be responsible for certain lending and other activities of
the
Bank as designated at the discretion of the Company’s President and Chief
Executive Officer and its Board of Directors. Executive also agrees to serve,
if
elected, as an officer and director of the Bank or any affiliate of the Bank.
Failure to reappoint Executive as Vice President of the Bank or, if Executive
is
also a director of the Bank, failure to re-nominate the Executive as a director
of the Bank without the consent of Executive during the term of this Agreement
(except for any termination for Just Cause or Retirement, as defined herein)
shall constitute a breach of this Agreement.
2. TERM
AND DUTIES.
(a) The
term
of this Agreement and the period of Executive’s employment hereunder will begin
as of the Effective Date and will continue for a period of twelve (12) full
calendar months thereafter. On each anniversary date of the Effective Date
(the
“Anniversary Date”), this Agreement shall renew for an additional year such that
the remaining term shall be twelve (12) full calendar months, provided, however,
that the Board shall at least sixty (60) days before such Anniversary Date
conduct a comprehensive performance evaluation and review of Executive for
purposes of determining whether to extend this Agreement. The Board shall
give
Executive notice of its decision whether or not to renew this Agreement at
least
thirty (30) days and not more than sixty (60) days prior to the Anniversary
Date, and if written notice of non-renewal is provided to Executive within
said
time frame, the term of this Agreement shall not be extended.
(b) During
the period of his employment hereunder, except for periods of absence occasioned
by illness, reasonable vacation periods, and reasonable leaves of absence
approved by the Board, 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, Executive may serve, or continue to serve, on the boards of
directors of, and hold any other offices or positions in, business, social,
religious, charitable or similar organizations which will not present any
conflict of interest with the Bank or materially affect the performance of
Executive’s duties pursuant to this Agreement.
3. COMPENSATION,
BENEFITS AND REIMBURSEMENT.
(a) The
compensation specified under this Agreement shall constitute the salary and
benefits paid for the duties described in Section 2. The Bank shall pay
Executive as compensation a salary of not less than $80,000.00 per year (“Base
Salary”). Such Base Salary shall be payable biweekly, or with such other
frequency as officers and employees are generally paid. 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
Bank may increase, but not decrease (except a decrease that is generally
applicable to all employees) Executive’s Base Salary (with any increase in Base
Salary to become “Base Salary” for purposes of this Agreement).
(b) Executive
will be entitled to participate in and 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
insurance plans, medical coverage or any other employee benefit plan or
arrangement made available by the Bank currently or in the future to its
senior
executives and key management employees. Executive will be entitled to
participate in any incentive compensation and bonus plans offered by the
Bank in
which Executive is eligible to participate. Nothing paid to Executive under
any
such plan or arrangement will be deemed to be in lieu of other compensation
to
which Executive is entitled under this Agreement.
(c) In
addition to the Base Salary provided for by paragraph (a) of this Section
3, the
Bank shall pay or reimburse Executive for all reasonable travel and other
reasonable expenses incurred by Executive performing his obligations under
this
Agreement and may provide such additional compensation in such form and such
amounts as the Board may from time to time determine. The Bank shall reimburse
Executive for his ordinary and necessary business expenses including, without
limitation, fees for memberships in such clubs and organizations as Executive
and the Board shall mutually agree are necessary and appropriate for business
purposes, and travel and entertainment expenses, incurred in connection with
the
performance of his duties under this Agreement.
(d) In
addition to items of compensation provided for by paragraphs (a), (b) and
(c) of
this Section 3, the Bank shall pay or reimburse the Executive for Social
membership dues to Briar Ridge Country Club in Dyer, Indiana or a comparable
club selected by the Board. The Bank shall also provide the Executive with
a
company car of equal or greater value than the vehicle driven by the Executive
as of the date of this agreement.
4. PAYMENTS
TO EXECUTIVE UPON AN EVENT OF TERMINATION.
(a) Upon
the
occurrence of an Event of Termination (as herein defined) during Executive’s
term of employment under this Agreement, the provisions of this Section 4
shall apply. As used in this Agreement, an “Event of Termination” shall mean and
include any of the following:
(i) |
the
involuntary termination by the Bank of Executive’s full-time employment
hereunder for any reason other than termination governed by Section 5
(Termination for Cause) or termination governed by Section 6
(Termination for Disability or death) or termination governed by
Section 7
(Termination Upon Retirement), provided that such termination of
employment is also a “Separation from Service” within the meaning of
Section 4(h) hereof; or
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(ii) |
Executive’s
voluntary resignation from the Bank’s employ for any of the following
reasons:
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(A)
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a
relocation of Executive’s principal place of employment by more than
twenty-five (25) miles from its location at the Effective Date
of this
Agreement;
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(B)
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a
material reduction in the benefits and perquisites to Executive
from those
being provided as of the later of the Effective Date or any subsequent
Anniversary Date of this Agreement, other than an employee-wide
reduction
in pay or benefits;
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(C)
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a
liquidation or dissolution of the Bank; or
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(D)
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a
material breach of this Agreement by the Bank or the Holding Company.
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Upon
the
occurrence of any event described in clauses (A), (B), (C), or (D) above,
Executive shall have the right to elect to terminate his employment under
this
Agreement by resignation upon not less than thirty (30) days prior written
Notice of Termination, as defined in Section 9(a), given within ninety (90)
days after the event giving rise to said right to elect. The Bank shall have
thirty (30) days to cure the condition giving rise to the Event of Termination,
provided that the Bank may elect to waive such thirty (30) day period.
Notwithstanding the preceding sentence, in the event of a continuing breach
of
this Agreement by the Bank, Executive, after giving due notice within the
prescribed time frame of an initial event specified above, shall not waive
any
of his rights under this Agreement and this Section solely by virtue of the
fact
that Executive has submitted his resignation, provided Executive has remained
in
the employment of the Bank and is engaged in good faith discussions to resolve
any occurrence of an event described in clauses (A), (B) or (D)
above.
(iii) |
(A)
Executive’s involuntary termination by the Bank (or any successor thereto)
on the effective date of, or at any time following, a Change in
Control,
or (B) Executive’s resignation from the employment with the Bank (or
any successor thereto) following a Change in Control as a result
of any
event described in Section 4(a)(ii)(A), (B), or (D) above. For
these
purposes, a “Change in Control” shall mean a change in control of the Bank
or the Holding Company of a nature that: (i) would be required
to be
reported in response to Item 5.01 of the current report on Form
8-K, as in
effect on the date hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”); or (ii) without
limitation such a Change in Control shall be deemed to have occurred
at
such time as (a) any “person” (as the term is used in Sections 13(d)
and 14(d) of the Exchange Act), is or becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), other than the Bank’s
employee stock ownership plan or trust, directly or indirectly,
of
securities of the Holding Company or Bank representing 25% or more
of the
combined voting power of the Holding Company’s or Bank’s outstanding
securities or (b) individuals who constitute the Board of Directors
of the
Bank, or the Holding Company on the date hereof (the “Incumbent Board”)
cease for any reason to constitute at least a majority thereof,
provided
that any person becoming a director subsequent to the date hereof
whose
election was approved by a vote of at least a majority of the directors
of
the Board, shall be, for purposes of this clause (b), considered
as though
he were a member of the Incumbent Board; or (c) a plan of reorganization,
merger, consolidation, sale of all or substantially all the assets
of the
Bank or the Holding Company or similar transaction in which the
Bank or
Holding Company is not the surviving institution occurs; provided,
however, that, to the extent necessary to comply with Code Section
409A,
“Change in Control” shall instead have the meaning set forth in Code
Section 409A and the regulations and other guidance published
thereunder.
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(b) Upon
the
occurrence of an Event of Termination under Sections 4(a) (i) or (ii), on
the Date of Termination, as defined in Section 9(b), the Bank shall be
obligated to 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, an amount equal to the sum of: (i) his
earned but unpaid salary as of the date of his termination of employment
with
the Bank; (ii) the benefits, if any, to which he is entitled as a former
employee under the employee benefit plans and programs and compensation plans
and programs maintained for the benefit of the Bank’s officers and employees;
(iii) the remaining payments that Executive would have earned, in accordance
with Sections 3(a) and 3(b), if he had continued his employment with the
Bank for the remainder of the term of this Agreement (but in any event, such
term shall not exceed twelve (12) months), and had earned the maximum bonus or
incentive award in each calendar year that ends during such term; and
(iv) the annual contributions or payments that would have been made on
Executive’s behalf to any employee benefit plans of the Bank as if Executive had
continued his employment with the Bank for the remainder of the term of this
Agreement (but in any event, such term shall not exceed twelve (12) months),
based on contributions or payments made (on an annualized basis) at the Date
of
Termination. Any payments hereunder shall be made in a lump sum within thirty
(30) days after the Date of Termination, except as otherwise provided herein.
Such payments shall not be reduced in the event Executive obtains other
employment following termination of employment.
(c) Upon
the
occurrence of an Event of Termination under Section 4(a)(iii), on the Date
of Termination, as defined in Section 9(b), the Bank shall be obligated to
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, an amount equal to the sum of: (i) his earned but unpaid
salary as of the date of his termination of employment with the Bank; (ii)
the
benefits, if any, to which he is entitled as a former employee under the
employee benefit plans and programs and compensation plans and programs
maintained for the benefit of the Bank or Holding Company’s officers and
employees; (iii) the remaining payments that Executive would have earned,
in
accordance with Sections 3 (a) and (b), if he had continued his employment
with the Bank for a twelve (12) month period following his termination of
employment, and had earned the maximum bonus or incentive award in each calendar
year that ends during such term; and (iv) the annual contributions or
payments that would have been made on Executive’s behalf to any employee benefit
plans of the Bank or the Company as if Executive had continued his employment
with the Bank for a twelve (12) month period following his termination of
employment, based on contributions or payments made (on an annualized basis)
at
the Date of Termination. Any payments hereunder shall be made in a lump sum
within thirty (30) days after the Date of Termination, except as otherwise
provided herein. Such payments shall not be reduced in the event Executive
obtains other employment following termination of employment.
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(d) Upon
the
occurrence of an Event of Termination under Section 4(a)(i), (ii) or (iii),
the
Bank will cause to be continued, at the Bank’s expense, non-taxable medical
coverage substantially identical to the coverage maintained by the Bank for
Executive and his family prior to Executive’s termination. Such coverage shall
continue at the Bank’s expense for the remainder of the term of this Agreement
following the Date of Termination.
(e) Notwithstanding
anything in this Agreement to the contrary, in no event shall the aggregate
payments or benefits to be made or afforded to Executive under this Section
constitute an “excess parachute payment” under Section 280G of the Internal
Revenue Code of 1986, as amended, (“Code”) or any successor thereto, and in
order to avoid such a result, Executive’s benefits hereunder shall be reduced,
if necessary, to an amount, the value of which is one dollar ($1.00) less
than
an amount equal to three (3) times Executive’s “base amount,” as determined in
accordance with Section 280G. The allocation of the reduction required hereby
shall be determined by Executive, or in the event such allocation violates
Code
Section 409A, the reduction required hereby shall be made pro-rata.
(f) In
the
event the Executive resigns for any reason other than an Event of Termination
(as described in Section 4), Termination for Just Cause (as described in
Section
5), Termination for Disability or Death (as described in Section 6) or
Termination Upon Retirement (as described in Section 7), all obligations
of the
Bank hereunder shall immediately cease upon the date of such
resignation.
(g) Notwithstanding
the foregoing, to the extent required by regulations or interpretations of
the
Office of Thrift Supervision, all severance payments under the Agreement
shall
not exceed three (3) times the Executive’s average annual compensation (as
defined in such regulations or interpretations) over the most recent five
(5)
taxable years.
(h) For
purposes of this Agreement, a “Separation from Service” shall have occurred if
the Bank and Executive reasonably anticipate that either no further services
will be performed by the Executive after the date of the Event of Termination
(whether as an employee or as an independent contractor) or the level of
further
services performed will not exceed 49% of the average level of bona fide
services in the 36 months immediately preceding the Event of Termination.
For
all purposes hereunder, the definition of Separation from Service shall be
interpreted consistent with Treasury Regulation Section 1.409A-1(h)(ii).
If
Executive is a Specified Employee, as defined in Code Section 409A and any
payment to be made under sub-paragraph (b) or (c) of this Section 4 shall
be
determined to be subject to Code Section 409A, then if required by Code Section
409A, such payment or a portion of such payment (to the minimum extent possible)
shall be delayed and shall be paid on the first day of the seventh month
following Executive’s Separation from Service.
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5. TERMINATION
FOR JUST CAUSE.
(a) The
term
“Termination for Just Cause” shall mean termination because of the Executive’s
personal dishonesty, incompetence, willful misconduct, 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.
(b) Notwithstanding
Section 5(a), the Bank may not terminate Executive for Just Cause unless
and until there shall have been delivered to him a Notice of Termination
which
shall include a copy of a resolution duly adopted by the affirmative vote
of not
less than a majority of the entire membership of the Board at a meeting of
the
Board called and held for that purpose, finding that in the good faith opinion
of the Board, Executive had engaged in or committed the conduct justifying
Termination for Just Cause and specifying the particulars thereof in detail.
Executive shall not have the right to receive compensation or other benefits
for
any period after Termination for Just Cause. During the period beginning
on the
date of the Notice of Termination for Just Cause pursuant to Section 5
hereof through the Date of Termination, any unvested stock options and related
rights granted to Executive under any stock option plan of the Bank or the
Holding Company (or any affiliate) shall not be exercisable nor shall any
unvested awards granted to Executive under any stock benefit plan of the
Bank or
Holding Company (or affiliate thereof) vest. At the Date of Termination,
any
such unvested stock options and related rights and any such unvested awards
shall become null and void and shall not be exercisable by or delivered to
Executive at any time subsequent to such Termination for Just Cause. In the
Event of Executive’s Termination for Just Cause, Executive shall resign
immediately as a director of the Bank and as a director and/or officer of
any
affiliate of the Bank.
6. TERMINATION
FOR DISABILITY OR DEATH.
(a) The
Bank
or Executive may terminate Executive’s employment after having established
Executive’s Disability. For purposes of this Agreement, “Disability” means a
physical or mental infirmity that impairs Executive’s ability to substantially
perform his duties under this Agreement and that results in Executive’s becoming
eligible for long-term disability benefits under a long-term disability plan
of
the Bank (or, if the Bank has no such plan in effect, that impairs Executive’s
ability to substantially perform his duties under this Agreement for a period
of
one hundred eighty (180) consecutive days). The Board shall determine in
good
faith, based upon competent medical advice and other factors that they
reasonably believe to be relevant, whether or not Executive is and continues
to
be disabled for purposes of this Agreement. As a condition to any benefits,
the
Board may require Executive to submit to such physical or mental evaluations
and
tests as it deems reasonably appropriate, at the Bank’s expense.
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(b) In
the
event of such Disability, Executive’s obligation to perform services under this
Agreement will terminate. In the event of such termination, Executive shall
receive benefits under any disability program sponsored by the Bank, provided
such benefit is not less than the benefits provided in the following sentence
of
this Section 6(b). In the event the Bank does not sponsor any disability
programs, the Executive shall continue to receive (x) his Base Salary, as
defined in Section 3(a), at the rate in effect on the Date of Termination
for
period of one (1) year following the Date of Termination by reason of
Disability. Notwithstanding anything to the contrary herein, any benefits
payable under this Section 6(b) shall be reduced to the extent of payments
received by Executive from a disability policy sponsored by the Bank.
(c) In
the
event of Executive’s death during the term of this Agreement, his estate, legal
representatives or named beneficiary or beneficiaries (as directed by Executive
in writing) shall be paid Executive’s Base Salary, as defined in Section 3,
at the rate in effect at the time of Executive’s death for a period of one (1)
year from the date of Executive’s death.
7. TERMINATION
UPON RETIREMENT
Termination
of Executive’s employment based on “Retirement” shall mean termination of
Executive’s employment at age 65, unless extended by the Board. Upon termination
of Executive’s employment based on Retirement, no amounts or benefits shall be
due Executive under this Agreement, and Executive shall be entitled to all
benefits under any retirement plan of the Bank and other plans to which
Executive is a party.
8. RESIGNATION
FROM BOARDS OF DIRECTORS
In
the
event of Executive’s termination of employment for any reason other than upon a
Change in Control, Executive shall resign as a director of the Bank, and
as a
director and/or officer of any affiliate of the Bank.
9. NOTICE
(a) Any
notice required hereunder shall be in writing and hand-delivered to the other
party. Hand delivery to the Bank shall be made to the Chairman or the Secretary
of the Board of Directors. Any 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 (A) if Executive’s employment is terminated for
Disability, thirty (30) days after a Notice of Termination is given (provided
that he shall not have returned to the performance of his duties on a full-time
basis during such thirty (30) day period), and (B) if his employment is
terminated for any other reason, the date specified in the Notice of
Termination.
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(c) If
the
party receiving a Notice of Termination desires to dispute or contest the
basis
or reasons for termination, the party receiving the Notice of Termination
must
notify the other party within thirty (30) days after receiving the Notice
of
Termination that such a dispute exists, and shall pursue the resolution of
such
dispute in good faith and with reasonable diligence pursuant to Section 19
of this Agreement. During the pendency of any such dispute, the Bank shall
not
be obligated to pay Executive compensation or other payments beyond the Date
of
Termination.
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. No provision of this Agreement shall be interpreted
to
mean that Executive is subject to receiving fewer benefits than those available
to him without reference to this Agreement.
12. NO
ATTACHMENT; BINDING ON SUCCESSORS.
(a) Except
as
required by law or as otherwise provided in this Agreement, 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 effect 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 waiver
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.
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14. REQUIRED
PROVISIONS.
(a) The
Bank
may terminate Executive’s employment at any time, but any termination by the
Board other than Termination for Just Cause as defined in Section 5 hereof
shall
not prejudice Executive’s right to compensation or other benefits under this
Agreement. Executive shall have no right to receive compensation or other
benefits for any period after Termination for Cause.
(b) If
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 USC §1818(e)(3)] or 8(g)(1) [12 USC §1818(g)(1)] of the
Federal Deposit Insurance Act (the “FDI Act”), the Bank’s obligations under this
Agreement 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 Executive all or part of the compensation withheld
while its contract obligations were suspended and (ii) reinstate (in whole
or in
part) any of its obligations which were suspended.
(c) If
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)(4) [12 USC
§1818(e)(4)] or 8(g)(1) [12 USC §1818(g)(1)] of the FDI Act, all obligations of
the Bank under this Agreement 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)(1) [12 USC §1813(x)(1)] of the FDI
Act, all obligations of the Bank under this Agreement shall terminate as
of the
date of default, but this paragraph shall not affect any vested rights of
the
contracting parties.
(e) All
obligations under this Agreement shall be terminated, except to the extent
determined that continuation of this Agreement is necessary for the continued
operation of the Bank, (i) by the Director of the OTS or his or her designee,
at
the time the FDIC enters into an agreement to provide assistance to or on
behalf
of the Bank under the authority contained in Section 13(c) [12 USC §1823(c)] of
the FDI Act; or (ii) by the Director or his or her designee at the time the
Director or his or her designee approves a supervisory merger to resolve
problems related to operation of the Bank or when the Bank is determined
by the
Director 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.
(f) Notwithstanding
anything herein contained to the contrary, any payments to Executive by the
Bank, whether pursuant to this Agreement or otherwise, are subject to and
conditioned upon their compliance with Section 18(k) of the FDI Act,
12 U.S.C. Section 1828(k), and the regulations promulgated thereunder in 12
C.F.R. Part 359.
15. NON-COMPETITION
AND POST-TERMINATION OBLIGATIONS.
(a) All
payments and benefits to Executive under this Agreement shall be subject
to
Executive’s compliance with paragraph (b), (c) and (d) of this Section
15.
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(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 Executive shall not be required to provide information
or assistance with respect to any litigation between the Executive and the
Bank
or any of its subsidiaries or affiliates.
(c) 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 and affiliates thereof. 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 (except
for such disclosure as may be required to be provided to the Office of Thrift
Supervision (“OTS”), the Federal Deposit Insurance Corporation (“FDIC”), or
other regulatory agency with jurisdiction over the Bank or Executive).
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 which is otherwise
publicly available or which Executive is otherwise legally required to disclose.
In the event of a breach or threatened breach by Executive of the provisions
of
this Section 15, the Bank will be entitled to an injunction restraining
Executive from disclosing, in whole or in part, his knowledge of the past,
present, planned or considered business activities of the Bank or any of
its
affiliates, or from rendering any services to any person, firm, corporation
or
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 them for such breach
or
threatened breach, including the recovery of damages from
Executive.
(d) Upon
any
termination of Executive’s employment hereunder for any reason other than (i)
pursuant to Section 4(a)(iii); (ii) pursuant to Section 6; or (iii) any
termination of Executive’s employment hereunder as a result of the expiration of
Executive’s employment term following a notice of non-renewal pursuant to
Section 2, Executive agrees not to compete in the banking and lending business
with the Bank and any of its affiliates for a period of one (1) year following
such termination within a twenty (20) mile radius of any branch of the Bank,
or
any location in which the Bank has filed an application for regulatory approval
to establish an office, determined as of the effective date of such termination.
Executive agrees that during such period and within said cities and towns,
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. The parties
hereto, recognizing that irreparable injury will result to the Bank, its
business and property in the event of Executive’s breach of this Section 15(d)
agree that in the event of any such breach by Executive, the Bank 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. Executive represents and admits that Executive’s experience and
capabilities are such that Executive can obtain employment in a business
engaged
in other lines and/or of a different nature than the Bank, and that the
enforcement of a remedy by way of injunction will not prevent Executive from
earning a livelihood. Nothing herein will be construed as prohibiting the
Bank
from pursuing any other remedies available to them for such breach or threatened
breach, including the recovery of damages from Executive.
10
(e) Upon
any
termination of Executive’s employment hereunder for any reason other than (i)
pursuant to Section 4(a)(iii); (ii) pursuant to Section 6; or (iii) any
termination of Executive’s employment hereunder as a result of the expiration of
Executive’s employment term following a notice of non-renewal pursuant to
Section 2, Executive agrees that Executive will not, in any manner whatsoever,
for a period of one (1) year following the termination of Executive’s employment
with the Bank either as an individual or as a partner, stockholder, director,
officer, principal, employee, agent, consultant, or in any other relationship
or
capacity, with any person, firm, corporation or other business entity, either
directory or indirectly, solicit or induce or aid in the solicitation or
inducement of any employees of the Bank to leave their employment with the
Bank.
Executive further agrees that the Executive will not, in any manner whatsoever,
for a period of one (1) year following the termination of Executive’s employment
with the Bank, either as an individual or as a partner, stockholder, director,
officer, principal, employee, agent, consultant or in any other relationship
or
capacity with any person, firm, corporation or other business entity, either
directly or indirectly, solicit the business of any customers or clients
of the
Bank at the time of termination of Executive’s employment with the
Bank.
16. 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.
17. 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.
18. GOVERNING
LAW.
This
Agreement shall be governed by the laws of the State of Indiana but only
to the
extent not superseded by federal law.
19. ARBITRATION.
Any
dispute or controversy arising under or in connection with this Agreement
shall
be settled exclusively by binding arbitration, conducted before a single
arbitrator selected by the Bank and Executive sitting in a location selected
by
the Bank and Executive within twenty-five (25) miles of Munster, Indiana,
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.
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20. PAYMENT
OF LEGAL FEES.
All
reasonable legal fees paid or incurred by Executive pursuant to any dispute
or
question of interpretation relating to this Agreement shall be paid or
reimbursed by the Bank, provided that the dispute or interpretation has been
settled by Executive and the Bank or resolved in Executive’s favor. To the
extent necessary to avoid taxes and penalties under Code Section 409A, such
reimbursement shall be made within two and one-half months following resolution
of the dispute in Executive’s favor.
[Signature
page follows]
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IN
WITNESS WHEREOF,
the
Bank has caused this Agreement to be executed by its duly authorized
representative, and Executive has signed this Agreement, effective as of
the day
and date first above written.
ATTEST:
|
AMERICAN
SAVINGS, FSB
|
||||
/s/
Xxxxxx Xxxxx
|
By:
|
/s/
Xxxxxxx Xxxxxx
|
|||
Corporate
Secretary
|
Title:
President,
Chief Executive Officer
|
||||
WITNESS:
|
EXECUTIVE:
|
||||
/s/
Xxxxxx Boss
|
/s/
Xxxxxx Xxxxx
|
||||
Xxxxxx
Xxxxx
|
13